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Category: Economy

  • IMF Assures Of Stronger Collaboration With Members To Tackle Global Headwinds

    The International Monetary Fund (IMF) has said it is collaborating with 190 countries across the world to facilitate international trade, contribute to high levels of employment and real income, promote exchange stability, and help member countries address payments imbalances.

    In spite of uncertainty of global outlook, the IMF noted, the world economy has shown resilience, but in most countries near- and medium-term growth outlooks remain subdued and downside risks are elevated.

    In its 2023 report, the IMF stated that tightening monetary policy stances to bring down inflation continues to weigh on most economies.

    The Bretton Woods Institute noted that the impact of the Russia-Ukraine war has impacted on macro-financial stability, including financial sector stress, adding that though inflation has moderated somewhat, underlying price pressures remain sticky.

    “Debt vulnerabilities are elevated, with 60 percent of low-income countries and 25 percent of emerging market economies in or at risk of debt distress. Debt-restructuring processes have been sluggish. Meanwhile, inequality persists within and across countries, and a record 350 million people in 79 countries face acute food insecurity.

    “Rising geoeconomic fragmentation risks are making it more difficult to respond to shared challenges, which calls for decisive steps to rebuild trust. The global peace dividend is shrinking, and with it, the resources available to support the vulnerable. Protectionism is on the rise, hampering global trade and eroding hard-won gains from integration. Confronting shared challenges, such as the climate crisis and digitalization, will require overcoming differences and boosting international cooperation,” it said.  

    The lender said it is committed to collaborating with its members to find pragmatic solutions to move the global economy onto a sustainable upward trajectory.

    “Ensuring sound domestic policies, bolstering global trade, and strengthening institutions will counter uncertainty and fortify macroeconomic resilience. Stepped-up international assistance and solutions to address high debt burdens will support vulnerable countries. Investing in digital technologies will help build a more prosperous and inclusive future. And jointly tackling climate change will sustain our planet,” the report stated. 

  • Analysts Forecast Increased Pressures On Economy As Naira Depreciates By 23%

    With the naira losing 23 per cent value in the third quarter of 2023, plummeting from N770/$1 at the end of the second quarter to over N1000/$1 by the end of the third quarter at the parallel market, analysts expect further pressure on the currency in the fourth quarter of 2023.

    Meanwhile, the official exchange rate at the end of the third quarter was N755.27/$1, a noticeable drop from N769.25/$1 at the end of the second quarter.

    The widening gap between the official and unofficial rates reflects the persistent scarcity of foreign exchange in the country, as well as the divergent policies of the CBN and the market forces.

    The Central Bank of Nigeria (CBN) has blamed the forex backlog estimated at between $6 billion to $10 billion as the major reason for the currency depreciation.

    At the recent Senate confirmation of the CBN governor, Yemi Cardoso stated that he intends to establish the exact unsettled obligations and find ways to “take care of it” confirming that progress will not be made without clearing the backlog.

    He said it would be naive to think that the CBN will be able to make progress if it don’t handle that side of the foreign exchange.

    “But definitely, the immediate priority will be to verify the authenticity and extent of the unsettled obligation and once we do that, we need to look for a way to take care of it.

    The naira’s weakness has had negative impacts on the Nigerian economy, as it has increased the cost of imports, fuelled inflation, eroding purchasing power, and discouraged investment.

    According to the Head of Macro Strategy at FIM Partners UK Ltd, Charlie Robertson, the CBN may have to devalue the official rate again to align it with the market reality and conserve its dwindling external reserves, which fell from $34.1 billion at the end of June to $33.2 billion at the end of September.

    He noted that further devaluation might be avoided if the apex bank is able to meet its obligations to clear forex backlogs, adding that achieving this might require the government tap new loans from friendly countries.

    Stears Africa FX Monitor, a data and intelligence company, also has predicted a continued naira volatility.

    The company highlighted fiscal policies, external trade, and global market trends, including inflation rates, interest rates, policy events, and geopolitical factors as key factors affecting the naira’s performance.

