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CBN Forex Allocation Inadequate, Say Manufacturers



Steel Manufacture At Evraz Plc West-Siberian Metallurgical Plant
  • CBN Forex Allocation Inadequate, Say Manufacturers

Manufacturers have described the $567.31m allocated to the industrial sector by the Central Bank of Nigeria in the month of January as a drop in the ocean.

The President, Manufacturers Association of Nigeria, Dr. Frank Jacobs, said this in an exclusive interview with our correspondent.

The CBN had stated in a statement on Thursday that it disbursed $2.83bn for importation of various types of equipment to the real sector of the economy between December 2016 and January 2017.

Providing a breakdown of the allocation, the Acting Director, Corporate Communications Department, CBN, Mr. Isaac Okorafor, stated that $609m and $228m were released for raw materials’ importation in December and January, adding that the manufacturing sector got $53m and $71m for raw materials, respectively in the period.

Jacobs told our correspondent that the CBN had informed him of the disbursement of $567.31m to the manufacturing sector in January, but described the amount as a drop in the ocean, adding that it was too small.

Our correspondent, however, learnt that the allocations from the apex bank for the months of December and January did not go round. Most of the manufacturers said they did not get any forex in the months in question.

In the automotive sector, the Chairman, Nigeria Automotive Manufacturers Association, Mr. Tokunbo Aromolaran, said his firm did not get any forex, adding that he did not know if others got.

Aromolaran, who remarked that a situation where somebody asked for $1m and got $100,000 could not be termed as forex allocation, wondered how far $1bn could go to satisfy the needs of all the manufacturers in the country.

In the food processing sector, the General Manager, Erisco Foods, Mr. Adetokunbo Agbede, stated that the firm had not received allocation from the CBN in the past eight months, alleging that forex was being allocated to importers of frozen foods.

However, a few of the industrialists admitted that they got some forex, but said the amounts were nothing compared to what they needed.

“It was minimal compared to what we got in the past,” the Chairman, Pharmaceutical Manufacturing Group of MAN, Mr. Okey Akpa, said.

Jacobs, however, said although the amount was too small, the fact that the CBN was making the forex available was helpful.

He said, “It is good that something is coming. Since they had it in January and December, that means they are making it more regular. If they can continue that way, people will continue in business. Problem arises when they cannot get the forex at all.

“If they are given a little, they can cut down their production and still remain in business instead of shutting down completely. “

The Managing Director of Coleman Wires and Cables, Mr. George Onfowokan, who said his firm got some forex, remarked that even though the amount was not much compared to the demand, the fact that the CBN was now responding with regular interventions was a positive sign and had made positive impact on the few firms that benefitted from it.

He stated, “It has restored confidence in the banking sector, because some of the banks have started opening up their credit lines for their customers based on anticipation of the next intervention.

“The CBN should continue to make the interventions regular. If they do that, even some of the people that did not get will eventually get.”

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


Dangote Cement Refutes Claim it Sells Cement High in Nigeria



economic woes

Dangote Cement Plc has refuted the widely propagated story that the company sells cement at a significantly higher price in Nigeria compared to other African nations like Zambia and Ghana.

The management of the leading manufacturing company said it sells a bag at N2,450 in Obajana and Gboko, and N2,510 in Ibese, the amounts stated include VAT.

Devakumar Edwin, Dangote’s Group Executive Director, Strategy, Portfolio Development & Capital Projects, who spoke with journalists in Lagos, said the company sells for an equivalent of $5.1, including VAT in Nigeria, it sells for $7.2 in Ghana and $5.95 in Zambia ex-factory, inclusive of all taxes.

Devakumar, therefore, described the allegation as false, misleading, and unfounded, and challenged the media to conduct independent investigation into the price of cement in some other African countries, including Cameroun, Ghana, Sierra Leone, Zambia.

To ensure that we meet local demand, we had to suspend exports from our recently commissioned export terminals, thereby foregoing dollar earnings.

“We also had to reactivate our 4.5m ton capacity Gboko Plant which was closed 4 years ago and run it at a higher cost all in a bid to guarantee that we meet demand and keep the price of Cement within control in the country.”

“Over the past 15 months, our production costs have gone up significantly. About 50% of our costs are linked to USD so the cost of critical components like: gas, gypsum, bags, and spare parts; has increased significantly due to devaluation of the Naira and VAT increase.

