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Power Crisis’ll Limit AfCFTA Benefits to Nigeria — Gencos

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  • Power Crisis’ll Limit AfCFTA Benefits to Nigeria — Gencos

Nigeria may not benefit much from the recently signed African Continental Free Trade Area agreement until the country’s power problems are adequately addressed, power generation companies said on Wednesday.

On Sunday, President Muhammadu joined other heads of government of the African Union in Niamey, Niger Republic, to sign the AfCFTA agreement.

But electricity firms under the aegis of the Association of the Power Generation Companies, in a congratulatory message to the President, made available to our correspondent in Abuja, noted that without adequate power supply, the benefits of the agreement to Nigeria would be minimal.

The APGC said, “In direct relation to the just-signed AfCFTA agreement, the benefits it poses to Nigeria may not be fully reaped until the problems of the power sector are fully addressed.

“Goods and services offered by the country may not be comparatively/competitively priced, when compared to other nations with better power supply. Thus, the cumulative result of a significant boost in trade and, therefore, the economy, may not be realised.”

The association added, “For instance, steel mills consume a huge amount of power to convert pig iron blocks to liquefied iron, mixed with ingredients such as carbon, alloys and chemicals to change into a different type of steel, alloy, bars, rods, H-beams, sheet metals, etc.”

The Gencos said in the mining industry, changing the mineral deposit and ores from the mines to concentrate metal blocks also required a huge amount of power.

According to them, hospitals need uninterrupted electricity supply 24 hours a day for many health care functions and operation of patients, and universities require constant electricity to undertake high level research and development works.

The power firms, however, said the development was a welcome one and a stirring indication that the Buhari administration was ready for business.

They said the government, through the signing of the agreement, had shown commitment to addressing the challenges that might hamper this laudable move including hurdles faced by the power generating companies.

The Gencos said, “This is even so given that adequate power supply plays a critical role in the development of the social sector, education, health, transportation and industrialisation of a nation.”

According to them, the recently signed trade agreement calls for a renewed zeal and focus in solving the power sector conundrum, so as to position Nigeria among leading industrialised countries to satisfy the ever-increasing demands for power in many industries and factories across the country.

“The power firms said, “The impact of the inadequate power supply is multifarious. Nigeria’s potential to become one of the world’s largest economies will remain just an aspiration without the electricity required to pursue aggressive industrialisation, including the revitalisation of moribund local industries.”

In a related development, a non-governmental organisation, Social Action, has said the signing of the AfCFTA by Buhari signified that it is time to implement the nation’s National Industrial Revolution Plan.

In a statement issued by the organisation’s Programme Officer, Mr Botti Isaac, in Abuja on Wednesday, the NGO said the country must implement the plan in order to position itself to take full advantage of the continental free trade zone.

Isaac said, “Time cannot be better than now to pursue and implement the National Industrial Revolution Plan to strengthen the country’s industrial sector, to empower it to effectively compete with those of other climates.

“It must also ensure genuine diversification of the economy by affecting a paradigm shift from the mono-product situation of the country to multi-product to afford Nigeria the impetus to harness not just the new African trade deal but others as the proposed open European Union markets.

“The AFCFTA, therefore, offers ample opportunity for industrialisation and job creation as it has provided the platform for Small and Medium Enterprises in Nigeria to connect to regional and continental value chains while consolidating the country’s position as the biggest economy in Africa.”

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

NNPC Supplies 1.44 Billion Litres of Petrol in January 2021

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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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Economy

NNPC Says Pipeline Vandalism Decrease by 37.21 Percent in January 2021

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The Nigerian National Petroleum Corporation (NNPC) said vandalisation of pipelines across the country reduced by 37.21 percent in the month of January 2021.

This was disclosed in the January 2021 edition of the NNPC Monthly Financial and Operations Report (MFOR).

The report noted that 27 pipeline points were vandalised in January 2021, down from 43 points posted in December 2020.

It also stated that the Mosimi Area accounted for 74 percent of the total vandalised points in Janauray while Kaduna Area and Port Harcourt accounted for the remaining 22 percent and 4 percent respectively.

NNPC said it will continue to engage local communities and other stakeholders to reduce and eventually eliminate the pipeline vandalism menace.

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Economy

Nigeria’s Food Inflation Hits 22.95 Percent in March 2021

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Food inflation in Africa’s largest economy Nigeria rose by 22.95 percent in March 2021, the latest report from the National Bureau of Statistics (NBS) has shown.

Food Index increased at a faster pace when compared to 21.70 percent filed in February 2021.

Increases were recorded in Bread and cereals, Potatoes, yam and other tubers, Meat, Vegetable, Fish, Oils and fats and fruits.

On a monthly basis, the food sub-index grew by 1.90 percent in March 2021. An increase of 0.01 percent points from 1.89 percent recorded in February 2021.

Analysing a more stable inflation trend, the twelve-month ended March 2021, showed the food index averaged 17.93 percent in the last twelve months, representing an increase of 0.68 percent when compared to 17.25 percent recorded in February 2021.

Insecurities amid wide foreign exchange rates and several other bottlenecks that impeded free inflow of imported goods were responsible for the surged in prices of goods and services in March, according to the report.

The Central Bank of Nigeria-led monetary policy committee had attributed the increase in prices to scarcity created by the intermittent clash between herdsmen and farmers across the nation.

However, other factors like unclear economic policies, increased in electricity tariffs, duties, subsidy removal and weak fiscal buffer to moderate the negative effect of COVID-19 on the economy continue to weigh and drag on new investment and expansion of local production despite the Federal Government aggressive call for improvement in domestic production.

Nigeria’s headline inflation rose by 18.17 percent year-on-year in the month under review.

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