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FG Projects GDP Growth of 4.2% by 2017- Adeosun

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Nigeria oil rig

The Federal Government has projected rise in the country’s Gross Domestic Product, GDP, growth to 4.2 percent by 2017.

Minister of Finance, Mrs. Kemi Adeosun, made this projection when she addressed Chief Financial Officers, CFOs, at the just concluded KPMG Professional Services CFO Forum and Survey Launch in Lagos.

In her presentation on the theme; Outlook of the Nigerian Economy, she noted that the country’s GDP for 2015 was the lowest in the last 15 years, at an average of 4 percent.

“Nigeria GDP, growth from 2005 to 2010 was at an average of 9 percent, and everybody was trying to announce about Nigeria saying, how fantastically we have been doing with great money in the economy.

“But we are actually mastering some vulnerability because if you look at the drop from 2010 to 2011, it was an average of 5 percent while oil price was still high.

“There was vulnerability building up in the economy, and this situation has been breeding for quite a while, and then we have the drop in crude price at 2015 and our GDP drop to an average of 4 percent.”

“My administration plan basically is to stimulate the economy to achieve a real GDP growth rate of 4.2 percent by 2017, then reduce the cost of governance, extract efficiencies in the public service and enhance collection of internally generated revenues.

“Also, we want to increase government expenditure on infrastructure, and then we are going to try and fund this budget deficit in the most efficient manner possible.

“There was vulnerability building up in the economy, and this situation has been breeding for quite a while, and then we have the drop in crude price at 2015 and our GDP drop to an average of 4 percent.”

The Minister further lamented that, “the GDP growth, is consumption led, and basically what we are doing is pumping the oil out of the ground and then spending it on import. There is no good gross capital formation in the economy, and without gross capital formation we can’t build our system.

“If the economy is growing because we are buying mobile phone or private jet, it’s actually not good growth, its growth, but it’s not a sustainable growth for the country.”

We are carrying out expansionary on fiscal budget, what do we do, we have come up to 6 trillion, we did that for the following reason, we have two option, as you can see, where we are, we would slide into recession no doubt, if we continue with the size of budget we have.

Also speaking, Partner and Head of Audit, KPMG Professional Services, Mr. Tola Adeyemi added that, the objective of CFOs, “is to provide a platform for them to network and share leading practices, create an additional channel to interact with regulators and senior government officials.”

In attaining the ideal finance function, he stated that “there is need for increasing involvement beyond the traditional roles of measurement and reporting, clear requirements for evolving skills, finance function needs to “earn the respect” of the business and need for additional assurance in a number of areas.

“Also, on creating a sustainable cost advantage, only 6 percent of cost saving initiatives achieves their target and 44 percent achieve less than 50 percent of target savings,” he added.

He lamented that the biggest barriers are usually, inadequate processes to drive cost reduction, resistance from employees and insufficient incentives to reward prudent cost management responsibility for cost management is not always clear.

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.

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Economy

Removal of Petrol Subsidy: NGF to Dialogue With Labour Unions Over Strike Threat

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Petrol - Investors King

The Nigeria Governors’ Forum (NGF) under the chairmanship of Dr Kayode Fayemi has said it will meet with the  Nigerian Labour Congress (NLC) and the Trade Union Congress(TUC) to discuss the removal of petrol subsidy.

The announcement of the minister of finance, Zainab Ahmed in November, 2021 that fuel subsidy will be removed in 2022 has birthed reactions from citizens and organised labour unions are threatening to embark on strike.

The federal government, however, promised that N5000 will be given monthly to poor Nigerians as a transportation grant while the subsidy is removed but the decision did not go down well with the unions, hence the strike threat.

Addressing newsmen after the forum meeting, the NGF chairman and governor of Ekiti State, Kayode Fayemi stated that the 36 states governors discussed major national issues, of which the removal of petrol subsidy was one.

Fayemi noted that on the fuel subsidy, the forum has decided to dialogue with the leadership of the labour unions with the aim of drawing a conclusion that will not affect the people and the Nigerian economy.

In his words, “we discussed the issue around petroleum subsidy and concluded to engage the leadership of the Nigerian Labour Congress (NLC) and the Trade Union Congress.

“We will engage them on how best to address this issue without causing any disaffection but with a view to salvaging the Nigerian economy for the Nigerian people at the end of the day.

“So, we shall be engaging the NLC as sub-national leaders and with a view to ensuring that the outcome of our engagement will also be fed into the national discourse.”

Fayemi further said that the recommendation of the National Economic Council (NEC) that the price of petrol should be N302 per litre, was not the decision of the governors forum but the responsibility of the federal government.

He hinted that the governors got a presentation from the Presidential Enabling Business Environment Council (PEBEC) on business growth and ease.

“The presentation elaborated on the need to step up the reforms towards improving the investments and business climate at the sub-national level,” Fayemi said.

