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FG, States, LGAs Share N4.55tn in Nine Months

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  • FG, States, LGAs Share N4.55tn in Nine Months

The three tiers of government shared a total of N4.55tn between January and September this year as disbursements from the Federation Accounts Allocation Committee.

According to the latest quarterly report of the Nigerian Extractive Industries Transparency Initiative, released in Abuja on Wednesday, out of the N4.55tn that was shared in the review period, N1.76tn was disbursed in the third quarter as against the N1.38tn and N1.41tn shared in the second and first quarters of the year, respectively.

It also showed that between January and September, the Federal Government received the highest allocation of N1.85tn, followed by state governments with N1.51tn and the 774 local governments with N913.8bn.

The sum of N271.78bn went to the Department of Petroleum Resources, Nigeria Customs Service and the Federal Inland Revenue Service as costs of revenue collection.

Further analysis showed that the revenues shared to the federating units were higher in the third quarter, a situation that has been the pattern for some years now.

For instance, while the Federal Government got N549.41bn in the second quarter of 2017, the third quarter figure was N752.79bn, an increase of 37.02 per cent. The trend was the same for the states and local governments, as they received N586.58bn and N363.98bn in the third quarter as against N467.13bn and N280.42bn in the second quarter, respectively.

The report noted that the percentage increases between the two quarters for the two tiers of government were 25.57 per cent and 29.8 per cent.

It attributed the reason for the increases in FAAC disbursements to the three tiers of government in the third quarter to the positive developments in the oil sector occasioned by resurgent crude prices and increased production levels.

The NEITI quarterly review report based its analysis on data obtained from FAAC, the National Bureau of Statistics, Federal Ministry of Finance and the Budget Office of the Federation.

The report stated that the “upward trend in the FAAC disbursements to the three tiers of government are encouraging signs, which if sustained, will improve government expenditures, help to boost economic activities and move the country further away from recession.”

The report also stated that Nigeria’s revenue in the first half of 2017 was about 49 per cent lower than the budgeted figures.

It stated that while the government projected N5.368tn revenue inflow in its 2017 fiscal framework for the first six months of the year, the actual inflow was N2.712tn.

The government’s half-year projections were N2.67tn for oil and N2.7tn for non-oil revenues, but the actual revenue fell short of projections.

“Actual oil revenue was N1.587tn, representing a shortfall of N1.079tn, implying a 40.4 per cent underperformance. Non-oil revenue fared slightly worse, as only 41.6 per cent of the projected revenue was realised. Actual non-oil revenue totalled N1.125tn, indicating a shortfall of N1.575tn,” the report stated.

It pointed out that while the government projected that the non-oil sector would outperform the oil sector, the latter performed better by as much as 41 per cent in revenue generation, raking in N1.587tn as against N1.125tn for the non-oil sector.

Figures for the three tiers of government were no different. The Federal Government had hoped for N2.542tn revenue flow for the first half of the year, but the actual revenue was N1.497tn.

A breakdown of the inflows showed that the oil sector accounted for a larger part of the shortfall, with a 60 per cent drop, while the non-oil sector underperformed by 49 per cent.

“Budgeted half-year inflow from the oil sector was N1.061tn but actual oil inflow to the Federal Government was N414bn. The Federal Government’s budget estimated half-year non-oil revenue inflow at N705bn, but realised only N352bn, indicating a 49 per cent shortfall,” the NEITI report stated.

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.

Finance

Emefiele Pledges Accommodative Monetary Policy to Boost Economic Growth

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Godwin Emefile

Emefiele Pledges Accommodative Monetary Policy to Boost Economic Growth

The Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, has pledged to adopt accommodative monetary policy stance in 2021 in order to support economic growth in the country.

Emefiele, said this on Friday, while speaking at a CBN/Bankers’ Committee’s initiative for economic growth, which is a one-day special summit on the economy by bank chief executive officers.

The theme of the summit is: “How to Overcome the Pitfalls of Recession.”

Nigeria’s economy recently came out of recession, according to the Gross Domestic Product report for fourth quarter 2020 released by the National Bureau of Statistics.

Owing to the slump GDP growth of 0.11 per cent that lifted the economy out of recession, Emefiele said it was imperative that, “we do all we can in 2021 and beyond to ensure that we build on the positive momentum and strengthen our efforts at stimulating growth.”

