FG Approves Three-year External Borrowing Plan
The federal government has approved a three-year rolling external borrowing plan.
Briefing State House Correspondents after the Federal Executive Council (FEC) meeting held in Abuja yesterday, the Minister for Finance, Mrs. Kemi Adeosun, said the approval would be transmitted to the National Assembly immediately.
She said the loans would come from agencies such as the World Bank, African Development Bank, China Exim Bank, and other development agencies like the Japanese International Cooperation Agency (JICA).
Also at the briefing were the Minister for Information and Culture, Lai Muhammed, Minister for Solid Minerals, Kayode Fayemi, Minister for Finance, Minister for Agriculture, Audu Ogbeh, and Minister for Education, Adamu Adamu, who also briefed journalists with respect to FEC’s approval for their respective ministry.
Other highlights of the meeting included the changing of the name of Ministry for Solid Minerals to Ministry of Mines and Steel Development, the approval of a new roadmap for the development of the solid minerals sector, approval of contracts to build a new structure called international house at the University of Ibadan and a library at the University of Lagos.
The finance minister said the plan to borrow externally was in line with government’s strategy to focus on concessional debts, low cost loans particularly from multi-lateral agencies.
She said: “So this plan we have put forward today which was approved by the FEC and will be transmitted to the National Assembly for the approval includes:
“Concessional loans average interest rates 1.25 per cent, four to seven year moratorium, 20 years to pay. From agencies such as the World Bank, African Development Bank, China Exim Bank, and other development agencies lke Japanese International Cooperation Agency (JICA).”
Adeosun said the loans would be applied to develop strategic sectors which government believed would help revive the economy.
She said the power sector would receive a significant amount of the loan to take care of projects militating against efficient power generation. She specifically cited transmission.
“This is long term money that will enable us solve some of the problems in that sector,” she added.
Adeosun said the health sector would also benefit from the loan.
She said: “There are projects around polio. There are some money that have been allocated to us to help us do some massive immunisation, in order to control this recent outbreak. This is being provided by the World Bank.
“There is provision for solid minerals and of course I’m very excited about the discovery of nickel. The World Bank is supporting the project by the Ministry of Mines and Steel with $150 million to enable them strengthen their capacity in that area.
“The largest beneficiary of our borrowing is agriculture because it is equally strategic and we have programmes by the minister some of which he inherited and is going to restructure and reform and some are new to the ministry.”
The minister said government would also seek funding through Eurobond.
She said: “The FEC sent a strong signal to everybody that we need to reach out to the National Assembly to get this borrowing plan approved as soon as possible. Because a lot of this money is for developmental projects. We need this money and it is available for us.
“Remember these are foreign exchange coming to our country that will help our economy.”
Answering questions after the briefing, the finance minister said the present administration was on course to lay a solid foundation for Nigeria’s development.
Adeosun dismissed claims that the administration was confused about how to manage the nation’s economy.
According to her, the government has a clear view of what to do to turn the economy around.
She said: “It is the worst possible time for us. Are we confused? Absolutely not. How are we going to get ourselves out of this recession. One, we must make sure that we diversify our economy. There are too many of us to keep on relying on oil. We can all see what happened at the output data of the oil and gas sector. What’s happening in the Niger Delta has dragged down the GDP of the entire economy. We’re too dependent on oil.
We have to invest in capital projects.
“No we are not confused, the time are confusing but we are not confused. We are extremely focused. We know that if we can just bear and get through this difficult period, Nigeria is going to be better for it. If we rely on oil and the price of oil remains low and the quantity of oil remains low, we can’t grow. We have to grow our non oil economy.
“I think that we have a long way to go. We’re not confused and we’re not deceiving ourselves that everything is rosy. It’s not. It’s a difficult time for Nigeria but I think Nigeria is in the right hands and if we can stick to our strategy. We still have some adjustments to make. I think we need to make some adjustments in monetary policy. It’s quite clear we do and we will do that. We’re working on that. We need to try and find a way to support the manufacturing sector better and we will do that.”
While answering question on the figure released by National Bureau of Statistics, Adeosun said the inflation was being pushed by cost and it would be curtailed.
“What we have is cost-push inflation and when you have cost-push inflation it is structural inflation. It is not going to respond to monetary policy tools such as increasing the rate of interest. We have to address the structural causes of the inflation
“The trend, the rate of inflation growth has slowed down and that’s a good sign.”
Airtel Grows Customer Base by 12 Percent to 116.4m in H1
Airtel Africa Increased Customer Base by 12 Percent to 116.4m in the First Quarter of 2021
Airtel Africa Plc, one of the leading telecommunications companies in Africa, grew customer base by 12 percent to 116.4 million in the first half of the year that ended September 30, 2020.
In the financial results signed by Simon O’Hara, Group Company Secretary, and released through the Nigerian Stock Exchange on Friday, the telecommunication giant reported a 10.7 percent increase in revenue to $1,815 million with second-quarter growth of 14.3 percent.
Similarly, revenue growth in constant currency was 16.4 percent in the first half of the year but 19.6 percent in the second quarter during the peak of COVID-19 locked down.
The report also showed growth was recorded across all regions with Nigeria rising by 20.2 percent. East Africa followed with 21.9 percent growth while Francophone Africa expanded by 4.4 percent.
