The President of the Senate, Bukola Saraki, on Tuesday itemised measures he said the Executive must take to take Nigeria out of recession.
The measures include the partial sale of the Nigeria LNG Limited and the reduction of government shares in upstream oil joint venture operations.
He also recommended the sale of government’s stakes in financial institutions like the Africa Finance Corporation and the privatisation and concession of major/regional airports and refineries to private operators.
According to him, the current economic recession transcends political parties, as well as religious and socio-cultural divides.
The Senate president noted that the economic problem facing the nation was a collective problem and should be treated as such.
He stressed that the Executive must begin to take steps to show not only Nigerians but the international community as well as local and foreign investors that the nation was ready to reform and do business.
Saraki said, “The Executive must immediately put in place a leadership-level engagement platform with the private sector. This must be one that is pro-business and shows unequivocally that the government is ready to partner the private sector towards economic revival. This is a critical signpost towards market confidence, which is a key ingredient to help us revamp the economy out of recession.
“The Executive must raise capital from asset sales and other sources to shore up the foreign reserves. This will calm investors, discourage currency speculation and stabilise the economy.
“The measures should include part sale of the NLNG Limited; reduction of government’s shares in upstream oil joint venture operations; sale of government’s stake in financial institutions e.g. Africa Finance Corporation; and the privatisation and concession of major/regional airports and refineries.”
The Senate President also insisted that the Executive should consider tweaking the pension funds policy within international best practice safeguards to accommodate investment in infrastructure and mortgages.
He stated, “The Executive and CBN must agree on a policy of monetary easing to stimulate the economy and harmonise monetary and fiscal policies until economic recovery is attained. We must ensure that local government borrowing does not crowd out credit for the private sector.
“The Executive must re-tool its export promotion policy scheme with export incentives such as the resumption of the Export Expansion Grant; and introduce export-financing initiatives. The Executive is urged to engage in meaningful dialogue with those aggrieved in the Niger Delta and avoid an escalation of the conflict in the region.
“The National Assembly is very ready to play any role in the process and offer ideas on approaches that will deliver quick win-win in order to move the region and the economy forward.
“The Executive must as a deliberate response consider immediate release of funds to ensure the implementation of the budget for the near short term to inject money into the economy.”
However, the Nigeria Labour Congress and the Trade Union Congress faulted the call by Saraki and other prominent Nigerians for the sale of some national assets.
The General-Secretary, NLC, Dr. Peter Ozo-Eson, and President, TUC, Mr. Bala Kaigama, stated this in separate telephone interviews with our correspondents on Tuesday, while reacting to the call.
Ozo-Eson and Kaigama said that those in the forefront of the move to sell the national assets were being motivated by a desire to acquire them.
Ozo-Eson advised the key players in the President Muhammadu Buhari administration to avoid taking advantage of the economic situation to loot the remaining national assets in the country.
He insisted that acquisition of national assets by those in power was partly responsible for the current economic situation in the country.
He added that selling the NLNG, airports and other assets would only compound the nation’s economic woes as had been demonstrated by the woeful performance of the power sector.
The NLC general-secretary said, “Selling national assets is not going cure the economy. Part of the crisis we are in is as a result of the national assets they distributed to themselves.
“They should not use the economic situation as a pretext for looting what is left of the public assets. Selling the NLNG, airports and all those other assets will not be the way to bail out the economy from this crisis. It will rather compound it as has been demonstrated by what they did with power, and other assets.
“We are opposed to the sale of those assets because they just want to take them over the way they have taken over the power sector and it is not functioning. So, that cannot be the excuse. We are opposed to it. What we will do if they go ahead is a matter that we will discuss at that point in time.”
Kaigama said that those behind the clamour for the sale of the national assets would only distribute them to their cronies.
He said that the administration should concern itself with the provision of a road map to get the economy out of recession rather than the ploy to sell the assets.
Kaigama stated “Well, I don’t know what they mean by that because these are very vital national assets. Are they saying that as soon as we sell these assets, we will be out of recession?