“Despite this, DCP has not increased ex-factory prices since December 2019 till date while prices of most other building materials have gone up significantly.

“We have only adjusted our transport rates to account for higher costs of diesel, spare parts, tyres, and truck replacement. Still, we charge our customers only N300 – 350 per bag for deliveries within a 1,200km radius.

“We have been responsible enough not to even attempt to cash in on the recent rise in demand to increase prices so far,” Devakumar said.

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Samsung, Vision Care Begin Fresh CSR Activities, Earmark 12,000 Masks for Nigeria



Samsung Heavy Industries Nigeria Limited (SHIN) and Vision Care, an international relief organization dedicated to the prevention of blindness, have launched fresh Corporate Social Responsibility (CSR) initiative to help Nigeria mitigate the impact of COVID-19 pandemic.

Vision Care is a member of the International Agency for the Prevention of Blindness (IAPB), and participant of ‘VISION 2020’, a global initiative of the IAPB and the World Health Organisation (WHO).

Vision Care has since conducted more than 25 Vision Eye Camps yearly and has grown into an international non-profit organisation serving 38 countries throughout Asia, Africa and Central-South America.

Since 2015, SHIN has worked with Vision Care in the yearly Eye Camp as part of its Corporate Social Responsibility (CSR) to provide free cataract surgeries to Nigerians who cannot afford the payment. SHIN has been sponsoring the eye surgeries of Nigerians on a yearly basis.

In 2019, SHIN sponsored the eye surgeries of at least 115 Nigerian patients and 224 outward patients as part of its CSR in Nigeria.

Since it started the programme, SHIN has sponsored the eye surgeries of 572 Nigerian patients, 1,593 outward patients and has also donated glasses to 99 patients.

Due to outbreak of the COVID-19 Pandemic, the yearly Eye Camp for 2021 had been called off to adhere to Federal Government’s measures in response to the virus.

Consequently, SHIN and Vision Care came up with a fresh CSR initiative this year to donate 496 bags of rice (25kg) and 12,000 reusable face masks to three states in the country to fulfill their commitment of contributing to the society.

The items will be delivered later this month.

The three states that will benefit from the donation are Lagos, Kano and Bayelsa states.

Out of the 496 bags of rice, and 12,000 facemasks, Lagos will receive 96 bags of rice and 200 masks.

SHIN also stated that Kano State will receive 200 bags of rice and 5,000 masks, while Bayelsa State will get 200 bags and 5,000 masks.

“This is an additional CSR activity from SHI in addition to SHIN’s donation of 5,000 COVID-19 test kits from Korea. The washable masks that the head office has purchased from Korea are certified to retain its effectiveness against COVID-19 transmission for up to 50 washes,” SHIN said in a statement.

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Senate Summons NICON, AIICO, Others Over N17.4bn Pension Remittances



pension fund

The Senate Public Accounts Committee has summoned the management of the NICON Insurance Plc, AIICO Insurance and other insurance companies over their alleged failure to remit N17.4bn pension fund to the Pension Transitional Arrangement Directorate.

The Senate hinged the summon on the 2016 report of the Auditor-General for the Federation which unraveled the alleged non-remittance of N17.4bn pension fund to PTAD.

Appearing before the panel on Monday, the Executive Secretary of PTAD, Dr Chioma Ejikeme, informed the lawmakers that PTAD took over the assets and liabilities of the defunct pension offices without a formal handing over.

She said, “On taking over, the directorate wrote all underwriters to make returns and remit whatever amount that was in their custody into a CBN dedicated account.

“Some of the underwriters responded to the request while some did not.

“The bank certificate of balances, accounting statements, three years financial statements and policy files requested by the federal auditor were not handed over to PTAD at the time of consolidation.

“It is worthy to note that we discovered that N17.4bn which comprised of cash, securities and properties from the nine insurance underwriters was unremitted as a result of the letter PTAD sent to them.

“These figures represent the claims by the underwriters with regards to their indebtedness.

“In order to ascertain the true position of legacy funds in custody of underwriters, the directorate appointed a consultant in 2018 who carried out forensic audit of nine out the 12 insurance underwriters and produced a final report on the recovery of the legacy funds and assets for PTAD.”

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