Services with voice revenue grew by 7 percent with data and mobile money appreciating by 33.4 percent and 30.4 percent, respectively.
Airtel operating profit increased by 19.5 percent to $472 million, representing an increase of 28.3 percent in constant currency. The company’s free cash flow stood at $319 million, up from $210 million filed in the same period of last year.
Raghunath Mandava, chief executive officer, on the trading update: “The first half of our fiscal year included the peak impact of the COVID-19 pandemic in the countries where we operate, as lockdown measures were swiftly implemented to stem the initial spread of contagion. In these unprecedented times, the telecoms industry has emerged as a key and essential service for these economies, allowing customers to work remotely, reduce their travels, keep them connected and allow access to affordable entertainment. In these exceptional circumstances, in the first half, we delivered a strong set of results and as lockdown restrictions eased during Q2 our performance continued to improve with constant currency revenue growth of 19.6%, up 6.6% from the prior quarter.
“Importantly, the fundamentals of our business remain strong and revenue growth further benefitted from the execution of our strategy with a specific focus on expanding distribution in the rural areas, investing in our network and increasing 4G coverage, as well as benefitting from the fact we provide an essential service to consumers. In Q2, performance in our mobile money business also significantly improved with constant currency revenue growth of 33.9%, up 8% from prior quarter, as lockdown restrictions were eased and fees on certain transactions, which had been previously waived, were largely reintroduced. We also continued to enter new partnerships with leading institutions such as WorldRemit, MoneyGram, Standard Chartered Bank, and Mukuru to increase use cases and improve customers’ access to digital
payments and financial services.
We remain alert to the potential for further disruptionsfrom a second wave of COVID-19 across Africa, and the associated actions of governments to minimise contagion. Nevertheless, we are in a strong financial position to capture the opportunities in a fast-growing region that is vastly underpenetrated in terms of mobile and banking services. We remain confident of delivering long term sustained growth for our shareholders.”
Airtel’s full financial year starts from April of the current year and ends in March of the following year.
Total Currency in Circulation Increased by N56.44bn in September
Currency in Circulation Rose by N56.44bn in the Month of September to N2.426 trillion
The total currency in circulation increased to N2.426 trillion in the month of September, the Central Bank of Nigeria (CBN) report has shown.
In the report released on Wednesday, the apex bank said the total currency in circulation stood at N2.369 trillion as of the end of August.
The amount then rose by N56.44 billion in September to N2.426 trillion.
A further breakdown of the report revealed that currency in circulation declined by 6 percent in the first quarter of the year to N2.29 trillion, about 7.5 percent below the same quarter of 2019.
The figure stood at N2.35 trillion in May, then rose to N2.39 trillion by the end of July.
While reserve money expanded by 5.9 percent to N12.96 trillion when compared to a 20.7 percent growth recorded in April 2020.
The report also noted that at N10.61 trillion, liabilities to other depository corporations grew 70.5 percent above the previous month’s growth rate of 59.7 percent.
The report said, “The heightened uncertain outlook due to the lockdown encouraged more cash to be held by the public.
“This was evident from the increase in currency in circulation, compared with the level in the preceding month.
“Currency in circulation rose by two per cent to N2.35tn at the end of May 2020, compared with the increase of 0.5 per cent at the end of April 2020.”
CBN Directs Banks to go After COVID-19 Financial Criminals
Central Bank Asks Banks to Stay Abreast Frauds and Rising COVID-19 Financial Crimes
The Central Bank of Nigeria has directed all financial institutions in Nigeria to update alert protocols in their Anti-Money Laundering/Combating the Financing of Terrorism monitoring tools, in accordance with emerging trends of rising COVID-19 related financial crimes.
In a circular titled, ‘Administrative letters to all banks and other financial institutions’ issued on Monday and signed by J.M. Gana, the Director, Financial Policy and Regulation Department, the apex bank said changes in business activities and financial transactions due to the shift caused by COVID-19 pandemic have led to the surge in financial crimes globally.
Therefore, it said financial institutions must now adapt quickly and keep abreast of the new emerging financial risks and other developments to arrest this new and emerging ML/TF.
According to the circular, this includes strategic investment in data mining and artificial intelligence software to monitor financial transactions effectively and report as quickly as possible.
The central bank said the Nigerian Financial Intelligence Unit, the central repository of suspicious transactions and other financial information, had released a comprehensive report on STRs and others.
It stated that the NFIU had identified cybercrimes, frauds, counterfeiting and substandard goods, diversion of public funds and misuse of non-government organisations funds as some of the ongoing crimes that banks across the nation need to stay abreast and report.
Other suspicious transactions and red flags identified in the report were some e-commerce companies with little or zero history or internet presence suddenly receiving multiple payments from unrelated third parties.
Similarly, it said individuals with zero or little history of financial transactions receiving multiple payments from unrelated third parties. It also noted that customers who suddenly start delaying in the supply or purchases of medical supplies and payment of goods linked to known brands, yet the beneficiary is an individual, not a corporate company should be flagged.
The measures, the apex bank said were necessary due to the rising numbers of unusual transactions from banks’ customers and unscrupulous individuals.
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