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G7 devt. finance institutions, others to invest $80bn into African businesses

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The G7 Development Finance Institutions (DFIs) have announced a commitment to invest 80 billion dollars in Africa’s private sector, over the next five years, to support sustainable economic recovery and growth in the continent.

A statement on Monday, from the African Development Bank (AfDB), said the G7 DFIs made the announcement along with the International Finance Corporation (IFC), the private sector arm of the AfDB, the European Bank for Reconstruction and Development (EBRD), and the European Investment Bank.

It is the first time the G7 DFIs have come together to make a collective partnership commitment to the African continent, according to the statement.

Each DFI has its own investment criteria which are aligned to an assessment of need, to achieve development impact across a range of sectors.

DFIs play an important role in helping to build markets, mitigate risks and pave the way for other investors to enter new markets.

The G7 DFI group consists of CDC, Proparco (France), Japan International Cooperation Agency (JICA) and Japan Bank for International Cooperation, DFC (US), FinDev Canada, DEG (Germany) and CDP (Italy).

The UK Minister for Africa, James Duddridge, said the UK was proud to back this commitment by world leaders at the G7 Summit.

“This investment will create jobs, boost economic growth, help tackle climate change and fight poverty. It comes at a crucial time as the continent rebuilds its economies, severely impacted by COVID-19,” Duddridge said.

Also, Nick O’Donohoe, the Chief Executive Officer, Centres for Disease Control and Prevention (CDC) Group, said the patient, high quality capital DFIs provided was urgently needed if African economies were to rebuild quickly from the impact of the pandemic.

“CDC is committed to building long term investment partnerships in Africa that fuel sustainable private sector growth in support of the UN’s Sustainable Development Goals,” O’Donohoe said.

Werner Hoyer, President of the European Investment Bank (EIB), said the EIB welcomed G7 leadership to enhance support for high-impact investment across Africa during and after the pandemic.

“Last year, the EU Bank’s engagement in Africa, as part of Team Europe, represented the largest ever support for climate action and investment in fragile states in 55 years of EIB operations on the continent.

“We stand ready to cooperate further with African and multilateral partners to tackle both COVID-19 and accelerate the green transition in Africa,” Hoyer said.

Also, Makhtar Diop, IFC’s Managing Director, said ensuring an inclusive and sustainable recovery for people, businesses and economies across Africa, in coordination with IFC’s development partners, was at the core of the corporation’s development mandate.

“We know that the private sector will play a major role in financing Africa’s future by creating millions of jobs that are essential to ensuring sustained economic growth and poverty reduction.

“We, therefore, welcome this important partnership and are proud to provide financing and to work with partners to help create the right conditions to bring more private investment to Africa,” Diop said.

Similarly, David Marchick, Chief Operating Officer of U.S. International Development Finance Corporation (DFC) said investing more in Africa, under President Biden’s leadership, was a top priority for DFC in fulfilling its development mandate.

“DFC is proud to be doubling down on our commitment to Africa, alongside our G7 and multilateral partners .

”We will continue to prioritise investments in vaccine manufacturing, COVID-19 response, climate mitigation and adaptation, and gender equity on the African continent,” Marchick said.

Dario Scannapieco, Chief Executive Officer, Cassa Depositi e Prestiti (CDP) said closer collaboration among DFIs and multilateral partners was an essential factor in fostering sustainable economic recovery and growth in Africa.

“CDP looks forward to contributing to this strategic partnership, supporting the African continent in developing its entrepreneurial and financial private sector, to unlock its vast, untapped potential,” Scannapieco said.

Also, Solomon Quaynor, Vice President, Private Sector, Infrastructure and Industrialisation, AfDB, said the bank welcomed the global partnership and the opportunity to provide the African voice, as Africa builds back better and boldly.

“The opportunity to create jobs, particularly for youth and women, from a focus on industrialising Africa underpinned by the African Continental Free Trade Area, will be our priority.

