Naira crashes further…. now N310 at Parallel Market

The naira traded at N310 to a dollar at the parallel market on Friday, amid expectations of an intervention by the Central Bank of Nigeria (CBN). The Nigerian currency traded at N307 at the close of market on Thursday, showing a depreciation of one per cent.

However, it maintained N197 to the dollar at the official CBN’s window.

Traders at the market blamed the further fall in value, in spite of insinuations of an intervention at the foreign exchange market by the CBN, on demand for the greenback.

Minister says plans afoot to promote Made-In-Nigeria goods

 The Minister of State for Industry, Trade and Investment, Hajia Aisha Abubakar, on Friday in Abuja said that the ministry would soon launch a nationwide campaign to encourage Nigerians to patronise made-in Nigeria products.

Abubakar stated this at the signing of a footwear production agreement between Global Smartfit Nigeria Ltd and Labora Shoes Ltd of South Africa in her office. The campaign is tagged, ” Patronise Naija Products’’.

Represented by the Permanent Secretary in the ministry, Mr Aminu Bisala, the minister lauded the partnership deal aimed at boosting local manufacturing of leathers and other footwear products.
“This venture is very commendable and there is no reason why it cannot be supported.

”Already, the ministry is furthering the campaign for made-in-Nigeria products, for us in Nigeria to consume what we produce and produce what we consume, and even go beyond that to export.
“We have the people, we have the brain, we have the resources, and so there is nothing stopping us. As a nation we are proud of our commodities, we are proud of our products.

“It is for the producers to ensure quality. An average Nigerian wants value for money and that is why possibly in the past you find them patronising even substandard foreign goods with the thinking that they are getting quality.

Govt borrows N242bn via Treasury bills

The Federal Government has sold N242.38bn ($1.22bn) worth of three months to one year Treasury bills at higher yields than in its previous auction, the Central Bank of Nigeria has said.

The CBN raised N50bn more than it initially planned, increasing the amount of six-month paper auctioned from N30bn to N80bn.

It sold N45.17bn of three-month paper at 4.95 per cent, up from 4.29 per cent at a sale on January 20.

The bank sold N80bn of six-month debt at 7.97 per cent against 7.59 per cent, while it sold N117.21bn of one-year paper at 9.49 per cent compared with 9.32 per cent.

The total subscription stood at N400.82bn, compared with N288.98bn. It stated that the three-month bills closed at 4.59 per cent on the secondary market on Wednesday, the six-month traded at 7.87 per cent, while the one year paper closed at 8.45 per cent.

The Federal Government had late last month sold N195.95bn ($975m) in Treasury bills with maturities from three months to one year in its second auction of the year, at higher yields than previously.

The bank sold N36.78bn of three-month paper at 4.29 per cent, up from four per cent at a sale on January 6, according to Reuters.

Nigerian bank FCMB says raised $115 mln in third-quarter bond issue

Nigerian bank FCMB raised 23 billion naira ($116 million) in a bond issue in the third quarter last year, its chief executive said on Thursday, adding that the mid-tier lender still had room to raise further debt even if there is an official devaluation of the naira.

Ladi Balogun said the bank had adequate capital and was embarking on a deliberate strategy to replace fixed-term deposits with bonds so that it will not be hit by central bank cash reserve requirements.

He said the bank was targeting a loan growth rate of 9 percent for 2016 even if there is a devaluation of the naira.

"We would pursue capital preservation and in the event in a devaluation of the currency we still have headroom for (raising more) Tier II debt. We don't see a need to raise Tier I (equity capital)," Balogun told an analysts' conference call.

Nigeria's naira has weakened 35 percent below its official level on the black market, weighed on by sinking oil prices and intensifying speculation that Africa's biggest economy will have to formally devalue.

Last week the bank reported its net profit fell 92 percent to 1.87 billion naira for the first nine months of 2015, warning that revenue pressures continued into the fourth quarter.

However, Balogun said there had been some writebacks on consumer loans in the final three months of last year after delayed salaries of most government workers were at last paid, bringing relief to the loan book.  

Nigeria's GT Bank seeks redemption on $500 mln Eurobond

Nigeria's Guaranty Trust Bank (GT Bank) launched a tender offer on Friday to repay a $500-million Eurobond early, a move to deploy its available dollar liquidity ahead of the debt's maturity.

The bank said the notes, priced to yield 7.5 percent, were due to mature in May 2016 and that the tender was voluntary. It said in a tender notice the bank would maintain cash to repay any outstanding debt not tendered.

The naira's exchange rate has dropped 35 percent below its official level on the black market, weighed down by sinking oil prices and speculation that Africa's biggest economy will have to formally devalue.

The results of the tender offer will be announced on Feb. 11.

AMCON takes over Aero Contractors

 The Asset Management Company of Nigeria (AMCON) has dissolved the board of Aero Contractors and appointed a manager over the affairs of the airline.

In a statement on Friday, AMCON said the takeover was in furtherance of its statutory responsibility of acquiring Eligible Bank Assets and putting them to economic use in a profitable manner. AMCON is both the majority shareholder and creditor of Aero. “An industry-based management team will be put in place to provide the highest level of professional competence which would ensure a quick re-positioning of the company,” it said. “The management of AMCON decided to make changes in the management of the airline to protect the brand heritage of the airline, a very well cherished value. “AMCON also maintains that its intervention is in the public interest to sustain and improve the robust and premium quality service which Aero is known for in the country.” It assured regulatory authorities, the travelling public and key stakeholders that the airline would continue to “operate on the solid foundation of safety and security with excellent customer service”.

It said it had also engaged a reputable accounting firm to undertake a forensic audit of the airline’s accounts over the last 5 years. Aero Contractors is Nigeria’s oldest aviation company.

It commenced business in 1959, initially providing services to oil and gas sector, before venturing into fix wing operations in the year 2000.

AMCON currently owns 60% of the company, with the remaining 40% held by the Ibru family.

Nigeria’s economy to grow by 3.78% in 2016 – NBS

The National Bureau of Statistics says the Nigerian economy, reeling from the drop in oil prices, is expected to grow by 3.78 per cent this year, up from 2.97 per cent in 2015, as it tries to confront its worst crisis in decades.

The statistics office expected growth to reach an average of 5.41 per cent yearly between 2017 and 2019 as infrastructure development provide support for both the oil and non-oil sectors, it said.

“Output in the oil and non-oil sectors are expected to perform marginally better relative to 2015,” the bureau said in a report, explaining its forecast. Africa’s top oil producer has been hit hard by a slump in oil prices, which has eroded public finances and weakened its currency.

The naira currency has weakened 35 percent below its official level on the black market, weighed down by sinking oil prices and speculation that Africa’s biggest economy will have to formally devalue.

 President Muhammadu Buhari is against devaluation, backing the central bank’s stance of keeping rates unchanged in the face of sharp falls against the dollar on the black market.