He expressed optimism that with the discovery and deployment of vaccines worldwide, 2021 would be a year of massive global recovery and Nigeria must not be left out.

“The banks CEOs are here, whether by moral suasion or by force, they will have to participate in this journey. In order to drive and sustain this recovery therefore, we need to sustain the accommodative fiscal and monetary policy measures aimed at improving access to finance for households and businesses.

“Secondly, we must prevent a resurgence in Covid-19 related cases. Thirdly, we must ensure that a significant number of our population is significantly vaccinated and also improve foreign exchange inflows into our country,” he added.

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Banking Sector

CIT Microfinance Bank Disburses Over N16bn Loans

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CIT Microfinance Bank Disburses Over N16bn Loans

CIT Microfinance Bank Limited says it has disbursed about N16bn loans since it commenced operations as part of its contributions to the financial sector and empowerment of businesses.

The Managing Director of the microfinance bank, Mr Kingsley Eremionkhale, disclosed this during the company’s 10th anniversary in Lagos recently.

He reiterated that the bank was committed to supporting the growth of small and medium-scale enterprises in the country.

“Since inception, we have disbursed loans worth about N16bn. Our operation is not just about profit-making, but we have impacted many lives, empowered many businesses, and done a lot in terms of our core mandate as a microfinance bank.”

While appreciating its customers who had been loyal to it for years, he said it was concerned about their business success.

The managing director said, “We are part of our customers’ businesses. We provide services beyond lending and savings products and we also give financial advisory services.”

He appreciated the customers who had stayed with the financial institution for many years.

The managing director noted that the MfB is a state-licensed bank operating in Lagos, and a subsidiary of Capitalfield Investment Group.

He also attributed the success of the MfB to the board of directors which it said had been supportive, the management team and its workforce in the past 10 years.

While saying that the bank could lay claims to exponential growth, he said the public should expect more from it.

He also said that it was driving its operations through its digital offerings and our e-channels, to improve its services to our customers.

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Finance

FMDQ Approves Valency Agro’s N5.12bn Commercial Paper

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FMDQ

FMDQ Approves Valency Agro’s N5.12bn Commercial Paper

FMDQ Securities Exchange Limited has announced the approval of the quotation of the Valency Agro Nigeria Limited N5.12bn Series 1 Commercial Paper under its N20bn CP Programme on its platform.

The Exchange said in fostering the development of the Nigerian debt capital markets, it had continued to avail its credible and efficient platform as well as tailor its listings and quotations services to suit the needs of issuers and registration members through innovative and uninterrupted service delivery.

It said in a statement on Thursday that the Valency Agro Nigeria CP debut issue came at a time when the Nigerian economy was bedeviled with soaring food prices, amidst compounding challenges of insecurity.

It said the agricultural sector and its attendant transformation agenda had never been more important in driving increased and sustainable production of agricultural products as well as the derived foreign earnings through exports.

The Exchange said the proceeds from the issue of the CP would be applied by Valency Agro towards meeting the mid-term working capital requirements of the various agricultural produce under its portfolio such as cashew, sesame, cocoa and in value addition prior to export.

The Executive Director, Valency Agro Nigeria Limited, Mr Sumit Jain, was quoted as saying, “We are thankful to our investors towards showing their faith in our agenda to grow the agriculture-focused business with a clear aim to maximise value addition and create employment opportunities in Nigeria.

“We would also like to commend the efforts made by FBNQuest Merchant Bank Limited’s team to build the reach and FMDQ for their unconditional support for the industry”.

The Head, Capital Markets, FBNQuest Merchant Bank, Mr Oluseun Olatidoye, said, “FBNQuest Merchant Bank Limited is delighted with the successful debut of the N5.12bn Series 1 CP issued by Valency Agro Nigeria Limited. This reiterates our effort to enable underserved sectors access the debt markets, optimise their capital structure and further deepen the domestic capital markets.

“We are proud of the instrumental role FBNQuest Merchant Bank played in this transaction and appreciate the trust the management of Valency Agro placed in us to assist them. Our clients remain our priority, and we strongly believe their success is our success.”

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