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How Shell’s Exit Cost Nigeria $178bn Loss – Ogoni Group

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Since the Royal Dutch Shell Petroleum Development Company (SPDC) exited Ogoniland, Rivers State, in 1993, Nigeria has suffered a total loss of $178.85 billion or N72 trillion.

Members of the Movement for Survival of the Ogoni People (MOSOP) disclosed this on Wednesday in Port Harcourt. The group blamed the federal government for mismanagement of funds, resources and the ensuing violence since the company’s exit from the land.

Shell, which began operation in Ogoniland in 1958, revealed that it drilled 96 wells to bring nine oil fields onstream. By the end of 1992, oil production from the region stood at 28,000 barrels of oil a day, about 3% of SPDC’s total production.

Sadly, the yield in production did not match the development of Ogoniland as its people suffered extreme oil pollution both on land and water.

However, after years of campaigning for greater control over oil and gas resources in the region to aid economic development and autonomy of their affairs, (including cultural, religious and environmental matters), MOSOP demanded that the petroleum company leave its land. Since then, SPDC no longer produced oil or gas from Ogoni fields. Nevertheless, Ogoni land continued to serve as a transit route for pipelines, transportation of both SPDC and third-party oil production from surrounding areas.

In his statement, while addressing the MOSOP Congress in Bera, Gokana Local Government Area of the state, factional head of the Ogoniland group, Fegalo Nsuke, stressed that the $178.85 billion loss in Nigeria’s revenue was from “oil revenue alone”.

According to him, the loss Nigeria has however procured from gas “are inestimable due to non-availability of statistical evidence,” and that Ogoni gas potentials and revenue generation capacity far exceeded that of its oil.

Nsuke gave further details saying that “Ogoni oil production stood at 350,000 barrels per day before the exit of Shell in 1993. At an estimated average $50 per barrel, Nigeria has lost some $178.85 billion for mismanagement of the Ogoni crisis”. He clarified that this fact is based on available evidence from the oil industry.

Blaming the government for mismanagement of the crisis in Ogoniland, Nsuke said that the government, “Rather than listen and engage with the people… opted for a repressive approach of killing, maiming and torturing, thus exacerbated and prolonged the conflicts.”

The group further appealed to the government “to accept the offers by MOSOP for implementation of an Ogoni Development Authority to pave way for peaceful resolution of the conflict. The continual delay by relevant agencies of government to accept the Ogoni demands and reach a deal with the Ogoni people does not only amount to economic sabotage but represents a threat to the security of the country.

“Money runs the government and so when those in government fail to take advantage of opportunities to resolve issues that affect the national economy, it does not only amount to sabotaging the economy but is also a threat to national security.

“The inability of decision makers to peacefully resolve the Ogoni crises in over 28 years leading to the loss of over $178 billion amounts to sabotaging the economy and national security,” he added.

The group factional leader further assured the Ogonis of MOSOP’s commitment to Ogoniland’s development, urging them to remain peaceful as the leadership of the movement, still committed, will continue to push forward the proposals for a peaceful resolution of the conflicts and the vision of the struggle.

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Implementation of 0.5% GDP on Technological Innovation Will Enhance National Socio-economic Devt– Onu

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Tech Hub - Investors King

The Minister of Science, Technology and Innovation, Dr. Ogbonnaya Onu has stated that the application of 0.5% Gross Domestic Product (GDP) on technological innovation will boost socio-economic development in the nation.

Onu affirmed that the implementation of 0.5% GDP will bring about sustainable economic growth and industrial revolution.

He disclosed this on Tuesday, at the consultative meeting on the provision of a minimum of 0.5% of GDP to fund science, technology and innovation sectors in the country, held in Abuja.

Investors King recalls that at the 2021 edition of the Annual STI Expo, President Muhammadu Buhari stated that 0.5% of the country’s GDP will be used for the development of STI as a measure to grow the nation’s productivity and economy. 

The minister noted that the ministry is strategising for its attainment which will improve creativity, innovation and development of the nation.

“Countries that have made giant strides in sustaining their economy invest heavily in STI Sectors, which has guaranteed their continuous growth as well as sustaining their industrial growth.

“The decision to increase the nation’s STI funding was taken at the African Union’s executive council in 2006 to establish a target for all member states to allocate at least 1% of the GDP investment in research and development,” Onu said.

In his remarks, the Minister of State, Barr. Mohammed Abdullahi stated that STI should be prioritised and properly funded in order to reap its benefits.

Abdullahi enjoined Nigeria to deliberately invest heavily in STI, adding that such step will boost the nation’s economy tremendously as done in some Asian countries like China, Singapore

“The Federal Government has resolved to allocate 0.5% to R&D sector in a bid to fully actualise her diversification agenda, as part of its effort to put the country on the pedestal of global competitiveness,” he said.

At the event, all the Commissioners of Science, Technology and Innovation from the 36 states of the nation, including the FCT as well as heads of agencies and directors in the ministry were present.

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