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Economy

Deregulate Power Sector, Don Urges FG

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  • Deregulate Power Sector, Don Urges FG

A Professor of Economics, Sheriffdeen Tella, has called on the Federal Government to deregulate the power sector as opposed to the current privatisation regime in the sector.

He made this call on Wednesday while fielding questions when he featured at The PUNCH Forum held at the PUNCH Place, Magboro, Ogun State.

The don likened the current regime of privatisation as “just putting money in some people’s hands.”

The sector was privatised by the President Goodluck Jonathan administration with 11 electricity distribution companies and six generation companies handed over to core investors on November 1, 2013.

The Transmission Company of Nigeria, which manages the national grid, is still fully owned and operated by the government.

On July 2015, the Federal Government took over Yola Electricity Distribution Company following the exit of the core investor.

Tella advised that by deregulating the power sector just as it did in the telecommunications sector, private investors would be able to generate power and sell to whoever could buy it.

He said, “The government should deregulate the power sector, just like it did with the telecommunications sector. Individuals should be allowed to generate power and distribute to the people and industries. The current privatisation is just like putting money in some people’s hands.”

The don, who is a former Vice-Chancellor of the Crescent University, Abeokuta, equally attributed the slow pace of economic development in the country to a lack of long-term national plan by successive administrations.

The don, who further noted that skewed federalism being operated in the country had denied it economic prosperity and progress, added that though past administrations had come up with one plan or the other, they had not really made any meaningful and enduring impact on the nation and Nigerians.

He said, “We have had governments both military and civilians that came up with different plans viz Vision 2010, Vision 20: 2020, NEEDS (National Economic Empowerment and Development Strategy), 7-Point Agenda, and Transformation Agenda, among others. They did not endure and each fizzled out after each administration. What we need is a long-term national plan.

“There is a report that by 2050, Nigeria’s current population will double. What are the plans we are making to address this? I don’t think there is anything on the ground in terms of a national plan.

“We have to have a long- term prospect of the economy. By this, I mean there must be a national plan and a state plan to direct the nation’s economic and political lives.”

He said that a nation that enjoyed economic prosperity must have “an economy where employment opportunities are available, national income and per capita income are rising, inflation is low, goods are available due to growing domestic production, people are taking holiday abroad, social amenities for young and old are of good quality and affordable, and life expectancy is high.”

Listing other barriers to the nation’s growth and economic prosperity, he noted that these included the political structure of the country, insincerity of politicians, and political expediency over economic judgement.

Tella, who is of the Department of Economics, Olabisi Onabanjo University, Ago Iwoye, Ogun State, said for Nigeria to experience industrial development, it must invest massively in education.

He said, “Massive qualitative education is necessary for economic prosperity. When people are educated they become creative. When one is educated, he knows he has to have a number of children he can cater for.”

Tella, also noted that industries needed a constant power supply to produce optimally.

Tella, who added that the nation’s democracy was maturing, however, called on the media and the elite to act as checks on the excesses of the politicians.

He said, “The elite and the media must insist on accountability, fairness and justice. The elite must get out of their comfort zone and fight for the poor for the benefit of Nigeria.”

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

Once Again The National Grid Collapsed

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Nigeria’s electricity transmission system, also known as the National grid, has suffered another system collapse, plunging Lagos, the country’s commercial capital, Kano and other major cities into a blackout.

The collapse, which occurred about 11.00 am on Tuesday, was confirmed by two of the country’s electricity distribution companies in separate messages to their customers.

“We regret to inform you that the power outage being experienced across our franchise – Kaduna, Sokoto, Kebbi and Zamfara states – is as a result of the collapse of the national grid,” Kaduna Electric said on Twitter.

Eko Electricity Distribution Company Plc, in a text message to its customers, said: “Dear customer, there is a partial system collapse on the national grid. Our TCN partners are working to restore supply immediately. Please bear with us.”

The grid, which is being managed by the government-owned Transmission Company of Nigeria, has continued to suffer system collapse over the years amid a lack of spinning reserve that is meant to forestall such occurrences.

Spinning reserve is the generation capacity that is online but unloaded and that can respond within 10 minutes to compensate for generation or transmission outages.

