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Power Firms Oppose Plan to Centralise Revenue Accounts

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Minister of Power, Works and Housing, Mr Babatunde Fashola
  • Power Firms Oppose Plan to Centralise Revenue Accounts

The 11 electricity distribution companies in the country on Monday condemned the alleged plan by the Federal Government to escrow and centralise their revenue accounts over poor market performance with respect to their various monthly remittances to the Nigerian Bulk Electricity Trading Plc.

Speaking under the aegis of their umbrella body, the Association of Nigerian Electricity Distributors, the power firms said such a move would be a nationalisation of the 11 Discos privatised just three years ago.

The NBET had on several occasions published reports, as well as announced that the Discos remitted only about 30 per cent of their monthly energy invoices in 2016.

The Market Operator, an arm of the Transmission Company of Nigeria, also confirmed this after its Executive Managing Director, Mr. Moshood Suleiman, in October last year at a market participants’ workshop in Abuja, declared that if the poor revenue collection continued, the firms’ revenue accounts might be escrowed.

But ANED’s Director of Research and Advocacy, Mr. Sunday Oduntan, said in a statement issued in Abuja on Monday, “Any attempt to centralise or escrow the Discos’ revenue accounts will be tantamount to nationalisation or expropriation of the distribution companies.”

According to him, such an action is contrary to the objectives of the National Electricity Power Policy, 2001 and the Electric Power Sector Reform Act, 2005 of a private sector-owned and managed electricity sector.

“It will also send very wrong signals to domestic and international investors that Nigeria is not fully open for private sector investment and that we are still partial to the old habits of nationalisation, preventing the injection of the cheap and sorely needed capital that is critical to the rehabilitation and improvement of the electricity infrastructure,” Oduntan stated.

He said it would be improper to have a supposedly private sector-owned and managed business in which the government would seize control of its revenues.

ANED advised the Federal Government to avoid any consideration of regulations or action that would intrude into corporate responsibilities of procurement, financial management or personnel management.

“Relative to procurement, we are not aware that the Nigerian Communications Commission issues regulations to guide the internal procurement of the telecommunication companies; the Central Bank of Nigeria, that of the banks; or the Department of Petroleum Resources, that of the oil companies,” Oduntan added.

The power firms also said they learnt that the Federal Government was mulling a decision to call for the declaration of eligible customers for the electricity market.

“Such can be declared by the minister only when a competitive market exists in the Nigerian electricity supply industry,” Oduntan stated.

ANED, however, argued that such a competitive market, driven by efficiency, presence and utilisation of industry contracts, did not exist at the moment.

According to the association, the minister, under Section 27 of the EPSR Act, 2005, has the authority to determine end-user customers, who then constitute eligible customers.

But it noted that Section 28 of the Act required that the Discos must be compensated for any reduction in their ability to “earn permitted rates of return on their assets,” or any inadequacy in their revenues as a result of such determination.

The power firms, therefore, warned that any such move would have an effect on consumers.

“What this means is that consumers will have to suffer an increase in their electricity tariff to accommodate this premature declaration of eligible customers,” ANED added.

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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An Average of 48% Global Consumers to Significantly Cut 2020 Holiday Spending

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Data presented by Buy Shares indicates that an average of 48% of global consumers plans to significantly reduce their 2020 compared to 2019. The research sampled consumer feedback from 13 countries.

Pandemic triggers reduced spending 

The data also highlights that an average of 13.46% of global consumers plans to spend more on 2020 holidays than last year. Consumers from Indonesia at 71% plan to shrink their budget in 2020 while 16% will spend more.

About 69% of Mexican consumers will spend less, while 12% plan for more spending. In Brazil, about 65% of consumers will cut their budget while 11% plan to spend more than last year. At 63%, South African consumers will cut back on holiday spending while 12% plan to increase their budgets from last year.

In Spain, 55% of consumers will reduce their spending while 7% plan an increase from a year ago. Italian consumers spending less will be at 54%, with 6% planning to increase their budget.

In India, about 47% of people will cut back on the holiday budget, while 36% plan to increase spending. French consumers at 44% have intentions of reducing holiday spending while 6% will raise the spending from a year ago. 43% of UK consumers will spend less, while 9% have plans to spend more.