“Otherwise, why don’t we work out a plan that will get the economy out of recession and not this kind of fire brigade approach? Obviously, that is what it is going to head to because they will sell them to their cronies. The TUC is not in support of this.”
Rather than sell the assets, the Federal Government should borrow from the International Monetary Fund, according to the Revenue Mobilisation, Allocation and Fiscal Commission.
The Acting Chairman of RMAFC, Mr. Umar Gana, said this in a statement made available in Abuja on Tuesday.
Gana said the opinion of the agency was different from that of business mogul, Alhaji Aliko Dangote, who had in an interview with a cable television, CNBC Africa, advocated the sale of NLNG and other federation assets as a way of augmenting government revenue shortfall as a result of the current economic recession.
He said, “It is the considered view of the commission that Nigeria’s assets such as the NLNG and other strategic national resources should not be sold to meet short-term financial obligations.
“It will be recalled that the Governor of the Central Bank of Nigeria indicated in a media report that the sum of $10bn would be realised from the sale of these assets. The commission is of the strong opinion that the same amount could be borrowed from the IMF and the revenue from these assets could be used to amortise the loans over an agreed period.
“It should be noted that after the amortisation of the loans, those assets would still be owned by the federation in addition to their regular dividends and revenues.”
Gana argued that it would be unwise for the Federal Government to dispose of its crown jewels that were generating revenues that keep the Federation Account healthy over the long-term.
He said since the assets were generating revenues, the government could borrow from the IMF and amortise the loan with revenues emanating from the assets.
Gana also counselled that instead of selling off vital assets generating funds for the federation, wealthy Nigerians should be encouraged to set up their own liquefied natural gas projects since was blessed with abundant natural gas reserves.
Complete Text of President Buhari’s Speech at the Furniture Investment Initiative Summit
President Muhammadu Buhari is one of the global leaders invited to speak at the ongoing 5th Future Investment Initiative Summit organised by Saudi Arabia.
As reported by Investors King, President Buhari arrived Riyadh, Saudi Arabia, on Monday at about 11.50 pm for the summit.
On Tuesday President Buhari delivered the speech below.
“Let me begin by conveying my heartfelt gratitude and appreciation to the Custodian of the Two Holy Mosques, King Salman Bin Abdulaziz Al-Saud for inviting me to the 5th edition of the Future Investment Initiative Summit in Riyadh.
In the short period of its existence, this summit has emerged as a credible forum for interaction between the public and private sectors, to explore ways of advancing economic growth, development and global prosperity.
I wish to commend the organizers of this year’s summit for the foresight to look at “investment”, not only from a profitability and wealth accumulation point of view, but also bringing prosperity to humanity in general. The humane approach to investment is the only way to address the global challenges we face, especially in the Covid-19 era.
We should continue to sustain our efforts to combat the COVID- 19 pandemic and mitigate its negative socio-economic impact on our societies, build resilience and achieve recovery. It is therefore my hope, that this session will leverage on the enormous economic opportunities that lie ahead in order to satisfy the prevailing needs of our people and planet.
Investing in humanity is investing in our collective survival. This is why we in Nigeria we believe that public and private partnership should focus on increasing investments in health, education, capacity building, youth empowerment, gender equality, poverty eradication, climate change and food security. By so doing, it will go a long way in re- energizing the global economy in a post COVID-19 era.
Nigeria’s population today exceeds 200 million people. Some 70 percent are under 35 years old. When we came into government in 2015, we were quick to realise that long-term peace and stability of our country is dependent on having inclusive and humane policies.
In the past six years, our government took very painful but necessary decisions to invest for a long-term prosperous future knowing very well that this will come with short term pains.
We focused on the following areas:
a. diversification from oil to more inclusive sectors such as agriculture, ICT and mining;
b. tackling corruption, insecurity and climate change; and c. introducing a Social Investment Program.
We introduced policies that supported investments in agriculture and food processing. We provided loans and technical support to small holder farmers, through the Anchor Borrowers Program. As a result, Nigeria today has over 40 rice mills from less than 10 in 2014. Nigeria also has over 46 active fertiliser blending plants from less than 5 in 2014.