Last week, Nigeria’s foreign reserves fell to $28.2 billion, its lowest level since 2005. The statistics office expects the central bank’s adjustment of the foreign exchange management framework to be steadied this year thus helping prices to gradually ease beyond 2016. Over the 2017 to 2019 period, inflation is expected to average 9.01 per cent, it said.

The outlook hit investments. Last year foreign inflows fell to $9.64 billion, down 53.5 per cent from $20.75 billion in 2014. The bureau expected the Nigerian economy to benefit from central bank stimulus worth N300 billion.

Salary scam: FG to probe 23,306 civil servants, banks

 

The Federal Government is concluding plans to probe no fewer than 23,306 federal civil servants, who have been accused by a panel of defrauding the government of millions of naira every month through an organised salary fraud.

The preliminary report of an investigative committee, set up to probe the alleged fraudulent payment of salaries to either ‘ghost’ workers or payments to multiple accounts, indicated that some banks would also be called to answer questions on the huge scam.

In a branch of one of the banks, over 300 accounts were said to have been opened in one day and all the accounts have become inactive.

A competent source on the investigative panel, who spoke to our correspondent on Thursday, said the federal civil servants and the banks, which had allegedly been indicted, had been marked down for thorough investigations and possible sanctions.

The source, who spoke on condition of anonymity, said the government had begun a plan to investigate and remove the names of the indicted civil servants from its payroll.

It was also learnt that some of the affected officers had started resigning their appointments as a pre-emptive measure to avert humiliation and sanctions at the end of the investigation.

Our correspondent gathered that out of 312,000 civil servants, whose bank accounts had been checked so far in the exercise through the Bank Verification Number platform, the accounts of 23,306 workers had questionable transactions.

The exercise was said to have led to the discovery of a high level of irregularities in salary payment.

CBN extends BVN registration for Nigerians abroad

The Central Bank of Nigeria has extended the Bank Verification Number registration exercise for Nigerians abroad from January 31 to June 30, 2016.

The CBN, in a circular on Thursday, said the extension would allow Nigerian bank customers in the Diaspora to obtain their BVN and link it with their respective bank accounts.

The circular, signed by the Director, Banking and Payments System, CBN, Mr. Dipo Fatokun, stated that the CBN had also increased the number of BVN registration centres overseas to allow more bank customers to register.

The circular read, “The CBN has observed, through a recent survey, the low percentage of registration of Nigerian bank customers in the Diaspora, which may be attributed to lack of accessibility to registration centres and unavailability of registration centres in some cities where Nigerian population is high.

“Consequently, all the Deposit Money Banks are hereby requested to note that the BVN enrollment for Nigerian bank customers in the Diaspora is hereby extended to June 30, 2016. This is to enable such customers to complete the enrollment and link the BVN with their bank accounts.”

The CBN further said plans were on to deploy more BVN registration centres in locations with high Nigerian population.

The central bank had in October last year closed the BVN registration process within the country and directed banks to stop customers without the numbers from carrying out transactions on their accounts.

It said only customers who obtained and registered their BVNs should be granted access to their accounts.

onshore installation with minor injuries.

The firm said it had also established a dedicated telephone hotline for family members of those on board the flight.

Tax: FIRS to audit banks, NNPC, MDAs

The Federal Inland Revenue Service, in a bid to ensure that all tax revenues due to the government are collected and remitted into the Federation Account, has begun a tax audit of the Nigerian National Petroleum Corporation.

The Executive Chairman, FIRS, Mr. Babatunde Fowler, disclosed this on Thursday in Abuja when members of the Public Accounts Committee of the Senate led by its Chairman, Senator Andy Uba, visited the agency.

Fowler said the audit was being carried out as part of measures aimed at boosting tax revenue in the 2016 fiscal period.

He said apart from the NNPC, the FIRS had received approval from the Minister of Finance, Mrs. Kemi Adeosun, to commence a joint audit of all Ministries, Departments and Agencies of the government.

He said the need for the joint audit arose owing to the fact that the arrangement where government agencies were to deduct Withholding Tax and Value Added Tax from contractors and remit same to the Federation Account had not yielded the desired results.

The audit, the FIRS boss added, had also been extended to all banks operating in the country to ensure that all tax revenues of government were remitted to the Federation Account.

Fowler said, “We have an audit process that we are carrying out with the collecting banks to ensure that revenues received have been swept into our account at the close of 2015; we are about to start another audit process to ensure that remittance still held by other banks have been swept.

Power Supply Hit All-time High Of 5074.7MW

 

Power supply has hit a new record peak of 5074.7 megawatts (MW), the Transmission Company of Nigeria (TCN) has said.

Announcing this feat in a statement yesterday, the system operator also announced the attainment of the highest maximum daily energy wheeled nationwide of 109,372 megawatts hour (MWH) which was attained on Tuesday, 2nd February, 2016.

The previous peak generation was 4,883.9MW achieved on Monday, 23rd November, 2015, while the previous highest maximum daily energy wheeled nationwide was 107,142.32MWH recorded on Tuesday, 26th January, 2016.

The statement signed by the TCN’s assistant general manager, Public Affairs, Clement Ezeolisah, revealed that the new peak generation of 5,074.7MW was attained at 9:30pm on Tuesday.

FASHOLARemarking on the achievement, the managing director, System Operation/Market Operation, TCN, Dipak Sarma, attributed the twin peak achievements to the enhanced cooperation among the power sector stakeholders and concerted efforts by system operators at the National Control Centre (NCC) located in Osogbo, Osun State.

This development comes as the minister of power, works and housing, Babatunde Fashola, has assured that power supply will increase by an additional 2000MW by the end of 2016.

Reps uncover 169 ghost companies in N1t rail contracts

The House of Representatives Ad Hoc Committee on Failed Rail Contracts on Wednesday unearthed 169 ghost companies that registered as contractors with the Nigeria Railway Corporation for projects valued at N1 trillion.
The ad hoc committee raised the alarm on Wednesday during the investigative hearing at the National Assembly.

It said none of the 169 companies invited by the committee had showed up.
The Chairman of the committee, Johnson Agbonnayinman (Ikpoba/Okha Federal Constituency), said the need to invite the contractors was important, but lamented that efforts to reach them had so far proven fruitless.

Agbonnayinman added that so far, only the China Civil Engineering Construction Corporation responded to the committee’s letter.

According to him: “You are duty bound to produce the contractors. They are nowhere to be found; they are not faceless but yet they cannot be reached.

“You gave them the job, so you should produce them; we are holding you responsible.”
The committee also asked the corporation’s MD, Adeseyi Sijuwade, to make available the agency’s record of Internally Generated Revenue between 2010 and 2014.

Sijuwade was also asked to tell the committee what the IGR was used for.
In response, the MD said the IGR was used to augment the agency’s overhead budget.

