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Roads: FG Releases N504bn Out of N890bn

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  • Roads: FG Releases N504bn Out of N890bn

The Federal Government released a total of N504.1bn out of the N890bn that was appropriated for the construction and rehabilitation of federal roads across the country in three years.

It was gathered that the N504.1bn was the total sum for capital releases to the Federal Ministry of Power, Works & Housing in 2016, 2017 and 2018 for the works sector.

On June 24, 2019, The media reported that Federal Government roads were still in disrepair despite the N757.48bn that was budgeted for the roads between 2015 and 2018.

Providing clarifications in a document that was made available to our correspondent by the FMPWH on Wednesday in Abuja, the ministry stated that all it got as capital releases for works in 2016, 2017 and 2018 was N504.1bn, instead of the N890bn appropriated for it.

The ministry also noted that the 2015 appropriation for works was meagre, adding that this was increased when the administration of President Muhammadu Buhari assumed office.

The FMPWH said, “It is pertinent to recall that the 2015 appropriation for the works sector was in the paltry sum of N18.132bn for all the ministry’s highway projects. This situation made most of the contractors to abandon their sites, retrench their personnel and shut down their operations.

“However, the appropriation for 2016, 2017 and 2018 were in the sums of N260bn, N274bn and N356bn while the releases were in the sums of N198.3bn, N177bn and N128.784bn respectively. These funds were expended on both inherited and new projects awarded by the Federal Government.”

The ministry stated that it managed 34,000km of federal roads spread across the six geo-political zones of the country.

It noted that with the funding requirements needed to restore the critical infrastructure, the Federal Government prioritised the projects to facilitate connectivity and to enhance socio-economic activities.

It added that the improved funding since 2016 ensured that contractors returned back to site and projects that were hitherto abandoned due to inadequate funding were revived.

On the status of the ministry’s activities on some specific roads, it said the Gusau-Dansadau Road was a state road belonging to the Zamfara State government and was under the purview of the state.

The FMPWH said the Oyo-lseyin-Ago Are-Saki Road in Oyo State had no budgetary provision, adding that the two substandard bridges at Km11 and Km25.6 along the road were, however, being procured by the ministry due to the socio-economic importance of the route.

On the lbadan-lfe Road in Oyo State, it said the road was being maintained by the Federal Roads Maintenance Agency and its reconstruction was under procurement process by the ministry.

The FMPWH said, “Osogbo-llesha Road in Osun State is a federal project and the contractor, Messrs Horizon Nigeria Limited, is currently working there.

“Makurdi-Aliade-Otukpo Road in Benue State has an on-going contract that involves the dualisation of Otukpo Township Road and rehabilitation of the remaining stretch up to Aliade being executed by M/s Rockbridge Nigeria Limited with 11km completed.”

It added, “FERMA is maintaining the Makurdi-Aliade section. The road between Makurdi-Otukpo-9th Mile has been awarded by this administration to Messrs China-Habour Nigeria Limited and construction work has commenced.”

“The Makurdi-Naka-Ankpa Road in Benue State has just been awarded to Gilmor Nigeria Limited by the Federal Government for reconstruction. Lagos-Badagry-Seme Road in Lagos State has an expansion and reconstruction project from Eric-Moore to Okokomaiko being executed by the Lagos State Government.”

The ministry explained that the Okokomaiko-Agbara section was under special maintenance recently awarded by FERMA, while the expansion/reconstruction of Agbara-Badagry-Seme Border section had been awarded to Messrs. CGC Nig. Limited for reconstruction by the Federal Government.

It said the Apapa-Oshodi Expressway in Lagos had been awarded to Messrs. Dangote Industries Limited for reconstruction under the Federal Government tax credit scheme and works had commenced on the road.

It went on to state that the Akure-Ado Ekiti Road was being designed for reconstruction by the ministry, adding that the Yahe-Wanakom-Benue State Border Road was being designed for reconstruction by the ministry.

On the Ejigbo-lwo Road in Osun State, the FMPWH said the road was not a federal road.

The ministry said the Suleja-Minna Road in Niger State had an ongoing contract awarded by the Federal Government to Messrs Salini Nigeria Limited for dualisation and this was one of the Sukuk funded highway projects.

The ministry assured the public that efforts were being made by the Federal Government to sustain the progress on the reconstruction of the federal roads network.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

Economy

Nigeria Aims for N2 Trillion Annual Revenue from Marine and Blue Economy by 2027

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NIMASA

Nigeria has set an ambitious target of generating N2 trillion in annual revenue from this sector by the year 2027.

The revelation came from the Minister of Marine and Blue Economy, Adegboyega Oyetola, during an ongoing ministerial briefing in Abuja on Tuesday.

Outlined within a comprehensive strategy, the plan involves a three-pronged approach to significantly increase revenue generation and operational efficiency within the marine sector.

Oyetola highlighted the imperative of automating revenue collection processes to eradicate bottlenecks and enhance transparency and accountability.

By deploying revenue assurance technologies, the aim is to ensure accurate billing aligned with established contracts and services rendered, thereby preventing revenue leakage.

The ministry plans to commission revenue enhancement studies targeting various departments and agencies to identify avenues for maximizing the use of existing assets.

This includes leveraging concessions to the private sector and fostering public-private partnerships to ensure efficient utilization of national assets.

Recognizing the vast potential of the blue economy, Nigeria intends to embark on investment promotion campaigns aimed at both domestic and international investors.

This strategy seeks to unlock new revenue streams within the marine sector, paving the way for sustainable economic growth.

Minister Oyetola emphasized the importance of harnessing Nigeria’s marine and blue economy, noting its significant role in driving economic diversification and reducing dependency on traditional sectors.

