- We Won’t Spend Money on Ajaokuta Again – F
The Federal Government on Thursday said it would not repeat the mistake of the former President Olusegun Obasanjo’s administration on the Ajaokuta Steel Complex in Kogi State.
The Minister of Mines and Steel Development, Dr. Kayode Fayemi, who stated this at a press conference in Abuja, also said the present administration would not spend any money to complete the steel plant.
Fayemi stated that the Federal Government had sunk over $8bn into the project since 1979 without any result.
The minister stated that no fewer than 14 organisations from different countries had since 2016 indicated interest in the Ajaokuta Steel Complex.
He said, “We have also said to them that we are not going to repeat the mistake of the Obasanjo administration. We will not undertake the re-concession without one, a technical audit; two, a transaction advisory service that will look into all these and advise us accordingly as to who really has the technical capacity, the financial wherewithal and the track record to really bring Ajaokuta back to life.
“However, the government took a principled position on one thing: that Nigeria will not spend one dollar on the so-called completion of the Ajaokuta steel plant. The reason for that is very simple; today from our record, we have spent close to $8bn since 1979 when this process started and we have not seen the result.”
The minister added that the government and the House of Representatives agreed on the concession of the plant and that the House approved the sum of N2bn for the purpose in 2017.
The House had last week passed a vote of no confidence in Fayemi and the Minister of State for Mines and Steel Development, Alhaji Abubakar Bwari, following their failure to appear before it for sectoral debate on the steel plant.
The lawmakers also instructed the ministers to suspend every step towards the concession of the plant, adding that they preferred that the government should invest and complete the project.
Fayemi, however, said that the government had taken a decision not to spend any money on Ajaokuta since over $8bn had been sunk into the project by successive administrations since 1979.
According to him, the House agreed on the need to give out the plant as a concession by approving N2bn for the process in the 2017 Appropriation Act.
He said, “We are just implementing what was passed by the National Assembly. That is why we are surprised that we have been subjected to an unwarranted attack over the matter in the last one week.
“Ajaokuta is an inherited challenge. The Chief Olusegun Obasanjo administration gave it out on concession; the President Umaru Yar’Adua government revoked it. And the case went to the London Court of Arbitration. Its resolution in 2016 led to the signing of the Modified NIOMCO Agreement, which ceded the complex back to the Federal Government and NIOMCO to Global Steel.
“No fewer than 14 parties have shown interest in running the complex, but government’s position is that we would not do any concession without a technical audit.
“PricewaterhouseCoopers was engaged to do a review of the company’s indebtedness and statutory liabilities as part of the settlement agreement.”
The minister added, “The National Assembly appropriated N2,096,500,000 for Ajaokuta concession in the 2017 Appropriation Act duly passed into law. We are just commencing what was passed into law by the National Assembly.
“This is why I am surprised at how we have been subjected to vitriolic attacks in the last one week. The March 1 sectoral debate, which we could not attend, was the first and only one I and the Minister of State were unable to attend and we duly communicated this to the leadership of the House.
“We take exception to allegations that are not backed up by evidences. Allegations that officials of the ministry have had their hands tied by the concessionaire are quite unfounded.
“The Russian government has not indicated interest in Ajaokuta. Yes, we have had offers from companies from Ukraine, Russia, Belarus and even Nigeria.
“Yes, I have met with the Russian Ambassador the same way I have met with the Ukrainian Ambassador and many other ambassadors. The Russian Ambassador told me they can offer technical, management and audit support, but not as a country bringing in money to take over the complex.
“Many are saying Ajaokuta is 98 per cent completed. The ministry believes that can only be determined by the outcome of the technical audit, which should be ready in about six weeks.”
Fayemi reiterated that the President Muhammadu Buhari administration was being painstaking with the Ajaokuta Steel Complex, given the fact that it had been a victim of bad planning and poor execution by past administrations.
“Our interest is to make it work so that it can create jobs and wealth, and we are ready to work with the National Assembly and other stakeholders to ensure its success,” he added.
Fayemi condemned what he called unwarranted attacks by the leadership and members of the House of Representatives on the ministry.