Drama, however, started when the committee, acting on documents before it, asked the MD to explain all he knew and the reason behind his request to the Office of the Accountant-General of the Federation for a return of N2 billion or 20 per cent of the corporation’s pension fund to the corporation in December 2014.

Responding, Sijuwade, who was reminded of being on oath, denied making such request to either the Accountant-General or Minister of Finance.
“I never at any time made any request to the AGF to return N2 billion pension fund to the corporation,” he said.

Insistent on getting to the root of the matter, the committee asked the Director of Finance, Felix Njoku, to take an oath in order to take questions regarding the issue.

Njoku did and insisted that there was never any correspondence from his office to the Accountant-General’s on return of the said money.
Not satisfied, the committee veered into what the organisation did with N2 billion that was in the corporations coffers around the period under review.

The Finance Director explained that the money was not related to pension and was used to fund ongoing contracts at the time.

He was asked to list the contracts, which he said was impossible at that point but that all transactions were duly documented.

He promised to make available the records.
The committee also faulted the award of rail contract to Costain Construction Company, claiming that it had no competence in railway projects.

Sijuwade replied that Costain went through due process and was found competent by the Federal Executive Council, adding that it successfully completed its project.

Nigeria to issue 90 bln naira bonds on Feb 10

The Debt Management Office (DMO) says Nigeria plans to raise 90 billion naira ($452.26 million) worth in local currency denominated bond at an auction on Feb. 10, the second of such this year.

The debt office said it will sell 40 billion naira in paper maturing in 2020 and 50 billion naira in the debt maturing in 2026, using the Dutch Auction System, in which the price is lowered until the bond is bought.

Both debt notes are reopening of the previously issued bond.

Nigeria is planning to borrow as much as $5 billion to help fund its budget deficit due to the plunge in oil, which has also sent the naira NGN=D1 currency into a tailspin.

It expects a deficit of 3 trillion naira ($15 billion) in 2016, up from an initial 2.2 trillion naira ($11 billion) estimate.

Nigeria's total debt rose to 12.60 trillion naira ($65.42 billion) as of December 2015, up from 11.2 trillion naira in 2014.

Crude oil prices steady at $34.41 per barrel in thin Asian trading

Crude oil futures were steady in lacklustre trading on Friday as Asian liquidity faded ahead of the Lunar New Year holiday across large parts of the region.

International benchmark Brent crude futures LCOc1 were trading at $34.41 per barrel at 0539 GMT, a notch below their last settlement while U.S. West Texas Intermediate (WTI) crude futures CLc1 were up 6 cents at 31.78 a barrel.

Traders said liquidity was low due to the Lunar New Year holiday which will last for most of next week.

Oil prices have been extremely volatile since the start of the year, and in particular this week, as a string of bullish indicators like a slump in the dollar .DXY and potential talks on output cuts clashed with bearish reports of record U.S. crude inventories, higher output and a slowing global economy.

Investment bank Jefferies said on Friday that U.S. crude prices had traded within a 19 percent band over the last week and with inter-day moves approaching 11 percent.

"We expect that volatility could remain elevated especially on upward moves from short covering; net length in WTI is at its lowest level since 08/01/2013 implying a large short position," Jefferies said.

BMI Research, a unit of rating agency Fitch Group, said that "bloated crude inventories in the U.S. pose rising risk to WTI" and that "a continued build in storage over the coming six to eight weeks could collapse the price of WTI, driving a sharp reopening of the spread to Brent."

U.S. crude inventories USOILC=ECI climbed 7.8 million barrels in the week to Jan. 29 to 502.7 million barrels. Gasoline inventories USOILG=ECI rose to a record high, soaring 5.9 million barrels to 254.4 million barrels.

Nigeria's economy to grow by 3.78 pct in 2016 - statistics office

 Nigeria's economy, reeling from the drop in oil prices, is expected to grow by 3.78 percent this year, up from 2.97 percent in 2015, as it tries to confront its worst crisis in decades, the national bureau of statistics said on Thursday.

The statistics office expected growth to reach an average of 5.41 percent yearly between 2017 and 2019 as infrastructure development provide support for both the oil and non-oil sectors, it said.

"Output in the oil and non-oil sectors are expected to perform marginally better relative to 2015," the bureau said in a report, explaining its forecast.

Africa's top oil producer has been hit hard by a slump in oil prices, which has eroded public finances and weakened its currency.

The naira currency has weakened 35 percent below its official level on the black market, weighed down by sinking oil prices and speculation that Africa's biggest economy will have to formally devalue.

President Muhammadu Buhari is against devaluation, backing the central bank's stance of keeping rates unchanged in the face of sharp falls against the dollar on the black market.

"Speculative pressure on the naira is likely to exist in 2016 in light of the current state of foreign reserves and inflation may rise to 10.16 by year end," the report said.

Last week, Nigeria's foreign reserves fell to $28.2 billion, its lowest level since 2005.

The statistics office expects the central bank's adjustment of the foreign exchange management framework to be steadied this year thus helping prices to gradually ease beyond 2016. Over the 2017 to 2019 period, inflation is expected to average 9.01 percent, it said.

The outlook hit investments. Last year foreign inflows fell to $9.64 billion, down 53.5 percent from $20.75 billion in 2014. The bureau expected the Nigerian economy to benefit from central bank stimulus worth 300 billion naira.

Nigerian bank FCMB says raised $115 mln in third-quarter bond issue

Nigerian bank FCMB raised 23 billion naira ($116 million) in a bond issue in the third quarter last year, its chief executive said on Thursday, adding that the mid-tier lender still had room to raise further debt even if there is an official devaluation of the naira.

Ladi Balogun said the bank had adequate capital and was embarking on a deliberate strategy to replace fixed-term deposits with bonds so that it will not be hit by central bank cash reserve requirements.

He said the bank was targeting a loan growth rate of 9 percent for 2016 even if there is a devaluation of the naira.

Nigeria's naira has weakened 35 percent below its official level on the black market, weighed on by sinking oil prices and intensifying speculation that Africa's biggest economy will have to formally devalue.

Last week the bank reported its net profit fell 92 percent to 1.87 billion naira for the first nine months of 2015, warning that revenue pressures continued into the fourth quarter.

However, Balogun said there had been some writebacks on consumer loans in the final three months of last year after delayed salaries of most government workers were at last paid, bringing relief to the loan book.  

Airline battle brews in Gulf as Iran eyes regional hub role

An economic battle is likely for dominance of the skies over the Gulf after Iran decided to invest $27 billion in an airline fleet capable of taking on the region's supercarriers.

By ordering dozens of long-distance European jets last month after the lifting of sanctions, Iran is positioning Tehran as a potential long-term transit point between East and West to rival regional hubs such as Dubai, air officials and analysts say.

