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Agric Leads Non-oil Export Proceeds with N105.06bn in First Quarter



  • Agric Leads Non-oil Export Proceeds with N105.06bn in First Quarter

Efforts by the federal government to diversify the economy and generate foreign exchange from other sources might have started yielding the needed results as the trade statistics report by the National Bureau of Statistics (NBS), revealed that the exportation of agricultural goods grew by 82 per cent in the first quarter of 2017.

The sectoral breakdown showed that proceeds from agricultural products stood at $340 million (N105.06 billion) in the first quarter of 2017, representing 39.5 per cent of total non-oil export proceeds. Food products, manufactured products and industrial goods counted for 10.8 per cent, 16.9 per cent and 10.9 per cent respectively.

However, the latest quarterly Economic Report from the Central Bank of Nigeria (CBN) puts non-oil exports provisionally at $87 million (N26.88) in Q1 2017, indicating a substantial rise of 86 per cent Quarter-on-Quarter ( q/q). However, they declined by 15 per cent Year-on-Year (y/y).

Analysts believe the q/q surge was attributed to a significant increase in receipts from food and agricultural products.

They however warned that the federal government should urgently address increasing drive by farmers to export their produce, a situation, they stressed will fuel the rise in food inflation.

According to analysts at FBN Quest, “We note that food inflation has risen steadily over the past few months (January – March 2017 inclusive). One likely reason, although anecdotal at this stage, is the increasing preference of farmers to export their produce as opposed to supplying domestically. In our view, this preference can be linked to the fact that the currency has depreciated by 56 per cent from N196/US$ on the interbank market over the period in question (i.e. Q1 2017 vs Q1 2016).”

They added: “The Federal Government of Nigeria (FGN) has announced its intention to boost export activities through payment of the export expansion grant (EEG). The EEG was suspended in 2014. However, N20bn was set aside for its revival in this year’s budget.

“The Manufacturers Association of Nigeria (MAN), following discussions with the authorities, thinks that the new grant may have lower rates than previously, be robustly designed to prevent abuse by applicants and reward exporters for value addition.”

The Minister of Agriculture, Audu Ogbe recently formally flagged off the export of yam with 72 tons of the produce exported to Europe.

Speaking during the flag off of the project at the Lilypond Container Terminal, Ijora, Lagos, Ogbe said he considers the event another giant leap in the country’s quest to grow the agricultural sector towards the diversification of the nation’s revenue base and conservation of foreign exchange by limiting citizen’s appetite for imported food.

“The 72 tonnes is going out in three containers but this is just the beginning; more will follow. There is demand in China, everywhere where Nigerians are and until we stabilise the economy through serious work like this, there will never be peace and stability,” he said.

While emphasising the need for farmers to ensure quality control, Ogbe appealed to exporters to ensure that their produce meet global standard as Nigeria can no longer afford the embarrassment of product rejection.

He said there is high demand for Nigerian yam once international standards are met; adding the federal government was working at taking yam production, processing and marketing in Nigeria to the level of that obtains in Ghana.

According to him, Ghana yam export trade employs over one million people with the country currently accounting for 94 percent of the total yam export in West Africa and covering markets in Canada, UK and Europe.

The minister also assured that the yam export drive would not lead to the product’s scarcity at home.

“I am aware that since we made the announcement that we are going to export yams, Nigerians have begun to express anxiety. I have seen people say we are hungry and you are exporting our yam. Quite frankly, I appreciate the point they are making but the truth is that the yams we export will in no way diminish the quantity at home. Most of the yams we produce rot away.

“New yam will be here in two weeks, the old stock is still there and people in the markets are getting worried but the new yam will come and nobody will touch the old one. We actually overproduce food here,” he said.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade experience in the global financial markets.


Electricity Consumers Get 611,231 Meters Under MAP Scheme



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Electricity Consumers Get 611,231 Meters Under MAP Scheme

A total of 611,231 meters have been deployed as at January 31, 2021 under the Meter Asset Provider initiative since its full operation despite the COVID-19 pandemic and other extraneous factors, the Nigerian Electricity Regulatory Commission has said.

NERC disclosed this in a consultation paper on the review of the MAP Regulations.

The proposed review of the MAP scheme is coming nearly four months after the Federal Government launched a new initiative called National Mass Metering Programme aimed at distributing six million meters to consumers free of charge.

“The existence of a huge metering gap and the need to ensure successful implementation of the MYTO 2020 Service-Based Tariff resulted in the approval of the NMMP, a policy of the Federal Government anchored on the provision of long-term low interest financing to the Discos,” NERC said.

The commission had in March 2018 approved the MAP Regulations with the aim of fast-tracking the closure of the metering gap in the sector through the engagement of third-party investors (called meter asset providers) for the financing, procurement, supply, installation and maintenance of meters.

It set a target of providing meters to all customers within three years, and directed the Discos and the approved MAPs to commence the rollout of meters not later than May 1, 2019.

But in February 2020, NERC said several constraints, including changes in fiscal policy and the limited availability of long-term funding, had led to limited success in meter rollout.

NERC, in the consultation paper, highlighted three proposed options for metering implementation going forward.

