- Curb Export of Crimes Abroad
Nigeria grabbed the headlines for the wrong reason in the United Arab Emirates recently, when five of her youths smashed a bureau de change outlet in the Sharjah Emirate of the country and made away with Dh2.3 million (about N226.1 million in our local currency). The UAE police said the robbers had travelled on March 18 with a tourist visa, which means that their sole mission was for this felony.
This embarrassing image echo in the UAE coincided with Saudi Arabia’s planned execution of a female Nigerian, Kudirat Afolabi, a mother of two, who had been on death row for drug trafficking. Indeed, she was executed last Monday. Nigerian officials say that 23 other Nigerians are facing death sentences for the same offence. But as the Senior Special Assistant to the President on Diaspora Affairs, Abike Dabiri-Erewa, lamented Afolabi’s tragic fate, another Nigerian woman, Somide Wahid, was caught at the Jeddah Airport with hard drugs. This underscores the foolhardiness of drug traffickers.
According to the UAE authorities, the Nigerian bandits stormed the BDC in a commando style, broke the glass barriers between the customers and the staff and grabbed the cash in various denominations of foreign currencies and fled. Under the illusion that their host country’s security personnel were as ineffective as Nigeria’s, the robbers fanned out to different emirates to make their arrest difficult, if not impossible. But they were dead wrong as they were rounded up within 48 hours after the robbery.
Shortly after the story was published in Nigerian newspapers, a report credited to a travel agency alleged that the standard three-month visa permit to tourists had been reviewed for Nigerians to one month. But the UAE Embassy in Nigeria swiftly said the report was false. These robbers who have given our country a bad name deserve the maximum punishment in the UAE penal code to serve as a deterrent to others. Nigerians, who think other nations are as notorious as our country in the breakdown of law and order and abysmal failure of government to enforce its writ, are in for hard times.
This explains why 446 Nigerians are serving various jail terms for offences they committed in the UAE. Nigeria’s Ambassador to the UAE, Mohammed Rimi, revealed this when President Muhammadu Buhari held a town hall meeting with Nigerian residents there during his latest state visit. Besides those in prison, 5,021 others were involved in irregular residency breaches. But they were pardoned and their residency regularised.
On drug trafficking, The Economist of London newspaper reports that there are 32 countries globally, especially in Asia and the Middle East that prescribe death penalty for the offence. Seven of these nations — Indonesia, China, Vietnam, Saudi Arabia, Malaysia, Iran and Singapore —are no-nonsense enforcers of the punishment, despite global condemnation and calls for its reversal in respect for human rights. With zero-tolerance for trafficking in cocaine, heroin and similar substances, these countries don’t succumb to diplomatic pressure, even at the highest level. Tochi Iwuchukwu’s case, convicted of drug trafficking and executed in Singapore in 2007, demonstrated this. President Olusegun Obasanjo, while in office, wrote to his Singaporean counterpart in a plea for clemency for the Nigerian, but he was rebuffed. In December 2017, two Nigerian students in Malaysia were sentenced to death, while another was executed in Indonesia. This is an image crisis for Nigeria. Since 2009, the United Nations Office on Drugs and Crimes had identified the country as a major drug transit hub in West Africa. The global agency said, “In May 2010, Nigerian authorities stopped two separate cargo shipments totalling 63 kg of methamphetamine and amphetamine to Japan and South Africa.”
Instructively, Nigeria accused Saudi Arabia of not informing its embassy of the arrest and prosecution of Afolabi, until it was invited to take the last will of the deceased. Even more intriguing is that the Nigerian Consul-General in Jeddah, Saudi Arabia, reportedly wrote two memos to the Minister of Foreign Affairs, Geoffrey Onyeama, stressing the innocence of some of the accused, but they were allegedly not acted upon. Nigeria has always pleaded with the Saudi authorities to temper justice with mercy. But this has never paid off. Saudi Arabia’s Embassy in Nigeria, in response to the latest execution, said, “It is well known for all those interested in travelling to the Kingdom of Saudi Arabia that the penalty for drug trafficking is the death sentence and it is applied on all persons convicted without exception, as long as the evidence is established against them, and this is conveyed to every person prior to his trip to the Kingdom of Saudi Arabia.”
