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Category: Economy

  • NNPCL, marketers, others involved in fuel subsidy scam –Yuguda

    NNPCL, marketers, others involved in fuel subsidy scam –Yuguda

    *Says Buhari can’t claim ignorance of the whole issue

    Former Bauchi State Governor, Isa Yuguda has said that the Nigerian National Petroleum Corporation Limited (NNPCL), petroleum markers and other are involved in the fuel subsidy scam the country has suffered in so many years.

    Yuguda, who blamed the lack of a political will on the part of former President Muhammadu Buhari’s, said Buhari had before becoming President in 2015 described subsidy as a scam yet he did nothing to end it.

    Yuguda, who said this on ChannelsTV on Monday in Abuja, insisted that the subsidy regime was a scam that was perpetuated by the Nigeria National Petroleum Company Limited (NNPCL) in collaboration with marketers and other stakeholders.

    He said: “I am sad to let Nigerians know what I saw; we came across situations where subsidy was claimed on pipelines that never existed.

    “We were subsidizing West Africa, we were bringing in this fuel at an elevated cost and then half of it was exported out by the same group that is supposed to supply this fuel in Nigeria. Are the security doing their jobs, are other security agencies that are supposed to sanction those that are taking our fuel out of Nigeria doing their jobs?

    “Secondly, when I chaired that committee on subsidy that uncovered the scam, I told you that subsidy was being paid on pipelines that never pumped products. In fact, forms were just filled and subsidies are paid, and to whom are they paid? – to the marketers.   

    “Those that claim to pump the products and those that are in the subsidy scam, they just fill papers, invoices and they claim subsidy on it. They have no heart, these people, they are just heartless,” Yuguda said.

    Yuguda, who is the Chairman of the APC Forum, a professional think-tank, said that the subsidy racket “was a sophisticated gang up and those that should act are also part of it. President Buhari cannot claim ignorance of the whole issue,” he added.   

    Recently, after a visit to President Bola Ahmed Tinubu, ex-militant leader, Asari Dokubo had said: 

    “I also want to say that oil theft is encouraged by the military. The Army and the Navy intimidate the (Nigeria Security and) Civil Defence (Corps) who are by status the people who are supposed to guard these pipelines. They receive a lot of money from NNPCL and the IOCs and just across the corner, you will see a houseboat.

    “We have seen that situation. You have a situation that is completely different. The government thought they could run the economy through borrowing. This is the time as a matter of necessity.

    “If Mr President can have the will to go after all those government officials that were responsible for hemorrhaging the economy, 70-80 per cent of what they have taken out of Nigeria should be brought back into Nigeria. Would he continue printing money like the way that they’ve been doing through Ways and Means.

    “Government cannot continue to borrow from the CBN to fund activities, it’s not possible. There is a limit to which you can borrow,” he explained.  

  • Adesina pledges to support Nigeria’s economic recovery

    President of the African Development Bank (AfDB), Akinwumi Adesina has assured President Bola Ahmed Tinubu of the Bank’s readiness to help resuscitate the Nigerian economy.

    Adesina gave the assurance during a meeting with President Tinubu, at the New Global Finance Pact Summit in Paris.

    Speaking on his verified Twitter handle, the AfDB President said; “I had a great meeting with President Tinubu during the New Global Finance Pact Summit in Paris.

    “I was impressed by his commitment to bold and sound policies for Nigeria’s economy. The AfDB will strongly support his vision for the Nigerian economy.”

    Tinubu commended Adesina and AfDB, for the bank’s investment of $520 million in the special agro-processing zones programme, which is said to be the largest in scope and size in Africa.

    He assured the AfDB President that the federal government would continue to provide necessary support for the bank’s projects and operations in Nigeria.

    The bank’s portfolio in Nigeria comprises 48 operations for a total commitment value of $4.2 dollars.

    The national (Federal and States) operations account for 90 per cent of the portfolio, for 41 projects amounting to $3.79 billion dollars, while multinational operations constitute 10 per cent, for seven projects amounting to 0.41 billion dollars.

    There are 24 sovereign operations ($2.36 billion or 56 per cent of total commitments) and 24 non-sovereign operations ($1.84 billion or 44%).

