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Senate Probes Alleged N4tn Revenue Leakage in Customs

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  • Senate Probes Alleged N4tn Revenue Leakage in Customs

The Senate has launched a fresh investigation into the Nigeria Customs Service over the alleged revenue leakage under the border security agency between 2006 and 2016 to the tune of about N4tn.

The Chairman, Senate Committee on Customs, Excise and Tariff, Hope Uzodinma, made this known in an interview with journalists in Abuja on Friday.

Uzodinma stated that the committee would stop at nothing to recover the money, which, he said, was lost due to various infractions by the men of the service.

The lawmaker said a preliminary investigation by the lawmakers had shown that the over N4tn revenue leakage discovered was due to the non-implementation of the Form ‘M’ (Foreign Exchange forms) by the customs from 2006 to 2016.

Hameed Ali was appointed as Comptroller-General of NCS in August 2015.

Uzodinma said a public hearing would be held as part of the investigation.

The lawmaker also attributed the loss of revenue to wrong classification of cargoes under the Harmonised System Codes, non-screening of cargoes coming into Nigeria and lack of adequate Information and Communication Technology infrastructure for revenue collection.

Uzodinma added that the cancellation of pre-arrival assessment reports and abandonment of goods declaration had also contributed to the revenue loss.

He said, “The Senate Committee on Customs has condemned the inability of the Technical Committee on the Implementation of Comprehensive Import Supervision Scheme to ensure that provisions of the Import Control Management Act are followed to the letter.

“The committee frowns on the quantum of revenue losses and it will stop at nothing in ensuring that those involved in this ugly act return all recoverable monies with them.

“The committee also frowns on the level of collusion and corruption within the Customs Service.

“At the end of our current investigation, all these will become a thing of the past and customs revenue will be enhanced while non-oil revenue will be improved upon.

“What we are investigating is not money spent. It is the leakages. For instance, I am supposed to pay XYZ amount of duty, I will abandon the documentation, go and get fake documents, collude with customs (officers), pay maybe a fraction of it (duty) and carry my goods. With that, the true import circle is not closed.

“Another instance is that assessment is abandoned or I (may) fill the Form ‘M’, for example, with a pro forma invoice, apply for foreign exchange in Central Bank of Nigeria, XYZ amount of money is allocated to me, money moves in (is released) but no goods shipped. I will then go get fake documents, collude with customs (officers) and then retire the allocation.”

Uzodinma decried that the alleged round tripping and false declarations had over years led to increase in the exchange rate. He stressed that in most cases, the amount of money spent was not commensurate with the number of goods being imported.

According to the lawmaker, the committee had started questioning the companies and banks indicted in the case.

“We will not mention the companies involved because we are also very careful of the integrity and public perception of some of these companies, being that some of them are in the stock market. We will be diplomatic in carrying out this investigation.

“This is to the extent that little or no damage will be done to the integrity and image of such companies, provided that government revenues in their hands will be recovered,’’ Uzodinma said.

When asked if the probe would not eventually be abandoned like in some previous cases in the Senate, Uzodinma explained that the lawmakers were, sometimes, faced with constitutional limitations.

He, however, stated that the current investigation would be concluded “because it has to do with the economy and revenue loss”.

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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Nigeria’s Plan to Review Oil Companies’ Gas Flaring Strategies

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Nigeria is ramping up its efforts to address environmental concerns in the oil and gas sector with a comprehensive plan to review gas flaring strategies of international and indigenous oil companies.

The Minister of State for Environment, Dr. Iziaq Salako, announced this initiative during a national stakeholders engagement meeting on methane mitigation and reduction held in Abuja, Investors King reports.

Gas flaring, a common practice in the oil industry, releases methane—a potent greenhouse gas—into the atmosphere, contributing to climate change and posing health risks to communities near oil facilities.

Nigeria aims to end routine gas flaring by 2030, aligning with global climate goals and commitments.