Interestingly, these drug traffickers were those who abused the advantage of their religious pilgrimages. A local media report claims that scanners, which could have been used to detect these incriminating substances in the luggage of delinquent pilgrims, were not used at the airports where they were lifted for the hajj in 2018. As a result, three traffickers were arrested last year on arrival in Saudi Arabia. If this is true, then, the Nigerian authorities should stop howling when her lawless citizens are caught in the act, but be ashamed of the country’s system that aids them. Such an act of omission or commission can only thrive where drug syndicates, working in cahoots with tainted aviation sector officials, have seized control. The foundation for this moral atrophy is laid in a justice delivery system that allowed 26 hard drug suspects to become fugitives as Premium Times reported on April 12. Again, thirty suspects on trial over eight years ago reportedly jumped bail.
In all, the get-rich-quick syndrome; unexplained wealth by public officials and individuals without a strong government mechanism to address the rot; corruption in the police that fuels the release of confessed killers and robbers in their custody and endless court trials of armed robbery cases, help to whet our youths’ appetite for life on the fast lane. But they should be conscious of the fact that unlike the shambolic governance at home, these countries do not condone such unlawful excesses.
However, the UAE, Saudi Arabia and others should not see any Nigerian deviant as the country’s true envoy. In Europe and the United States, there is an army of Nigerians in all the professions who are doing Nigeria proud and adding value to the economies of their host nations.
African Energy Developments Demand Sustained Investment With New Projects in Mozambique, Tanzania, Uganda, and Senegal
In the past twelve months, the African energy sector has seen several encouraging developments – in the form of both Foreign Direct Investment (FDI) and strategic partnerships – that have advanced the sustainable development of its natural resources. In fact, despite a global downturn in investment in 2020, FDI flows to developing economies accounted for 72% of global FDI, the highest share to date. Given the magnitude of Africa’s oil and gas reserves – not to mention its abundant renewable resource wealth – the continent remains a highly attractive market for inbound investment, which is vital for its growth.
Take Uganda, for instance, which is home to one of the largest onshore discoveries in sub-Saharan Africa. Following multiple petroleum discoveries in Uganda’s Albertine Graben – estimated to contain 6.5 billion barrels of oil, of which 1.4 billion are considered recoverable – foreign investments into the country are expected to reach nearly $20 billion. Last April, Total E&P Uganda B.V. signed a Sale and Purchase Agreement with Tullow Oil PC, through which Total will acquire Tullow’s entire 33.34% interests in Uganda’s Lake Albert development project and the East African Crude Oil Pipeline (EACOP). Five months later, the Ugandan Government and Total signed a host government agreement for EACOP, representing a significant step toward reaching a final investment decision. The deal pushes along an extended development process – slowed by infrastructure issues, tax complications, then COVID-19 – that not only promises to bring first oil by 2022, but also provides a pathway to monetization via associated transport infrastructure.
In addition to developments at Lake Albert, the Ugandan Government has proven its commitment to attracting FDI to its hydrocarbon sector through its second licensing round held last year, as well as its invitation to local and foreign entities to forge joint-venture partnerships with the Government. By prioritizing the establishment of mutually beneficial partnerships, the emerging East African producer aims to facilitate the successful transfer of skills, knowledge and technology, initiating an influx of technical expertise and working capital into the country.
“Those who have been locked out from access to opportunity want the same from the energy sector that the energy sectors want from governments. We must not forget local content, local jobs, local opportunities especially for young people and women” Stated NJ Ayuk Executive Chairman of the African Energy Chamber.
Meanwhile, in West Africa, Senegal has been reaping the rewards of a long-standing partnership with Germany, which has resulted in more than one billion Euros in funding, including significant support for small-scale power plants and renewable energy projects. Holding sizeable potential for solar and wind energy development, Senegal serves as a regional leader in renewable deployment as a means of rural electrification. Indeed, energy is a central component of poverty alleviation across Africa, with electricity access enabling greater independence, clean cooking and potable water, as well as dramatically improving the well-being of individuals, businesses and communities alike. Rural populations are cognizant of the challenges posed by a lack of stable electricity supply – increased urban migration, lack of access to basic services, low economic competitiveness, to name a few – and distributed renewables can represent the fastest and least expensive path to electrification.
European interest in Senegal has shed light on and served as a model for co-operation opportunities between renewable-rich African countries and developed partners, which offer cutting-edge technologies and technical expertise to transform raw resources into viable off-grid and mini-grid solutions.
Furthermore, while the cost of deploying renewable technology has never been lower, the availability of renewable-focused capital has never been higher. Investment in commercial and industrial solar has demonstrated resilience against the pandemic, continuing to be seen as a safe investment in light of rising utility costs and increasing distribution of both solar and financial technologies. Yet resource potential and low costs of equipment are not enough; Senegal and other resource-rich African nations require active investor interest and strong government support to unlock diversified energy mixes. In turn, a lack of investment represents a pointed threat to the achievement of long-term energy security.