    Fadekemi Abiru, Head of Insights at Stears, expressed concerns about the naira volatility. “The continued unpredictability of the naira underscores the importance of timely and informed decision-making for businesses and investors in Nigeria,” she said.

    The CBN had removed trading restrictions on the official market in June which drove the naira to a record low of N750 to the Dollar on the official market, down from the previous N477 to the dollar it traded for.

    This was the first time since 2016 that the naira had recorded a big fall on the official market before the CBN introduced a managed exchange rate in 2017.

  • FAAC Distributes N1.1trn In August Allocation To FG, States, LGs  

    FAAC Distributes N1.1trn In August Allocation To FG, States, LGs  

    The Federation Account Allocation Committee (FAAC) has shared a total sum of N1100.101 trillion August 2023 Federation Account Revenue to the Federal Government, States and Local Government Councils.   

    A communique issued by the FAAC at its September, 2023 meeting indicated that the N1100.101 trillion total distributable revenue comprised distributable statutory revenue of N357.398 billion, distributable Value Added Tax (VAT) revenue of N 321.941 billion, Electronic Money Transfer Levy (EMTL) revenue of N14.102 billion, Exchange Difference revenue of N 229.568 billion and Augmentation of NN177.092 billion. 

    According to the communique, total revenue of N1483.902 billion was available in the month of August 2023.  

    “Total deductions for cost of collection was N58.755 billion, total transfers and refunds was N254.046 billion and savings was N71.000 billion.   

    “Gross statutory revenue of N 891.934 billion was received for the month of August 2023. This was lower than the N1150.424 billion received in the month of July 2023 by N258.490 billion.  

    “The gross revenue available from the Value Added Tax (VAT) was N345.727 billion. This was higher than the N298.789 billion available in the month of July 2023 by N46.938 billion,” the Committee said.

    The communique stated that from the distributable revenue, the Federal Government received a total of N431.245 billion, the State Governments received N361.188 billion and the Local Government Councils received N266.538 billion.

    A total sum of N26.473 billion (13% of mineral revenue) and N14.657 billion (13% of savings from NNPCL), were shared to the relevant States as derivation revenue. 

    From the N357.398 billion distributable statutory revenue, the Federal Government received N173.102 billion, the State Governments received N87.800 billion and the Local Government Councils received N67.690 billion.

    The sum of N14.446 billion (13% of mineral revenue) and N14.361 billion (13 % of savings from NNPCL) were shared to the relevant States as derivation revenue. 

    The Federal Government received N48.291 billion, the State Governments received N160.971 billion and the Local Government Councils received N112.679 billion from the N321.941 billion distributable Value Added Tax (VAT) revenue.

    The N14.102 billion Electronic Money Transfer Levy (EMTL) was shared as follows: the Federal Government received N2.115 billion, the State Governments received N7.051 billion and the Local Government Councils received N4.936 billion.

    “The Federal Government received N114.445 billion from the N229.568 billion Exchange Difference revenue. The State Governments received N58.048 billion, and the Local Government Councils received N44.752 billion. The sum of N12.027 billion (13% of mineral revenue) and N0.296 billion (13 % of savings from NNPCL) went to the relevant States as derivation revenue. 

    “From the N177.092 billion Augmentation, the Federal Government received N93.292 billion, the State Governments received N47.319 billion and the Local Government Councils received N36.481 billion. 

    “In the month of August 2023, Value Added Tax (VAT), Import and Excise Duties and Electronic Money Transfer Levy (EMTL) increased considerably while Petroleum Profit Tax (PPT), Companies Income Tax (CIT), Oil and Gas Royalties recorded significant decreases.  

    “The balance in the Excess Crude Account (ECA) was $473,754.57,” FAAC added. 

  • Blue Economy: Prof Pauli Tasks FG On Private Sector Partnership, Job Creation

    Blue Economy: Prof Pauli Tasks FG On Private Sector Partnership, Job Creation

    The creator of Blue Economy, Prof Gunter Pauli, has said that, for the policy to succeed, the Federal Government must aggressively collaborate with the private sector to attract investment into the sector. 