The first option is to allow the implementation of both the NMMP and MAP metering frameworks to run concurrently; the second is to continue with the current MAP framework with meters procured under the NMMP supplied only through MAPs (by being off-takers from the local manufacturers/assemblers).

The third option is to wind down the MAP framework and allow the Discos to procure meters directly from local manufacturers/assemblers (or as procured by the World Bank), and enter into new contracts for the installation and maintenance of such meters.

“Customers who choose not to wait to receive meters based on the deployment schedule of the NMMP shall continue to have the option of making upfront payments for meters which will be installed within a maximum period of 10 working days,” NERC said.

The regulator said such customers would be refunded by the Discos through energy credits, adding that there would be no option for meter acquisition through the payment of a monthly meter service charge.

“Where meters have already been deployed under the meter service charge option, Discos shall make one-off repayment to affected customers and associated MAPs. Such meters shall be recognised in the rate base of the Discos,” it added.

NERC urged stakeholders to provide comments, objections, and representations on the proposed amendments within 21 days of the publication of the consultation paper.

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Nigeria’s Economy Moving in Right Direction but Slow – Amina Mohammed



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Nigeria’s Economy Moving in Right Direction but Slow – Amina Mohammed

Nigeria is moving in the right direction economically but its movement is not fast, the United Nations stated on Thursday.

Deputy Secretary-General of the United Nations, Amina Mohammed, said this during a meeting at the headquarters of the Federal Ministry of Industry, Trade and Investment in Abuja.

She said the challenges in Nigeria were huge, its population large but described the country’s economy as great with lots of opportunities.

The UN scribe stated that after traveling by train and through various roads in the Northern parts of Nigeria, she discovered that the roads were motorable, although there were ongoing repairs on some of them.

Mohammed said, “This is a country that is diverse in nature, ethnicity, religious backgrounds and opportunities. But these are its strengths, not weaknesses.

“And I think the narrative for Nigeria has to change to one that is very much the reality.”

Speaking on her trips across parts of Nigeria, she said, “What I saw along the way is really a country that is growing, that is moving in the right direction economically. Is it fast enough? No. Is it in the right direction? Yes it is.

“And the challenges still remain with security, our social cohesion and social contract between government and the people. But I know that people are working on these issues.”

She said the UN recognised the reforms in Nigeria and other nations, adding that the common global agenda was the Sustainable Development Goals.

Mohammad commended Nigeria’s quick response to the COVID-19 pandemic, as she expressed hope that the arrival of vaccines would be the beginning of the end of COVID-19.

On his part, the Minister of Industry, Trade and Investment, Adeniyi Adebayo, told his guest that the Federal Government was working hard to make Nigeria the entrepreneurial hub of Africa.

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N10.7tn Spent on Fuel Subsidy in 10 Years – MOMAN



petrol Oil

N10.7tn Spent on Fuel Subsidy in 10 Years – MOMAN

Nigeria spent a total of N10.7tn on fuel subsidy in the last 10 years, the Chairman, Major Oil Marketers Association of Nigeria, Mr Adetunji Oyebanji, has said.

Oyebanji, who was the guest speaker at the 18th Aret Adams Lecture on Thursday, said N750bn was spent on subsidy in 2019.

He highlighted the need for a transition to a market-driven environment through policy-backed legislative and commercial frameworks, enabling the sustainability of the downstream petroleum sector.

“Total deregulation is more than just the removal of price subsidies; it is aimed at improving business operations, increasing the investments in the oil and gas sector value chain, resulting in the growth in the nation’s downstream petroleum sector as a whole,” he said.

The managing director of 11 Plc (formerly Mobil Oil Nigeria Plc) said steps had been taken, “but larger and faster leaps are now required.”

According to him, deregulation requires the creation of a competitive market environment, and will guarantee the supply of products at commercial and market prices.

“It requires unrestricted and profitable investments in infrastructure, earning reasonable returns to investors. It requires a strong regulator to enable transparency and fair competition among players, and not to regulate prices,” Oyebanji said.

He noted that MOMAN had recently called for a national debate by stakeholders to share pragmatic and realistic initiatives to ease the impact of the subsidy removal on society – especially on the most vulnerable.

He said, “A shift from crude oil production to crude oil full value realisation through deliberate investment in domestic refining and refined products distribution, creates the opportunity to transform the dynamics of the downstream sector from one of ‘net importer’ to one of ‘net exporter’, spurring the growth of the Nigerian economy.

“Effective reforms and regulations are key drivers for the growth within the refining sector. Non-functional refineries cost Nigeria over $13bn in 2019. If the NNPC refineries were operating at optimal capacity, Nigeria would have imported only 40 per cent of what it consumed in 2019.”

Full deregulation of the downstream sector remains the most glaring boost to potential investors in this space, according to Oyebanji.

He said, “As crude oil prices will fluctuate depending on the prevailing exchange rates, it will be astute to trade in naira to avoid inevitable price swings.

“There needs to be a balance between ensuring the sustainable growth of the crude oil value chain (upstream through downstream) and providing value for the Nigerian consumer and the Nigerian economy.”

He said the philosophy should be for the government to put the legislative and commercial framework in place and let the market develop by itself.

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