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FG Okays Power Service Improvement Plan

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Minister of Power, Works and Housing, Mr Babatunde Fashola
  • FG Okays Power Service Improvement Plan

The Federal Government on Wednesday approved the Power Sector Recovery Programme comprising many policy actions to be carried out to improve service delivery, and also approved contracts for the construction of 13 roads and replacement of bridges across states of the federation and the Federal Capital Territory worth N85bn.

The decisions were taken at a meeting of the Federal Executive Council presided over by President Muhammadu Buhari at the Presidential Villa, Abuja.

The Minister of Information and Culture, Alhaji Lai Mohammed; Minister of Power, Works and Housing, Mr. Babatunde Fashola; and Minister of the Federal Capital Territory, Alhaji Mohammed Bello, briefed State House correspondents at the end of the meeting.

Fashola listed some roads and bridges that would gulp N80bn as being located in Taraba, Adamawa, Sokoto, Zamfara, Bauchi, Plateau, Osun, Kwara, Kano, Oyo, Enugu and Kaduna states.

He said the council also approved the contract for the engineering and consultancy designs for two access roads to link Asaba, Delta State; and Onitsha, Anambra State, to the Second Niger Bridge.

He said the contract had a duration of six months and would gulp N150m.

The minister said the council also approved the extension of the consultancy and project management of the Katsina Wind Energy Farm Project.

On the power sector recovery programme, Fashola said it comprised many policy actions, operational and financial interventions that needed to be carried out by the government to improve transparency, service delivery and performance of the electricity distribution firms, among others.

The minister said, “Some of the highlights of the programme are how to simplify and reduce the cash deficits that have accumulated as a result of previous unilateral reduction of tariff by the last administration during the run-off to the elections; and how to make the Discos viable, accountable, responsive to customers, ensure stability of the grid and expansion of the grid, and transparency and communication within the sector.

“The programme also processes for Ministries, Departments and Agencies debts and how to improve sector governance and the quality of personnel on the board of the Discos.

“It addresses access to renewable energy, especially in rural areas, using mini-grids and standalone solutions and how we are going to carry out the solutions that have been developed for 37 federal universities and seven tertiary hospitals.”

Fashola added, “It also focuses on how to solve the Niger Delta problem and also how to ensure there is a stable and predictable foreign exchange policy for the sector so that it is somewhat protected from sudden head winds of the volatility of the foreign exchange market so that the operators can plan and deliver.

“It also addresses the issue of vandalism at consumer and production levels of pipelines, among others. This will help bring confidence to the market and stimulate the appetite that currently exists globally for Nigeria’s power sector.

“We see a lot of people who want to invest, but some of them are tied to what other international financial institutions do and the institutions are also waiting to see us commit to these things.”

Bello, on his part, said the council approved the award of contract for the second phase of the Abuja Mass Transit Lot 1B (26.77km), which is from Ring Road I, passing through Area 10 beside Wuse Market, Berger Junction, Jabi Motor Park, through Life Camp to Gwagwa.

He said the project, being funded by China EXIM Bank, would gulp $1.79bn and was awarded to CCECC.

The minister gave the other components of the project to include the remaining part of Lot 1A (5.76km); rolling stocks; workshop equipment; and three years’ management contract.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Federal Government Set to Seal $3.8bn Brass Methanol Project Deal in May 2024

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Gas-Pipeline

The Federal Government of Nigeria is on the brink of achieving a significant milestone as it prepares to finalize the Gas Supply and Purchase Agreement (GSPA) for the $3.8 billion Brass Methanol Project.

The agreement to be signed in May 2024 marks a pivotal step in the country’s journey toward industrialization and self-sufficiency in methanol production.

The Brass Methanol Project, located in Bayelsa State, is a flagship industrial endeavor aimed at harnessing Nigeria’s abundant natural gas resources to produce methanol, a vital chemical used in various industrial processes.

With Nigeria currently reliant on imported methanol, this project holds immense promise for reducing dependency on foreign supplies and stimulating economic growth.

Upon completion, the Brass Methanol Project is expected to have a daily production capacity of 10,000 tonnes of methanol, positioning Nigeria as a major player in the global methanol market.

Furthermore, the project is projected to create up to 15,000 jobs during its construction phase, providing a significant boost to employment opportunities in the country.