    A mapping of the portfolio to the High 5s shows a balanced distribution. industrialise Africa has the highest share (45 per cent).

    This is followed by improving the quality of life for the people of Africa (18%), lightup and power Africa (14%), feed Africa (13%), and integrate Africa (10%).

    Also, the performance of the bank’s public sector portfolio in Nigeria has been satisfactory.

  • FAAC: FG, States LGs get N786.161bn May allocation

    The Federation Account Allocation Committee (FAAC) has shared a total sum of N786.161 billion May 2023 Federation Account Revenue to the Federal Government, States and Local Government Councils.   

    This was contained in a communiqué issued at the end of the Federation Account Allocation Committee (FAAC) meeting for June 2023; chaired by the Accountant General of the Federation, Dr. Oluwatoyin Madein.

    The N786.161 billion total distributable revenue comprised distributable statutory revenue of N519.545 billion, distributable Value Added Tax (VAT) revenue of N251.607 billion, Electronic Money Transfer Levy (EMTL) of N14.370 billion, and Exchange Difference revenue of N0.639 billion.   

    In May 2023, the total deductions for cost of collection was N38.238 billion and total deductions for transfers and refunds was N163.193 billion. 

    The balance in the Excess Crude Account (ECA) was $473,754.57

    The communiqué stated that from the total distributable revenue of N786.161 billion; the Federal Government received N301.889 billion, the State Governments received N265.875 billion and the Local Government Councils received N195.541 billion. A total sum of N22.855 billion was shared to the relevant States as 13% derivation revenue. 

    Gross statutory revenue of N701.787 billion was received for the month of May 2023. This was higher than the sum of N497.463 billion received in the previous month by N204.324 billion.  

    From the N519.545 billion distributable statutory revenue, the Federal Government received N261.686 billion, the State Governments received N132.731 billion and the Local Government Councils received N102.330 billion. The sum of N22.798 billion was shared to the relevant States as 13% derivation revenue.  

    For the month of May 2023, the gross revenue available from the Value Added Tax (VAT) was N270.197 billion.  This was higher than the N217.743 billion available in the month of April 2023 by N52.454 billion.   

    The Federal Government received N37.741 billion, the State Governments received N125.804 billion and the Local Government Councils received N88.062 billion from the N251.607 billion distributable Value Added Tax (VAT) revenue.

    The N14.370 billion Electronic Money Transfer Levy (EMTL) was shared as follows: the Federal Government received N2.155 billion, the State Governments received N7.185 billion and the Local Government Councils received N5.030 billion.

    From the N0.639 billion Exchange Difference revenue, the Federal Government received N0.307 billion, the State Governments received N0.156 billion, the Local Government Councils received N0.119 billion and the sum of N0.057 billion was shared to the relevant States as 13 percent mineral revenue. 

    According to the communiqué, in the month of May 2023, Petroleum Profit Tax (PPT), Companies Income Tax (CIT), Oil and Gas Royalties, Value Added Tax (VAT), Import and Excise Duties increased significantly, while Electronic Money Transfer Levy (EMTL) decreased marginally. 

  • Nigerians to pay more for petrol as ex-depot price hits N490/litre

    As the ex-depot prices of Premium Motor Spirit (PMS), rises to N490 per litre, some independent fuel marketers in Lagos are already selling the product at prices higher than the fixed rate of N488 per litre.

    According to unconfirmed reports, while the Nigerian National Petroleum Company Limited depot sells to major marketers at N466.52 per litre, private depots are however selling at N490 per litre.

    NNPCL stations are selling fuel at the fixed rate of N488 per litre, while major marketers sell fuel between N488 and N492 per litre. Independent marketers who purchase from private depots at N490 per litre are selling fuel to consumers at prices above N500 per litre.

    President Bola Ahmed Tinubu in his inauguration speech declared that the controversial petroleum subsidy regime was gone. He said rather the funds saved from the subsidies would be channeled to other critical areas.   

    The federal government for several decades, subsidised fuel and fixed retail prices of petroleum products. The payment has, however, threatened the nation’s fiscal position and impacted the government’s ability to fund developmental projects across the country.