Furthermore, in agriculture, we have reformed the process of obtaining inputs such as fertilizer and seeds. We have several million hectares of available arable land and have embarked on the creation of Special Agriculture Processing Zones across the country. These initiatives we believe will make it easier for investors in agriculture.
Two months ago, I signed the Petroleum Industry Act. The Act will serve as a catalyst to liberalize our petroleum sector. It has introduced a number of incentives such as tax holidays, 100 percent ownership, zero interest loans and easy transfer of funds. In addition, we have highly skilled in-country workforce and a large domestic market.
In mining, we have also made several opportunities available for investors. Nigeria is a country rich in minerals from gold, iron ore, tin, zinc, cobalt, lithium, limestone, phosphate, bitumen and many others. We have made the licensing process easier and also made extensive investments in rail and transportation.
Infrastructure investments represent significant potential for investors in Nigeria. We have opportunities in seaports, rail, toll roads, real estate, renewable energy and many others. We have created several institutions that are available to co-invest with you in Nigeria.
We have the Nigeria Sovereign Investment Authority and more recently, I approved the creation of Infrastructure Corporation of Nigeria. These institutions are run as independent world class institutions to make investments in the country and are available to co- invest with you.
In addition, the development of social infrastructure such as healthcare and education present enormous opportunities for investors in a country our size.
Digital Economy in Nigeria has many potentials for investment, as it has remained the fastest growing sector in both 2020 and 2021. Nigeria has many opportunities for investment in broadband, ICT hardware, emerging technology and software engineering.
We have recently approved the national policy on Fifth Generation (5G) network. Our aim is to attract investors in healthcare, smart cities, smart agriculture among others. The benefit of real time communication will support all other sectors of the economy.
Yesterday, I launched the E-Naira, the electronic version of our national currency, which puts us on track to become the first African country to introduce a Central Bank Digital Currency. We believe this and many other reforms, will help us increase the number of people participating in the banking sector, make for a more efficient financial sector and help us tackle illicit flow of funds.
To further strengthen our anti-corruption drive, increase accountability and transparency, we have centralized government funds through a Treasury Single Account, and ensuring that all Nigerians with a bank account use a unique Bank Verification Number (BVN). These initiatives, coupled with our nationwide National Identification Number (NIN) exercise, reinforce our efforts to tackle corruption and fraud. We believe that this should give investors a lot of comfort.
As we strive to build resilience towards a sustainable economy in our various countries, let us not forget the negative impact of climate change on our efforts to achieve this goal. Nigeria and many countries in Africa, are already facing the challenges posed by climate change. Climate change has triggered conflicts, food insecurity, irregular youth migration, rising level of sea waters, drought and desertification, as well as the drying-up of the Lake Chad.
In the Lake Chad Basin region, where Boko Haram insurgency continues to undermine the peace, security and development of the region, climate change is largely responsible for the drying up of the Lake Chad which has shrunk by more than 85% of its original size.
The diminishing size of the Lake is at the root of the loss of millions of livelihoods, displacement of inhabitants and radicalization of teeming youths in the region who are recruited to serve as foot soldiers in the insurgency.
In order to redress this situation and restore the lost fortunes of the Lake Chad Basin region, strong public-private partnership through massive investments will be needed to recharge the waters of Lake Chad. I am confident that this forum will rise to the challenge in the interest of durable peace and sustainable development of our region.
We cannot invest in humanity without relieving our countries from the crushing effects of the debt burden especially when the COVID-19 pandemic has increased the risk of deepening the debt portfolio of poor countries. These nations increasingly allocate more and more resources towards external debt servicing and repayment at the expense of the health, education and other services that contribute to the overall well- being of their population.
Nigeria is Africa’s largest economy and most populous nation. Our economic reforms which focus on “humane” investments are ideal for investors looking to have profitable returns while positively impacting the citizenry.
Your Excellencies, Distinguished ladies and gentlemen, Investing in Humanity is the right thing to do. I strongly believe the historical under- investments in “humane projects” is the genesis of most of the insecurity and socio-economic challenges the world is experiencing today.