The move is underscored by Tehran's choice of Airbus A380, which is the world's largest jetliner and is used by other Gulf carriers, and sends a political warning to Iran's neighbours not to ignore the Islamic Republic's emergence from isolation.

"Certainly this is our historical position: we have always been a center for communications in the region," Transport Minister Abbas Akhouni said in an interview.

The investment also points to a strategy to take part in the globalization of the transport industry alongside Gulf rivals, even though the social and economic challenges of building a world-class hub are formidable for Iran.

"We used to be a very important airline in the region and globally, so of course we want to play our role fully once again," Iranair Chairman Farhad Parvaresh told Reuters.

Iran signed a deal for 118 Airbus jets, and contracts to expand the main Tehran airport, during a visit to Europe by President Hassan Rouhani, less than two weeks after sanctions were lifted in exchange for curbs on Iran's atomic program.

Not all the planes are expected to go to Iranair, but Tehran says it will give the flag carrier priority.

Nor will Iran's hub ambitions bear fruit any time soon, as its airlines must focus first on rebuilding a busy domestic network and catering for inbound tourism and business traffic.

"The A380s don't arrive for another five years," Parvaresh said in an interview. "Before then we need to watch closely the expansion of Imam Khomeini (Tehran International) airport."

MTN Hires Ex-US Attorney-General, Eric Holder, For Talks With NCC

 Telecom giants, MTN, has employed a former United States attorney-general, Eric Holder, to negotiate on its behalf  in its case with the Nigeria Communications Commission (NCC) over the N1.04 trillion fine placed on it by telecom regulator for not deactivating 5.1 million subscriber identification module (SIM) cards.

Holder’s brief is to help fight the multi-billion-dollar fine imposed on the mobile operator by Nigerian authorities.

Sources familiar with the matter said Holder made an initial visit to Abuja last month to plead with senior Nigerian officials on MTN’s behalf.

The hiring of Holder followed MTN’s decision to seek an out-of-court settlement with NCC late January after it had challenged the power of the telecom regulator to impose the N1.04 trillion on it.

MTN is making little progress with its attempts to convince Nigerian authorities the fine is disproportionate and beyond the regulator’s authority. The Nigerian authorities claim the amount was calculated correctly according to rules set in 2011 on disconnecting unregistered Sims. During his time as attorney general from 2009-2015, Holder participated in a number of major settlements with corporations such as JPMorgan Chase over mortgage-backed securities and BP over the Horizon oil spill.

When contacted to confirm the development, an official of MTN Nigeria said he was unaware of the matter.

“What you are saying is news to me; I cannot confirm or deny it. I just heard of it from you now,” the official said.

According to Financial Times, an unnamed official said MTN was also found to have ignored warnings that its unregistered Sim cards were being used by criminals and Boko Haram terrorists, especially after a terrorist commander was captured with dozens of MTN cards after the August 2015 deadline for disconnecting any unregistered Sims.

Kerosene marketers lament over scarcity of product

Marketers of oil products in the country said non availability of the Household Kerosene (HHK) might affect the implementation of the new pump price.

The Petroleum Products Pricing Regulatory Agency in January increased the HHK pump price from N50 to N83.

Some of the filling stations visited by a correspondent of the the News Agency of Nigeria (NAN) on Wednesday in Abuja had no products for couple of months.

At NNPC Mega Station on Kubway Express Road, HHK was not available but Premium Motor Spirit was dispensed at the official price to customers.

One of the members of staff who preferred anonymity said that the station in the last three months had not sold HHK.

“Our major focus here is selling PMS; we have not sold kerosene since November last year.

“But we always sell at the approved price; the thing is that it is not always available.

Also, at NNPC station in Gwarinpa and Central Business Distric, NAN reported that the product was also not available.

Mr Johnson Ibe, a worker at the Central Business District, said that the station was yet to sell any product because of the repairs from the fire that gutted the station.

“We usually sell kerosene but you know that fire gutted this station few weeks ago; we are still undergoing repairs.

“By the time we finish the repairs, we will sell to our customers at the approved price as usual,’’ he said.

At MRS Mararaba station, NAN reported that at the notice board, the price was still registered as N50.

The supervisor of the station, who identified himself as Joseph, said that it no longer sold kerosene because the station would incur loss.

Zimbabwe's growth to remain flat, deflation to persist in 2016: World Bank

Zimbabwe's economy will grow at 1.5 percent in 2016 and consumer prices would remain deflationary as global and local constraints limited a recovery, the World Bank said on Wednesday.

The global lender said growth this year would be slower than the government's estimate of 2.7 percent, while inflation in the same year would average -1.7 percent.

"We expect deflation to continue this year," World Bank senior economist for Zimbabwe Johannes Herderschee said during a presentation of the bank's outlook on Zimbabwe.

The Southern African country is experiencing crippling power cuts, blamed for keeping away potential investors in an economy struggling to emerge from a steep recession between 1999-2008 that saw the economy contract by nearly half.

"The fundamentals for recovery are still strong but the headwinds are increasing. These headwinds and the brunt of economic corrections, both domestic and global will likely be most deeply felt by the poor," the World Bank said in a report.

Zimbabwe however expects gold output to rise by 28 percent in this year, while the government also plans to cut the royalty fee on bullion by 40 percent, among a host of government's efforts to boost growth.

Finance Minister Patrick Chinamasa in December blamed deflation on weak consumer demand and an influx of cheaper goods from South Africa, the continent's biggest economy.

Shell confirms 10,000 job cuts and a steep profits fall

Royal Dutch Shell has confirmed it is cutting 10,000 jobs amid its steepest fall in annual profits for 13 years.

It made $1.8bn (£1.23bn) for the fourth quarter of the year, compared with a $4.2bn profit for the same period the year before.

Full-year 2015 earnings, excluding identified items, were $10.7bn, compared with $22.6 billion in 2014.
The oil firm indicated it would report a massive drop in profits two weeks ago.
Shell also said then that it had cut operating costs by $4bn, or around 10%, in 2015, and expected to cut costs by a further $3bn this year.

Last month, shareholders in Shell, which is Europe's largest oil company, voted in favour of its takeover of smaller rival BG Group.

At the time, oil was trading at about $55 a barrel, but has fallen sharply since then and is currently trading at about $30 a barrel, leading some shareholders to oppose the plan.

Standard Life, a key investor in Royal Dutch Shell, said earlier this month that the price of oil needed to be $60 a barrel for the takeover to make financial sense.

It has already said it will cut 10,000 staff if the deal with BG Group went ahead and said synergies though its tie-up with BG would be on top of the cost savings already outlined.

The company cut back hard on investment over the year, while capital spending for the year was slashed to $28.9bn, $8.4bn lower than in 2014.

Shell sold $5.5bn worth of assets in the course of 2015.

Shell's results are calculated on the basis of replacement cost, which reflects the current cost of supplies and is widely seen as the best measure of an oil firm's underlying performance.

