Finance Minister Okonjo-Iweala warns of economic recession

Minister of Finance and Co-ordinating Minister for the Economy, Dr. Ngozi Okonjo-Iweala, has warned of a difficult time ahead as she told the Federal Executive Council meeting in Abuja, yesterday, that "government should buckle up and prepare for a possible recession" in the economy.

Her warning came on the heels of the approval of a new visa regime by the Federal Executive Council.

Finance Minister, Mrs. Ngozi Okonjo-Iweala discussing with the Health Minister, Dr. Christian Chukwu (l); Housing Minister, Ms. Amal Pepple and the Solid Minerals Development Minister, Arc. Musa Sada during the weekly meeting of the Federal Executive Council at the State House, Abuja. Photo by Abayomi Adeshida

Okonjo-Iweala, who gave the warning during the weekly meeting at the Presidential Villa cited the slide in the price of crude oil as well as the dire economic situation inSpainand Greeceas possible trigger for another round of global recess.

Minister of Information, Mr Labaran Maku, who conveyed the Minister of Finance's warning quoted her as saying: "Nigeriamay not be so lucky to avoid recession this time as it did during the last economic meltdown and urged the Federal Government to put up measures that will help mitigate the effect of such economic melt down."

According Maku, the Coordinating Minister, however, explained that occasional delays in meeting government's obligation to creditors was not a sign of weakness in the economy, adding: "Our economy is sound."

New visa regime

According to Maku, the new visa regime is driven by economics to boost investment, tourism, generate employment and fight terrorism.

Maku, who briefed State House correspondents alongside his colleagues Minister of Interior, Abba Moro and Minister of Health, Onyebuchi Chukwu, saidNigeriawas emulating countries that had tried to make it easier for potential investors by liberalizing their visa policy.

One of the highlights of the new visa regime, the minister explained, was the possibility of some visitors to the country to accessNigeria's visa at various international points of entries into the country.

He said the policy was based on the assumption and dynamics of constantly changing international economy and the need forNigerianot to be left behind in the drive by nations to attract more highly resourceful, wealthy portfolio investors.

Minister of Interior, Abba Moro, who gave further insight into the new visa policy stated: "The assumption and dynamics on the basis of which we had our old policy have changed in line with the realities of our time.

"Most significantly is the fact that we have been in recent time witnessing security challenges in our country and it becomes necessary that we must attack the problem from all sides and the way you enter and get out ofNigeriaconstitute a very vital component of fighting internal security."

He added: "Today, we have a new visa regime that contains some innovations in the sense that new elements are being introduced in line with the strategic interest ofNigeriaand of course most other areas still have to be based on the principle of reciprocity.

Visa at entry point

"We now have visa at entry point. So, if a businessman, a tourist or a business delegation or a government delegation has reason to visitNigeriaat short notice to do business with Nigeria and if by any coincidence we don't have embassy in such country, such delegation or group can come toNigeriaand obtain their visas at point of entry particularly at international airports. Of course, this is without prejudice to ensuring our internal security.

On the abuse of expatriate quota

On the abuse of expatriate quota in the past, the Interior Minister said government had introduced appropriate check mechanism that would make it easier to monitor compliance with expatriate quota under the new regime.

"For every expatriate that is employed, two Nigeria under studies must be employed. If you are coming toNigeriawith $500,000, for instance, in addition to those employed to understudy, you will be expected to employ between 30 to 50 Nigerians.

"We have admitted there has been difficulty in enforcing the expatriate quota before now but with the automation with the business department of the interior ministry, we will enforce expatriate quota."

New E-Health Policy

The other decision by Council was the approval of a new E-Health Policy also known as Regulatory and Business Practices Improvement and Information Management for the National Health Insurance Scheme (NHIS).

Maku explained that the "Minister of Health, Professor Onyebuchi Chwukwu had proposed in his memo to Council for approval to procure an e-platform as part of the e-governance to enable NHIS to function more effectively and improve manual work and make the programme more efficient".

The project is based on the need to promote an efficient plateform for scaling up the installation and implementation of an electronic network that will facilitate transactions between NHIS and other stakeholders in the sector such as Health Management organizations HMO, Health Financiers, Enrollees, Banks and Insurance companies.

He said 60 per cent of the fund is expected to be provided by the International Finance Organisation IFC and the World Bank, while the federal Government will provide the balance 40 per cent.

The IFC grant, which is unconditional amounting to $1,368, 964.45 represents 60 per cent of the total cost, while federal government will provide $554,785.78, representing 40 per cent of the total cost of the project.

Council also approved the rehabilitation of the G17 unit of Ugheli plant expected to deliver 100MGWts of electricity to the country.

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