My Blog

Category: Economy

  • Naira begins new week on a downslide

    Naira begins new week on a downslide

    The Naira depreciated against the dollar on Monday, exchanging for N464 at the investors’ and exporters’ window.

    The rate represented a decrease of 0.36 percent when compared to the N462.33 it exchanged at the close of business on May 12.

    The open indicative rate closed at N463 .50 to the dollar on Monday.

    A spot exchange rate of N467 was used for trading within the day before it settled at N464.

    Spot exchange rate was determined instantly.

    The Naira sold for as low as N460 to the dollar within the day’s trading.

    A total turnover of 55.10 million dollars was traded at the official Investors’ and Exporters’ window.

  • CBN unveils ‘SabiMONI’ platform to promote financial literacy, inclusion

    CBN unveils ‘SabiMONI’ platform to promote financial literacy, inclusion

    The Central Bank of Nigeria (CBN) has unveiled an e-learning platform, SabiMONI to promote financial literacy and to deepen financial inclusion.

    Speaking at the ceremony, the CBN Governor, Mr Godwin Emefiele said that the platform was a fully digital national e-learning platform that provided a knowledge base for financial literacy.

    According to him, SabiMONI is aimed at providing individuals with the opportunity to be trained and to become Certified Financial Literacy Trainers (CFLT) through self-service.

    “The platform is aimed at supporting our efforts toward ramping up the number of experts that can be used to drive financial education in the country and perhaps beyond.

    “One of the key drivers of financial inclusion today, is no doubt financial literacy.

    “It is a prerequisite for greater financial inclusion, which would lead to the stability of the financial system and ultimately economic growth and development,” he said.

    Emefiele said that the absence of or low levels of financial literacy constituted an impediment to financial inclusion.

    “In other words, the pace of financial inclusion is directly related to the level of financial literacy and financial
    capability.’’

    He said that to address the financial inclusion gaps, the National Financial Inclusion Strategy 2022, identified increasing adoption and
    usage of financial services in priority demographics.

    He said that such demographics comprised of the most vulnerable segments such as women, youth, MSMEs and rural dwellers.

    “And especially, the Northern part of the country as well as expansion of digital financial services and platforms amongst its strategic priority areas.

    “To enable us to achieve these, we must take deliberate steps to upscale financial capability through financial education programmes.

    “The shortage of skilled and experienced persons to drive financial education remains a major hindrance.

    “Interestingly, the National Financial Inclusion Strategy 2022 places high priority on financial and digital learning.

    “This will serve as a strategy that would enable the creation of a conducive environment for serving or ensuring the inclusion of the most excluded groups,” he said.

  • Budget deficits, low revenue responsible for rising debt – DMO

    The Debt Management Office (DMO) says decades of operating budget deficits by successive governments is responsible for Nigeria’s high debt profile.

    The Director-General of the DMO, Patience Oniha, said this on Sunday in Abuja.

    According to Oniha, a review of Nigeria’s fiscal data shows that not only has the government operated budget deficits which have been growing, but most of the deficits have been funded through local and external borrowing.

    “The records show that deficits in the annual budgets, including supplementary budgets rose to N10.78 trillion in 2023 from N1.62 trillion in 2015.

    “Between 82 per cent and 99 per cent of these were funded by new borrowing which ranged from N1.46 trillion in 2015 to N8.80 trillion in 2023.

    “These facts confirm that these budget deficits, funded by new borrowings, have been responsible for the rapid growth in the debt stock and the resultant increases in debt service,” she said.

    According to Oniha, this trend could have been avoided or at least moderated if revenues had been higher or expenditures lower.

    She tasked the incoming government of Sen. Bola Tinubu to take cognisance of the situation and prioritise increased revenue generation.

    “The budget deficits would have been much smaller, or Nigeria would have operated on a balanced budget.

    “It is therefore imperative that the incoming government takes into account the perennial budget deficits in the preparation of the Medium-Term Expenditure Framework (2024 – 2026) and the 2024 budget.

    “The government should also accelerate the growth in revenues to ensure debt sustainability,” she said.

  • PENGASSAN tasks incoming govt on rehabilitation of refineries

    The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has urged the incoming government to ensure the completion of the ongoing rehabilitation of the nation’s petroleum refineries.

    President of PENGASSAN, Mr. Festus Osifo said this at the 7th Triennial National Delegates Conference of the association in Abuja.