Profit taking: NSE market indices drop by 0.96 per cent

Profit taking continued at the Nigerian Stock Exchange with the market indicators dropping by 0.96 per cent amid loses by some highly capitalized equity.

The News Agency of Nigeria reports that the market capitalization shed N79 billion or 0.96 per cent to close at N8.118 trillion, compared to N8.197 trillion posted on Tuesday.

Also, the All-Share Index lost 228.98 points or 0.96 per cent to close at 23,605.89 as against 23,834.87 achieved on Tuesday.

Nigerian Breweries topped the losers’ chart, dropping by N4.25 to close at N95.25 per share.

Unilever trailed with a loss of N1.67 to close at N31.81, while Dangote Cement dipped N1.01 to close at N127 per share.

GT Bank dropped by 84k to close at N15.54, while Zenith Bank lost 70k to close at N12.90 per share.

On the other hand, Seplat led the gainers’ table, gaining N21.94 to close at 236.09 per share.
Advertisement

7UP followed with a gain of N9.95 to close at N188.95, while Guinness increased by N5.56 to close at N118.76 per share.

Flour Mill garnered N1.83 to close at N19.88 and International Breweries grew N1.02 to close at N17.82 per share.

In spite of the drop in market indices, the volume of shares traded closed higher with an exchange of 1.32 billion shares worth N2.91 billion transacted in 4,012 deals.

NAN reports that this is in contrast with 313.68 million shares valued at N2.41 billion exchanged in 3,451 deals.

Wema Bank emerged the most traded equity, trading 1.14 billion shares worth N1.091 billion in 25 deals.

FBN Holdings followed with 35.59 million shares worth N141.02 million traded in 276 deals, while GT Bank accounted for 27.09 million shares valued at N422.14 in 548 deals.

Zenith Bank sold 24.24 million shares worth N320.19 million in 494 deals, while Transcorp achieved a turnover of 12.58 million shares valued N14.53 million traded in 119 deals.

IMF says ready to lend to African oil producers; no requests yet

 The International Monetary Fund says it stands ready to help sub-Saharan Africa's oil exporters cope with plunging crude prices and growing fiscal pressures but has not received any new funding requests from the region.

Nigeria and Angola instead have turned to the World Bank for assistance, even though the IMF is typically viewed as the world's go-to crisis lender.

Facing an estimated $15 billion budget deficit in 2016, Nigeria's finance ministry has said it is looking to borrow as much as $5 billion. It has held discussions with the World Bank, African Development Bank and China's Export-Import Bank due to their "concessionary rates of interest."

The World Bank is discussing potential financing for Nigeria and Angola through a program to support structural changes in an emerging market country's economy and government institutions.

The two sub-saharan African countries are the latest in what may become a long line of oil-exporting countries to seek financial assistance to help stem growing deficits as falling crude prices crush revenues. The IMF and World Bank are already talking to Azerbaijan about a $4 billion financing package.

On Tuesday, U.S. crude fell back below $30 a barrel, half its price in June 2015 and down from about $100 two years ago.

"The sharp decline in oil prices represents a formidable shock on the oil exporting countries of sub-Saharan Africa, especially in view of their strong reliance on oil receipts for fiscal and external revenues," an IMF spokeswoman said in a statement.

The IMF noted that despite rising deficits, several of these countries still have adequate foreign exchange reserves and low levels of overall debt. This would suggest that a balance-of-payments crisis is not imminent. 

Shell posts lowest income in at least 13 years as oil price takes toll

 Royal Dutch Shell, Europe's largest oil company, reported its lowest annual income in at least 13 years on Thursday as slumping oil prices hit profits.

Shell, whose shareholders last week approved its takeover of rival BG Group, said 2015 income fell 87 percent year on year to $1.94 billion, in line with analysts' estimates.

Shell's fourth quarter current cost of supplies (CCS) earnings excluding identified items, its preferred way of measuring profits, fell 44 percent to $1.83 billion.

Shell's full-year capital spending, or capex, came in at $28.9 billion, $8.4 billion lower than in 2014. Capex for the combined Shell-BG group was expected to reach $33 billion in 2016, a 45 percent reduction from their combined spending.

Shell sold $5.5 billion worth of assets in 2015, it said.

Naira falls further to N307 to the dollar

The Naira yesterday depreciated by 0.7 per cent at the parallel market, following the last minute payment of tuition fees abroad.

The naira lost N2 to exchange at N307 to a dollar against N305 traded on Tuesday.

The Naira had relatively remained stable in the past weeks.

Traders at the market expressed optimism that the proposed intervention of the apex bank by selling foreign exchange to the commercial banks would shore up the naira.

Some parents, who spoke on condition of anonymity, said that it was stressful sourcing dollars to pay school fees of their children abroad. They urged the Federal Government to ensure easy access to dollars for legitimate needs.

    
    

Nigeria’s debt rises by N1.31tn in one year

The Debt Management Office says Nigeria’s debt burden rose by N1.31tn in one year.

Official statistics released by the DMO in Abuja on Wednesday showed that the country’s total debt rose from N11.24tn as of December 31, 2014 to N12.6tn at the end of 2015.

The N1.31tn increase showed that within a period of one year, the country’s debt rose by 12.1 per cent.

As of June 30, 2015, the country’s debt burden stood at N12.12tn. This means that the federal and state governments grew the country’s debt profile by N480bn in the first six months of last year.

The total is made up of the external debt of the federal and state governments, the domestic debts of the Federal Government as well as the domestic debts of the states.

In terms of segmentation, the external debts of both tiers of government rose from $9.71bn as of December 31, 2014 to $10.71bn as of December 31, 2015. This shows a rise of $1bn or growth rate of 10.37 per cent within the period.

The domestic debt of the Federal Government, which is the biggest component of the debt burden, rose from N7.9tn as of December 31, 2014 to N8.84tn in the 12-month period.

This shows that the domestic debt of the Federal Government rose by N932.97bn within the one-year period. It also means that the domestic debt of the Federal Government rose by 11.8 per cent.

The 36 states of the federation and the Federal Capital Territory held $3,369,911,154.54 of the country’s external debt component, while the Federal Government’s external commitments stood at $7,348,520,340.26.

With $1,207,900,597.65, Lagos remained the most externally indebted state of the federation as it held 35.84 per cent of the country’s subnational external debt.

For 2016, the Federal Government expects to borrow N984bn from domestic sources and N900bn from foreign sources to finance the capital component of the budget.

It will also set aside the sum of N113bn as a sinking fund towards the retirement of maturing loans, while N1.36tn has been provided for foreign and domestic debt service obligations.

Our correspondents reported that the Federal Government spent a total of N2.95tn to service domestic debts for a period of five years from 2010 to 2014.

NNPC recorded N267bn loss in 2015 – Report

The Nigerian National Petroleum Corporation recorded a loss of N267.14bn in 2015, latest data from its group financial report for the month of December have shown.