“Young people and women have shown their great resilience, and it is our hope we close these deals in the renewable energy sector, Africans can have a sense of some hope that they will be included in the industry contracts and opportunities. It is no longer correct for the African to be the last hired and the first fired” Concluded Ayuk.
Moreover, without sustained levels of FDI continuing to move the needle on oil, gas and renewable developments, energy export revenues run the risk of being stranded and resources left undeveloped. For emerging producers like Uganda – as well as Tanzania, Kenya, Mozambique, among several others – this would mean foregoing critical government revenues that could aid in a much-needed, post-COVID-19 economic recovery. FDI is vital to Africa’s growth, and while it may be challenging to procure capital in a tepid global economy, it is even more difficult not to. Yes, COVID-19 has put emerging producers in a tough spot: new exploration is seen as risky, and new producers lack existing assets or low-cost development of marginal fields on which to fall back. However, it is not an option to slow or postpone time-sensitive developments that promise to harness natural resource wealth and make sustainable improvements in standards of living across the continent. Africa requires a sustained flow of investment and has proven time and again that it offers the scope of projects and magnitude of resources that are worthy of foreign capital.
Saudi Aramco’s Profit Halved in Two Years, Market Cap $210B Below Apple’s
Even before the pandemic, the oil and gas industry was faced with slumping prices. However, with a record collapse in oil demand amid the lockdowns, the COVID-19 crisis has further shaken the market, causing massive revenue and market cap drops for even the largest oil companies.
According to data presented by Finaria.it, the net income of the world’s biggest oil producer and one of the largest publicly listed companies, Saudi Aramco, dropped to $49bn in 2020, a 55% plunge in two years.
The COVID-19 Crisis and Oil Price War Cut Profits by Almost $40B in a Year
In preparation for its IPO, which took place in December 2019, Saudi Aramco had published 2018 profits. With a net income of $111.1bn, Saudi Arabia’s state-run oil giant ranked as the most profitable publicly listed company in the world.
Global macroeconomic concerns like the US-China trade war and the oil overproduction set significant price drops even before the coronavirus outbreak. In 2019, the company reported a profit of $88.2bn, a 20% drop year-over-year.
However, a standoff between Russia and Saudi Arabia in the first months of 2020 sent prices even lower and caused a massive hit for Saudi Aramco’s profits.
After global oil demand plunged in March, Saudi Arabia proposed a cut in oil production, but Russia refused to cooperate. Saudi Arabia responded by increasing production and cutting prices. Shortly Russia followed by doing the same, causing an over 60% drop in crude oil prices at the beginning of 2020. Although OPEC and Russia agreed to cut oil production levels to stabilize prices a few weeks later, the COVID-19 crisis already hit.
In March, Saudi Aramco announced full-year figures for the second time since going public, and the results revealed huge financial losses. In 2020, Saudi Arabia’s state-run oil company reported a net income of $49bn, almost a $40bn drop in a year.
While Saudi Aramco was the most profitable publicly listed company globally in 2019, the current result puts the company behind Apple, which reported a net income of $57.4bn in 2020.
Saudi Aramco’s Market Cap $210B Below Apple’s
In December 2019, Saudi Arabia’s state-run oil giant completed its long-awaited IPO and hit a staggering $2 trillion valuation on the second day of trading, nearly one trillion higher than the world’s next-largest publicly listed companies Microsoft and Apple. The initial public offering was an essential part of Crown Prince Mohammed bin Salman’s Vision 2030 program to transform the Saudi economy.
However, Saudi Aramco’s stocks were outperformed by Apple in 2020. After plunging to $1.61trn in March last year, the market cap of the Dhahran-based company jumped to $2.15trn in September. By the end of the year, this figure slipped to $2.05trn. Statistics show that Saudi Aramco’s market cap floated around this value for the last three months and then dropped to $1.87trn in April after the company revealed the full-year results.
Although valued one trillion less than Saudi Aramco at the time of its IPO, the world’s largest tech company, Apple’s, has seen its market cap surge last year. In January 2020, the combined value of shares of the US tech giant stood close to $1.4trn. After plunging to $1.1trn in March, Apple’s market cap soared to over $2.3trn in December. Although this figure slipped to $2.08trn last week, it still represents almost a 90% increase in a year.
Oil Inches Higher But Rangebound as COVID-19 Cases Soar
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.
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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