I will conclude once again by thanking the Custodian of the Two Holy Mosques, King Salman Bin Abdulaziz Al-Saud, and also congratulate His Royal Highness, Crown Prince Mohammed Bin Salman for their leadership and their support through the Future Investment Initiative.
I remain confident that through such exchanges, the world indeed will be a better place. I hope and pray that this forum will rise to the challenge in the interest of durable peace and sustainable development.
I thank you.”
UN and Zimbabwe Sign New Cooperation Framework
The government of Zimbabwe and United Nations have signed the 2022-2026 Zimbabwe United Nations Sustainable Development Cooperation Framework that will support the country’s efforts to achieve Sustainable Development Goals (SDGs).
The official signing and launch of the Zimbabwe United Nations Sustainable Development Cooperation Framework 2022-2026 was presided over by the Chief Secretary to the President and Cabinet, Dr Misheck Sibanda and UN Resident Coordinator Maria Ribeiro. UNESCO Regional Director for Southern Africa, Prof. Hubert Gijzen witnessed the signing ceremony together with other UN Country Team members and Government officials.
Speaking at the signing ceremony, Dr Misheck Sibanda said Zimbabwe was grateful for the UN support towards the country’s development in the face of various challenges.
“I want to pay gratitude to Ms Maria Rebeiro for her commitment to uplift the livelihoods of the people of Zimbabwe in the face of natural disasters like the cyclone, droughts and the COVID-19 pandemic,” Dr. Misheck Sibanda.
He took the opportunity to bid farewell to Ms Rebeiro whose term of office ends this year and urged the UN team to continue with the legacy of her hard-work which saw the UN mobilise US$400 million towards promotion of agriculture, climate adaptation and health needs for Zimbabwe.
The UN Resident emphasised the importance of aligning the UN’s programmes with the country’s development strategies.
“In the same spirit of achieving SDGs, climate change, the COVID-19 pandemic are opportunities for us to do better by aligning the country programmed NDS1 with instruments of the UN in resource and financial mobilisation,” Ms. Maria Ribeiro.
The 2022-2026 Zimbabwe United Nations Sustainable Development Cooperation Framework (ZUNSDCF) articulates the strategic engagement of the United Nations Country Team (UNCT) in Zimbabwe to support the country to achieve the Sustainable Development Goals (SDGs).
Anchored on Zimbabwe’s National Development Strategy 1 (NDS1) 2021-2025, the ZUNSDCF encapsulates the shared commitment to leaving no one behind through delivering concrete results that ensure inclusive participation and reaching the people typically left the furthest behind.
The ZUNSDCF with full government ownership throughout the process, is a result of extensive consultations involving a wide range of key stakeholders whose inputs contributed to defining the strategic priorities and implementation modalities.
The ZUNSDCF lays out an ambitious programme to accelerate development progress during the Decade of Action as Zimbabwe strives to recover better and stronger from the impacts of the COVID-19 pandemic.
Fully cognizant of the urgency to act, the ZUNSDCF represents the vehicle through which the UNCT in partnership with the Government of Zimbabwe and other stakeholders, will deliver transformative support that drives inclusive and sustainable economic growth, gender equality, human rights and climate action.
Fiscal Federalism: Lagos Demands One Percent in Revenue Allocation Formula
Lagos State Government on Monday demanded a one percent share in the revenue allocation formula, maintaining that the special status of the State and its prosperity directly or indirectly have multiplying effects on the South-West region and the entire country.
Lagos State Government also proposed that the revenue sharing formula should be 34 percent for Federal Government including one percent for FCT – Abuja, 42 percent for State Governments, 23 percent for Local Governments and one percent for Lagos State (Special Status) as against the current revenue allocation formula, which are 52.68 percent, 26.72 percent and 20.60 percent for Federal Government, 36 state governments and 774 local governments respectively.
The demands were made by Lagos State Governor, Mr. Babajide Sanwo-Olu at the opening of a two-day South-West Zonal Public hearing on the review of revenue allocation formula by the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) held on Monday at Lagos Continental Hotel, Victoria Island.
