Private Sector to Invest N169.72bn Tax Credit in Four Roads Construction
The Federal Government of Nigeria, through its Executive Council, on Wednesday, approved N169.7bn private sector investments for at least four road infrastructures under the government’s Tax Credit Scheme.
Minister of Works and Housing, Babatunde Fashola, made this known to the State House correspondents after the council meeting. At the meeting presided over by President Muhammadu Buhari, Fashola disclosed that the scheme was initiated in 2019 through Executive Order 7 signed by the President, and that the arrangement allowed private sector players to finance public infrastructure instead of paying taxes and then offset it over time using tax credits.
In the statement made available to Investors King, the four roads include a 234 kilometre stretch from Bali to Sheti through Gashaka to Gembu in Taraba State at the sum of N95,232,474,010.72 and the second road, which is also a tax credit scheme, is made up of three roads worth N74,486,577,050.
For the 234-kilometre road in Taraba costing N95.23bn, Fashola noted that N20bn under the NNPC Tax Credit Scheme would be disbursed to begin the project soonest.
“The two main memoranda relate to the uptake by the private sector in response to the tax credit programme, which we initiated in 2019, by Mr. President signing of Executive Order 7 to allow private sector finance public infrastructure in lieu of tax and then to offset it over time using tax credits.
“So the first road that was awarded today on that policy initiative is the rule road from Bali to Sheti through Gashaka to Gembu in Taraba State. A total of 234 kilometres reconstruction of that road in the sum of N95,232,474,010.62.
“The existing road, for those who are familiar with it, has no concrete stone base. It is just laterite on the asphalt so it doesn’t last and it’s breaking up and leading to potholes.
“So we’ve rewarded this now for reconstruction under the tax credit scheme, there’s a N20bn provision under the NNPC tax credit scheme that will be used to kickstart this immediately,” he said.
Fashola added that “the second road which is also the tax credit scheme, which was approved by the Council is actually three roads. The applicant, in this case, is Mainstream Energy Solutions, a major energy player in the country and is now seeking to also participate in this policy by investing a total of N74,486,577, 050.”
Snake Island Port Makes History with $1 Billion Private Investment in Concession Agreement
Snake Island Port has achieved a significant milestone by securing a momentous $1 billion private investment through a historic concession agreement.
This landmark agreement is set to transform the port’s operations and propel it to new heights.
The Chairman and Chief Executive Officer of Nigerdock, Maher Jarmakani, expressed his elation over this remarkable achievement. Jarmakani affirmed that the 45-year concession agreement with the Federal Government would not only allow for an expanded operational scope but also attract substantial private investment, amounting to an impressive $1 billion.
Jarmakani conveyed his heartfelt gratitude to the Federal Government for its unwavering support in enabling the expansion of Nigerdock’s operations. This collaboration serves as a testament to the government’s commitment to fostering partnerships that drive economic growth, job creation, and the development of critical infrastructure.
Nigerdock, a multipurpose port facility situated within the Snake Island Integrated Free Zone (SIIFZ), occupies an expansive 85-hectare area and encompasses three terminals. The facility specializes in ship repair, logistics, and free zone solutions. Recognizing the potential of Snake Island Port, the Presidency awarded Nigerdock free zone and port status back in 2005, leading to the establishment of the Snake Island Integrated Free Zone. In subsequent years, the Nigerian Ports Authority and Nigeria Customs Service granted approvals for direct shipping and cargo handling operations, respectively.
With the new concession agreement, Snake Island Port is poised for transformative growth. The extended operational scope and influx of private investment are expected to attract both domestic and international businesses, stimulating economic development in the region. This milestone aligns perfectly with Nigerdock’s long-term vision of becoming a globally recognized maritime operator, further enhancing its contribution to Nigeria’s economy.
The approval of the concession agreement not only emphasizes the Nigerian government’s commitment to public-private partnerships but also underscores its dedication to driving infrastructure projects nationwide. The collaboration between Nigerdock and the Federal Government sets a positive precedent, fostering an environment conducive to investment and economic prosperity.
Nigerian Banks and Telcos Struggle to Resolve N100bn USSD Debt
Nigerian banks and telecommunication firms are currently struggling to resolve a N100bn Unstructured Supplementary Service Data (USSD) debt.
This debt has been accumulating over the past few years due to a disagreement over non-remittance of USSD fees.