    While hailing President Bola Tinubu for creating the Ministry of Marine and Blue Economy, Pauli said in six months the ministry can facilitate the creation of a hundred thousand jobs by exploiting opportunities provided by the blue economy.

    Prof Pauli, who listed shipping, paper conversion from wastes and maggot farming for poultry and fishing as low hanging fruits, urged the ministry to embrace job and wealth creation. 

    In his remarks, the Minister of Blue Economy, Gboyega Oyetola expressed happiness on the interest shown by Prof Pauli in assisting the country tap its idle capacity from the oceans and the blue economy, while also promising to work with private investors in opening up the sector.

    “I want to say that it’s not by accident that this ministry was created. It was part of the economic diversification policy of our country. We believed so much in oil but we now realize that 70% or so of the resources available actually come from the ocean and we have it in abundance here but neglected it for long.

    “I must commend the president for creating the ministry. I want to assure you that we are up to the task and I believe so much in the PPP arrangement because government has no business in business. Government should just provide the enabling environment for business to thrive,” the minister said.

    He disclosed that efforts have been stepped up to improve transportation infrastructure, including automation of port operations for efficiency and increase in revenue.

    “We now have sufficient control over insecurity and I want to tell you that for the past two years there has been no record of piracy on our shores. That is re-assuring to investors. I also assure you that we are ready to collaborate with investors, we are willing and ready and we will support all the initiatives that will bring all this to reality,” the minister promised,” he said. 

  • Customs Exceeds Monthly Target, Generates N343bn In August 

    Customs Exceeds Monthly Target, Generates N343bn In August 

    The Acting Comptroller-General (CG), Nigeria Customs Service (NCS), Mr Adewale Adeniyi, has disclosed that the service exceeded the revenue target for the months of July and August.

    Adeniyi, who spoke while presenting the scorecard for his 100 days in office on Thursday in Abuja, said that the NCS generated N307 billion in July and N343 billion in August

    “One of our early achievements has been a remarkable boost in monthly revenue collection.

    “We have witnessed a substantial increase, with an average monthly collection of 202 billion in the first half of the year that concluded in June, surging to an impressive 343 billion in August.

    “This outstanding growth amounts to a remarkable 70.13 per cent increase in revenue collection.

    “I am delighted to announce that we have consistently exceeded the monthly target collection, marking a remarkable departure from previous performances,” he said.

    He said that the ongoing revenue recovery review activities hadl contributed an additional eight billion Naira during the period.

    “This underlines our commitment to revenue generation. Subject to unforeseen circumstances, our aim is to sustain and even expand this momentum until the end of the year.

    “This commitment is driven by our resolve to minimise the deviation from the target, especially in light of the substantial shortfalls recorded during the first half of the year,” Adeniyi said.

    He said that the NCS had recorded appreciable results in its ongoing battle against smuggling

    “We have successfully intercepted various contraband items, including arms, ammunition, illicit drugs, substandard pharmaceuticals and other prohibited goods that pose grave risks to our citizens.

    “These seizures accompanied by the apprehension of 62 suspects undergoing legal procedures, underscore our commitment to tackling smuggling and safeguarding our communities.

    “Notably, a significant surge in impactful seizures, especially involving arms, ammunition, and drugs, has occurred in the past two months, reinforcing our resolve to combat these illegal activities,” he said.

    He said that NCS had forged stronger alliances and fostered an environment of trust and cooperation among stakeholders in the public and private sectors., as well as international partners.

    The acting CG said that NCS was at the verge of introducing multiple cutting-edge solutions to support the enforcement strategies, starting with the signing of an Memorandum of Understanding (MoU) that seeks to put vehicle smugglers out of business for good.

    “As we reflect on the achievements of the first 100 days in office and the journey we have embarked upon, it is essential to look ahead with a clear vision for the future.