    The theme of the conference is: ‘Equity and Social Justice; Advocacy for Equal Opportunities for all Workers”.

    Osifor said that completion of the ongoing rehabilitation of refineries and associated pipelines would be in the interest of the Nigeria’s economy.

    He said the union will also continue to advocate for the adoption of the NLNG model in the running of the Nation’s four Refineries when fully revamped.

    The union also called for the creation of an enabling environment for the establishment and operation of modular and private Refineries.

    “We are happy that the current NNPC management is favourably disposed to such. With the Dangote refinery, there will be a significant impact on the fuel supply dynamics.

    “This will also ease pressure on the economy, especially when combined with the ongoing revamping of the three refineries in the country.

    “The incoming government must do all within its reach to see to the conclusion of the current rehabilitation effort and initiatives that are currently in place so that our nation’s refinery will come up in no time,” he said.

    He charged the incoming administration of the President-elect, Sen. Bola Tinubu to ensure that the Petroleum Industry Act (PIA) was comprehensively implemented.

    He added that, as the new government comes in, the union urged it to fast track the implementation of different sections of the act to the benefit of Nigerians.

    “The provision of the act that will further deepen the development of the midstream sector of the Nigeria oil and gas industry should be aggressively implemented.

    “This will lead to the provision of gas infrastructure that will in turn aid gas development and help in harnessing the vast gas reserves in the country.

    “We warn that the implementation of the PIA must not be made to pass through arm-twisting tactical bureaucratic monsters that bedeviled the PIB. The Host Community Development fund and trust should be immediately constituted,” he said.

    Also speaking, the President of the Nigeria Labour Congress (NLC), Mr. Joe Ajaero called for greater solidarity and collaboration between PENGASSAN and other unions under in the Trade Union Congress (TUC).

    He said that this would enable the NLC and TUC to forge a stronger front in fighting for workers’ rights and welfare in the country.

    Also, the Chairperson of the event and an Executive Director of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Mrs. Zainab Gobir called on everyone not to project Nigeria in a bad light.

    ”This will de-market our country. It is therefore important for us not to wash our dirty linens in public.

    Gobir said that people should find better ways to raise issues with the government, with a view to addressing them.

  • Electricity: Nigeria needs $3.5bn annually to generate 40,000mw by 2030- FG

    *As REA targets N7bn from investors

    Nigeria needs a $3.5 billion investment annually to generate 40,000 megawatts (MW) of electricity by 2030.

    This was even as the Rural Electrification Agency (REA) was targeting additional N7 billion revenue from its first investors’ matchmaking for Solar Naija Programme (SNP).

    Speaking at the investor match-making event, which the REA organised in Abuja, the Minister of Power, Engr. Abubakar Aliyu, disclosed that it would cost Nigeria an annual investment of $3.5 billion to attain 40,000MW by 2030.

    With 23 power generating plants connected to the national grid, Nigeria has the capacity to generate 11,165.4 MW of electricity.

    As at last January, Nigeria’s available power generation capacity in the First Quarter of 2022, according to a Nigerian Electricity Regulatory Commission (NERC) First Quarter 2022 Report published on January 6, 2023, decreased to 4,712.34MW from 5,465.72MW in the Fourth Quarter of 2021.

    It stated that in the First Quarter of 2022, the average hourly generation of all available units decreased by 190.58MWh/h (-4.44 per cent) from 4,294.02MWh/h in 2021/Q4 to 4,103.11MWh/h.

    The Commission attributed the decrease to incessant technical faults, gas constraints, as well as undulating load demand patterns that have continued to affect the amount of energy generated by power plants.

    Represented by the Ministry’s Director of Investment, Mrs. Eyo Babalola, Aliyu noted the Ministry was the fulcrum of the actions with which the government is transforming the industry from a public to a private sector-driven one.

    He said that, with the recent legislation that has empowered state governments to generate and distribute electricity, there are limitless investment opportunities in the sector.

    The Managing Director of REA, Engr. Ahmad Salihijo Ahmad, informed the Rural Electrification Fund (REF) is undergoing some slight reforms to work with private investors for impact financing.

    He explained the essence of the reform was to ensure there is a revolving fund that could suffice when there are non-viable areas.

    Meanwhile, the REA is targeting additional N7 billion revenue from its first investors’ matchmaking for SNP.