According to the report, the national oil firm lost N11.861bn in the month of December alone, down from the N14.29bn loss recorded in November.

Its gross revenue for the 2015 financial year was put at N2.046tn, while its expenses were N2.3tn, leaving a loss of N267.138bn.

The refineries continued their poor performance throughout the year as the three of them posted a combined loss of N82.09bn in the period under review.

The Kaduna Refinery and Petrochemical Company lost N34.7bn, while the Warri Refinery and Petrochemical Company and Port Harcourt Refining Company lost N24.308bn and N23.09bn, respectively.

Reps uncover 169 ghost companies on N1trn rail contracts

The House of Representatives Ad Hoc Committee on Failed Rail Contracts, yesterday, unearthed 169 ghost companies that registered as contractors with the Nigeria Railway Corporation, NRC, for projects valued at N1 trillion.

The ad hoc committee raised the alarm during the investigative hearing at the National Assembly, that none of the 169 companies invited by the committee had shown up.

Chairman of the committee, Johnson Agbonnayinman, (Ikpoba/Okha federal constituency), said the need to invite the contractors was important, but lamented that efforts to reach them had so far proven fruitless.

He added that so far, only the China Civil Engineering Construction Corporation, CCECC, responded to the committee’s letter.

He said: “You are duty bound to produce the contractors. They are nowhere to be found; they are not faceless but yet they cannot be reached.

“You gave them the job, so you should produce them; we are holding you responsible.”

The committee also asked the corporation’s MD, Mr. Adeseyi Sijuwade, to make available the agency’s record of Internally Generated Revenue, IGR, between 2010 and 2014, and was also asked to tell the committee what the IGR was used for.

In response, the MD said the IGR was used to augment the agency’s overhead budget.

Power transmission attains new peak of 5,074.7mw

System Operator, Transmission Company of Nigeria yesterday announced the attainment of a new record peak generation of 5,074.7MW, and highest maximum daily energy wheeled nationwide of 109,372MWH on Tuesday, February 2, 2016.

In a statement signed by Assistant General Manager, Public Affairs, Clement Ezeolisah, the new peak generation of 5,074.7MW was attained at 9:30pm on Tuesday, February 2, 2016.

While the previous peak generation was 4,883.9MW achieved on Monday, November 23, 2015, the previous highest maximum daily energy wheeled nationwide was 107,142.32MWH recorded on Tuesday, January 26, 2016.

Managing Director, System Operation/ Market Operation, TCN, Dipak Sarma, attributed the twin peak achievements to the enhanced cooperation among all power sector stakeholders and concerted efforts by system operators at the National Control Centre and other stations to ensure that all generated power is wheeled to the distribution companies and that there is no stranded power.

Meanwhile, Minister of Power, Works and Housing, Babatunde Raji Fashola, has said power generation would increase with additional 2000MW by the last quarter of 2016. According to a statement by Assistant Director of Press, Etore E. Thomas, the minister expressed optimism that the feat would be achieved given the various plans undertaken by the present administration in the sector.

He stated this at the ministry’s budget defence before the Senate Committee on Power and Mines, adding that a lot have changed in the management of power in the country, in recent times.
Distribution of power is no longer government business, but has been taken over by private companies.
Also government has privatised power generation which has steered towards the full privatisation of the sector with transmission aspect being managed by Manitoba International of Canada.

According to the minister, the 2016 budget focuses more on the transmission, completion of on-going projects, refurbishing power plants and tackling gas supply issues.
If all these, are well addressed, the expected projection would boost electricity generation in the country.
The minister further stated that the ministry plans to take its role as a policy maker more seriously while the agencies will be tasked more on implementation and execution of government’s agenda for the sector.

Why FG won’t spare looters — Osinbajo

Vice President, Prof. Yemi Osinbajo yesterday said the Federal Government would not spare anyone indicted for corruption and other corrupt practices.

Osinbajo lamented that if not for the high incidence of corruption that has ravaged the nation’s economy, the country would have been buoyant enough to put in place the necessary infrastructure.

The Vice President , who spoke while inaugurating the Ota township roads in Ado-Odo/Ota Local Government Area and the Ayetoro township roads in Yewa North Local Government Area of the state in commemoration of the 40th anniversary of the creation of the state , also assured that the President Muhammadu Buhari-led administration would begin the implementation of all its campaign promises immediately the 2016 budget is signed into law..

Osinbajo, who represented President Muhammadu Buhari during his two-day official visit to the state on Monday and Tuesday had inaugurated only four of the 40 projects earmarked for the event, said corruption, which had ravaged the country had made it impossible for government at all levels to provide the necessary infrastructure.

Speaking in Yoruba, the vice president told the people of Ayetoro that “the development of our country should be of utmost importance to all of us. We should continue to proclaim it loud that corruption should not be tolerated. We have to keep saying it everywhere that no corrupt person would go scot-free. Whoever is involved and whatever his status is, he must answer for such wrongs done. We have to keep proclaiming that everywhere.

Also, while inaugurating the Iganmode- Ilo- Awela road in Ota, the vice president assured Nigerians that the Buhari administration would commence implementation of its campaign promises immediately the 2016 budget is passed into law.

He disclosed that  the Federal Government had provided for the unemployed youths, artisans, market men and women in the budget, noting that employment and job creation for the youths remained the cornerstone of the Buhari administration.

CBN resumes forex sales to banks

 The Central Bank of Nigeria (CBN) said it would resume forex sales to commercial banks. The apex bank told the lenders to fund their naira accounts to be able to participate in a currency intervention on the interbank market slated for today.

Although the CBN did not disclose how much it would sell, but one trader said the bank sold between $100 million and $150 million at its intervention last Thursday and this could be repeated tomorrow.

Last month the bank banned dollar sales to retail bureaux de change outlets, sending the naira to record lows on the black market and later stopped daily sales to the interbank market, all to conserve foreign reserves which are down to an 11-year low.

The local currency traded around a pegged rate of N198 to the dollar on the official interbank market on Tuesday, but was quoted at N305 on the black market.

The CBN had imposed some currency control measures to save the naira. In June, it curbed access to the interbank currency market for importers bringing in a variety of goods. In an effort to conserve its dollar reserves, the bank said importers could no longer get hard currency to buy 41 items, ranging from toothpicks and rice to steel products and private jets.

One of such measures –  the  total ban on the use of debit cards abroad, has caused panic in both the local and international markets with customers feeling the pangs of the policy, which was meant to conserve foreign reserves and protect the local currency.

NERC: DISCOs Must Put Up Meters In Every Home

 The Nigerian Electricity Regulatory Commission, (NERC) yesterday said it would compel the various distribution companies to install meters in all homes, so as to move away from estimated billing era into an energy serving regime.

