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Former Vice President Atiku Abubakar Condemns Electricity Tariff Hikes by Tinubu Administration

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Former Vice President Atiku Abubakar has said the recent hikes in electricity tariffs imposed by the Tinubu administration will exacerbate the suffering of Nigerians already grappling with economic challenges.

In a strongly worded statement signed personally by Atiku, the former Presidential candidate of the main opposition Peoples Democratic Party (PDP) criticized the government for implementing reforms without adequate preparation and mitigation plans to cushion the impact on citizens.

Atiku pointed out that the timing of the electricity tariff hikes couldn’t be worse, coinciding with the withdrawal of fuel subsidies and the depreciation of the domestic currency.

He argued that the government has failed to address the hardships resulting from these measures before introducing further tariff increases.

“The hike in electricity tariff will create more difficulties for the citizens as inflationary pressures are elevated,” Atiku declared.

Moreover, Atiku expressed concerns about the adverse effects of the tariff hikes on the manufacturing sector, stating that businesses would face higher operational costs due to increased electricity expenses, elevated interest rates on loans, and rising wages following the implementation of the new minimum wage.

Atiku warned that the government’s reforms, lacking a human touch, risk plunging the economy into a deeper crisis.

He called for a thorough examination of the root causes of inefficiencies in the power sector before implementing further reforms, advocating a reassessment of the privatization process that led to the establishment of Distribution Companies (DISCOs).

While criticizing the Tinubu administration’s approach, Atiku also offered constructive suggestions, urging the government to sequence its reforms and implement measures to mitigate the adverse effects of tariff hikes on the populace.

Additionally, Atiku called upon President Tinubu to hold the Nigerian Electricity Regulatory Commission (NERC) accountable for ensuring improved service delivery in the power sector, stressing the importance of addressing systemic issues to enhance efficiency and reliability.

As Atiku’s voice joins the chorus of dissent against the electricity tariff hikes, it underscores growing concerns about the economic hardships faced by ordinary Nigerians and the need for policymakers to prioritize citizens’ welfare in decision-making processes.

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.

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Economy

President Tinubu’s New Year Gift: Free Abuja Light Rail Rides Extended

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President Bola Tinubu announced the extension of free rides on the Abuja Light Rail until the end of the year.

This announcement was made on Wednesday during the re-launch of commercial operations on the Abuja Light Rail, with several key political figures in attendance, including the Minister of the Federal Capital Territory, Nyesom Wike.

The initiative, initially introduced by Minister Wike during a recent ministerial press briefing on President Tinubu’s 12-month performance, initially offered a two-month free ride period.

However, President Tinubu has extended this benefit until December 31st, calling it a gift to the people of Nigeria to help them celebrate and ease transportation challenges.

“Our dear Landlord, the Minister of the Federal Capital Territory (FCT), I have heard you say there will be free train rides for two months. I want to appeal to you to make it until the end of the year. Let us give the people reasons to celebrate,’’ President Tinubu declared.

President Tinubu praised the reopening of the Abuja Metro Line as a significant milestone, lauding Minister Wike for the timely completion of the project. Following his comments, the President, along with the FCT Minister, Vice President Kashim Shettima, Senate President Godswill Akpabio, Speaker of the House of Representatives Tajudeen Abbas, Chief Justice of Nigeria Justice Olukayode Ariwoola, members of the Federal Executive Council, and other dignitaries, took a 40-minute ride from the metro station to the airport station.

Minister Wike, in his address, highlighted the rapid progress made on the metro line following President Tinubu’s directive in September 2023.

He noted that although the metro line was inaugurated in 2018, it remained non-functional due to the lack of essential access roads.

The project was completed within nine months, with the Central Bank of Nigeria, in collaboration with the Coordinating Minister of the Economy, the Minister of Finance, and the Accountant General of the Federation, facilitating the payment of $30 million to the contractors, China Civil Engineering Construction Corporation (CCECC). The construction of the access roads cost N21.4 billion.

Providing further details, the FCT Mandate Secretary for Transportation, Chinedu Elechi, stated that the Abuja Metro Line has 12 trains, each capable of carrying at least 700 passengers, making 14 trips per day.

He added that Lot 1 and 2 of the metro line would run two trips simultaneously every day, with a cumulative capacity of transporting 980,000 passengers monthly within the Federal Capital Territory.

This extension of free rides is expected to significantly benefit the residents of Abuja, offering them a reliable and cost-effective mode of transportation while also encouraging more people to use public transit.

The move underscores President Tinubu’s commitment to improving infrastructure and public services, enhancing the quality of life for Nigerians, and fostering economic growth through better connectivity.

As the year progresses, the continued free service on the Abuja Light Rail is anticipated to be a cornerstone of the city’s transportation network, easing traffic congestion and providing a modern, efficient alternative for daily commuters.

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

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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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Investor Optimism Dwindles One Year After Tinubu’s Reforms

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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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