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States Generated N3.5tn IGR in 66 Months – NBS

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  • States Generated N3.5tn IGR in 66 Months

A total sum of N3.5tn was earned as Internally Generated Revenue by the 36 states of the federation within a 66-month period from January 2011 to June of 2016, figures obtained from the National Bureau of Statistics have revealed.

An analysis of the states’ IGR report made available showed that the IGR of the 36 states recorded a sharp increase between 2011 and 2013, after which it declined steadily up to 2016.

For instance, the sum of N499.08bn was earned by the states in 2011. The figure rose to N567.99bn and N800bn in 2012 and 2013, respectively.

However, in 2014 and 2015, the states’ combined revenue dropped by N92.15bn and N25.18bn to N707.85bn and N682.67bn, respectively.

For the first half of 2016, the report stated that the sum of N317.7bn was generated by 29 states as IGR, adding that seven states had yet to report their half-year IGR figures. The states are Abia, Anambra, Bauchi, Ebonyi, Oyo, Rivers and Sokoto.

The NBS stated in the report that the IGRs were generated from five main sources.

They are Pay-As-You-Earn; direct assessment; road taxes; Ministries, Departments and Agencies of government; and other revenues.

The IGRs made by the states excluded the monthly allocations, which they received from the Federation Accounts Allocation Committee.

Further analysis of the revenue showed that Lagos State, with a total of N1.35tn generated in the 66-month period, led the IGR collection chart.

The N1.35tn, when further broken down, showed that the state earned N202.76bn in 2011; N219.20bn in 2012; while the sums of N384.25bn, N276.16bn and N268.2bn were generated as IGR in 2013, 2014 and 2015, respectively.

For the first half of last year, Lagos State raked in N150.59bn as IGR.

Rivers State followed on the revenue chart with a total collection of N377.54bn within the period.

The amount was earned as follows: N52.71bn in 2011; N66.27bn in 2012; N87.91bn in 2013; N89.12bn in 2014; and N82.1bn in 2015.

The state has yet to submit its IGR figure for 2016 to the NBS.

Ogun State, according to the bureau, came third by generating a total sum of N145.1bn in the period. It was able to grow its IGR from N10.8bn in 2011 to N56.2bn by 2016

On the other hand, the report stated that Nasarawa, Ekiti and Borno states, with sums of N22.72bn, N17.61bn and N15.49bn, generated the lowest revenue within the period.

Further analysis of the report revealed that Benue State’s IGR decreased from N11.13bn in 2011 to N7.63bn in 2015, while the revenue for the first six months of 2016 was put at N8.89bn.

The IGR for Kogi State increased from N2.84bn in 2011 to N7.78bn in the first half of 2016, while that of Kwara State increased from N8.82bn in 2011 to N16.46bn in the first six months of last year.

The IGR for Bauchi State, according to the report, rose from N4.46bn in 2011 to N5.39bn in 2016. The state has not supplied its 2016 half-year IGR report, according to the NBS.

Similarly, Kano State’s IGR increased from N6.62bn in 2011 to N34.46bn in 2016, while Gombe State’s rose from N3.15bn in 2011 to N3.57bn in 2016.

The IGR for Osun State increased from N5.02bn in 2012 to N8.96bn in 2016.

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

Ogun Records N13.3B Internally Generated Revenue Monthly in Q1 of 2021

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Revenue - Investors King

Ogun State Government has recorded an average of N13.3billion monthly as Internally Generated Revenue (IGR) in the first quarter of 2021.

The government said it is also planning to raise its yearly Gross Domestic Product (GDP) rate from the current single digit by 25 percent.

The Commissioner for Finance, Dapo Okubadejo disclosed this to newsmen in Abeokuta ahead of the state’s investment summit tagged: ‘OgunIseya21: Becoming Africa’s Model Industrial and Logistics Hub’, slated for July 13th-14th, 2021.

Okubadejo who doubles as the State’s Chief Economic Adviser noted that the state’s IGR had experienced an upward movement after last year’s shortfall due to the Covid-19 pandemic and the attendant lockdown.

“We had a significant turnaround in the first quarter of this year. In fact, as of April, we have done almost N40bn in the Internally Generated Revenue. Our target this year is to exceed all the previous records we have set in IGR. That’s why we have put in place, all these transformation initiatives, friendly policies and also facilitate this investment summit to further showcase Ogun State as the preferred industrial destination,” he said.

The Finance Commissioner was supported in highlighting the investment potentials of the summit by his counterparts from the Ministries of Industry, Trade and Investment, Mrs. Kikelomo Longe; Works and Infrastructure, Ade Adesanya; Culture and Tourism, Toyin Taiwo; Budget and Planning, Olaolu Olabimtan and the Director-General, Public-Private Partnership, Dapo Oduwole.

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Unemployment To Push More Nigerians Into Poverty – NESG

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Nigerian Economic Summit Group- Investors King

On Friday, The Nigerian Economic Summit Group said that many more Nigerians are expected to fall into the poverty trap amid rising unemployment in the country.

