- IMF Meeting: CBN Resists Calls to Float Naira
The Central Bank of Nigeria has resisted calls from financial institutions in Washington to float the naira, saying it cannot kill Nigerians in the name of floating the currency.
Speaking to journalists on the sidelines of the World Bank/International Monetary Fund spring meetings in Washington DC, United States, the CBN spokesperson, Mr. Isaac Okorafor, restated the apex bank’s commitment to ensuring access to forex by the drivers of the economy, TheCable reported.
Okorafor said the call to liberalise the foreign exchange market by floating the naira was laughable.
He said, “The call here in Washington that we should float the naira, liberalise the market – our market is extensively liberalised – and the call to float the naira is a bit laughable in our case.
“Yesterday (Thursday), when Madame Lagarde was discussing the economy of Egypt, she lamented herself the devastating inflation that is in that country.
“Egypt has half of our population; Egypt receives about $12bn in foreign earnings and several billions in tourism. We are 180 million people, our infrastructure is so poor and the productive capacity cannot be fast enough to rise to the benefit of the people from massive depreciation (of the naira).
“If you float the naira today, and given the discoveries by security agencies, you’ll discover that our case will be terrible. Egypt today has an inflation rate of almost 31 per cent; remember that Angola also has about 36 per cent inflation; ours is at 17.26 per cent.”
Okorafor further explained, “If we float the naira and we allow speculators and those with corruption money and all the people who create the bubbles to launch into the market, you can yourself imagine the kind of situation we will find ourselves in.
“Yes, we will go all out to practise economic theory the way they say you should allow your currency to float, but of course, you should also know that no country floats its currency, just leaving it to the dictates of the market.
“Our economy has its own peculiarities and we cannot kill our people in the name of floating the naira.”
On access to forex by small and medium-scale enterprises, Okorafor advised anyone being frustrated by commercial banks to report with evidence to the CBN.
He vowed that the bank would take necessary action and apply sanctions on errant institutions, where necessary.
He added, “It has become necessary that we bring to your notice the complaints from customers, especially those who operate in the SME segment of the market, that banks are frustrating their efforts at getting forex.
“You will recall that recently we introduced a window to be able to give forex to SMEs, which incidentally are the engine of growth in our economy, for them to be able to obtain a small amount of forex that suits their businesses and we have received complaints now that banks are frustrating them.
FIRS Sets N5.9 Trillion Revenue Target for 2021
FIRS to Generate N5.9 Trillion Revenue in 2021
Mohammed Nami, the Chairman of Federal Inland Revenue Service, FIRS, on Friday said the agency is projecting total revenue of N5.9 trillion for the 2021 fiscal year.
Nami stated this while meeting with the House of Representatives Committee on Finance led by Hon. James Falake on the Service’s 2021 budget defence of its proposed Revenue and Expenditure Estimates.
According to the Chairman, N4.26 trillion and N1.64 trillion were expected to come from non-oil and oil components, respectively.
However, Nami put the cost of collecting the projected revenue at N289.25 billion or 7 percent of the proposed total revenue for the year, higher than the N180.76 billion spent in 2020 to fund the three operational expenditure heads for the year.
He said: “Out of the proposed expenditure of N289.25 billion across the three expenditure heads, the sum of N147.08 billion and N94.97 billion are to be expended on Personnel and Overhead Costs against 2020 budgeted sum of N97.36 billion and N43.64 billion respectively. Also, the sum of N47.19 billion is estimated to be expended on capital items against the budgeted sum of N27.80 billion in 2020. The sum is to cater for on-going and new projects for effective revenue drive.”
Speaking on while the agency failed to meet its 2020 target, Nami said “There’s lockdown effect on businesses, implementation directive also for us to study, research best practices on tax administration which involves travelling to overseas and we also have to expand offices and create offices more at rural areas to get closer to the taxpayers, we pay rent for those offices and this could be the reason why all these things went up.
“And if you have more staff surely, their salary will go up, taxes that you’re going to pay on their behalf will go up, the National Housing Fund contribution, PENCOM contribution will go up. Those promoted you have to implement a new salary regime for them. There’s also the issue of inflation and exchange rate differential”, he said.
Gov Emmanuel Attracts $1.4b Fertilizer Plant to Akwa Ibom
The Governor of Akwa Ibom State, Mr. Udom Emmanuel has signed an agreement for the citing of a multi billion fertilizer plant in his State.
Governor Emmanuel was part of a Nigerian delegation led by the Minister of State for Petroleum Resources, Chief Timipre Sylva, that visited Morocco to set out the next steps of the $1.4 Bln fertilizer production plant project launched in June 2018.