“Given the gap between the IMF estimates and what this partnership is committing to, we will seek to crowd-in African development partners.

”As well as African savings from SWFs, pensions, and insurance pools, estimated to have US$1.8 trillion AUM,” Quaynor said.

Furthermore, Heike Harmgart, EBRD Managing Director, Southern and Eastern Mediterranean, said harnessing the potential of the private sector was essential in supporting prosperity in Africa and meeting its development needs.

“In the North African countries where we work, Egypt, Morocco and Tunisia, we have invested over 11.5 billion euros in only nine years.

”It will be focused on boosting the private sector, developing green sustainable infrastructure and promoting youth and women participation in the economy.

“We will pursue our efforts to expand private sector investment opportunities at scale in the region, in close cooperation with other development actors,” Harmgart said.

However, Monika Beck, member of the DEG-Management Board, a German development finance institution, noted that many of the institution’s African partner countries had been affected by the pandemic.

“We quickly developed new services to support private sector SMEs and to help protect jobs and livelihoods.

“In Africa, DEG has always been specifically committed to creating prospects for the young, growing population. Therefore DEG welcome and is proud to be part of the G7 DFI Africa initiative,” Beck said. (NAN)

 

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Tinubu Rules Out Fuel Subsidy Return, Says Nigeria Cannot Go Back to ‘Egypt’

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President Bola Ahmed Tinubu
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President Bola Tinubu has ruled out any return to petrol subsidy, insisting that the removal of the policy was necessary to prevent Nigeria’s economy from sliding into bankruptcy.

The President reiterated his position on Monday during a meeting with members of the City Boy Movement, a youth-driven political and advocacy group, where he defended the economic reforms introduced by his administration.

Tinubu said the government could no longer sustain the financial burden of subsidising petrol, arguing that the country lacked the resources required to continue funding the scheme.

“I came, and I removed the subsidy on my first day. Nigeria would have gone bankrupt; there was nothing left to pay for subsidies,” he said.

Using a biblical and Quranic analogy to underscore his position, the President declared that reversing the policy would amount to returning to an unsustainable economic system.

“When Moses (Musa) left Egypt, the Red Sea parted and gave way. You cannot ask Moses to go back to Egypt. With your energy and support, we will never go back to Egypt,” he stated.

The removal of petrol subsidy, announced during Tinubu’s inauguration on May 29, 2023, marked a major shift in Nigeria’s fiscal policy. The decision significantly increased petrol prices and contributed to mounting pressure on household incomes, transportation costs and businesses.

Petrol prices, which were below ₦200 per litre before the policy change, have since risen substantially, with prices reported at between ₦1,350 and ₦1,405 per litre across major filling stations.

The resulting increase in energy and transportation costs has continued to fuel public concerns over inflation, declining purchasing power and the overall cost of living.

However, the Federal Government has maintained that subsidy removal is critical to reducing fiscal pressure, improving public revenue and creating room for investment in infrastructure and other priority sectors.

Tinubu acknowledged the political contest surrounding the policy, noting that his opponents had promised to restore fuel subsidy. He nevertheless maintained that his administration would not reverse the reform.

Beyond defending the policy, the President urged members of the City Boy Movement to mobilise support for his administration by communicating its achievements and future plans to young Nigerians across campuses, markets and rural communities.

He also encouraged eligible young people to obtain their Permanent Voter Cards (PVCs) and participate in the electoral process.

The debate over fuel subsidy remains a central issue in Nigeria’s economic policy, with the government defending the reform on fiscal sustainability grounds while households and businesses continue to grapple with the effects of higher fuel prices.

 

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FG Rules Out Electricity Tariff Hike, Targets 24-Hour Power Supply

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The Federal Government has ruled out any plan to increase electricity tariffs, saying its priority is to improve power supply and ensure reliable electricity across the country.

The Minister of Power, Joseph Tegbe, gave the assurance in Ibadan, Oyo State, on Thursday, amid concerns and speculation about a possible increase in electricity tariffs.

