Connect with us

Government

Nigeria Scraps Fuel Subsidy, Cut Petrol Price

Published

on

Nigerian President Muhammadu Buhari

The Nigerian Government announced on Friday that it has scrapped the Petroleum Support Fund, also known as fuel subsidy.

Speaking to journalists at the Port Harcourt refinery where he had spent Christmas inspecting the facility, the Minister of State for Petroleum, Ibe Kachikwu, said the government could no longer pay the subsidy due to the fraud tainting the scheme.

Mr. Kachikwu, who is also the Group Managing director of the Nigerian National Petroleum Corporation (NNPC), also added that the government could no longer afford the payment due to the dip in its revenue, caused by the drop in crude oil prices.

He said a new pricing template he signed off on Thursday effectively removed the payment of subsidy on petrol and that oil marketers would be informed of the development in the coming days.

The official price of petrol is N87 but it is sold for higher prices in many states of the federation.

When pressed on what the new price of petrol would be following the removal of the subsidy, Mr Kachikwu said it would sell for below the current official price, maybe as low as N85 per litre.

“It (new pricing regime) is out,” the minister said. ”I signed off on it yesterday (Thursday). I imagined that in the next couple of days the marketers would get advice on that. The nice thing about the PPPRA, where I signed up on it yesterday is that the price will be far below N87,” he said.

“So for the first time, people will understand that the pricing modulation I was talking about is not a gimmick. It is for real. We have gone to find out how we will be able to fluctuate this market to reflect what the reality of the crude market is. The objective is that one, we cannot afford to continue to subsidise.

“We can’t even understand where those subsidies were going to. There are a lot of fraud elements in it so we need to cut that off.

“The second is the earning capacity of the Federal Government is deteriorating by the day with lower prices of crude and come out more,” he said.

The call for government to scrap the payment of subsidy on petrol has become louder recently following the drop in crude oil prices.

Last week, a leader of the ruling All Progressives Congress and former Governor of Lagos, Bola Tinubu, joined the call for the government to scrap the subsidy regime.

Mr. Tinubu, who had opposed the removal of the subsidy under the administration of former President Goodluck Jonathan, said subsidy was originally a good idea, but it had since been “perverted”.

He, therefore, urged the government to divert the money it is currently paying on subsidy to other social programmes and infrastructure that would have more rewarding impacts on the people.

“In a perfect world, I wish we could sanitize the subsidy regime and thus continue (with) it. However, I have reached the conclusion that there are too many demons in the system for this hell to be converted into good earth let alone heaven,” he said while speaking at the 10th memorial anniversary of left-wing politician and scholar, Bala Usman, in Kaduna.

“I would choose to remove the subsidy and use the money to help people – let us feed our school children, with our local produce promote agriculture, create jobs and start erecting a social safety net for the vulnerable among us in true need,” he added.

On Tuesday, President Muhammadu Buhari told a joint session of the National Assembly that he had directed “the Petroleum Products Pricing Regulatory Agency (PPPRA) to adjust its pricing template to reflect competitive and market driven components” that would keep the price of petrol selling at “N87 per litre for now.”

According to Mr Kachikwu, the President’s comment was informed by the analysis that was done that put the price at below the official price of N87.

“But in applying that where we landed when we did the analysis for the very first time was about N85 or N86 so it is below N87.

“And maybe the first price that will come will reflect it. That was why Mr. President said that prices will be N87 for now. And that is what we have in mind,” he said.

The announcement on fuel subsidy removal came two days after the Nigerian Labour Congress threatened it would vehemently oppose any cut on the subsidy regime.

At the end of its Central Working Committee meeting in Abuja, the NLC said the discordant pronouncements from government officials on plans to cut subsidy was creating panic and confusion in the system, even as it reaffirmed its opposition to any fuel price increase.

An attempt by the government to cut fuel subsidy in 2012 led to what came to be known as the #OccupyNigeria protest.

Nigerians were outraged when in the early hours of January 1, 2012, then President Jonathan announced the removal of subsidy from petroleum products.

The then president’s New Year announcement meant that PMS, which sold for N65 a litre – with subsidy – would go for N141, more than a hundred per cent increase.

This action translated into more than one hundred per cent increase in fares, food, rents and virtually every all goods and services in Nigeria.

Petrol is central to Nigeria’s economy and literally close to every Nigerian’s heart.

Expectedly, that announcement immediately drew Nigerians to the streets, sparking spontaneous protests across the country.