  • We’ve not free-floated the FX market, says CBN  

    We’ve not free-floated the FX market, says CBN  

    Deputy Governor of the Central Bank of Nigeria (CBN) Kingsley Obiora has described the Banks recent decision concerning the foreign exchange market as a a managed float and not a free float as it is being perceived.

    In an interview in Rabat, Morocco, Tuesday, Obiora said the country plans to announce further measures to loosen forex controls, stating that Nigerians should expect more policy changes “in the next couple of weeks.”

    He added that the CBN has not intervened in Nigeria’s FX markets since the new policies were introduced.

    The CBN chief noted that it has no plans to set the Naira on a totally free float, as no country runs a completely free float.

    “There is no country in the world, even the US that has a completely free float. It may be too early to determine if the naira’s exchange rate to the dollar has bottomed out.”

    Obiara cited reports by the IMF that suggest that the naira should not be as weak as the parallel market indicated, adding that he expects that the supply of foreign exchange will eventually be unlocked once the price of the dollar reaches a level that both buyers and sellers consider “fair.”

    He also noted that he expects Nigeria’s GDP growth to hit 6 per cent by 2024, noting that GDP should approach $700 billion in 4 years, according to Obiora, the report noted:

    “The removal of subsidies, along with the convergence of the exchange rates will drive economic growth, especially from next year when the policies start making an impact.

    Nigeria’s exchange rate and the Investor and Exporter (I&E) window fell to N770.38/$1 on Monday as the foreign exchange market in Nigeria experienced significant volatility following the Central Bank of Nigeria’s (CBN) operational changes.

    The move to allow market-determined forex rates is seen as a major step towards currency reforms in Nigeria, which has been plagued by a chronic shortage of foreign exchange and multiple exchange rates.

    According to analysts, a unified and flexible exchange rate regime will help boost investor confidence, increase foreign inflows, reduce import costs, and ease pressure on the naira.

  • FX Reforms: CBN relaxes restriction on domiciliary accounts

    Following the Central Bank of Nigeria (CBN) new guidelines in the Foreign Exchange (FX) market recently released, the apex bank has announced further policy changes.

    According to the Director, Corporate Communications, Dr Isa AbdulMumin, these policy changes aim to promote transparency, liquidity and price discovery in the FX market.

    AbdulMumin said that this is in order to improve FX supply, discourage speculation, enhance customer confidence and ensure overall stability in the FX market.

    He said that in line with deliberations at an extraordinary Bankers’ Committee meeting held on June 16, the CBN provided further guidance to Deposit Money Banks (DMBs) as follows:

    “All visible and invisible transactions (medicals, school fees, BTA/PTA, airline and other remittances) are eligible for the Investors’ and Exporters’ (I & E) window.

    “DMBs shall ensure expeditious processing of all eligible invisible transactions on behalf of their customers using the applicable rate at the I & E window.

    “Ordinary domiciliary account holders shall have unfettered and unrestricted access to funds in their accounts.

    “Domiciliary account holders are permitted to utilise cash deposits not exceeding 10,000 dollars per day or its equivalent via telegraphic transfer,” he said.

    The CBN spokesman said that the DMBs are mandated to provide returns to the CBN, including the “purpose” for such transactions.

    He added that cash deposits into domiciliary accounts would not be restricted, subject to DMBs conducting proper Know Your Customer (KYC), due diligence.

    “The CBN will prioritise the orderly settlement of any committed FX forward transactions as they fall due in order to boost market confidence further.

    “The Bank will normalise its Cash Reserve Ratio (CRR) maintenance processes and ensure equity in
    its implementation across the banking industry,” he assured.

    He added that the apex bank would continue to engage stakeholders and issue further guidance as it implements the ongoing reforms. 

  • Q1 2023: FG rakes in N709.59bn VAT

    Nigeria’s aggregate Value Added Tax (VAT) for Q1 2023 has been reported at N709.59 billion, the National Bureau of Statistics (NBS), has said. 

    According to the NBS Value Added Tax report for Q1, 2023, a growth rate of 1.75 percent on a quarter-on-quarter basis from N697.38 billion in Q4 2022.

    Local payments recorded were N436.10 billion, Foreign VAT payments were N151.13 billion, while import VAT contributed N122.37 billion in Q1 2023.

