- TUC Knocks FG for N24.3tn Debts, Inflation, Others
The outgoing President of the Trade Union Congress, Mr Bobboi Kaigama, has knocked the Federal Government on the country’s debt profile and the increasing rate of inflation in the country.
He expressed these concerns at the opening of the Triennial National Delegates Conference of the union in Abuja on Thursday, according to the News Agency of Nigeria.
He further noted that it became more worrisome as little efforts were being made to solve the issue by those concerned.
Kaigama noted that with the country’s current debt profile still at N24.3tn, efforts must be geared towards ending borrowing and looking inwards for self-sufficiency.
“Our economy is in dire strait, regrettably, those who should manage it are not showing promising signs on how to fix it. Nigeria’s debt profile is over N24.3tn, it was reported recently that the government wants to borrow more.
“Borrowing in itself is not a bad thing, the issue is what you borrow for. Countries borrow for capital projects, and not to pay salaries. If we cannot bequeath wealth to our children, why burden them with debts?’’
He said with the revenue generated by the Federal Inland Revenue Service, NIPOST, NNPC, NIMASA, NAPIMS and the monies recovered by the EFCC and ICPC, Nigeria should not be borrowing.
Kaigama said with the rate of inflation standing between 11.28 and 11.44 per cent for goods and services, there was an adverse effect on purchasing power for citizens, calling on the Central Bank of Nigeria and the Federal Government to ensure the smooth running of the economy.
He said, “Comrades, the current Consumer Price Index also known as the inflation rate for goods and services hovers between 11.28 and 11.44 per cent. This, of course, has had an adverse effect on the purchasing power of the citizens and also leads to bad debt for commercial banks. There is uncertainty in the system.
“We urge the CBN to take drastic action on that to avoid the pain of a double digit inflation rate. In addition, we urge the government to improve our operating environment to ensure the smooth running of the economy
He also decried the secrecy surrounding crude oil refinery in the country, noting that adequate information should be made available to Nigerians on both the internally and externally generated earnings.
The President, Nigeria Labour Congress, Ayuba Wabba, emphasised the need to address the global imbalance in which more people lived below the poverty line, given the growing global wealth.
He called for unity among the organised labour, arguing that it was only through such that workers’ demands could be met.
He said, “The rules cannot be changed through wishful thinking, our leaders must be instigated to promote the rights of Nigerian workers.’’
On his part, the Vice- Chancellor, Nasarawa State University, Prof Suleiman Mohammed, while commending the TUC and its affiliates at promoting the rights of workers, urged them to continue in unity and solidarity.
Delivering a lecture with the theme, ‘Labour and nation-building, the place of labour in national politics’’, he said the role of the organised labour existed to ultimately to make the ruling class do the right thing.
He noted that the political leaders in all tiers of government had continued to use the instrumentality of power to disempowered workers.
He, however, called for more political consciousness to promote workers’ rights.
The don charged them to continue to promote industrial justice and fight for the protection of workers’ interest in all tiers of government.
Human rights lawyer, Femi Falana, who also spoke at the event, called on the organised labour to continue to speak up against corruption in the society, especially issues like the overbloated salary of elected leaders.
He assured them of legal assistance in case of any litigation involving the organised labour, as he had a legal team for that purpose.
He said, “We are happy that labour has achieved the new minimum wage of N30,000 but I must say that it is not enough. I want to see labour protest against corruption, huge salaries of political office holders and their cronies.”
Oil Firms Borrowed N130B From Banks in February – CBN
Operators in the downstream, natural gas and crude oil refining sectors of the Nigerian oil and gas industry borrowed N130b from Nigerian banks in February amid the significant rise in global crude oil prices.
The debt owed by the oil and gas companies rose to N4.05tn in February from N3.92bn in January, according to the latest data obtained from the Central Bank of Nigeria on Monday.
Operators in the upstream and services subsectors owed banks N1.26tn in February, down from N1.27tn a month earlier.
The combined debt of N5.31tn owed by oil and gas operators as of February 2021 represents 25.29 percent of the N21tn loans advanced to the private sector by the banks, according to the sectoral analysis by the CBN of deposit money banks’ credit.
Oil and gas firms received the biggest share of the credit from the deposit money banks to the private sector.
The slump in oil prices in 2020 as a result of the coronavirus pandemic hit many oil and gas companies hard, forcing them to slash their capital budgets and suspend some projects.