The NESG, a private sector-led think-tank, noted in its economic report for the first quarter of 2021 that the country’s economic growth in the period under review was relatively weak.

It said, “Nigeria’s economic growth trajectory is better described as jobless and less inclusive even in the heydays of high growth regime in the 2000s.

“While the Nigerian economy recovered from the recession in Q4 of 2020, the unemployment rate spiked to its highest level ever at 33.3 percent in the same quarter.

“With the COVID-19 crisis heightening the rate of joblessness, many Nigerians are expected to fall into the poverty trap, going forward.”

The group noted that the World Bank estimated an increase in the number of poor Nigerians to 90 million in 2020 from 83 million in 2019.

“This corresponds to a rise in headcount poverty ratio to 44.1 percent in 2020 from 40.1 percent in 2019. The rising levels of unemployment and poverty are reflected in the persistent insecurity and social vices, with attendant huge economic costs,” it said.

According to the report, huge dependence on proceeds from crude oil, leaving other revenue sources unexplored, indicates that Nigeria is not set to rein in debt accumulation in the short to medium term.

The NESG noted that public debt stock continued to trend upwards, with a jump from N7.6tn ($48.7bn) in 2012 to N32.9tn ($86.8bn) in 2020.

It said public debts grew by 20 percent between 2019 and 2020, adding, “This is partly due to the need for emergency funds to combat the global pandemic and alleviate its adverse economic impacts on households and businesses.”

According to the group, Nigeria needs more than an economic rebound, and there is a need to improve growth inclusiveness.

It said, “Nigeria has struggled to achieve inclusive growth for many decades. Since recovery from the 2016 recession, the economy has been on a fragile growth path until it slipped into another recession in 2020 due to the COVID-19 pandemic.

“This suggests that the country needs to attain high and sustainable economic growth to become strong and resilient.

“The relationship between economic growth and unemployment rate in Nigeria suggests that economic growth has not led to a reduction in the unemployment rate – jobless growth.”

The NESG said to reverse this recurring trend, there was an urgent need for collaborative efforts between the government and relevant stakeholders towards addressing the constraints to value chain development in high-growth and employment-elastic sectors, including manufacturing, construction, trade, education, health and professional services, with ICT and renewable energy sectors as growth enablers.

It noted that despite the re-opening of the land borders that the Nigerian government shut since October 2019, inflation reached a four-year high of 18.1 percent in April 2021.

“While we expect improved agricultural production in coming months to partially ease inflationary pressures, this positive impact could be suppressed by recurring key structural bottlenecks including insecurity in the food-producing regions, electricity tariff hike, fuel price increase and hike in transport and logistic costs,” it added.

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IMF Queries FG Strategies On Fuel Subsidy, Unemployment, Inflation

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IMF - Investors King

The International Monetary Fund has raised the red flag over Nigeria’s resumption of petrol subsidy payments, describing it as injurious to the economy.

It also reiterated the importance of introducing a market-based fuel pricing mechanism and deployment of well-targeted social safety nets to cushion any adverse impact on the poor.

In a report produced after a virtual meeting with Nigerian authorities from June 1 to 8, the IMF also expressed concerns over the rising unemployment and inflation rates, even as it admitted that real Gross Domestic Product was recovering.

The IMF team, led by Jesmin Rahman, further hailed the Central Bank of Nigeria for its efforts at unifying the exchange rate by embracing needed reforms.

The Fund said: “Recent exchange rate measures are encouraging, and further reforms are needed to achieve a fully unified and market-clearing exchange rate.

“The resurfacing of fuel subsidies is concerning, particularly in the context of low revenue mobilisation.

“The Nigerian economy has started to gradually recover from the negative effects of the COVID-19 global pandemic. Following sharp output contractions in the second and third quarters, GDP growth turned positive in Q4 2020 and growth reached 0.5 percent (y/y) in Q1 2021, supported by agriculture and services sectors.

“Nevertheless, the employment level continues to fall dramatically and, together with other socio-economic indicators, is far below pre-pandemic levels. Inflation slightly decelerated in May but remained elevated at 17.9 percent, owing to high food price inflation. With the recovery in oil prices and remittance flows, the strong pressures on the balance of payments have somewhat abated, although imports are rebounding faster than exports and foreign investor appetite remains subdued resulting in continued FX shortage.

“The incipient recovery in economic activity is projected to take root and broaden among sectors, with GDP growth expected to reach 2.5 percent in 2021. Inflation is expected to remain elevated in 2021, but likely to decelerate in the second half of the year to reach about 15.5 percent, following the removal of border controls and the elimination of base effects from elevated food price levels.”

The IMF also recognised that tax revenue collections were gradually recovering but noted that with fuel subsidies resurfacing, additional spending for COVID-19 vaccines and to address security challenges, the fiscal deficit of the Consolidated Government is expected to remain elevated at 5.5 percent of GDP.

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