    On a quarter-on-quarter basis, the activities of households as employers, undifferentiated goods- and services producing activities of households for own use recorded the highest growth rate with 349.86%, followed by construction with 95.64%.

    On the other hand, the report noted that activities of extraterritorial organizations and bodies had the lowest growth rate with–53.54%, followed by real estate activities with– 47.01%.

    In terms of sectoral contributions, the top three largest shares in Q1 2023 were manufacturing with 29.65%; information and communication with 19.29%; and mining & quarrying with 12.24%.

    The report said: “Conversely, activities of extraterritorial organizations and bodies recorded the least share with 0.02%, followed by activities of households as employers, undifferentiated goods- and services-producing activities of households for own use with 0.03%; and water supply, sewerage, waste management, and remediation activities with 0.04%.”

    However, on a year-on-year basis, VAT collections in Q1 2023 increased by 20.56% from Q1 2022. 

    Similarly, aggregate Company Income Tax (CIT) for the first quarter of 2023 was reported at N469.01 billion, indicating a growth rate of -37.79% on a quarter-on-quarter basis from N753.88 billion in Q4 2022.

    According to the NBS, local payments received were N300.78 billion, while Foreign CIT payment contributed N168.23 billion in Q1 2023.

    On a quarter-on-quarter basis, the financial and insurance activities recorded the highest growth rate with 50.42 per cent, followed by construction with 42.32 per cent.

    “On the other hand, water supply, sewerage, waste management, and  activities had the lowest growth rate with – 69.38%, followed by other service activities with -60.13%. In terms of sectoral contributions, the top three largest shares in Q1 2023 were financial & insurance activities with 22.94%; manufacturing with 20.91%; and information and communication with 11.89%.

    “Conversely, the activities of households as employers, undifferentiated goods-and services-producing activities of households for own use recorded the least share with 0.01%, followed by water supply, sewerage, waste management, and remediation activities with 0.04%; and activities of extraterritorial organizations and bodies with 0.12%.

    “However, on a year-on-year basis, CIT collections in Q1 2023 decreased by 14.96% from Q1 2022,” the NBS stated. 


  • IMF supports Nigeria’s exchange rate unification

    The exchange rate unification policy of the President Bola Ahmed Tinubu has received the backing of global lender, the International Monetary Fund (IMF). 

    Over the last several years, Nigeria has been operating a dual exchange rate regime which had led to round tripping with many Nigerian businesses preferring to trade dollars than engage in their legitimate businesses.

    According to the Apex Bank had in a statement abolished the dual exchange rate collapsing it into the Investors Exporters (I&E) window. 

    The regulator stated that it is expected to be a willing seller and a willing buyers 

    With the policy, all applications for medicals, school fees, business travel allowance/personal travel allowance, and SMEs would now go through the I&E window.

    in a short statement, on Friday, IMF’s Resident Representative in Nigeria, Ari Aisen said it would support the federal government as it implement the new reform. 

    “The Fund greatly welcomes the authorities’ decision to introduce a unified market-reflective exchange rate regime in line with our long-standing recommendations. We stand ready to support the new administration in its implementation of FX reforms.”

    The Bretton Woods institute and experts consistently warned the federal government on the dangers of keeping a dual exchange rate saying it created room for arbitrage. 

  • Subsidy: FG provides solar alternative power to Nigerians

    The Managing Director/Chief Executive Officer of Rural Electrification Agency (REA), Engr. Ahmad Salihijo Ahmad on Friday, said the Federal Government is providing solar energy alternatives to Nigerians in a bid to cushion the effect of subsidy removal on businesses and households.

    Ahmad, who was speaking after the inspection of REA’s Energizing Economies Initiative (EEI) project in Ayegbaju International Market, Osogbo, said the Federal Government, through REA, is setting up alternative solar energy systems to cater to electricity-underserved Nigerians.

    He also explained that the concept of the EEI project was to provide alternative and clean solar energy to Nigerians, so as to reduce or abolish the use of carbon monoxide petrol-powered generators.

    “We came to our Zonal office in Osun and we decided to do a short inspection of the Energizing Economies Initiative (EEI) that we have in Ayegbaju International Market, Osogbo.