Governor Sanwo-Olu in a memorandum on review of Revenue Allocation Formula he submitted to the RMAFC declared that allocating one percent for Lagos State (Special Status) and allowing the three tiers of government to share 99 percent in a new revenue sharing formula is very straightforward, self-justifying and in no way controversial.
He said the review of the current revenue allocation formula is long overdue, noting that the best way to guarantee national progress and development is by paying attention to sub-national development because the national is a summation and a reflection of the sub-national.
He also reiterated the call for Lagos State to be accorded special status in recognition of its huge financial commitments to infrastructure and provision of basic amenities for the increasing population of its residents, as well as its preeminent contribution to the national coffers.
He said the call, which has been re-echoed at different fora and at various levels and tiers of government, cannot be overemphasized, especially against the backdrop of the current economic situation of the country, the aftermath of the EndSARS protests a year ago, and the devastating effects of the COVID-19 pandemic, for which Lagos has been the national epicenter.
“Our demand is a sharing formula that is just, fair and equitable; reflecting the contribution of stakeholders to the common purse, and also one that enhances the capacity of state and local governments to deliver high-quality services and the full dividends of democracy to the greatest number of our people.
“Lagos State is no doubt the nation’s commercial capital, and population center. The level of funding required to service the State’s social and public infrastructure is so significant that it will be difficult for the State to bear the burden for much longer under the present arrangement.
“I should say that it will actually be unfair to expect the State to bear this heavy burden on its own. It is, therefore, necessary to give due consideration to all the variables that support our advocacy for a Special Status.
“The call for a special status for Lagos is not a selfish proposition; it is in the best interest of the country and all Nigerians, for Lagos which accounts for about 20 percent of the national GDP and about 10 percent of the nation’s population to continue to prosper,” the Governor said.
Justifying the need for Lagos State to be accorded special status, Governor Sanwo-Olu said Lagos is more than just another state in the Nigerian federation, noting that there is no tribe in the country that has no significant stake in Lagos State.
He said: “As the former capital of the country for 77 years (compared to the 30 years that Abuja has been the Federal Capital Territory), Nigeria’s largest metropolis still bears the heavy brunt of being home to all Nigerians; irrespective of age, class, gender, religious affiliation or tribe.
“There are several statistics that show the number of people that comes into Lagos every day, however, there are clear indications that most of these people migrate with the intention to make Lagos their new home and in pursuit of personal dreams due to the opportunities the city-state seemingly possesses, and this portends additional responsibilities on the government.
“Additionally, Lagos still harbors a huge number of federal establishments which could not be moved to Abuja. These include military cantonments and barracks, Police, Customs, Immigration, Civil Defence, Prisons, Road Safety and security/intelligence establishments.
“There are several reasons to justify the call for a special status for Lagos apart from the aforementioned factors and by extension, a review of the Revenue Allocation Sharing Formula.”
Governor Sanwo-Olu also said that it would be unfair for Lagos State to be left alone to bear the burden of the massive destruction experienced by the State during the EndSARS protests hijacked by hoodlums and the COVID-19 pandemic without assistance from the Centre.
“This month marks one year after the massive destruction experienced by the State in the violence that accompanied the hijacking of the EndSARS protests. Public buildings were burnt down, and historical infrastructure was destroyed.
“Although we have put that experience behind us and forged ahead, the reality of this unfortunate incident remains with us; resources that should be committed to other areas of need are now being used for the restoration of these public facilities. It will be totally unfair for Lagos State to be left alone to bear these huge expenses without assistance from the Centre.
“COVID-19 pandemic is another issue that has once again, supported the justification for Lagos to be accorded the privilege of special status. As much as this affects the entire country, it is a fact that the degree of the havoc caused by this virus differs from State to State.
“Lagos was the epicenter for this virus, the same way it was for the Ebola virus some years ago. The management of these unforeseen occurrences comes with huge responsibilities and financial commitments on the part of the State Government,” he said.
Governor Sanwo-Olu commended the Chairman and members of RMAFC for taking a bold step, which he believed will “result in a fundamental alteration of the current revenue sharing formula, in favour of one that is truly fair and equitable, and that takes into full consideration the specific and more pragmatic fiscal contexts of the sub-national governments of the Federation.”
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