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Economy

FG Consider Diversification To Generate Revenue

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As revenue from oil nosedives following incessant global price fluctuations, the Federal Government is now channeling efforts to the development of minerals in the mines and steel industry to shore up foreign exchange earnings.

Officials of the Federal Ministry of Mines and Steel Development said on Wednesday that while there had been concerted efforts to develop various minerals in the sector, much emphasis had been placed recently on the development of bitumen, barite and gold.

They told our correspondent in Abuja that the government through the mines and steel ministry was striving to diversify the Nigerian economy away from oil as the major foreign exchange earner for Nigeria.

They also confirmed that large quantities of gold had been discovered in various locations in Zamfara and Osun states.

Asked if the government had initiated programmes to explore the minerals and boost revenues now that the country’s income had plunged, the Special Assistant on Media to the Minister of Mines and Steel Development, Ayodeji Adeyemi, replied in the affirmative.

He said, “Indeed, the ministry has the mandate to generate revenue and diversify the economy through the mines sector.

“And bitumen is one of the key resources which the nation is abundantly endowed with, that has been identified for strategic development.”

To buttress his position, Adeyemi shared some recent presentations of the Minister of Mines and Steel Development, Olamilekan Adegbite, where the minister said his ministry was gathering data on some bitumen fields across the country to attract investors.

“A lot of people are interested in bitumen, which is coming from both local and foreign investors. However, we are still acquiring data in some of the fields,” the minister stated.

On barite, the minister said the mines and steel ministry was working on raising the quality of barite produced in Nigeria to an internationally acceptable standard, as certified by the American Petroleum Institute.

Adegbite said his ministry had contracted a consultant to help raise the standard in the local production of barite to ensure that oil industry players make use of barite produced in Nigeria as against importing the commodity from other countries.

He said, “Barite is a critical weighting material in drilling fluids used in the oil industry. We have a lot of barites but the issue is that it is not produced to API standards. However, we are putting a system in place which would be ready to launch in about July.

“We have got the millers who can produce barite to API standard. Hence we will be able to compete with foreigners and it would save Nigeria a lot of foreign exchange in import substitution.”

On the development of gold, officials at the ministry further stated that the commodity had been aggregated for the production of bullion bars and that this was the first time that such aggregation was happening in Nigeria.

They stated that the gold was sourced from artisanal miners, while the final refining to bullion was done in Turkey.

The sources stated that the ministry had registered two refineries that would now refine to LBMA standard when they come on stream. LBMA is the de facto standard, trusted around the world.

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Economy

Nigeria Sovereign Investment Authority Generates N160.06 Billion in 2020

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Naira Exchange Rates - Investors King

The Nigeria Sovereign Investment Authority (NSIA) generated revenue of N160.06 billion in 2020, according to the latest audited financial reports announced by the Managing Director of NSIA Mr. Uche Orji.

The NSIA income came from devaluation gain of N51 billion, and core income of N109 billion compared to N33.07 billion in 2019.

But Orji lamented: “Covid-19 adversely affected logistics around infrastructure projects, especially the toll road projects and the presidential fertiliser initiative.

Despite the pandemic, the Authority achieved 33 percent growth in Net Assets to N772.75 billion compared to the previous year’s performance of N579.54 billion.

Orji said the NSIA “received additional contribution of $250 million; and provided first stabilisation support to the Federal Government of $150 million withdrawn from Stabilisation Fund last year.”

The same year, the NSIA received $311 million from funds recovered from the late General Abacha from the United States Department of Justice and Island of Jersey for deployment towards the Presidential Infrastructure Development Fund (PIDF) projects of Abuja-Kaduna-Kano Highway, Lagos Ibadan Expressway and Second Niger Bridge.

In response to COVID-19, Orji said: “NSIA partnered the global Citizen, a not-for profit group, to form the Nigeria Solidarity Support Fund. Separately NSIA acquired and distributed oxygen concentrators to the 21-teaching hospital as part of corporate social responsibility; in addition to staffing support to the Presidential taskforce on COVID-19.”

In 2020, the NSIA “invested additional capital into NG Clearing, the first derivative clearing house in Nigeria to maintain NSIA’s shareholding at 16.5 per cent following the company’s rights issue of 2020″ Orji said.

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