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With N49tn Import Bill, FG Looks Inwards for Goods and Services

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  • With N49tn Import Bill, FG Looks Inwards for Goods and Services

The federal government wednesday said Nigeria had spent a whopping N49 trillion on imports in 17 years, adding that it has resolved to chart a new course for the country by saving N3.6 trillion in five years through the take off of a new innovation plan targeted at Nigeria’s industrialisation.

It also said that there was no cause to worry over President Muhammadu Buhari’s health, adding that he was in safe hands in London where he is receiving treatment for an undisclosed illness.

Rising from its weekly Federal Executive Council (FEC) meeting in the State House, Abuja, the government said the degree of dependence on foreign products for survival was no longer sustainable in view of the fall in oil prices and the availability of natural resources in different parts of the country.

Briefing journalists at the end of the meeting, the Minister of Science and Technology, Dr. Ogbonaya Onu, said FEC approved a memorandum to alter the status quo and re-direct the country’s priority towards the production and consumption of locally made goods and services.

“We will be saving N3.6 trillion to achieve this in five years. It will require that ministries, departments and agencies (MDAs) should work together. All they need will be put in the budget.

“We will be asking for 30 per cent of the amount which will be about N1 trillion over five years. If you take about one-fifth of the N1 trillion which will be N200 billion every year by all the MDAs for five years, we can do it,” he said.

According to Onu, in accordance with the approval of the council memo, the next five years will witness the exploration of existing abundant natural resources in the country for the nation’s industrialisation.

Onu, who said the by-product of the move would be the creation of jobs for the teeming population, disclosed that the Raw Materials Research and Development Council, an agency under his ministry, had conducted extensive research in consultation with other countries, research institutes, tertiary institutions, governments and industries.

He said the research was meant to determine the degree of Nigeria’s dependence on foreign products and also decipher how to put paid to the imports.

“For too long, our nation has been dependent on importation of raw materials and products and this has had very adverse effects on our economy, particularly as it concerns job creation and the search for self-reliance.

“Nigeria is a great nation and we have an abundance of natural resources in our country. It doesn’t make sense that we leave what we have and are importing from outside.

“For example, between 2000 and 2016, Nigeria spent as much as N49 trillion importing raw materials and products. At that time, not that it was sustainable, but our economy could manage such level of imports because crude oil sold most of the time at above $100 per barrel.

“But definitely, such level of importation is unsustainable and we are paying the price right now because if we had depended on our own raw materials, we would have been better off.

“With the sharp drop in the price of crude oil, Nigeria would have been able to withstand such a shock and we would not have had the problem that we are passing through now.

“So the Federal Ministry of Science and Technology is determined to change the direction that Nigeria has passed through. In the past 56 years, we have been over-dependent on foreign commodities.

“We have relied on massive imports, we have sacrificed jobs. But we now want to move our economy away from that direction into an innovation-driven economy.

“So the Raw Materials Processing and Development Council, one of the agencies under the supervision of the Ministry of Science and Technology, had to undertake a very important study.

“Before the study was done, there were extensive consultations with research institutes, countries and universities, businesses, industries, governments at all levels, to determine our level of dependence on outside products and to find a way we can stop this.

“We looked at what other countries such as Canada, China, India, Japan and South Korea did. It was now very clear to us that if we moved in the direction that approval was given for today, Nigeria will attain its industrialisation plan in the next five years and this will be very helpful because what it means is that the abundance of natural resources can now be utilised for industrial production in the country.

“Then, we will be able to create jobs for Nigerians. The major thrust of President Muhammadu Buhari’s administration is that we should be producing made-in-Nigeria goods so that those who want to work will be able to do so and this is the way to go

“Above all, as a great nation, we must work for self-reliance. We must be a self-reliant nation. Other countries have achieved it. We must be able to achieve it,” he said.

In his own briefing, the Minister of Niger Delta, Mr. Usani Uguru, said the council received the report of a Project Technical Audit Committee from his ministry, which had hitherto been saddled with the responsibility of investigating all contracts and projects executed by the ministry since its creation in 2009 up to 2015.