“The House of Representatives has every right to seek for an explanation on any matter relating to what they have appropriated as one responsible for appropriation, and on any matter of public interest. There is nothing fundamentally wrong in the House and its leadership requesting our presence at the sectoral debate that was called last week,” he stated.
Fayemi stated the ministry requested that the appearance of the ministers be shifted to another date.
“We did not think there was anything untoward about our request for another time, partly because this was the fourth time we were going to be speaking to the House of Representatives on the Ajaokuta Steel Complex,” he added.
Lagos Loses N1 Trillion to #EndSARS Protest, a Year Budget – Gov
Lagos Needs N1 Trillion to Fix Vandalised Infrastructure, a Year Budget – Gov
The Governor of Lagos State, Babajide Sanwo-Olu, has puts the total economic cost of past week destruction and vandalism in the state at about N1 trillion.
Sanwo-olu, who spoke with the speaker of the House of Representatives, Hon. Femi Gbajabiamila, that was on a fact-finding visit to Lagos on Sunday, said the state may spend up to N1 trillion to fix damages done to infrastructure.
Speaking on the situation, Femi Gbajabiamila, said “The House of Representatives will do all it can to compensate all those who suffered brutality including policemen that lost their lives in the process.
“Also whatever the house can do in rebuilding Lagos and other states it will do. We are now in a state of reconstruction. What must be done will be done.
“I learnt from the governor of Lagos State that it will take N1.0 trillion to rebuild what had been lost and I asked him what is the budget size of the state he said about N1.0 trillion. You can see we are moving backward.
Rotimi Akeredolu, Chairman of the South West Governors, who was part of the visit, stated, “We are indeed surprised at the extent of damage to lives and properties in Lagos. We will be right to say Lagos was turned into a war zone.
“We are deeply concerned with the ease with which public buildings, utilities, police stations and investments of our people have been burnt despite the proximity of security agencies to those areas. However, while responding to the total number of government’s buildings burnt among others,” Lagos State Commissioner for Information and Strategy, Mr Gbenga Omotoso, stated.
“We are still counting. The state is still taking inventories of all that happened and not until all that is concluded we can’t not ascertained for now the total number of burnt structures. But I can tell you it’s very huge.”
Experts Recount Nigeria Losses Ahead Possible Rebuilding, Recovery
Economic Experts Recount Losses Incurred from the #EndSARS Protest Ahead Possible Rebuilding, Recovery
Economic experts have started releasing reports on the size of the damage done to the nation’s economy following the #EndSARS protest that was hijacked by hoodlums and criminals.
The most affected state, Lagos State, will need about $1 trillion, an equivalent to its annual budget, to recoup the economic value of what was lost to the destruction and looting perpetrated by thieves masquerading as protesters.
A Senior Economist/Head, Research & Strategy, Greenwich Merchant Bank, Ayodeji Ebu, said the unrest and the 24 hours curfew that was later imposed by Lagos State to restore order could cost the state at least N54 billion per day.
He explained that the protest would hurt the nation’s foreign direct investment in the remaining part of the year and as well as the first quarter of 2021.
His words: “While it may be difficult to estimate the exact loss so far, based on the significant contribution of Lagos State (approximately 30%) to Nigeria’s total Gross Domestic Product (GDP) and as over 50 percent of Nigeria’s non-oil industrial capacity is located in Lagos, the impact of the crisis will be enormous.
“This was further compounded with the 24hours curfew that lasted for about four days. Estimating using the Q2’2020 GDP data and assuming there was a total shut down, each day will cost Lagos alone about N54 billon.”
Speaking further, Ebu said: “With Lagos the centre of the civil unrest, which account for 70 percent or $1.1 billion of total capital importation in Q2’2020, we expect this to further impact on direct investment in Q4’2020 and Q1’2021.”
He expects that insurance claims to also rise in line with the damages done on lives and properties.
Similarly, analysts at Cordros Capital, a Lagos based investment banking firm, reacted to the negative impact of the unrest on the nation’s economy.