The successful execution of the GSPA is essential to ensuring uninterrupted gas supply to the Brass Methanol Project.

Key stakeholders, including the Nigerian National Petroleum Company Limited and the Nigerian Content Development & Monitoring Board, are working closely to finalize the agreement and pave the way for the project’s advancement.

Speaking on the significance of the project, Minister of State Petroleum Resources (Gas), Ekperikpe Ekpo, emphasized President Bola Tinubu’s keen interest in expediting the Brass Methanol Project.

Ekpo reaffirmed the government’s commitment to facilitating the project’s success and harnessing its potential to attract foreign direct investment and drive economic development.

The Brass Methanol Project represents a major stride toward achieving Nigeria’s industrialization goals and unlocking the full potential of its natural resources.

As the country prepares to seal the deal in May 2024, anticipation grows for the transformative impact that this landmark project will have on Nigeria’s economy and industrial landscape.

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IMF Report: Nigeria’s Inflation to Dip to 26.3% in 2024, Growth Expected at 3.3%

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IMF global - Investors King

Nigeria’s economic outlook for 2024 appears cautiously optimistic with projections indicating a potential decrease in the country’s inflation rate alongside moderate economic growth.

The IMF’s revised Global Economic Outlook for 2024 highlights key forecasts for Nigeria’s economic landscape and gave insights into both inflationary trends and GDP expansion.

According to the IMF report, Nigeria’s inflation rate is projected to decline to 26.3% by the end of 2024.

This projection aligns with expectations of a gradual easing of inflationary pressures within the country, although challenges such as fuel subsidy removal and exchange rate fluctuations continue to pose significant hurdles to price stability.

In tandem with the inflation forecast, the IMF also predicts a modest economic growth rate of 3.3% for Nigeria in 2024.

This growth projection reflects a cautious optimism regarding the country’s economic recovery and resilience in the face of various internal and external challenges.

Despite the ongoing efforts to stabilize the foreign exchange market and address macroeconomic imbalances, the IMF underscores the need for continued policy reforms and prudent fiscal management to sustain growth momentum.

The IMF report provides valuable insights into Nigeria’s economic trajectory, offering policymakers, investors, and stakeholders a comprehensive understanding of the country’s macroeconomic dynamics.

While the projected decline in inflation and modest growth outlook offer reasons for cautious optimism, it remains essential for Nigerian authorities to remain vigilant and proactive in addressing underlying structural vulnerabilities and promoting inclusive economic development.

As the country navigates through a challenging economic landscape, concerted efforts towards policy coordination, investment promotion, and structural reforms will be crucial in unlocking Nigeria’s full growth potential and fostering long-term prosperity.

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South Africa’s March Inflation Hits Two-Month Low Amid Economic Uncertainty

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South Africa's economy - Investors King

South Africa’s inflation rate declined to a two-month low, according to data released by Statistics South Africa.

Consumer prices rose by 5.3% year-on-year, down from 5.6% in February. While this decline may initially suggest a positive trend, analysts caution against premature optimism due to various economic factors at play.

The weakening of the South African rand against the dollar, coupled with drought conditions affecting staple crops like white corn and geopolitical tensions in the Middle East leading to rising oil prices, poses significant challenges.

These factors are expected to keep inflation relatively high and stubborn in the coming months, making policymakers hesitant to adjust borrowing costs.

Lesetja Kganyago, Governor of the South African Reserve Bank, reiterated the bank’s cautious stance on inflation pressures.

Despite the recent easing, inflation has consistently remained above the midpoint of the central bank’s target range of 3-6% since May 2021. Consequently, the bank has maintained the benchmark interest rate at 8.25% for nearly a year, aiming to anchor inflation expectations.

While some traders speculate on potential interest rate hikes, forward-rate agreements indicate a low likelihood of such a move at the upcoming monetary policy committee meeting.

The yield on 10-year bonds also saw a marginal decline following the release of the inflation data.

March’s inflation decline was mainly attributed to lower prices in miscellaneous goods and services, education, health, and housing and utilities.

However, core inflation, which excludes volatile food and energy costs, remained relatively steady at 4.9%.

Overall, South Africa’s inflation trajectory underscores the delicate balance between economic recovery and inflation containment amid ongoing global uncertainties.

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