According to him, the committee found that out of the N700 billion appropriated for the ministry within the period, N423 billion had been spent with little or nothing to show for it.

According to him, the figure, representing 60 per cent of total appropriated funds within the period, showed that the rate of execution of 427 projects awarded stood at only 12 per cent, while the impact of such projects on the region was put at a mere eight per cent.

“So, today, we sought approval from council to have the recommendations of this report conveyed to the legitimate agencies charged with the statutory responsibility of recovering government assets that are either misappropriated, misused or found to be idling in some quarters.

“With this, it means all those who have accessed government resources for one purpose or another must be compelled to make adequate use of same, otherwise, they would face the recommendations that go with such violations, and that is our position concerning that report. And we have got the council’s approval for that,” he said.

Also, the Minister of Health, Prof. Isaac Adewole, said FEC approved a joint venture agreement between the federal government and May & Baker Plc to produce local vaccines for the country between 2017 and 2021.

The minister further explained that under the joint venture agreement May & Baker would hold 51 per cent in the company to be established under the arrangement, while the federal government would own 49 per cent.

He recalled that between 1940 and 1991, Nigeria was producing smallpox, yellow fever and anti-rabbis vaccines and was quite successful at it, and had exported such vaccines to Cameroon, Central African Republic and other countries.

However, he said in 1991, the vaccine production laboratory stopped producing, following the federal government’s attempt to reactivate and upgrade the facility, a move he said never took place and ended the country’s vaccine production programme.

“What council did today was to put life into this joint venture agreement that proposes to establish a company called Bio-vaccines Ltd., which will be jointly owned by the federal government and May & Baker Plc.

“The board of the company will comprise seven people – four from May & Baker and three from the federal government. The equity participation will be 51 per cent May & Baker, 49 percent federal government.

“The company, between 2017 and 2021, will produce basic vaccines that we need. We have considered vaccines as a security issue. It is not only a health issue, as we need to consider the security of all Nigerians, particularly our children.

“So, with this agreement, we will be able to produce those command vaccines and from 2021 and beyond, every other vaccine that is necessary will also be out for administration to Nigerians.

“We are quite happy that today it has taken place and we believe that Nigeria has started the journey to vaccines security,” Adewole said.

Adewole who said the take off funding for the project would be N100 million, added that the federal government would make its equity contribution through its existing Institute of Vaccines Research valued at N1.2 billion, while May & Baker would contribute N1.3 billion.

The minister, who also said the country had almost put the meningitis outbreak behind it, disclosed that Kenya Airways which recently flew the corpse of a Nigerian from the Democratic Republic of Congo (DRC) into the country, in violation of standard procedures, had been reported to the International Civil Aviation Authority (ICAO), with a view to getting the airline sanctioned.

The DRC is currently battling an Ebola outbreak, which has already led to four deaths in the Central African country.

Meanwhile, the Minister of Information, Lai Mohammed, while responding to a question on Buhari’s health, said there was no cause for alarm, as the president was in safe hands in London.

The president returned to London three weeks ago to get treatment for an undisclosed ailment. Prior to his trip, he had spent 50 days in the British capital between January and March for the same reason.

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.

Crude Oil

Oil Inches Higher But Rangebound as COVID-19 Cases Soar

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Oil prices edged higher in rangebound trade on Monday on optimism about a rebound in the U.S. economy as vaccinations accelerate, but rising COVID-19 cases in other parts of the world kept a lid on prices.

Brent was up 22 cents, or 0.4%, at $63.17 a barrel by 0843 GMT. West Texas Intermediate (WTI) U.S. crude rose 12 cents, or 0.2%, to $59.44 a barrel.

The prices have remained rangebound in the last three weeks, with Brent between $60 and $65 per barrel and WTI at $57 to $62.

“Oil prices are entering a consolidation phase after swinging wildly last month,” Stephen Brennock of oil broker PVM.