A global credit rating agency, Moody’s Investors Service, said last month that the outlook for Nigeria’s banking system remains negative, reflecting expectations of rising asset risk and weakening government support capacity over the next 12 to 18 months.
“Nigerian banks’ loan quality will weaken in 2021 as coronavirus support measures implemented by the government and central bank last year, including the loan repayment holiday, are unwound,” said Peter Mushangwe, an analyst at Moody’s.
The rating agency estimated that between 40 percent and 45 percent of banking loans were restructured in 2020, easing pressure on borrowers following the outbreak of the pandemic.
Another global credit rating agency, Fitch Ratings, had noted in a December 8 report that Nigerian bank asset quality had historically fallen with oil prices, with the oil sector representing 28 percent of loans at the end of the first half of 2020.
It said the upstream and midstream segments (nearly seven percent of gross loans) had been particularly affected by low oil prices and production cuts.
“However, the sector has performed better than expected since the start of the crisis, limiting the rise in credit losses this year due to a combination of debt relief afforded to customers, a stabilisation in oil prices, the hedging of financial exposures and the widespread restructuring of loans to the sector following the 2015 crisis,” it said.
The rating agency predicted that Nigerian bank asset quality would weaken over the next 12 to 18 months.
Fall in Economic Activities in Nigeria Created N485.51 Billion Fiscal Deficit in January -CBN
The drop in economic activities in Africa’s largest economy Nigeria led to a N485.51 billion fiscal deficit in January, according to the latest data from the Central Bank of Nigeria (CBN).
In the monthly economic report released on Friday by the apex bank, the weak revenue performance in January 2021 was due to the decline in non-oil receipts following the lingering negative effects of COVID-19 pandemic on business activities and the resultant shortfall in tax revenues.
In part, the report read, “Federally collected revenue in January 2021 was N807.54bn.
“This was 4.6 per cent below the provisional budget benchmark and 12.8 per cent lower than the collection in the corresponding period of 2020.
“Oil and non-oil revenue constituted 45.4 per cent and 54.6 per cent of the total collection respectively. The modest rebound in crude oil prices in the preceding three months enhanced the contribution of oil revenue to total revenue, relative to the budget benchmark.
“Non-oil revenue sources underperformed, owing to the shortfalls in collections from VAT, corporate tax, and FGN independent revenue sources.
“Retained revenue of the Federal Government of Nigeria was lower-than-trend due to the lingering effects of the COVID-19 pandemic.”
“At N285.26bn, FGN’s retained revenue fell short of its programmed benchmark and collections in January 2020, by 41.3 per cent and 7.5 per cent respectively.
“In contrast, the provisional aggregate expenditure of the FGN rose from N717.6bn in December 2020 to N770.77bn in the reporting period, but remained 14.4 per cent below the monthly target of N900.88bn.
“Fiscal operations of the FGN in January 2021 resulted in a tentative overall deficit of N485.51bn.”
The report noted that Nigeria’s total public debt stood at N28.03 trillion as of the end-September 2020, with domestic and external debts accounting for 56.5 percent and 43.5 percent, respectively.
NNPC Supplies 1.44 Billion Litres of Petrol in January 2021
The Nigerian National Petroleum Corporation (NNPC) supplied a total of 1.44 billion litres of Premium Motor Spirit popularly known as petrol in January 2021.
The corporation disclosed in its latest Monthly Financial and Operations Report (MFOR) for the month of January.
NNPC said the 1.44 billion litres translate to 46.30 million litres per day.
Also, a total of 223.55Billion Cubic Feet (BCF) of natural gas was produced in the month of January 2021, translating to an average daily production of 7,220.22 Million Standard Cubic Feet per Day (mmscfd).
The 223.55BCF gas production figure also represents a 4.79% increase over output in December 2020.
Also, the daily average natural gas supply to gas power plants increased by 2.38 percent to 836mmscfd, equivalent to power generation of 3,415MW.
For the period of January 2020 to January 2021, a total of 2,973.01BCF of gas was produced representing an average daily production of 7,585.78 mmscfd during the period.
Period-to-date Production from Joint Ventures (JVs), Production Sharing Contracts (PSCs) and Nigerian Petroleum Development Company (NPDC) contributed about 65.20%, 19.97 percent and 14.83 percent respectively to the total national gas production.
Out of the total gas output in January 2021, a total of 149.24BCF of gas was commercialized consisting of 44.29BCF and 104.95BCF for the domestic and export markets respectively.
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