In the United States, 42% of consumers will spend less, while 17% will increase the budget. For Germany, about 29% of consumers will spend less than 7% planing to pay more. It is only in China where more people plan to spend more at 29% than 25% planning to spend less at 25%.

Elsewhere, 21% of Japanese consumers plan to spend less, while 7% will pay more. The research highlighted some of the reasons behind the massive slash in this year’s holiday spending. According to the research report:

“The less spending comes as most consumers lost their jobs and faced pay cuts as employers struggled to remain afloat in the course of the health crisis. Some consumers have been saving more to pay debts, while those on stimulus paychecks cannot sustain daily needs and holiday spending.”

The research also notes that most Americans at 30% look forward to the Christmas holiday while 23% anticipate Amazon Prime Day. Only 7% of Americans look forward to Fathers Day.

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President Buhari to Inaugurate Waltersmith 5,000bpd Modular Refinery Today

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oil refinery

President Muhammadu Buhari will inaugurate the 5,000 barrels per day modular refinery built by Waltersmith Group in Imo State.

According to Waltersmith Group, the President will lead a team of other top government officials, oil regulators and stakeholders to Imo State today for the inauguration, the Group stated in a statement released on Monday.

It said the modular refinery has a storage capacity of 60,000 barrels and is expected to deliver over 271 million litres per annum of refined petroleum products, including kerosene, diesel, naphtha and heavy fuel oils, to the domestic market.

Mr. Abdulrazaq Isa, the Chairman, Waltersmith Group, said the first of 50,000 bpd modular refinery to be inaugurated today would process 5,000bpd of crude oil.

We are looking at 50,000bpd refining capacity that will come with the planned additional two modules; 25,000bpd and 20,000bpd refining capacity respectively which will then add PMS, aviation fuel and LPG to the product slates,” he added.

The statement added that Waltersmith obtained the ‘Licence to Establish’ the refinery from the Department of Petroleum Resources in June 2015 and got the ‘Authority to Construct’ in March 2017.

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Central Bank of Guinea Selects Refinitiv Trading solutions to Enhance Transparency and Digitize Guinea’s Financial Markets

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GUINEA – Central Bank of Guinea has adopted Refinitiv Trading solutions to effectively manage currency flows, primary market liquidity provision, and facilitate regional and international trade and investment.

With the scarcity of liquidity across Sub Saharan African markets, it is crucial for African countries to protect their FX reserves and tab on new liquidity pools. Leveraging technology and deploying efficient FX and trading infrastructure systems enhances transparency, accuracy and credibility to the marketplace and facilitates economic growth. The Refinitiv FX Trading platform will offer the local market in Guinea access to deeper offshore liquidity, efficient execution, and automated trade reporting tools.

Refinitiv Auctions will enhance the efficiency of Guinea’s forex auction capabilities and provides a real-time view of bid submissions which will simplify the allocation process. Last year, Refinitiv Auctions reached a key milestone having helped facilitate over $1trillion for its central bank and large corporate customers in Africa, Middle East, Asia and Europe.

Dr. Louncény NABE, Governor of the Central Bank of Guinea, said: “We are delighted to announce the deployment of Refinitiv Auctions in Guinea. The step comes in line with the Central Bank’s vision to run a transparent and compliant auctions infrastructure. The deployment will help us improve the efficiency of our FX auction process and enhance the financial sector’s confidence in Guinea.”

Nadim Najjar, Managing Director, Middle East and Africa, Refinitiv, said: “We are proud to be part of The Central Bank of Guinea’s digital transformation vision. Following the COVID-19 outbreak, Central Banks in Africa are facing increasing risks in managing their currency flows and protecting FX reserves. To do this effectively, central banks need to be able to run a transparent and compliant process across multiple asset classes including FX and money markets.”

Refinitiv Auctions has seen rapid growth and adoption in 2019, with a 27% year on year increase in customers, and is now used by central banks in Europe, the Middle East, Africa and Asia. Refinitiv is able to address central banks’ needs around data residency and infrastructure costs by offering its solution on either a hosted or deployed basis.

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