The commission made this position known while appearing before the Senate committee on power to justify the hike in electricity tariff, revealing further that power supply had hit a record 5000 Megawatts as result of policies put in place to ensure that Nigerians get value for monies.

Acting chairman of the Commission, Mr Anthony Akah told the committee that the new policy of the commission would equally ensure that any distribution company that fails to meet with set standards would be sanctioned.

Akah also assured that henceforth, Nigerians will stop buying electricity polls as well as transformers, stressing that it is the duty of the distribution companies as part of the agreement with the regulator.

Earlier chairman of the committee Senator James Manger sort to know the justification for the hike at a time Nigerians are suffering from epileptic power supply.

His words, “The most important issue now is the issue of tariff which has come into effect. What do you stand to achieve and what is it all about, electricity is epileptic, yet people are paying high, but if there was an increased supply one can understand, but the case here is different”, he declared.

For the NERC acting chairman, “The new system is to increase both cost and supply. We have inbuilt mechanism such that people get value for money.

“We are also dealing with the issue of estimated billing and metering we also had issue where power was generated but could not be distributed, but now we are going to address it. 5000Megawatts was achieved yesterday, first of its kind and we are going to ensure that we make more progress.

7Energy Invests $800m In Gas Infrastructure, Laments Pricing Challenges

The chief executive officer (CEO) of 7Energy, Phillip Ihenacho, has expressed deep concern over the challenge to address price of gas in the country.

Ihenacho is also worried that the inability of customers to offset the huge gas debt is threatening the industry.

He said that the company has invested about $800,000,000 to boost gas infrastructure but all the efforts are being hampered by the current price regime and huge debt profile of customers.

Speaking with LEADERSHIP in an interview, Ihenacho noted that most of the pronouncements of the previous administration were in connection with the domestic supply obligation of the international oil companies (IOCs). He explained that the previous government  requested that the IOCs supply gas at a certain price and that price was below the commercial price of gas.

He stated that the previous government tried to encourage the IOCs to consider supplying gas to the domestic market by making pronouncements of higher gas prices, but argued that in an ideal world, there should be no government intervention on gas prices.

“The price should be negotiated between the gas buyers and the gas suppliers and price should be down to basic demand and supply and this should work as it does for any other commodity. Ultimately, we need to work on a willing buyer/willing seller basis. Actually, the social impact of a commercial and reliable gas supply is very positive. It means that remote areas and villages could be electrified in the future.

“People in these remote areas are currently using firewood or small diesel generators and as we know, diesel is about four times more expensive than gas. We see this on a macro-scale with our industrial customers where we are significantly reducing their cost of energy by supplying gas as opposed to diesel and other substitutes.

“When a customer pays for gas, they are paying in part for the gas infrastructure, such as pipelines that is required to connect their location, but even when you factor that cost in, it is still far lower than burning diesel” he ,” he said.

Ihenacho pointed out that if more independent operators were given access to gas acreage in order to develop gas businesses to supply the domestic market, it will have a big social impact on Nigeria.

Speaking further, the CEO said, “As the gas price becomes more commercial, the IOCs too will come to the party. We are in an environment that is blessed with plenty gas and over time, provided a commercial price is paid for the gas, the supply will come to meet the demand.”

He recalled that in the past, IOCs made investments in gas infrastructure with the objective of ‘good citizenship’ and the associated tax benefits that came with that, but what is needed is for the gas infrastructure industry to become profitable on a stand-alone basis which is starting to happen.

“Companies will then start investing in gas infrastructure and distribution as a commercial business not just for good corporate citizenship purposes,” he stated.

7 Foreign Firms Jostle For Ajaokuta Steel Complex

 The minister of state for solid minerals, Abubakar Bawa Bwari, has said that more than 7 foreign firms are jostling for the completion of the Ajaokuta Steel Company Limited.

He said that while the federal government is committed to working with any company serious to revive the steel plant, there is the need for them to be careful as they are inundated with various demands by different companies who had shown interest.

Speaking in an exclusive telephone chat with LEADERSHIP recently, the minister assured that the present government was being careful to avoid past mistakes made in a bid to refurbish and revive the steel complex.

The minister revealed to LEADERSHIP that “more than 7 companies from China, India, and Ukraine, among others, had expressed interest to complete the steel plant, adding that “even Nigerians have come out to say that they have partners and investors interested in completing the project.”

He, however, reiterated that government was being careful not to repeat the same mistake of sinking money into a project that did not yield revenue commensurate to the investment.

“We are being very careful not to make any mistakes and waiting till we are able to vet all proposals before a technical team. Also, we would involve the government of these countries to certify the companies before sitting down to discuss with the firms. This time around we want to be very careful but are willing to associate and discuss with those interested in completing the steel complex,” Bwari said.

South Africa's Jacob Zuma to repay Nkandla upgrade funds

South Africa's President Jacob Zuma has agreed to repay some of the $23m (£15m) the government controversially spent on upgrading his private rural home.

In 2014, a report by the public protector said Mr Zuma had "benefited unduly" from the upgrades.

Mr Zuma said the auditor-general and finance minister should determine how much he should repay to end the dispute.

The announcement comes a week before a constitutional hearing on the matter.

The refurbishment of the residence in the village of Nkandla, in Mr Zuma's home province of KwaZulu-Natal, has turned into a major political controversy in South Africa.

Some of of the money was spent on building an amphitheatre, swimming pool, and cattle enclosure.

The opposition Democratic Alliance (DA) and Julius Malema's Economic Freedom Fighters (EFF), who have called for a corruption investigation, say they are pressing ahead with their court case regardless of the president's latest offer.

LCCI Supports FG's Plan to Make More Nigerians Pay Tax

 Lagos Chambers of Commerce and Industry (LCCI) has expressed support for the plans by the federal government to widen the tax net.

President of LCCI, Chief Nike Akande, who spoke with journalists after meeting with the Vice-President, Professor Yemi Osinbajo, said one of the ways to address the shortfall created by the fall in price of crude oil was to make many more people to pay tax.

She said: “Also, we can make a lot of revenue from taxation. Some states have done it and it can be done at the federal level.

“It is not just about increasing the Value Added Tax (VAT). We are not asking for that but generally, most people don’t pay tax. Let people pay tax and we can get revenue from there.”

She said the LCCI was aware and conscious of the sharp decline in the oil price.
To reduce the adverse of this, she recommended that the economy be diversified.

She said: “We should look at agriculture, industrialisation and solid minerals.
“These are areas that have not been fully exploited. We discussed this with the vice-president. He even mentioned the issue of rice.

“Instead of importing rice from Taiwan, rice can be produced in the country and a lot of investment can be made from this.”

She said members of the chamber came to Abuja to meet with the vice president ‎to discuss with him some areas of the economy and the promotion of the private sector.