    “The next phase builds upon the foundation we have laid, and it is characterised by unwavering dedication to our policy thrust of consolidation, collaboration, and innovative solutions.

    “Looking forward, we envision a service that is not only the most efficient and service-driven government organ but also a pivotal driver of national economic growth and border security.

    “There are also challenges we face but we are working hard to overcome it and get a better result,” he said.

    According to him, the NCS plays a pivotal role in facilitating international trade and economic growth and equally serves as a bridge connecting the nation to the global marketplace.

    He expressed commitment to aligning with President Bola Tinubu’s agenda on economic growth and development.

  • Rising Oil Prices Good For FG, Bad For Nigerians, Says Rewane

    Goldman Sachs has predicted oil price will likely rise to $100 again, citing lower production output from the Organization of Petroleum Exporting Countries (OPEC), amongst others.

    Chief Executive Officer of Financial Derivatives Company (FDC) Limited, Bismarck Rewane, says it will only increase revenue to governments but will not benefit Nigerians.

    “Globally, oil prices trade at $95/b and are projected to hit $100/b by year-end due to supply shortages. While government revenue, Federal Account Allocation Committee (FAAC) could increase in naira terms, Nigeria’s reliance on imported energy products (LPG, diesel, petrol and kerosene) amid a falling naira means higher food and transport costs, exacerbating inflationary pressures”, said Rewane in a statement Sunday.

    He said, these will be major considerations for the MPC at its next meeting, whenever that will be. Nonetheless, we expect the MPC to remain hawkish.

    Rewane in its FDC Prism Sunday however said, some form of looking inward could solve Nigeria’s economic woes.

    “Viable options would be improving the value addition of top agricultural traded products like cashew and cocoa, as well as mineral resources like steel. More importantly, Nigeria needs to show its political will, improve access, and encourage local businesses, particularly SMEs, to participate in the AfCFTA by removing non-tariff barriers, he said.

    Also meanwhile, oil and gas companies keep reporting meaty profits and investors are rediscovering their love of hydrocarbons.

    At the recent World Petroleum Congress (WPC) in Calgary, oil executives and government officials both warned against the continued push to discourage investment in new hydrocarbon production.

    “There seems to be wishful thinking that we’re going to flip a switch from where we’re at today to where it will be tomorrow,” Exxon’s chief executive said during the event.

    “No matter where demand gets to, if we don’t maintain some level of investment industry, you end up running shorter supply which leads to higher prices,” Darren Woods also said.

    This is exactly what we are currently witnessing in Europe and the United States. Because of the transition push, oil producers are being extra cautious with production growth. Also, they are prioritizing shareholder returns to keep shareholders on, so it pays for them to be cautious.

    In Europe, the supermajors are being squeezed by windfall profit taxes, activist pressure, and increasingly restrictive legislation, so they are turning elsewhere.

    Shell is tapping billions of potential barrels in Namibia, and Total is considering a $9billion commitment to oil exploration in Suriname.

    Meanwhile, Nigeria’s oil output could increase to 2.1 million barrels per day by December 2024 after the country secured $13.5 billion in investment pledges over the next twelve months from oil majors.

    The companies agreed to invest a total of $55.2 billion by 2030 – including the $13.5 billion over the next twelve months – to lift crude production, according to a statement from the president’s office.
    Nigeria’s oil output stood at 1.18 million bpd in August 2023, according to the Organisation of Petroleum Exporting Countries (OPEC), meaning production would nearly double by the end of next year.

    Nigeria is the top oil producer in Africa but large-scale oil theft has over the years cost the country billions of dollars, while dwindling investment in the sector has also curtailed output.
    The losses from theft and a lack of new projects have reduced oil exports sharply, eroding foreign currency earnings in Africa’s biggest economy.

  • Professional Accountants Have Contributed To Nigeria’s Economic Woes – Expert

    A governance expert, public affairs analyst and Chairman of the Board, Amaka Chiwuike-Uba Foundation (ACUF), Dr Chiwuike Uba, has revealed that accountants have contributed to the economic woes of Nigeria in the last few years as a result of their professional silence and inactions.