    The Programme aimed at providing the opportunity for potential investors to pitch their financial offerings to developers, clearly stating the selection criteria and key terms.

    In a statement by the Agency on Thursday, the Agency hinted that the event would facilitate networking and matchmaking forum that brings together key investors and high-performing developers (pre-evaluated by the SPN team) in the power sector.

    The event was organized in collaboration with the Power Africa Nigeria Power Sector Program (PA-NPSP, USAID).

    The Solar Power Naija Programme was launched as part of the Economic Sustainability Plan (ESP) to achieve the roll out of 5 million new solar connections in off grid communities.

    It stated that program is expected to generate an additional N7 billion increase in tax revenues per annum and $10 million in annual import substitution.

    The objectives of the programme is to expand energy access to 25 million individuals (5 million new connections) through the provision of Solar Home Systems (SHS) or connection to a mini grid, Increase local content in the off grid solar value chain and facilitate the growth of the local manufacturing and assembly industry and Incentivize the creation of 250,000 new jobs in the energy sector.

    Speaking during the event, Ahmad encouraged partnerships like these to boost energy access in communities.

    “As the implementing agency for Nigeria’s off-grid strategy, the REA has been working to support private developers by creating an enabling environment to facilitate investments in various ways, including access to data, policy support, grants, capacity development, stakeholder management, and most importantly financing for Developers,” he said.

    The Acting Deputy Missions Director, USAID Nigeria, Stephan Menard, in his remark, encouraged private developers to key into the project. 

    “I encourage the private developers to take advantage in accessing financing towards improving the lives of Nigerians by delivering sustainable energy access,” he said.

    The Head, Solar Power Naija Programme, Barbara Izilien, looked forward to better days.

    “We hope, with this approach, we will be able to build quick partnerships that would lead to new connections, and further count towards our target of electrifying a minimum of five million households, serving a minimum of 25 million Nigerians,” he said.

    The Solar Power Naija Programme, implemented through the REA, is actively working on catalysing access to financing for developers in the off-grid sector to achieve the programme targets.

    The event witnessed the signing of Memorandum of Understanding (MoU) between the REA and Chapel Hill Denham through the Solar Power Naija Programme.

    The MoU is aimed to facilitate financing to developers for off grid electrification projects.

  • Oil production falls below benchmark to 998.6bpd in April

    Nigeria’s oil production in April 2023 fell below the one million mark – the lowest in seven months – as the production figure fell to 998,602 barrels per day (bpd).

    This is a 21.26 per cent decline compared to March, when output was 1,268,202 bpd.

    The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) disclosed this in its latest crude oil and condensate production data for April 2023.

    The volume of production is at its lowest point in the last seven months.

    In the previous year, oil production fell below one million bpd in August and September owing to several issues, including oil theft.

    According to the NUPRC report, oil production decreased from 1.517 million bpd in March 2023 to 1.245 million bpd in April 2023, with the addition of condensate.

    Condensate is a mixture of light liquid hydrocarbons, similar to a light (high API) crude oil. It is usually separated from a natural gas stream at the point of production (field separation) when the temperature and pressure of the gas are dropped to atmospheric conditions.

    Speaking about the current oil output on Wednesday, the Chief Executive Officer (CEO) of the NUPRC, Gbenga Komolafe, said that oil production is currently about one million bpd below “its technically allowable capacity”.

    Komolafe, who was represented by the Executive Commissioner for Economy, Regulatory, And Strategic Planning, NUPRC, Kelechi Ofoegbu, at a host communities sensitisation workshop, attributed the low oil production to a number of issues, including the energy transition’s impact on hydrocarbon funding, a lack of investments, and insecurity.

    “While the commission is prioritising efforts towards increasing oil and gas production and ensuring maximum federation revenue through the optimisation of the oil and gas value chain, the efforts have been constrained by a myriad of challenges.

    “These challenges range from insecurity, low investment, and de-prioritisation of funding of hydrocarbon development arising from the energy transition.

    “Currently, Nigeria has the technical allowable capacity to produce about 2.5 million barrels of oil per day. However, arising from the highlighted challenges, our current production hovers around 1.5 million barrels of oil and condensate per day,” he said.