    “We came to see the progress of the work and we are very happy with what we have seen here today.

    “The concept is to see how we can work with the market association and most importantly, work with the state government to scale up solar power supply to the whole market,” he said.

    He said the construction of the solar system at the Ayegbaju Market is about 95 percent completed and that the power generation of the system is targeted at 30kwp.

    He said at the pilot phase now, the solar power electricity is being test run on 48 shops and that in the long run, it would be extended to all the shops in the market.

    He said with the interaction he had with the leadership of the market, shop owners are interested in the solar power project, as an alternative power source to run their operations/shops.

    “What we have seen is the tremendous interest of the market people in the solar energy alternative, especially using it to replace petrol generators, in the face of subsidy removal,” he said.

    He said as a follow up to the inspection and interaction with the market people, he would meet and work with developers, Osun State Government and even the market association, to draw a roadmap of how the project would be sustained and scaled up to cover the entire market.

    He said with the solar system initiative, REA has been able to demonstrate a concept of solar power generation and supply, and that they can now bring in and work with other stakeholders to scale it up to the demand of Nigerians who are unserved and undeserved with electricity.

    “Over 148 sites have been audited directly by REA,” saying “support from partners, such as E-guide and Rockefeller Foundation, will enhance the Energizing Economies Initiative (EEI) project.

    “It is from these sites that Ayegbaju International Market, Osogbo, and Abubakar Gumi Market, Kaduna, were selected to deliver the next phase of EEI projects,” he said.

    He said they are taking into account the lessons learned from phase zero and one of the project initiatives and would use it as a model for sustainable and collaborative projects with state governments and Electricity Distribution Companies (DisCos).

    “Once the solar system construction is completed, the State Governments or DisCos, developers, and REA will be able to sit with the Market Associations to sign a multilateral agreement which ensures the long-term viability of the project while ensuring energy access to the markets.

    “These projects will also provide the much-needed relief to businesses in these markets by reducing their dependence on petrol generators while increasing the penetration of renewable energy sources,” he said. 

  • Drive transformative change, Tinubu tasks new Economic Council

    President Bola Tinubu on Thursday inaugurated the National Economic Council (NEC) with a charge on them to work with his administration to revive the nation’s economic fortunes.

    At the inauguration at the Council Chambers of the State House in Abuja, Tinubu said that the task of reviving the economy before the new administration is daunting.

    He, however, added that there would be no excuses for not delivering since they all begged and even danced before Nigerians to give them the job.

    He urged the members of the Council to put in their best, pointing out that Nigerians are waiting for them eagerly to deliver democratic dividends.

    “It is very reassuring that our citizens are behind us, but they want reforms and they want them very quickly.”

    The NEC is constitutionally under the Chairmanship of the Vice President.

    The NEC meets monthly and has the mandate to advise the President concerning the economic affairs of the Federation.

    They are also expected to advise on measures necessary for the coordination of the economic planning efforts or programmes of the various governments.

    Membership of the NEC comprises of the 36 State Governors, the Governor of the Central Bank of Nigeria and other co-opted Government officials.

    No fewer than 30 governors and two deputies were in attendance at the inauguration.

    They include governors Abdulrahman Abdulrazaq of Kwara, Ademola Adeleke of Osun, Yahaya Bello of Kogi, Biodun Oyebanji of Ekiti and Abdullahi Sule of Nasarawa.

    Others are Umo Eno of Akwa Ibom, Peter Mbah of Enugu, Bassey Otu of Cross River, Caleb Muftwang of Plateau, Nasir Idris of Kebbi, Aliyu Radda of Katsina and Hycinth Alia of Benue.

    The Secretary to the Government of the Federation, George Akume, Chief of Staff, Femi Gbajabiamila, the Group Chief Executive Officer (GCEO) of the Nigerian National Petroleum Company Limited (NNPCL), Mele Kyari also attended.

    Other officials include the acting Accountant General of the Federation, Oluwatoyin Madein, Acting Governor of Central Bank, Folashodun Shonubi, Permanent Secretaries Budget and National Planning, Federal Capital Territory Administration, and State House.