    Speaking on Thursday in Abuja during the 28th annual conference of the Association of National Accountants of Nigeria (ANAN), on ‘Role of Professional Accountants in Economic Reforms’, Uba, a lead presenter, said some accountants have had opportunities to support economic reforms of successive administrations, but ended up corrupting the system.

    The ACUF boss said poor management of debt and guarantees have created unnecessarily high debt service costs and could cause significant fiscal risks.

    Uba also revealed that professional accountants play a crucial role in economic reforms by providing financial expertise and advice to various stakeholders, including governments, businesses and organisations.

    He said: “Professional accountants’ actions and inactions might have contributed to Nigeria’s economic conundrum. I am expressing this opinion because some professional accountants, who had the opportunity to support economic reforms in the past, ended up corrupting and messing up the system even more. 

    “In some instances, professional accountants, including one of the former Accountants General of the Federation, were involved in a corruption case that amounted to billions of naira.

    “Currently, over 90 of Nigeria’s revenue is being spent on payment of interest on debt. Poor debt management procedures can lead to increased costs of borrowing, poor decision making and possible default on debt repayment with associated consequences.

    “They equally play a pivotal role in promoting financial stability, transparency and sustainable economic growth. Professional accountants should, therefore, among others, play these roles: record, report and continuously monitor debt and guarantees and, based on monitoring feedback, provide expert advice. They should regularly monitor the ratio of average monthly debt service deducted from revenue.

    “Audit reports need to include more forward-looking, qualitative and non-financial data in the field of financial reporting with more information on risks. Timely reporting of audit findings to generate increased value for stakeholders and enable real-time decision-making is key. The idea of producing audit reports in arrears needs to be corrected. 

    “The last audited financial statements that are publicly available on the website of the Office of the Auditor General were the 2019 accounts. Incidentally, the account was published on August 18, 2021, which was 19 months, 18 days from the end of the financial year.”

    Dr Uba stressed the need for increased communication of financial statements and auditor’s reports through the publication of the reports for public access, adding that management letters from public companies should also be made available more widely beyond sharing it with the audit committee.

    “Performance and accountability have become vital elements in the governance framework. Improving performance and accountability with an eye on delivering more appropriate, efficient and effective public service is the hallmark of good governance. The ability of professional accountants to defend or account for performance according to some ethical framework is part of the accountability framework.

    “Audits, investigations and advisory services are required to reduce risk, improve transparency and accountability, and maintain the public trust.

    To satisfy this key element needed to achieve the objectives of economic reforms, professional accountants engaged in auditing should carry out Value for Money (VFM) auditing by confirming whether proper arrangements were in place to secure economy, efficiency and effectiveness in the use of public resources,” he added.



  • CBN Shifts Monetary Policy Committee Meeting

    The Central Bank of Nigeria (CBN) has postponed its 293rd Monetary Policy Committee (MPC) meeting.

    The MPC meeting had been scheduled for September 25 and 26, 2023.

    A statement by the Director of Corporate Communications at the CBN, Dr. Isa AbdulMumin on Thursday in Abuja, which was posted on its website, did not give any reason for the postponement.

    “The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has deferred its 293rd meeting scheduled for Monday and Tuesday, September 25 and 26, 2023, respectively.

    “A new date will be communicated in due course.

    “We regret any inconvenience this change may cause our stakeholders and the general public,” the statement read.

  • Come, Invest In Nigeria’s Bubbling Economy, Tinubu Tells US

    President Bola Tinubu has invited the United States business community to come and invest in Nigeria’s ‘bubbling’ economy.

    Tinubu, who rang the closing bell at the Nasdaq Stock Market in New York on Wednesday, called on the United States business community to invest in Nigeria’s “bubbling market”.

    The President, who is attending the ongoing 78th session of the United Nations General Assembly, was accompanied to the bell ceremony by the President of the U.S.-Africa Business Center (USAfBC) at the U.S. Chamber of Commerce, Scott Eisner.