  • Overtime Cargoes: FG inaugurates task team at nation’s ports

    Overtime Cargoes: FG inaugurates task team at nation’s ports

    The Federal Government has inaugurated a collaborative Task Team of the Nigerian Ports Authority (NPA), Nigeria Customs Service (NCS), Federal Ministry of Transportation, and others, with the charge to address lingering issues of overtime cargoes at the nation’s seaports and terminals while also proffering best case situation on how these cargoes can be cleared.

    The Permanent Secretary, Federal Ministry of Transportation (FMT) and Chairperson of the Committee, Dr. Magdalene Ajani, while inaugurating members of the Task Team in Abuja stressed on the importance of the Task Team and that the inability to clear overtime cargoes at the ports and terminals has affected the number of cargoes that can be handled due to limitation of space.

    Similarly, Ajani observed that this has resulted to a drastic drop in the volume of cargoes coming into the country. Adding that the reduction in cargoes has ultimately affected Internally Generated Revenue which is now lost to the neighbouring countries.

    Furthermore, the Permanent Secretary explained that the clearing of overtime cargoes should not be confined to the Ikorodu Lighter Terminal, Lagos Port Complex, and Tin Can Island Port Complex but all other ports and Terminals within the country.

    On the composition of the Task Team Ajani said it was as a result of series of meetings between the Minister of Transportation, Mu’azu Jaji Sambo and the Comptroller General, Nigeria Customs Service, and the I Secretary, FMT, Dr. Magdalene Ajani. She called on the Task Team bring their professionalism to bear in the discharge of the onerous task.

    The Permanent Secretary read the “Terms of Reference” (ToR) and they include but are not limited to: Confirm the inventory of submission by the Nigerian Ports Authority on the actual number of overtime cargo in the ports and other locations; Conduct a joint examination of all such cargo to determine contents suitable for use or consumption; Provide a list separating goods for disposal by public auction and those to be deposed by condemnation/destruction and gazette all cargoes identified as overtime for disposal.

    Others are: Determine methodology for public auctioning at various port/locations; determine the recoverability of part of Terminal Operator’s revenue arising from long occupation of economic spaces and transfer charges; Ensure that the process is in conformity with applicable customs practices and any other task that may arise in the cause of the assignment;

    Responding on behalf of the team, Comptroller Adekunle Oloyede, of the Nigeria Customs Service, assured that the Task Team is a one-stop that will certainly unravel the overtime cargoes challenge.

    The Task Team is expected to summit its report within 8 weeks.

  • Stamp Duty is our constitutional function, NIPOST Chair tells FIRS

    *Calls on President Buhari’s intervention

    The Chairman, Nigerian Postal Service Board, Barr. Maimuna Abubakar has called on President Muhammadu Buhari to intervene in the ongoing tussle between the Federal Inland Revenue (FIRS), and the Nigerian Postal Service (NIPOST), over which of the agencies should administer stamp duty.

    Maimuna made the appeal in Abuja while speaking at 1st Economic Confidential Public Lecture & Presentation of the Books entitle, “Pantami – Trials & Triumphs of a Digital Economy Maestro” and “e-Naira Revolution – A peep into Nigeria’s Cashless Future.”

    In her speech, the NIPOST Board Chairman, who described FIRS’ action as a usurpation of NIPOST legal duties, emphasized the need for the President to call for the withdrawal of the ongoing legal tussle and have it settled out of court.

    Also present at the event, the Keynote Speaker, Prof. Isa Pantami, who delivered a lecture themed, “Economic Diversification in an Evolving Cashless Society”, spoke on his ministry’s efforts at promoting Nigeria’s digitization.

    He further harped on the importance of exploring the knowledge-based economy option for Nigeria in the quest for economic diversification.

    Earlier, the Chairman, Revenue Allocation and Fiscal Commission (RMAFC), Mohammed Shehu, who also chaired the event, clarified that diversification is vital for economic growth and development.

  • Privatization: FG gives Transcorp Power discharge certificate

    Transcorp Power Limited has received the Discharge Certificate from the Federal Government in Abuja.

    Nigerian Anchor reports that Transcorp Power Limited, a leading power generation company, located in Ughelli Delta State, is the first power generation company to fulfil all privatisation obligations.

    Transcorp Power Limited, with an installed capacity of 972 megawatts, was presented with a post-privatisation discharge certificate by the Federal Government, following fulfilment of all privatisation conditions.