“While there are still plenty of reasons to be bullish, market players have become more cautious as infections have surged in Europe, India and some emerging markets, while vaccine rollouts have proved slower than anticipated,” he added.

India now accounts for one in every six daily infections worldwide, and other parts of Asia are seeing infection rates rise.

Asian oil demand remained weak and some buyers asked for lower volumes in May partly because of refinery maintenance and higher prices.

The United States has fully vaccinated more than 70 million people but U.S. gasoline demand has not picked up as much as expected.

The U.S. economy is at an “inflection point” amid expectations that growth and hiring will accelerate in the months ahead, but faces the risk of reopening too quickly and sparking a resurgence in coronavirus cases, Federal Reserve Chair Jerome Powell said in an interview broadcast on Sunday.

“There really are risks out there. And the principal one just is that we will reopen too quickly, people will too quickly return to their old practices, and we’ll see another spike in cases,” Powell said in a CBS interview, recorded on Wednesday.

On the production side, no new oil drilling rigs were started in the United States in the most recent week, a report published by Baker Hughes showed.

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Equatorial Guinea to Launch Vision on Post-COVID Energy Transition Plans with Report and Film

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The Africa Energy Series (AES): Equatorial Guinea 2021 campaign – comprising a report and a documentary – will serve as a critical tool to navigate the energy investment landscape in one of Africa’s more mature petroleum producing markets; Equatorial Guinea has largely been able to sustain its pace of engagement with global investors in the face of COVID-19, forecasting $1.1 billion in FDI in oil and gas activities in 2021; The third edition of the AES: Equatorial Guinea 2021 report will be released at Africa Oil & Power’s U.S. Africa Energy Forum 2021 networking event in Washington, D.C. this July.

Africa Oil & Power is proud to announce the upcoming launch of its Africa Energy Series (AES): Equatorial Guinea 2021 investment report and documentary, as part of a multimedia campaign set to champion the domestic energy sector and shape the West and Central African energy narrative.

The dual-language publication will target key developments driving a post-COVID-19 recovery in Equatorial Guinea – namely, the growth of petroleum and power industries; regional gas monetization initiatives; a clean energy transition; the impact of environmental, social and governance criteria; and expansion of the national diversification agenda.

A 30-minute documentary will provide a visual complement to the publication, featuring first-hand interviews with government officials, private sector players, industry regulators and energy experts discussing Equatorial Guinea’s unparalleled ambition and future plans.

“From spearheading regional gas monetization initiatives to drilling new exploration wells as early as Q2 2021, Equatorial Guinea continues to cement its reputation as a progressive, dynamic force on the African energy stage,” said H.E. Gabriel Obiang Lima, Minister of Mines and Hydrocarbons. “The Africa Energy Series publication in conjunction with a detailed documentary format, gives us the voice to showcase the depth of our full-stream investment opportunities to a global audience.”

Since the onset of COVID-19, Equatorial Guinea has been proactive in safeguarding opportunities for foreign investors and continuing to drive capital into its hydrocarbon resources. In February, Chevron achieved first gas flow from the successful execution of its Alen Gas Monetization project, a $475-million investment representing the first phase of Equatorial Guinea’s Gas Mega Hub masterplan.

The Ministry of Mines and Hydrocarbons is currently promoting several capital-intensive projects – including the construction of modular oil refineries, a gold refinery, liquefied petroleum gas strategic tanks, a urea plant and the expansion of a compressed natural gas project – which are open for investment. Last December, the Ministry of Mines and Hydrocarbons announced a forecast of $1.1 billion in foreign direct investment in oil and gas activities in 2021.

Active in Equatorial Guinea since 2015, AOP released its first AES documentary on the country in 2016, followed by investment reports in 2018 and 2019.

The AES: Equatorial Guinea 2021 investment report will be launched at the U.S. Africa Energy Forum 2021 online seminar and in-person networking event in Washington, DC. (July 12). The documentary will be launched at the U.S. Africa Energy Forum conference in Houston (October 4-5) and broadcast globally on news networks.