    The closing bell ceremony, held at the seven-storey tower of the Nasdaq headquarters in New York, signifies the end of a trading session.

    “I am happy to bring Nigeria to your doorsteps and honoured that we’re here today with a bubbling maket that will evolve the West African subregion,” Tinubu said.

    “The greatest economy is Nigeria. There is an immense opportunity in Nigeria that you can invest your money without fear.

    “We’ve removed a lot of the bottlenecks. We’ve cleared the subsidy that is corrupt and we’ve also retooled the exchange rate to a reliable, dependable one-figure floating of the exchange naira.”

  • Nigeria Rakes In N5.2trn Revenue In 6 Months – RMAFC

    The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has disclosed that the total sum of N5,244 trillion accrued into the Federation Account in the first 6 months of 2023.

    A press statement signed by the RMAFC Chairman, Mr. Mohammed Bello Shehu, and made available to journalists on Wednesday in Abuja, said the amount was captured in the monthly report to the Federation Account Allocation Committee (FAAC) by the Central Bank of Nigeria (CBN) under the caption “CBN Federation Account Component Statement”. 

    According to Shehu, out of the total gross revenue inflows into the Federation Account, the sum of N627.301 billion was NNPCL JV Petroleum Profit Tax (PPT) due, captured and recorded by the FIRS, but utilized by the NNPCL for other FGN obligations.

    From the reports according to the statement, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) remitted the sum of N823,512,065,893.15 while the Federal Inland Revenue Service (FIRS) made a gross collection of N3,655,894,989,129.28 but remitted N3,028,593,066,702.93 retaining the difference as cost of collection. 

    The statement further disclosed that the Nigeria Customs Service (NCS) on its part remitted the sumN764,630,581,539.17.

    It however, added that the Nigerian National Petroleum Company Limited (NNPCL) did not remit any amount into the Federation Account during the period either as profit revenue or other revenues as contained in the Petroleum Industry Act (PIA), 2021 as its revenue performance could not be assessed because neither its revenue target was disclosed nor its revenue remittance to the Federation Account was provided.

    Furthermore, the statement adds that the sum of N1,490,946,180,918.52 was realized as Value Added Tax (VAT) while the sum of N83,024,395,855.89 was realized from the Electronic Money Transfer Levy (EMTL) from which the sum of N3,320,975,834.23.

    Additionally, the FIRS received the sum of N82,031,796,937.01 and N3,320,975,834.23 as cost of collection on PPT/CIT and EMTL collections respectively in the period.

    The report revealed that on VAT, the FIRS/NCS together received the sum of N59, 593,164,213.83 as cost of collection within the period under review.

    Similarly, the report indicates that the sum of N16, 680,990,990.93 was realized from the solid minerals sector.

    The RMAFC Chair further revealed that total collections from VAT netted the sum

    of N1,387,328,862,898.16 whichwas shared to the 3-tiers of government in accordance with the approved VAT sharing formula.
    On the statutory allocations to the three tiers of government, Mr. Bello disclosed that the net sum of N3,069,594,889,669.74 (Three trillion, sixty-nine billion, five hundred and ninety-four million, eight hundred and eighty-nine thousand, six hundred and sixty-nine Naira, seventy four Kobowas shared to the 3-tiers of government in the period January to June, 2023.

    In the area of payment of cost of collection to Revenue Generating Agencies (RGAs) from the Federation Account component, the statement reveals that the NCS received the sum of N53,524,140,707.73 within the period under review.

    In the same vein, the statement adds that the sum of N48,105,698,218.35 was paid to the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).

    “This money was collected by NUPRC as penalty on gas flared. Revenues on gas flared penalty used to be Federation Account revenues before the PIA, 2021 which provided that such revenues should be paid 100% to the NMDPRA”.

    In a similar development, the RMAFC Chair described the statutory deductions which constituted 32.27% of the total gross inflow into the Federation Account in the six-month period as superfluous and constitute a drain on the Federation Account.