Finance minister Kuma says ‘glimmer of hope at end of tunnel’
By EDDIE OSIFELO
MINISTER of Finance and Treasury, Harry Kuma says there is glimmer of hope despite the challenges the country faces in economic, social and health issues due to the impact of covid-19.
Speaking on the sine die motion in Parliament yesterday, Kuma said despite all the abnormalities; the severity of covid 19, the harsh economic environment, challenging fiscal position of the Government and offensive public trial prosecuted by social media, there is hope and glimmer of positive indicators.
He makes reference to the fact they have a healthy foreign reserve level, kept inflation at a manageable level, continue to enjoy a sustainable debt position, agriculture production boosted, and log production although low continues to provide the life blood of government finance.
Furthermore, Kuma said despite an array of regulatory reforms, they must accomplish, their international competiveness and investor profile is stable according to Moddy’s recent release of a B3 Stable annual rating.
He said this is positive news for the government and this simply means that our country is still open for business and investment.
“Let me take this time to commend my Ministry for its stringent adherence to ensuring that the government’s debt burden remains low and upheld by our strict Debt Management Strategy,” he said.
In addition, Kuma said global economy is expected to rebound with a 5.2 percent growth in 2021 at the back of improved economic performance mainly from advanced economies.
He said the economies of Spain and Italy that have suffered terribly during Covid-19 are rebounding.
“These two European countries are our primary importers of fisheries, especially fish loin exports to Italy, and sea food to Spain, accounting for some eight percent of our total merchandise exports.”
Moreover, Kuma said since growth in China is projected to rise from 1.9 percent in 2020 to 8.2 percent in 2021, this is a strong and positive sign for our country given that China is our biggest trading partner and importer of logs.
“Even during declining commodity prices, a surge in China’s growth will have an impact on our economy, especially our round log exports.
“Our log volumes are projected to rise from 2.2 million cubic metres in 2020 and expected to slow down to around 2 million cubic meters in 2021 although this is likely to change with the current developments and demand from China,” he said.
Kuma said China alone accounts for two-thirds (or close to average $3 billion) of all our merchandise exports.
“However, any increased Covid-19 pressures in China will obviously have negative effects on demand for our logs with drastic flow on effects on our fiscal revenue, and growth in other interconnected sectors,” he said.