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Economy

N’Assembly Approves MTEF, Raises Oil Benchmark to $44.5

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  • N’Assembly Approves MTEF, Raises Oil Benchmark to $44.5

The two chambers of the National Assembly on Wednesday finally approved the revised version of the 2017-2019 Medium Term Expenditure Framework and Fiscal Strategy Paper.

The Senate approved all the critical projections in the MTEF/FSP as proposed by the executive, except the oil benchmark, which was increased to $44.5 a barrel from the proposed $42.5.

By the provision of the Fiscal Responsibility Act, 2007, the MTEF must first be approved by the legislature before the budget is considered and passed.

Wednesday’s approval of the MTEF/FSP meant that the Senate and House of Representatives would open debate on the budget as planned on January 24.

The Senate adopted the proposals as recommended by its joint Committee on Finance, Appropriations and National Planning in its report, which was presented to the lawmakers at Wednesday’s plenary.

President Muhammadu Buhari had in October 2016 sent the MTEF/FSP to the Senate to serve as the foundation for the 2017, 2018 and 2019 national budgets.

The President had also on December 15 last year presented the 2017 Appropriation Bill to the National Assembly, with a total estimate of N7.298tn. The legislature has yet to work on the budget due to the delayed passage of the MTEF/FSP.

Deputy President of the Senate, Senator Ike Ekweremadu, who presided over Wednesday’s plenary, described the passage of the document as a very important step towards the passage of the 2017 budget proposal.

He said, “Hopefully, if we pass this MTEF/FSP, we will be in the position to comment on the consideration of the 2017 budget proposal by next week. It is, therefore, important that we conclude the discussion on this subject and ensure that it is passed today.

“Having listened to the comments, it appears to me that the only area that needs to be emphasised is the issue of the exchange rate. We are worried with the huge gap between the parallel market and the official market, and as it has been said by the Chairman of the Appropriations Committee that the Central Bank of Nigeria needs to do something about it, because it is one thing that is breeding corruption.

“We must find a way of bridging that gap and also stabilise the exchange rate so that investors can do their own forecast in terms of their investments. We believe that something needs to be done in the area of the exchange rate.”

The committee, in its report, recalled that daily oil production had been projected to average 2.2 million barrels per day, 2.3mbpd and 2.4mbpd for 2017, 2018 and 2019, respectively.

On the oil benchmark price, the report noted that the price of crude oil in the international market fell to as low as $25 per barrel mid-January 2016, with an increase to more than $50 per barrel in October of the same year.

The committee also said while it approved the projected exchange rate of N305 per dollar for the 2017 fiscal year, “a judicious monetary fiscal policy mix and deliberate government policies to expand the productive base of the economy will be expedient to improve the exchange value of the naira relative to the dollar.”

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.

Economy

Nigeria Sovereign Investment Authority Generates N160.06 Billion in 2020

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Naira Exchange Rates - Investors King

The Nigeria Sovereign Investment Authority (NSIA) generated revenue of N160.06 billion in 2020, according to the latest audited financial reports announced by the Managing Director of NSIA Mr. Uche Orji.

The NSIA income came from devaluation gain of N51 billion, and core income of N109 billion compared to N33.07 billion in 2019.

But Orji lamented: “Covid-19 adversely affected logistics around infrastructure projects, especially the toll road projects and the presidential fertiliser initiative.

Despite the pandemic, the Authority achieved 33 percent growth in Net Assets to N772.75 billion compared to the previous year’s performance of N579.54 billion.

Orji said the NSIA “received additional contribution of $250 million; and provided first stabilisation support to the Federal Government of $150 million withdrawn from Stabilisation Fund last year.”

The same year, the NSIA received $311 million from funds recovered from the late General Abacha from the United States Department of Justice and Island of Jersey for deployment towards the Presidential Infrastructure Development Fund (PIDF) projects of Abuja-Kaduna-Kano Highway, Lagos Ibadan Expressway and Second Niger Bridge.

In response to COVID-19, Orji said: “NSIA partnered the global Citizen, a not-for profit group, to form the Nigeria Solidarity Support Fund. Separately NSIA acquired and distributed oxygen concentrators to the 21-teaching hospital as part of corporate social responsibility; in addition to staffing support to the Presidential taskforce on COVID-19.”

In 2020, the NSIA “invested additional capital into NG Clearing, the first derivative clearing house in Nigeria to maintain NSIA’s shareholding at 16.5 per cent following the company’s rights issue of 2020″ Orji said.

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Economy

EFCC Recovers $153m, 80 Assets from Diezani, Says Bawa EFCC Chairman

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Diezani Allison-Madueke - Investors King

The Chairman of the Economic and Financial Crimes Commission (EFCC), Abdulrasheed Bawa has said the commission recovered $153 million and 80 properties from the former Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke.

Bawa said: “There are several cases surrounding that. As you may have read, I was part of that investigation, and we have done quite a lot. In one of the cases, we recovered $153 million; we have secured the final forfeiture of over 80 properties in Nigeria valued at about $80 million.

“We have done quite a bit on that. The other cases as it relates to the $115 million INEC bribery as the media has sensationalised it, is also ongoing across the federation.”

We are looking forward to the time when we will, maybe, have her in the country, and of course, review things and see what will happen going forward. The case has certainly not been abandoned.

Speaking on the trial of former Abia State Governor Orji Uzor Kalu, he said his trial will start soon in Lagos.

Bawa added: “The position is very clear. The EFCC succeeded in 12 years to get him convicted at the Federal High Court. Of course, he went to the Supreme Court, and because the judge that convicted him has been elevated, the ruling was made and the EFCC as a respecter of the rule of law, we have taken it as it is. The Supreme Court has ordered that we should go back to the Federal High Court in Lagos.

“Now, we are at the Federal High Court in Abuja, and we have applied to the court for the case to be transferred to Lagos as ordered by the Supreme Court to enable us start all over again.

“It, however, draws a precedence, and those are the issues; law as the lawyers will say, is a living thing; we had the ACJA in 2015, we have had this problem of elevation of judges from High Court to Court of Appeal, and we pushed that they should be given the opportunity to finish their cases, because some of these cases have taken a very long time.

“We thought we had succeeded in getting this in ACJA, The law was, however, not seen as such. Now, we may have to solve the problem from the constitution, and then, we will be home and dry.”

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Economy

Nigeria Consumes 93m Litres of Petrol Daily in April 2021

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Petrol - Investors King

Nigeria’s daily petrol consumption rose to a record-high of 93 million litres in April 2021, according to the latest data from the Nigerian National Petroleum Corporation (NNPC).

The amount represents 77 percent of the 120.80 million litres consumed daily in West Africa despite having just 52 percent of the region’s population.

In previous months, Nigeria consumed 61 million litres on average, therefore, the NNPC stated that the 93 million litres per day consumption is unsustainable.

The sudden surged in petrol consumption was a result of smuggling, according to experts.

There is no doubt that Nigeria’s present petrol consumption is embarrassing, due to smuggling which is currently a thriving business,” Mike Osatuyi, national operations controller, Independent Petroleum Marketers Association of Nigeria.

On the allegation that marketers illegally export petrol, Osatuyi asked why the five security agencies across the borders are unable to stop it.

Smuggling of petrol across the borders is becoming more intense as Nigeria inches closer to full deregulation, one stakeholder said. Despite over 95 million Nigerians in poverty, the country inadvertently pays for cheap petrol across West Africa.

It means Nigeria is financing the economies of neighbouring countries,” Osatuyi said. “Nigeria should not be consuming more than 50 million litres per day.

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