The agreement between the OCP Africa, the Nigerian Sovereign Investment Authority and the Akwa Ibom State Government will birth one of the biggest investments in the fertilizer production industry worldwide.
The signing ceremony took place at the Mohammed VI Polytechnic University (UMP6).
Mr. Emmanuel signed one of the agreements of the partnership, which covers a memorandum of understanding between OCP Africa, the Akwa Ibom State in Nigeria and the NSIA on land acquisition, administrative facilitation, and common agricultural development projects in the Akwa Ibom State.
Speaking while signing the agreement, Governor Emmanuel said, “Our state is receptive to investments and we are prepared to offer the necessary support to make the project a reality.
“With a site that is suitably located to enable operational logistics and an abundance of gas resources, all that is left is for the parties to accelerate the project development process”, Mr. Udom said.
The agreement reached between the Nigerian Government and the OCP further links OCP, Mobil Producing Nigeria (MPN), the NNPC, the Gas Aggregation Company Nigeria (GACN), and the NSIA.
The two partners agreed to strengthen further their solid partnership leveraging Nigerian gas and the Moroccan phosphate.
This project will lead to a multipurpose industrial platform in Nigeria, which will use Nigerian gas and Moroccan phosphate to produce 750,000 tons of ammonia and 1 million tons of phosphate fertilizers annually by 2025.
The visit of the Nigerian delegation to Morocco takes place within the frame of the partnership sealed between OCP Group and the Nigerian Government to support and develop Nigeria’s agriculture industry.
Following the success of the first phase of Nigeria‘s Presidential Fertilizer Initiative (PFI) and the progress of the fertilizer production plant project launched in 2018 by OCP and NSIA, the Moroccan phosphates group and the Nigerian government delegation have agreed on the next steps of their joint project which is rapidly taking shape.
Several cooperation agreements were inked on Tuesday at the Mohammed VI Polytechnic University (UM6P) by OCP Africa and the Nigerian delegation. Through these deals, OCP reaffirms its unwavering support of agricultural development initiatives in Nigeria including PFI.
OCP Africa and the NSIA have agreed, inter alia, to set up a joint venture which will oversee the development of the industrial platform that will produce ammonia and fertilizers in Nigeria.
The OCP has also pledged to supply Nigerian famers with quality fertilizers adapted to the needs of their soil at competitive prices and produced locally.
ICPC Says Nigeria Loses $10bn to Illicit Financial Flows
The Independent Corrupt Practices and Other Related Offences Commission (ICPC) says Nigeria accounts for 20 per cent or 10 billion dollars (N3.8 trillion) of the estimated 50 billion dollars that Africa loses to Illicit Financial Flows (IFFs).
Chairman of ICPC, Prof. Bolaji Owasanoye, said this during a virtual meeting to review a report on IFFs in relation to tax, Mrs Azuka Ogugua, spokesperson for ICPC, said in a statement released in Abuja on Friday.
The ICPC Chairman said, “the African Union Illicit Financial Flow Report estimated that Africa is losing nearly 50 billion dollars through profit shifting by multinational corporations and about 20 per cent of this figure is from Nigeria alone.”
The ICPC boss explained that taxes played “very strategic role in the nation’s political economy.”
He said the objective of the meeting was to improve on the awareness on IFFs, especially in the areas of taxation.
The ICPC boss added that the meeting would give participants the opportunity to openly discuss how to effectively use the instrumentality of taxation to curb IFFs through risk-based approach.
“Risk-based approach, that is: monitoring and audit; due process in tax collection; structured tax amnesty framework skewed in public interest; data privacy; timely resolution of audits and payment of tax refunds and intelligence sharing among revenue generating, regulatory and law enforcement agencies,” he said.
Owasanoye also stated that for the contemporary tax man to remain relevant, he must build his capacity in areas of technology management, solution architects and an astute relationship manager.
The Executive Chairman of Federal Inland Revenue Service (FIRS) Mr Muhammad Nani, expressed concerns that IFFs posed a serious threat to the Nigerian economy as the act robbed the nation of resources that were needed for development.
Nani declared that tackling IFFs would expand the country’s tax base and improve revenue generation, which was required for development.
He consequently pushed for policy reforms that would make it difficult for “capital flights” from occurring so that the country would be placed on the path of growth.
Other discussants at the event identified weak regulatory framework, opacity of financial system and lack of capacity amongst others as some of the factors that fuelled IFFs.
The discussants emphasised the need for capacity building of relevant stakeholders as one of the ways to stamp out illicit financial flows.
They commended ICPC for leveraging its corruption prevention mandate to open a new vista in IFFs discourse in Nigeria. (NAN)
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