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Operations of Dangote Refinery Will Save Nigeria $3B Annually From Petroleum Imports – Emefiele

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The Central Bank Governor, Godwin Emefiele, has said that the country will save about $3 billion from petroleum products imports annually when Dangote Refinery is fully operational.

He said that latest records showed that petroleum products took about 25 percent of the country’s import.

Emefiele spoke when he paid a visit to inspect the Dangote Refinery and Petrochemical Company in Ibeju-Lekki, Lagos, on Friday. Some banks chief executives were also part of the visit.

During the visit, Dangote Fertilizer Limited disclosed the formal commencement of production of Urea in commercial quantity and the plan to hit the Nigerian market on Monday.

The CBN governor said the bank was introducing initiatives to support indigenous producers to stimulate local production and preserve foreign exchange in the country.

He added, “Imagine if this refinery comes to life, hopefully by the first quarter of next year, where we have propylene, polyethylene, granules and other by-products from petrochemicals, we will be saving about $3bn worth of import annually.

“For me, that is extremely gratifying. Don’t forget that I keep asking what is the contribution of import to our Gross Domestic Product?

“The contribution of import to GDP is negative and if we can reduce our import by about $3bn annually, imagine how our GDP will be growing.

“That is the science behind what we are doing. Reduce import and produce things that we can produce locally and consume them locally thereby promoting solid import substitution.”

Emefiele said that Nigeria had the potential to export at least 3.5 million metric tonnes of urea to different parts of the world.

He said, “Nigeria needs between one million metric to 1.5 million metric tonnes of Urea to meet the local demand. So, we have potentials to export at least three to four million metrics tonnes of Urea to different parts of the world.

“With this latest development, Nigeria has become one of the major producers of Urea in the world. This for me, is a story, which no one would have believed would happened in Nigeria.”

“Nigeria, now ranks among the leading countries in the production of Urea in the world. This, for me is a story that no one would have believed will happen in Nigeria.”

Emefiele said the commissioning of the petrochemical and refinery plant would kick off by the end of the first quarter of 2022.

Speaking on behalf of the bankers, the Group Managing Director of Access Bank Plc, Mr Herbert Wigwe, expressed joy for the support they gave to Dangote to create a world class manufacturing enterprise in Nigeria.

President, Dangote Group, Aliko Dangote, appreciated the Nigerian banks for believing in his dreams and supporting his initiatives.

He said, “This Phase 1 of the project, which is estimated to cost $2.5bn, is to manufacture 3mmtpa of urea per annum.

“This capacity will later be expanded to produce multi grades of fertilisers to meet soil, crop and climate specific requirements for the African continent.”

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Economy

Kenya Receives $750 Million Loan from World Bank to Boost Economic Recovery

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World Bank Loan - Investors King

Kenya has received a $750 million loan from the World Bank to support its budget and help the East African economy recover from the effects of the COVID-19 pandemic, the multilateral lender said on Friday.

The Kenyan government has been pushing hard to secure foreign funding to fill a wide budget deficit before its financial year closes at the end of this month.

The $750 million disbursement is part of World Bank’s Development Policy Operations (DPO), which lends cash for budget support instead of financing specific projects.

The bank said some of the funds would go towards setting up an electronic procurement system for government goods and services to improve transparency.

The World Bank said the concessional loan will have a 3.1% annual interest rate. Typically, World Bank loans have zero or very low interest rates and have repayment periods of 25 to 40 years, with a five- or 10-year grace period.

On Thursday, Finance Minister Ukur Yatani presented to parliament the 2021/22 budget, with a deficit of 7.5% of gross domestic product, reduced from 8.7% for the current fiscal year ending this month.

The finance ministry forecasts a economic growth of 6.6% this year, recovering from 0.6% in 2020 when sectors like tourism and related services collapsed due to restrictions imposed to curb the spread of COVID-19.

The World Bank forecasts Kenya’s economy will grow 4.5% this year, and 4.7% in 2022.

President Uhuru Kenyatta, who took the helm in 2013, has overseen a jump in public borrowing. Total debt stands at 70% of GDP, up from about 45% when he took over – a surge that some politicians and economists say is saddling future generations with too much debt.

The government has defended the increased borrowing, saying the country must invest in its infrastructure, including roads and railways.

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FG Spends N612.7 Billion on Domestic Debt Servicing in Q1 2021

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Naira Exchange Rates - Investors King

The latest report from the Debt Management Office (DMO) has revealed that the Federal Government spent a total sum of N612.71 billion on domestic debt servicing in the first quarter (Q1) of 2021.

In the report released on Wednesday, the DMO said the Federal Government paid holders of mature Nigerian Treasury Bills (NTB) N17.23 billion in January, N12.3 billion in February and N5.49 billion in March 2021. Indicating that the Federal Government paid a combined sum of N35.03 billion to NTB holders in Q1 2021.

Similarly, the Federal Government paid N537.783 billion to holders of Federal Government of Nigeria bonds in three instalments of N201.95 billion in January, N79.26 billion in February and N256.58 billion in March 2021.

The Federal Government also paid N308.38 million in three tranches to subscribers of mature FGN Savings Bond. FG paid N111.65 million in January, N97.074 million in February and N99.65 million in March 2021.

Another N8.16 billion was used to settle FGN Sukuk Rentals in March 2021. No payment was made in January and February 2021.

The Federal Government released N31.44 billion as principal repayment “in respect of promissory notes during the quarter under review.

A monthly breakdown revealed that a total sum of N219.29 billion was released to service domestic debts in January, N123.09 billion in February and N270.33 billion in March. Therefore, bringing the total amount spent on domestic debt servicing in the first quarter of 2021 to N612.71 billion.

Nigeria’s total debt rose to N33.1 trillion in the first quarter of 2021, according to the report released by the DMO.

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Togo, Niger, Others to Acquire Nigeria’s Idle Electricity

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Electricity - Investors King

Four West African nations are collaborating to acquire unutilised power produced in Nigeria, stated Sule Abdulaziz, the Chairman of the Executive Board of the West African Power Pool (WAPP).

Abdulaziz, who doubled as the acting Managing Director of the Transmission Company of Nigeria, listed the four West African nations as Niger, Togo, Benin and Burkina Faso.

He said the nations were collaborating to make the purchase via the Northcore Power Transmission Line presently under construction.

Abdulaziz disclosed this at the WAPP meeting held on Wednesday in Abuja.

He said, “The power we will be selling is the power that is not needed in Nigeria.

“The electricity generators that are going to supply power to this transmission line are going to generate that power specifically for this project. So, it is unutilised power.”

The WAPP chairman said the country was expecting new generators to take part in the energy export for the 875km 330KV Northcore transmission line from Nigeria through Niger, Togo, Benin to Burkina Faso.

Abdulaziz said, “In addition, there are some communities that are under the line route, about 611 of them, which will be getting power so that there won’t be just a transmission line passing without impact.”

He further stated that the project, financed by the World Bank, French Development Council and the African Development Bank, had recorded progress, saying that the energy ministers would be addressing security issues for the project at another meeting in Abuja.

He added that “Nigeria has the greatest advantage among these countries because the electricity is going to be exported from Nigerian Gencos (generation companies).

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