He underscored the government’s commitment to fostering an enabling environment for investment and innovation within the sector.

The ambitious revenue target reflects Nigeria’s determination to tap into its vast marine resources, which have long been underutilized.

With strategic planning and concerted efforts, the country aims to position itself as a key player in the global blue economy, unlocking opportunities for sustainable development and prosperity.

As Nigeria charts its course towards achieving this ambitious goal, stakeholders across government, industry, and civil society will play a pivotal role in driving forward the necessary reforms and initiatives to realize the full potential of the marine and blue economy.

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Economy

Investor Optimism Dwindles One Year After Tinubu’s Reforms

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Bola Tinubu

One year into President Bola Tinubu’s administration, the initial investor enthusiasm over his ambitious economic reforms is fading.

Despite significant changes aimed at revitalizing Nigeria’s economy, persistent challenges such as currency volatility and high inflation are dampening investor confidence.

Upon assuming office in late May 2023, Tinubu enacted a series of reforms intended to attract foreign investment and boost dollar liquidity.

These included eliminating costly fuel subsidies, appointing ex-Citibank executive Olayemi Cardoso as the new central bank governor, and overhauling the country’s exchange-rate policies, which effectively devalued the naira.

While these steps initially sparked optimism and increased dollar inflows, the momentum has since waned.

Kevin Daly, a portfolio manager at London-based Abrdn Investments Ltd., highlighted the need for further stability in Nigeria’s foreign exchange market before considering additional investments in local currency bonds.

“We are likely to add to local currency bonds once FX volatility declines, but the timing of that remains up in the air,” Daly remarked.

He emphasized that the central bank cannot be the sole provider of FX liquidity for the market, calling for more foreign portfolio flows and a degree of de-dollarization.

Data from Tellimer Ltd. reveals that investor inflows into Nigeria’s foreign-exchange market fell by nearly 20% in April, averaging $200 million daily, and dropped further to $180 million in the first three weeks of May.

Since June, the naira has depreciated by almost 67% against the dollar. Additionally, the reintroduction of fuel subsidies, following public backlash over rising living costs, has further complicated the economic landscape.

Inflation remains a significant hurdle, with rates soaring to approximately 33.7%, far outpacing the central bank’s policy rate of 26.25%.

This has deterred investors like Ayo Salami, chief investment officer at Emerging Markets Investment Management Ltd., from venturing into local currency bonds, deeming them unattractive under current conditions.

Another critical issue is the repatriation of funds. While Nigeria offers higher equity valuations and yields compared to some emerging and frontier markets, peers like South Africa, Egypt, Kenya, Turkey, and Pakistan present lower repatriation risks, more credible policy frameworks, and advanced policy corrections.

Ladi Balogun, CEO of Lagos-based FCMB Group, underscored the importance of consistent and clear policy direction to restore investor confidence.

“I think as long as we can be consistent and clear about policy direction, when it comes to monetary policy and the like, then I think you will see confidence return, then you will see liquidity return,” Balogun stated. “That is when you will see international investors come back.”

As Nigeria navigates these economic challenges, the road to restoring and sustaining investor confidence remains complex and fraught with hurdles. The coming months will be crucial in determining whether Tinubu’s administration can achieve the stability and growth it seeks.

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Economy

IMF Boosts China’s 2024 Growth Forecast to 5% Amid Strong Start

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growth

The International Monetary Fund (IMF) has raised its forecast for China’s economic growth in 2024 to 5%, up from its earlier estimate of 4.6%.

This adjustment reflects a robust expansion at the start of the year and additional government support aimed at stabilizing and invigorating the economy.

The IMF’s latest projection aligns with China’s target growth rate of around 5% for the year.

The upward revision comes on the heels of a better-than-expected 5.3% growth in the first quarter, indicating a strong recovery trajectory despite ongoing challenges in the housing market, which continues to dampen domestic demand.

Gita Gopinath, the IMF’s First Deputy Managing Director, highlighted the dual forces driving this positive outlook.

“We certainly are seeing that consumption is recovering, but it has some ways to go,” Gopinath noted in a recent interview with Bloomberg News.

“The strength we’re seeing in public investment remains. Private investment is still weak, mainly because of the weakness in the property sector.”

The IMF’s statement emphasized the need for Beijing to enhance monetary and fiscal support, particularly addressing the protracted housing crisis.

Gopinath underscored the urgency of protecting buyers of pre-sold unfinished homes and accelerating the completion of these projects to stabilize the sector.

Earlier this month, Chinese authorities unveiled new measures to support the real estate market.

These include easing down-payment requirements for buyers and injecting 300 billion yuan ($42 billion) of central bank funding to assist local governments in purchasing excess inventory from developers. However, Gopinath argued that these steps should be expanded.

“Fiscal policy should prioritize providing one-off central government financial support for the real estate sector,” she stated, adding that the current low inflation environment offers room for further monetary easing.

Beyond the domestic landscape, the IMF is also monitoring the implications of international trade tensions. Gopinath expressed concerns over the rising number of trade restrictions globally, noting that about 3,000 new trade barriers were introduced in 2023 alone, triple the number in 2019.

These developments are contributing to an emerging trend of geopolitical fragmentation in global trade.

“There has been an increase in more restrictive trade policies across countries,” Gopinath said. “Trade across countries that are more geopolitically aligned is holding up better than trade across countries that are less geopolitically aligned.”

The IMF’s revised forecast underscores a cautiously optimistic outlook for China’s economy.

While strong public investment and government support are driving growth, the ongoing weaknesses in the property sector and global trade tensions present challenges that need to be carefully navigated.

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