But it soon became clear that the subsidy regime was characterised by monumental fraud.

For instance, to benefit from the 2011 fuel subsidy largesse, some oil companies “manufactured” fictional oil ships (vessels) they claimed traversed seas and oceans of the world carrying imaginary petrol, with Nigeria the final destination of the product, a Technical Committee set up by the Federal Government discovered.

For supplying this phantom product to Nigeria, some seven companies pocketed a princely N13 billion naira from the 2011 fuel subsidy payments, the committee’s report, exclusively obtained by PREMIUM TIMES at the time, showed.

Some other companies, not wanting to create fictional vessels, decided to space- travel existing ones; such that real vessels, which were definitely in countries like China and UAE, were purported to have discharged petrol into storage depots in Nigeria at the exact time they were in those other countries. The 11 companies involved in this category of fraud pocketed N21 billion from the 2011 subsidy payments, the report said.

Sources in the oil industry revealed at the time that those companies were able to perpetuate the crime with the help of field officers of the Petroleum Products Pricing and Regulatory agency (PPPRA) and the Department of Petroleum Resources (DPR), men of the Nigerian Navy, Nigeria Custom officers, banks and others involved in the various stages of fuel importation.

The companies and their owners are still being prosecuted by the Economic and Financial Crimes Commission.

Premiumtimesng

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Continue Reading
Comments

Government

FG Places 3,964 Nigerians on Watch List, Suspends Passports

Published

on

Nigerian passport - Investorsking

No fewer than 3,964 Nigerians are currently on the watch list of the Nigeria Immigration Service.

The names of the affected individuals, it was gathered, have been placed with security agencies at the nation’s international airports where they will be arrested on sight.

According to the 2020 NIS annual report suspect index, 308 persons were placed on the watch list in 2019, 166 in 2020, while 51 persons were stop-listed in two years.

No fewer than 3, 438 passports are also being watch, while 23 are on the exemption list.

The report states, “Suspect index reviews and maintains the list of persons whose entry into Nigeria is prohibited or on whom special instructions are in place with respect to entry and departure from Nigeria. The travel documents are the instruments used to achieve this objective through synergy with other law enforcement agencies and court of competent jurisdiction.”

In a related development, the NIS has revoked 149, 875 stolen or lost passports and uploaded them to Interpol’s Stolen and Lost Travel Documents database via the Web Services for Data Management platform.

Meanwhile, there are indications that the FG may not meet its 2021 revenue projection from NIS services.

Findings show that there might be revenue shortfall from visa; e-PASS, ECOWAS Residence Card, the Combined Expatriate Residence Permit and Aliens Card and other documents issued by the NIS due to the reduced number of foreign visitors and expatriates in the country following COVID-19 travel restrictions.

Immigration sources said the number of Italians, Britons, South Africans, Chinese, Indians, and other Asians, who constitute a large percentage of expatriates in the country, had reduced on account of travel restrictions imposed by their respective countries.

The erstwhile Comptroller-General of Immigration, Muhammad Babandede had said the service recorded a 40 per cent revenue shortfall in 2020 due to the COVID-19 pandemic.

Figures from the NIS showed that in 2018, the immigration service generated N20.3bn from CERPAC; N40.7bn in 2019, and N16.7bn in 2020.

Continue Reading

Government

Envoy Considers Establishment Of Chinese Banks In Nigeria To Boost Economy

Published

on

Chinese Ambassador to Nigeria- Investors king

Mr Cui Jianchun, the Chinese Ambassador to Nigeria, says he is in talks with Chinese owned Banks to establish operations in Nigeria.

This, the envoy said, is to boost Nigeria’s economy and expand trade relations between the two nations.

Cui made this known on Tuesday in Abuja while addressing Journalists during the commemoration of the 2021 Chinese Moon Festival and China-Nigeria Cultural week.

According to Cui, the establishment of Chinese Banks in Nigeria will also be one of the key areas of discussion during the China-Nigeria Binational Committee meeting, which he is also pushing for the establishment.

He said that an efficient financial institution was a key driver to achieving a strong economy, one Nigeria can learn from China’s experience.

“Before my departure from Beijing to Abuja, I talked to several banks in China. When you list the World’s 10 big banks, six are in China.

“The Banking sector is very important, because, without money, we cannot build our industries.

“What I am thinking here is best to talk to the governor of Central Bank and how we can allow the Chinese Banks to run office here and now, they are doing the feasibility studies on that.