    This development means that Transcorp Power will no longer be subjected to post-privatisation monitoring, and it is the first privatised power generation company to achieve this milestone since the power sector privatisation commenced in 2013.

    One of the key targets set for Transcorp is a minimum available capacity of 670 megawatts.

    The Discharge Certificate was presented at the meeting of the National Council of Privatisation (NCP) by the Vice President, Professor Yemi Osinbajo, to Mr. Tony Elumelu, Group Chairman, Transnational Corporation Plc (Transcorp), owner of Transcorp Power.

    Osinbaho, who also doubles as the Chairman of NCP, commented on the ceremony.

    “Post privatisation monitoring is an important aspect of the Federal Government’s privatisation programme.

    “Transcorp Power has been able to ensure compliance and meet the expectations of post privatisation deliverables.

    “I commend Tony Elumelu and his Transcorp team for this feat. I urge Transcorp Group to continue in that path and even do better. This being the first, should not be the last post privatisation discharge event,” he said.

    Elumelu thanked the Federal Government for their trust and confidence in Transcorp.

    “In addition to fulfilling the post privatisation performance criteria, Transcorp has driven a strong indigenous agenda – our plants are managed and fully operated by Nigerians, creating jobs and reducing unemployment in the country.

    “Safety is very important to us as well, since we began operations in 2013, we have recorded zero incidents till date.

    Speaking at the Event, the Director General of the Bureau of Public Enterprises, Alex Okoh, congratulated the Board and Management of Transcorp for the milestones achieved in turning around the enterprise.

    He noted that Transcorp had met and exceeded the performance targets and all other covenanted obligations agreed during the signing of the privatisation agreement in 2013.

    “Transcorp Power increased the generation capacity of the plant by 227 per cent from the operational status as at handover in 2013.

    “Capital expenditure totalling N58.612 billion was covenanted for phase1, phase 2 as ‘additional investment’ but the actual investment made by Transcorp was the sum of N83.85bn, leading up to a score of 143 per cent,” he said.

    Transnational Corporation Plc acquired Ughelli Power Plc (now Transcorp Power Limited) from the Federal Government of Nigeria on November 1, 2013 when the power sector was privatised. At the time of acquisition, the plant had an available capacity of 160 megawatts. Transcorp invested and increased the available capacity to 680.83 megawatts (being a 227 per cent increase) within four years of takeover, surpassing the five-year target of 670 megawatts set by the Bureau for Public Enterprises (BPE).

  • N/Delta Oil Spill: UK’s Supreme Court rules in favour of Shell

    The United Kingdom Supreme Court on Wednesday ruled in favour of Shell, a British multinational oil and gas company, over a 2011 offshore oil spill.

    The apex court ruled that it was too late for Nigerian claimants to sue Shell subsidiaries over a 2011 offshore oil spill.

    The case was one of a series of legal battles Shell has been fighting in London courts against residents of Nigeria’s oil-producing Niger Delta, a region blighted by pollution, conflict and corruption related to the oil and gas industry, Reuters report.

    In December 2011, there were allegations that an estimated 40,000 barrels of crude oil leaked when a tanker was loaded at Shell’s Bonga oilfield, 120 kilometres off the coast of Nigeria’s Niger Delta.

    Shell disputed the allegations and said the Bonga spill was dispersed offshore and did not have adverse effects on the shoreline, according to Reuters.

    A group of 27,800 individuals and 457 communities have made several attempts to drag Shell to court, arguing that the resulting oil slick polluted their lands and waterways, destroying farming, fishing, drinking water, mangrove forests and religious shrines.

    But a panel of five Supreme Court justices unanimously upheld rulings by two lower courts that found they had brought their case after the expiry of a six-year legal deadline for taking action.

    The claimants’ lawyers had argued that the ongoing consequences of the pollution represented a “continuing nuisance”, a type of civil tort, which would have meant the deadline did not apply.

    “The Supreme Court rejects the claimants’ submission. There was no continuing nuisance in this case,” Justice Andrew Burrows said during the ruling.

    While it was two Nigerians that were appellants in the Supreme Court case, the verdict would be applicable to the thousands of other claimants, the report added.

    Shell said the Supreme Court ruling had brought to an end all legal claims in English courts related to the spill.

    “While the 2011 Bonga spill was highly regrettable, it was swiftly contained and cleaned up offshore,” a Shell spokesperson said.