The analysts said the nation’s economy could contract by as much as 6.91 percent year-on-year in the final quarter of the year due to the unrest. Therefore, they projected a negative growth rate of 4.15 percent year-on-year for the 2020 fiscal year.
In their words, they said “The transportation, trade, and manufacturing sectors are expected to be the hardest hit.
“On transportation, we expect reduced domestic and international flight operations pending when normalcy is restored.
“Similarly, we expect compliance with curfew directives to hinder the free movement of people and goods across the country, further compounding the woes of the transport sector, which is yet to recover from the COVID-19 induced decline.
“While the manufacturing sector is currently being hampered by FX related issues and an unfriendly business environment, the imposition of curfews will further exacerbate the challenges of the sector.
“For the trade sector, the decline in household consumption brought about by higher food prices and shrinking consumers’ income will cascade into weak wholesale and retail trade in conjunction with the pre-existing supply chain constraints.”
Analysts at Fidelity Securities Limited also added their voices and said the protest may cost the nation more than the N700 billion estimation previously estimated by the Lagos Chamber of Commerce.
They said “The EndSARs protest and eventual escalation of the protest would cost the Nigerian economy way more than N700 billion initially estimated by the Lagos Chamber of Commerce. With the current level of destructions, it may take a while for business to run at full capacity as the government as well as the private sector will first have to channel funding into the destroyed infrastructure in a bid to restore things back to the way it was, before even thinking of further improving on the infrastructure.
“Given the level of destruction, more businesses have been affected, more jobs would be lost, and more families would further fall below the poverty line as a result of the looting and burning of business. This is expected to further worsen the economic situation of the country which was already suffering from the impact of Covid-19. The government at this point would need to think out of the box, if it aims to revitalise the economy in the shortest time, else our GDP growth rate may remain negative even into the new year.”
Accordingly, the Electricity Distribution Companies of Nigeria (DISCOs), on Sunday said the destruction of equipment it uses to deliver power and service operations will hurt its revenue generation and service delivery in October and the rest of the fourth quarter.
The DISCOs said “I tell you, assets are been destroyed, which is a significant impact on the industry. The DISCOs are expected to give power and how will it be achieved when our facilities including cables, poles, buildings are destroyed.
“That, however, transcends to money because the DISCOs cannot collect money for bills due to the unrest. Who would want to pay when everybody is angry.
“This means the remittance will be low to the Government on power we have collected. The protest has empowered Nigerians to fight back and the threat to lynch officials collecting bill are high. The properties and cables would have to be fixed on whose account?
“Seriously we are at a crossroad but we have signed an agreement to deliver power and that we would do.”
Nigeria Mulls Selling Electricity to Republic of Chad
Nigeria Considers Selling Electricity to the Republic of Chad
The Federal Government is presently considering selling electricity to the Republic of Chad after a request was made by the neigbouring nation.
The federal government-owned Transmission Company of Nigeria disclosed this on Sunday, adding that a meeting was held last week to discuss the possibilities of plugging the Republic of Chad to the nation’s grid.
Nigeria presently exports electricity to three neighbouring nations, Benin, Togo and the Republic of Niger despite struggling with power supply at home and failed to up its power generation more than the current level of 3,000 -4,500 megawatts in recent years.
On Sunday, the total power generated declined to 3,474.5MW as of 6am, down from 3,776.5MW on Saturday, according to the latest data from the Nigerian Electricity System Operator.
The total number of idle plants rose from 8 on Saturday to 11 on Sunday. These idle plants were Geregu II, Sapele II, Alaoji, Olorunsogo II, Omotosho II, Ihovbor, Gbarain, Ibom Power, AES, ASCO and Trans-Amadi.
A total of twenty-seven plants were presently connected to the national grid, which is being managed by the TCN.
“Meeting between Ministry of Power, TCN, and the Chadian Minister of Energy, Mrs Ramatou Mahamat Houtouin, to discuss the possibilities of connecting the Republic of Chad to the Nigerian national grid [was held] on Wednesday, October 21, 2020,” the TCN said on its Twitter handle on Sunday, alongside pictures of the meeting.
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