“I am working hard that in the Bi-national meeting, I hope we can make a big decision and give a big push to let the banking industry and insurance industry because financial integration and institutions are key.

“If you go to China, you will find our banking industry is very powerful, not only for business but the change in the way of life.

“Because of the COVID-19, the Banking Industry is a little hesitant, but I told them Nigeria has a lot of human resources and as long as we work together, we can do big things.

“And that is why it is important to invest in the banking industry, to solve this problem,” Cui said.

Extolling the extant China-Nigeria trade relations, Cui noted that the volume of trade between China and Nigeria is nearly 20 billion US Dollars, with an increase from 2020’s 19.2 billion dollars.

Cui said the Chinese economy is restoring to the normal post-COVID-19 pandemic and both governments are working hard on how to expand imports and exports.

Speaking on the event, Cui said the China’s moon festival is a very important and significant one for China as it symbolises family reunion, national peace and social harmony.

The envoy said the 2021 celebration is also a special one as it coincides with the 50th Anniversary of China-Nigeria’s bilateral relations.

He said that both countries also share Oct. 1 as their National Days.

He said it is also on that note that the Chinese Embassy is honouring 50 Nigerian employees of Chinese Companies in Nigeria for their outstanding performance and contribution to strengthening diplomatic ties.

Dr Ifeoma Anyanwutaku, the Permanent Secretary, Federal Ministry of Information and Culture, also lauded the Nigeria-China relations.

She said the relations had recorded great successes over the past five decades.

“The five decades of co-operation had since witnessed several cultural activities and exchanges in the spheres of arts, music, dance, exhibition, cultural administration, training and capacity building of cultural officers.

“And recently, the development of Cultural Industries centres in Nigeria, among others.

“I must add that China, through the youth-oriented programmes such as the photos competition and similar activities in the past is surely a dependable ally.

“In redirecting the energy and mind of our youth to creative ventures, thereby furthering the Nigerian government’s policy of lifting a hundred million Nigerians out of poverty in the next 10 years”, Anyanwukatu said. (NAN)

Continue Reading

Government

Lagos Prohibits Open Cattle Grazing, Sanwo-Olu Signs Bill Into Law

Published

on

herdsmen

Lagos State Governor Babajide Sanwo-Olu, on Monday, assented to the bill prohibiting Open Cattle Grazing and Trespass of Cattle on Land, signing the legislation into law 11 days after it was unanimously passed by the State House of Assembly and transmitted to the Executive arm for authorisation.

By implication, it is now criminal in Lagos for cattle rearers to occupy unapproved public areas and private land with their livestock for grazing. The law also prohibits the act of moving cattle round public places by herders.

The signing of the anti-open grazing law by the Governor followed the decision of Southern Governors’ Forum last August, setting the September deadline to pass the law across member States.

There have been crises witnessed in some States, resulting from alleged open grazing.

Although farmer-herder crisis is not pronounced in Lagos, the anti-open grazing law is expected to prevent the spillover of the menace into the State.

Sanwo-Olu, who assented to the bill during the State’s Executive Council meeting in Alausa, directed the security agencies to swing immediately into action and enforce provisions of the law.

He said: “By the powers vested in me as the Governor of Lagos State, I am signing the bill on Open Cattle Grazing and Trespass of Cattle on Land into law to prohibit issues associated with open grazing of livestock.”

The Governor also signed legislation transforming the Lagos State Domestic and Sexual Violence Response Team (DSVRT) into a full-blown agency.

The development coincided with the commemorative month dedicated to raising awareness on gender-based violence in the State. The Governor and members of the State’s cabinet wore attire with purple shades to support the campaign against sexual violence.

The DSVRT legislation provides for the establishment of Sexual Offenders’ Register that would help the State efficiently tackle violations in the communities.

After signing the law, Sanwo-Olu said: “Raising awareness about domestic and sexual violence is an important piece of working to end the cycle of violence. It is important to reiterate the State Government’s zero tolerance to all forms of sexual and gender-based violence. We will not rest on our oars until the menace is reduced to the barest minimum in Lagos.”

The Governor appointed Mrs. Titilola Vivour-Adeniyi as the Executive Secretary of the new agency.

Vivour-Adeniyi was the coordinator of the response team before the legislation was signed into law.

Continue Reading




Advertisement
Advertisement
Advertisement

Trending