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U.S. Africa Energy Forum 2021 Launches: Promotes U.S. Role as Primary Investor in African Energy

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The U.S. Africa Energy Forum 2021 – organized by Africa Oil & Power, in partnership with the African Energy Chamber’s U.S.-Africa Committee – will foster alignment between U.S. and African governments’ energy policies and highlight African oil, gas, power and renewable projects across the energy value chain for U.S. investors; the multi-day forum unites U.S. and African policymakers, energy executives and industry leaders to create new linkages and foster discussions that drive long-term policy formation and project execution; the in-person, two-day summit and gala dinner will be hosted in Houston, Texas (October 4-5, 2021) and an online seminar and in-person networking event will be held in Washington D.C. (July 12).

Africa Oil & Power (AOP) and the African Energy Chamber are excited to announce the launch of the first-ever U.S. Africa Energy Forum (USAEF). This event aims to create deeper cooperation between the U.S. and Africa on energy policy, to reach alignment on long term sustainability goals, to stimulate greater American investment in the African oil, gas and power sectors, and to engage and reposition the U.S. as the primary partner of choice for African energy developments.

Under the theme “New Horizons for U.S. Africa Energy Investment” the forum will explore diverse foreign investment and export opportunities across the continent, including natural gas as a vital fuel for the energy transition; energy storage and battery minerals; Africa’s place in global energy supply chains; the benefits of the African Continental Free Trade Area; evolving energy technologies and how they relate to the future role of petroleum resources; and on-and off-grid power developments.

An online seminar and in-person networking event will be held in Washington D.C. on July 12, 2021, building up to the in-person U.S. Africa Energy Forum summit and gala dinner, to be hosted in Houston, Texas, on October 4-5, 2021. Africa Oil & Power and the African Energy Chamber invite all U.S.-based companies with an interest in engaging with African industry leaders and project developers to participate in the USAEF Houston summit.

This initiative comes at an important juncture in U.S.-Africa relations. The Biden Administration’s announcements of its intentions to proactively build a stronger U.S.-Africa partnership coincides with the fact that African projects are seeing rising interest from U.S. companies and lending institutions alike. The USAEF event is thus dedicated to enabling dialogue between its participants that advances these developments.

“Our mission has always been to showcase the resource potential that Africa has to offer while at the same time showing its growing preference for sustainable energy policies and technologies. Toward that end, we hope it becomes evident that Africa does not just want investment capital: it wants smart capital and an accompanying partnership with the investors,” says James Chester, Senior Director of Africa Oil & Power. “The U.S. Africa Energy Forum represents the first-of-its-kind opportunity to catalyze U.S. participation in Africa’s energy transformation – via technology, policy support, capital injection and skills development – and turns a new page in the chapter on global energy investment.”

In partnership with the African Energy Chamber’s U.S.-Africa Committee, AOP will introduce American companies to African opportunities and advance an agenda of sustainable, long-term investment in African energy and other sectors by U.S. organizations.

“The rise in support from the U.S. to the continent is a credit to Africa itself, which is increasingly viewed as a favored destination for global investors, multilaterals and export credit agencies,” says Jude Kearney, President of Kearney Africa and former Deputy Assistant Secretary for Service Industries and Finance at the U.S. Department of Commerce during the Clinton Administration. “Africa continues to command a healthy share of global FDI in oil and gas industries. It has for decades shown that investment in those sectors is favorable compared to other jurisdictions and can be successful by many measures. Even as Africa and the rest of the world wrestles with a global pandemic, Africa’s energy sector shows vitality and resiliency – not only in hydrocarbons but in regard to new opportunities in mining, liquefied natural gas, and agriculture.”

Both African governments and private sector sponsors of African energy projects value highly the combination of investment and partnership that US investors famously convey. The USAEF seeks to enable successful partnerships between its participants such that the energy development goals of U.S. investors and strategic partners and their African counterparts can be achieved.

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