USSD services have been essential to financial inclusion in Nigeria, with a large number of Nigerians using it to access banking services through their mobile phones. However, despite its significance, banks and telcos have been at loggerheads since 2019 over the non-remittance of USSD fees.
The accumulated USSD debt was initially estimated at N32bn in 2019, and by November 2022, it had risen to N80bn. Unfortunately, it has now increased to over N100bn as banks and telcos are yet to come to a resolution.
According to Gbolahan Awonuga, the Head of Operations of the Association of Licensed Telecoms Operators of Nigeria, banks and telcos are still locked in discussions with no way forward. He said, “the debt has continued to increase, and it is now over N100bn.”
A source in one of the telecoms companies also disclosed that banks owe one of the telcos about N100bn. This amount, the source said, does not cut it as it could be estimated at N150bn, including debts owed to other telcos.
However, the recovery process has been frustrating for telcos as banks refuse to acknowledge the debt, and the Central Bank of Nigeria (CBN) supports them. The source said, “no progress has been made simply because the banks have dug in their heels and are refusing to accept that they owe us money, not to talk of repaying.”
This issue threatens financial inclusion as many underserved Nigerians rely on USSD services to access banking services. It is essential that banks and telcos resolve this issue quickly to ensure that businesses and individuals can continue to carry out transactions seamlessly.
Foreign Investment in Nigerian Exchange Declines by Over 50% in One Month
The Nigerian Exchange Limited (NGX) has reported a significant decrease in foreign investment in its markets.
According to the Domestic & Foreign Portfolio Investment Report for March 2023, transactions conducted by foreign investors fell by 53.16% from N19.62bn in February to N9.19bn in March, equivalent to about $42.51m to $19.94m respectively.
The decline marks a considerable setback in the efforts to attract foreign investment into Nigeria.
The report shows that total transactions conducted by domestic investors also dropped by 19.06% from N169.29bn in February to N137.03bn in March.
However, the decline in foreign investment was much more significant, with the total value of transactions by foreign investors decreasing by 88% compared to transactions by domestic investors, which stood at 96% in March 2023.
The decrease in foreign investment is attributed to several factors, including the uncertainty around exchange rates and the unfavorable business environment.
Prof Olawale Ajai of the Lagos Business School pointed out that insecurity and the opaque Naira foreign exchange regime have made Nigeria unattractive to foreign investors.
He also noted that low national productivity, infrastructure deficits, and poor human capital development have contributed to the decline.
The Director-General of the Securities and Exchange Commission, Lamido Yuguda, also highlighted the forex challenges facing foreign investors, citing the delay in accessing foreign exchange for the repatriation of their dividends or capital.
He added that the reduced proportion of foreign investors in the Nigerian capital market was not permanent, and he expected the foreign exchange situation in Nigeria to improve substantially.
The decline in foreign investment is a cause for concern for the Nigerian economy, which is heavily reliant on foreign investment to drive growth.
The government must take urgent steps to address the challenges facing foreign investors and create a more favorable business environment to attract more foreign investment.
African Development Bank Approves $20 Million Investment in Private Equity Fund Targeting the Infrastructure Sector in Africa
EFCC Summons Former Ekiti State Governor Kayode Fayemi for Questioning on N4 Billion Scandal
Wema Bank Plc. Appoints Dr. (Mrs.) Oluwayemisi Olorunshola as Board Chairman
Cryptocurrency3 weeks ago
Binance Resumes Bitcoin Withdrawals After Pause, Cites Congestion of Network
Blockchain4 weeks ago
Nigeria’s Government Embraces Blockchain Technology with New National Policy
Dividends4 weeks ago
Zenith Bank Fetes Shareholders With Unprecedented Dividend Payout of N100.47 Billion
Naira4 weeks ago
Nigerian Naira Appreciates Amidst Decline in Foreign Exchange Market Turnover
Technology3 weeks ago
Apple And Google Collaborate to Stop Unwanted Tracking of People by Bluetooth Devices
Naira4 weeks ago
Dollar to Naira Exchange Rate Today May 3rd, 2023
Cryptocurrency4 weeks ago
Fedi Raises $17 Million to Launch Alpha Version of Federated Operating System
eNaira4 weeks ago
IMF Managing Director Cautions About Unforeseeable Consequences of Retail CBDCs