Tegbe spoke during the groundbreaking ceremony for five interconnected mini-grid projects with a combined generation capacity of 17.7 megawatts and a 17.74-megawatt-hour Battery Energy Storage System (BESS).

“I want to say this clearly and without ambiguity: there is no plan to increase electricity tariffs. What we are planning is a power sector that works around the clock. Our commitment is 24/7 power,” the minister said.

He urged Nigerians to disregard reports suggesting an impending tariff hike, stressing that the government was focused on improving electricity generation, transmission and distribution.

The five mini-grid projects are located in Bola, Jiboye, Molade-Adelubi, Ogo Oluwa and Sooko-Elega. They are expected to provide electricity to communities across Akinyele, Ido, Ibadan North, Egbeda and Lagelu Local Government Areas of Oyo State.

According to the minister, the projects are designed to expand electricity access, reduce dependence on petrol and diesel-powered generators, and create a more favourable environment for businesses, investment and job creation.

Tegbe said the Federal Government was also implementing a broader energy strategy aimed at improving electricity supply through designated energy corridors, including the Lagos-Ogun, Abuja-Kaduna-Kano and Benin-Enugu-Port Harcourt corridors.

He added that efforts were underway to strengthen the national grid and upgrade generation and transmission infrastructure across the country’s eastern, western and central corridors.

The minister described the mini-grid initiative as part of President Bola Tinubu’s Renewed Hope Agenda, noting that similar electricity interventions had been implemented in communities across several states with support from the Rural Electrification Agency (REA).

He commended Tinubu for his leadership and acknowledged the contributions of the REA, project developer Paras Energy and Natural Resources Development Limited, the World Bank and the Ibadan Electricity Distribution Company.

Tegbe also recognised the Oyo State Government, traditional rulers and other stakeholders for their roles in facilitating the projects.

The initiative is expected to improve electricity reliability in the beneficiary communities, support local economic activities and reduce energy costs for households and businesses.

 

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Oyedele Warns Against New Taxes, Urges Governments to Explore Revenue Alternatives

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President Bola Ahmed Tinubu
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Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has cautioned governments against imposing new taxes or increasing the tax burden on vulnerable citizens and productive sectors amid economic pressures.

Oyedele spoke on the sidelines of the 2026 annual meetings of the International Monetary Fund (IMF) and the World Bank in Bangkok, Thailand, where he presented the communiqué of the Intergovernmental Group of Twenty-Four (G24), which he chairs.

The minister said governments should prioritise identifying areas of savings, improving revenue mobilisation and strengthening fiscal management rather than introducing additional tax burdens that could further strain households and businesses.

“This is the wrong time to impose new taxes or increase the burden of tax, particularly on the vulnerable population and productive sectors of the economy,” he said.

Oyedele made the remarks while responding to questions on how developing countries could reduce debt-servicing costs without cutting essential public expenditure.

He urged governments to look inward for savings and explore more efficient ways of generating revenue while protecting vulnerable populations from further financial pressure.

On public borrowing, the minister said debt financing remained necessary to support economic growth but stressed that borrowed funds should be deployed to stimulate job creation and promote inclusive development.

He noted that governments should prioritise limited public resources for essential services, including healthcare and education, while leveraging private capital to support other investment needs.

Oyedele also cautioned against treating taxation and borrowing as mutually exclusive options, explaining that both have economic implications and must be carefully balanced.

According to him, excessive taxation of vulnerable households could reduce their capacity to afford basic necessities, including food, healthcare and education.

He described public debt as a future tax burden, emphasising the need for governments to adopt fiscal policies that balance present revenue needs with long-term economic sustainability.

“Debt is future taxes, so it’s not one or the other. It’s to strike a balance, bearing in mind ultimately that the essence of tax and of debts is to cater for the people,” he said.

The minister’s remarks underscore the need for developing economies to strengthen domestic revenue mobilisation, improve public spending efficiency and manage debt sustainably without undermining household welfare or productive economic activities.

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