Dr. Salako explained the importance of reducing methane emissions and highlighted the detrimental effects on public health, food security, and economic development.

He outlined practical steps being taken to tackle methane emissions, including the development of methane guidelines and the engagement of government institutions.

The ministry, through the National Oil Spill Detection and Response Agency, will conduct periodic reviews of oil companies’ plans to ensure compliance with the gas flaring deadline.

Deloitte management consultants will assist in conducting comprehensive forensic audits to scrutinize the legitimacy of forward-contracted transactions.

President Bola Tinubu’s commitment to environmental sustainability underscores the government’s dedication to addressing climate change and fulfilling its multilateral environmental agreements.

The engagement event served as a platform for stakeholders to discuss methane mitigation strategies, existing policies, and implementation challenges.

Collaboration and dialogue among diverse sectors are crucial in charting a unified course towards sustainable methane reduction in Nigeria’s oil and gas industry.

As the country navigates its environmental agenda, ensuring accountability and transparency in gas flaring practices remains paramount for achieving a greener and healthier future.

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Interest Rate Jumps to 24.75% as CBN Takes Aggressive Stance Against Inflation

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Dr. Olayemi Michael Cardoso

The Central Bank of Nigeria (CBN) has announced a significant increase in the monetary policy rate, known as the interest rate, to 24.75%.

This move disclosed by CBN Governor Olayemi Cardoso during the 294th Meeting of the Monetary Policy Committee press briefing in Abuja, represents a bold step by the apex bank to address the mounting inflationary pressures faced by the country.

With inflation soaring to 31.70% in February, the CBN aims to moderate this upward trend by tightening its monetary policy stance.

This decision follows the previous hike in the interest rate to 22.75% in February, showcasing the CBN’s commitment to combatting inflationary forces.

While the bank opted to maintain the Cash Reserve Ratio at 45%, the significant increase in the interest rate underscores the urgency of the situation and the need for decisive action.

Governor Cardoso emphasized that these measures are essential to stabilize the economy and safeguard the purchasing power of the Nigerian currency.

The 294th MPC marks the second meeting under Governor Cardoso’s leadership, indicating a proactive approach to addressing economic challenges.

The next MPC meeting is scheduled for May 20th and 21st, 2024, highlighting the ongoing commitment of the CBN to navigate Nigeria’s economic landscape amidst inflationary pressures.

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Economy

Nigeria Braces for 10th Consecutive Interest Rate Hike by Central Bank

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Central Bank of Nigeria (CBN)

As Nigeria grapples with persistently high inflation, the Central Bank of Nigeria (CBN) is gearing up to implement its tenth consecutive interest rate hike in a bid to curb the soaring prices and attract investment.

Analysts surveyed by Bloomberg are anticipating a substantial 125 basis-point increase in the key rate to 24%, marking one of the most significant adjustments in the current tightening cycle.

The decision, expected to be announced by Governor Olayemi Cardoso on Tuesday at 2 p.m. in Abuja, comes on the heels of inflation accelerating to 31.7% in February, far surpassing the central bank’s target range of 9%.

This surge has been primarily attributed to the sharp depreciation of the naira, prompting authorities to devalue the currency twice since June to narrow the gap with the unofficial market rate and encourage investor confidence.

While these measures have seen the naira strengthen in recent days and bolstered investment inflows, including a fourfold increase in overseas remittances and significant foreign investor portfolio asset purchases, there remains a palpable need for more decisive action.

Giulia Pellegrini, a senior portfolio manager at Allianz Global Investors, emphasized the necessity for the CBN to intensify its tightening efforts to regain foreign investors’ confidence in the local bond market.

While acknowledging the positive strides made by the central bank, Pellegrini stressed the importance of a more assertive approach to prevent the diversion of investor attention to other frontier markets.

As the Nigerian economy navigates through these challenging times, the impending interest rate hike signals the CBN’s determination to address inflation head-on and foster a more stable economic environment.

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