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Nigeria Attracted $6.8bn Investments in Nine Months – NBS

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  • Nigeria Attracted $6.8bn Investments in Nine Months – NBS

The nation attracted $6.85bn worth of investments in the first nine months of 2017; while some state governments took advantage of portfolio investors’ appetite for the Nigerian market, others allowed the opportunity to slip, IFEANYI ONUBA writes

Between January and September last year, about 28 state governors could not attract any form of investments to their states, an analysis of the Capital Importation Report for the period has revealed.

The report, prepared by the National Bureau of Statistics, contains the total amount of fresh investments attracted to the Nigerian economy during a particular period of time.

In the report, which was obtained by our correspondent in Abuja on Friday, the NBS revealed that none of the 28 states contributed to the entire $6.85bn (N1.38tn) that the federation attracted during the nine-month period.

The states that could not attract any form of investment inflow are Abia, Adamawa, Anambra, Bauchi, Bayelsa, Benue, Borno, Cross River, Delta, Ebonyi, Ekiti, Gombe, Imo, Jigawa, Kaduna and Kano.

Others are Katsina, Kebbi, Kwara, Nasarawa, Niger, Ondo, Osun, Plateau, Sokoto, Taraba, Yobe and Zamfara.

Based on an analysis of the NBS report, only nine state governments were able to secure fresh investments inflow into their states within the first nine months of last year.

Lagos State attracted the highest amount of $5.9bn during the nine-month period.

The $5.9bn investment inflow into Lagos State represented about 86.18 per cent of the entire $6.85bn that the country attracted during the nine-month period.

A further breakdown of the state’s investment inflow revealed that the sum of $865.71m was attracted in the first quarter, while the second and third quarters had $1.74bn and $3.29bn, respectively.

The Federal Capital Territory and Akwa Ibom State followed, attracting total investment inflows of $849.12m and $76.42m, respectively during the period.

A quarterly breakdown of the FCT’s $849.12 investment inflow showed that $14.86m was attracted in the first quarter, while the second and third quarters had $16.64m and $817.61m in that order.

For Akwa Ibom State, its $76.42m investment inflows were received as follows: $18.36m in the first quarter, $34.08m in the second quarter, while the third quarter attaracted $23.98m.

During the period under review, Ogun attracted fresh investment inflows of $6.75m; Oyo, $6.35m; Rivers, $550,000; Edo, $3.74m; Enugu, $630,000; and Kogi, $148,000.

In terms of sectoral inflow, findings revealed that investment through shares attracted the highest amount of $985.33m.

This was followed by the services sector, with $732.53m; while the production and banking sectors recorded $584.32m and $267.74m, respectively.

Others are oil and gas, $206.46m; telecoms, $207.81m; financing, $107.22m; agriculture $66.56m; electrical, $32.72m; brewing, $8.83m; construction, $4.07m; and consultancy, $6.72m

The rest are trading, $23.98m; information technology services, $7.53m; marketing, $1.68m; drilling, $1.51m; and hotels, $170,000.

Speaking on the investment climate, the President and Chairman of the Governing Council, Institute of Directors, Nigeria, Alhaji Ahmed Mohammed, called on the Federal Government to improve the level of corporate governance in both public and private sector institutions in order to encourage investors to bring in fresh funds to the country.

He said there could not be substantial improvement in the investment inflows into Nigeria without a fast economic growth entrenched in global best practices in both the public and private sectors.

The IoD president said there was a need for sound corporate governance in order to protect those that would investt their funds in the economy.

Mohammed stated, “Investors need to be protected through regulation; it is also important to recognise that only good corporate governance attracts investments in the long-term. This is what will enable organisations to attract financial and human capital, perform efficiently and generate long-term economic value for their stakeholders.

“It is obvious that only countries with strong corporate governance culture will attract more sustainable capital inflow and create more wealth than less compliant nations.

“The inference is that both domestic and foreign investors are likely to shy away from nations and states that do not guarantee investor rights, provide for adequate corporate disclosures or ensure sound boardroom practices.”

The Deputy Assistant Secretary, United States Department of Commerce, Mr. Seward Jones, stated that there was a need for the government at all levels to address some of the impediments to trade and investments in Nigeria.

Jones, who spoke to our correspondent on the sidelines of a meeting at the Nigerian Investment Promotion Commission, said already, his country had signed a commercial investment dialogue agreement with the Federal Government to deepen commercial and investment ties between both countries.

The agreement, according to him, will allow for the exchange of information between the two business communities and the governments on key commercial and investment matters of importance.

This, he noted, was expected to improve the business climate, foster greater economic growth and ensure job creation.

Under the pact, Jones said the initial focus areas would be infrastructure, agriculture, digital economy, investment and regulatory reform.

On what was being done to attract more investments to Nigeria, the Minister of Budget and National Planning, Senator Udo Udoma, said the government was putting in place adequate measures that would enable it to attract fresh investments to the country.

Udoma explained that the Federal Government’s priority was to create a better environment for businesses to thrive, as the country was focused on expanding the productive base of the economy.

The minister, who noted that the country was open for business, gave an assurance that the government would continue to improve the business climate as set out in the Economic Recovery and Growth Plan.

Udoma stated that there existed untapped investment opportunities in agriculture, manufacturing, oil and gas, power, rail, mining and shipping, among others.

He said, “The fall in crude oil price experienced at the inception of the administration was a wake-up call for the diversification of the country’s economy, which has historically relied, almost entirely, on crude oil for its foreign earnings and government revenues.

“The government’s response to this was the development of an ambitious four-year plan to dramatically turn around the economic direction of the country. This plan is the ERGP. The ERGP is aimed at increasing the productivity of the Nigerian economy by encouraging private sector investment.

“Government is committed to achieving the objectives of the plan and getting the economy back on the path of diversified, sustained and inclusive growth.”

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.

Economy

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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Economy

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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Economy

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

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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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