Dangote Cement Comes under Scrutiny in Ghana

 

The Ghanaian Ministry of Trade and Industry has announced that it is set to commence investigations into allegations raised by some Ghanaian cement manufacturing companies over Dangote Cement’s operations in the country.

Diamond Cement has been complaining for months of undue competition from Nigeria’s Dangote cement.

The development is said to have reduced Diamond cement’s annual production capacity of 1.8 million bags to 1.3 million bags.

The Deputy Communications Manager at the trade ministry, Ahmad Nasir, said the ministry would comply with the recommendations of the Tariff Advisory Board of the ministry mandated to conduct the investigations.

“Diamond cement’s point was that looking at the price of input into the manufacturing of cement, there was no way Dangote could produce in Nigeria, bring goods into Ghana, pay tariffs and still sell at a price lower than theirs.

They are suspecting that something fishy was going on,” Ahmad Nasir stated.

“At this stage it is an allegation until it is investigated, no action can be taken, within two weeks or so, this issue should be dealt with,” he added.

TELCOs pay N600bn tax to economy yearly

Telecommunications operating companies said yesterday that the N600 billion tax they pay to the economy could improve if the states and local government in the federation desist from arbitrary imposition of taxes and levies on its facilities which slowing down broadband rollout.

During a courtesy call on Vice President Yemi Osinbajo at the State House, Abuja, the Association of Licensed Telecommunications Operators of Nigeria (ALTON), the umbrella body for all providers of telecom service in Nigeria, said the sector accounted for about 10 per cent of nominal GDP in 2014.

With a direct contribution of around N600 billion in the same year, the sector accounted for over 30 per cent of the Nigerian Foreign Direct Investment (FDI) since deregulation in year 2001 and well up to half of our country’s FDI in between some years since 2001. It has also created over 20,000 direct jobs since liberalisation and 1.5 million indirect jobs.

Engr Gbenga Adebayo, chairman of Alton who led the delegation said the easier access to basic communication services has transformed personal and business productivity and facilitated better government and security services delivery. ICT is also having a direct impact on the performance of Government at all levels.


    

New electricity tarrif worries consumers: picture

CBN plans Forex intervention for banks

The Central Bank of Nigeria is planning to pump foreign exchange in to the market this week as it told commercial banks yesterday to fund their naira accounts to be able to participate in a currency intervention on the interbank market on Thursday.

Traders citing a message from the apex bank told Reuters that the CBN sold between $100 million and $150 million at its intervention last Thursday, but did not mention how much it will be selling on Thursday.

Although the value of the naira has remained static at N199.1 to the dollar at the interbank market since the beginning of the year, overnight rates which was 0.98 on Monday jumped to 3.4167 at the close of business yesterday.

Last week, overnight lending rates had risen from one per cent on Monday to 9.2917 per cent by Wednesday before dropping to 1.0467 per cent by the close of business on Thursday. Loner tenured lending rates had remained relatively stable.


    

Kano govt encourages regular tax payment

The Kano State government has repeated its call for residents and corporate entities in the state to regulary pay their taxes.

In an interactive session with the leadership of business groups held at the Center for Democratic Research, the chairman of the state board of internal revenue, Sani Abdulkadir Dambo said payment of tax was not an option but a responsibility of law abiding persons.

Dambo said the state was aware that a conducive environment was needed for businesses to thrive adding that the authorities were doing all they could to ensure this.
Advertisement

He advised the business men to exhibit shrewdness in their business dealings as it was not always about profit.

According to him, in the past there was an unsuccessful attempt to revive local industries which led to the borrowing of about N50bn by the state but such factories eventuially collapsed.

He said the board would ‘‘eliminate, simplify and streamline tax collection’’ to do away with the current multiple tax collection system from the state government, local government and federal government.


    
    

NASS to ensure right regulations for telecoms industry

 

The National Assembly (NASS) is to ensure that right regulations that would ignite rapid growth and development in the telecommunication sector are pursued vigorously.

Chairman, Senate Committee on Communications, Gilbert Nnaji, who stated this in Abuja at the opening of Airtel Service Centre at the Senate wing of the NASS, said that the committee is focused on promoting an enabling environment that would foster growth, prosperity and development in the telecommunications sector.

He observed that the committee is collaborating with key stakeholders in the sector, especially Nigeria Communications Commission (NCC) to commence the review of the Nigerian Communications Act of 2003.

Fashola offers reasons for increase in electricity tariff

The Minister of Power, Works and Housing, Hon. Babatunde Fashola, on Tuesday, rationalised the resolve by the Federal Government to increase electricity tariff.

He said the increment was meant to attract investors into the power sector, since only a few among them were willing to invest there.

Fashola said this during a budget defence by his ministry before the Senate Committee on Power.

He said that investors were already indicating a resolve to pull out of the power sector because they felt that they were not going to get returns on their investments.

The Minister, who said the Ministry had secured the endorsement of the National Assembly on tariff increase, said that the Ministry would continue to widen the scope of the power sector.

He said that, “Electricity is a product. It is made from raw materials and some of the raw materials are gas. So, the issue of tariff is the single issue of price, when the raw materials of course will go up the price cannot stay the same.

“You may ask: ‘why can’t we have more power before the price goes up?’. I am also a consumer, but we see that investments in power are not where they should be.

“If the recovery of price, the income and profit do not make economic sense to the investor, would you do that business if you are the one?”

President Buhari regrets dwindling oil production for local use

 President Muhammadu Buhari, on Tuesday, regretted that there was sharp fall in the local production of oil refinery for domestic use.

He felt unhappy that the country’s oil wealth was fast thinning out as it had been unable to produce enough refined petroleum products for domestic use, in spite of the government huge investment on the refineries.

Buhari spoke at a luncheon organised for him during his two-day official visit to Ogun State, on Tuesday, and also commended Governor Ibikunle Amosun for the rapid transformation of the state within five years of his administration.

His words: “I appreciate President Olusegun Obasanjo for making me the Minister of Petroleum; for three years, he tolerated me. During that period we built Warri and Kaduna refineries. We laid so many pipelines and then we were exporting refined petroleum products. But what do we have today? I want to stop here,” Buhari said.

He, however, commended Amosun for his administration’s achievement in the area of infrastructural development of the state.

Buhari commenced the activities for the day with the inauguration of some projects to the admiration of thousands of residents of Abeokuta, the state capital, who turned out in large numbers to cheer his convoy.

FG begins rail transportation of petroleum products in April – Amaechi

 The Minister of Transport, Hon. Rotimi Amaechi, has declared that the Buhari administration would commence the rail transportation of petroleum products to selected parts of the country before the end of the first quarter of 2016.

He made this known at the hearing on rail contracts awarded between 2010 and 2015, by the administration of former President Goodluck Jonathan, conducted by the House of Representatives ad hoc committee on railway contract scam.

Amaechi said that the development would decongest the number of heavy trucks and tankers that convey petroleum products that ply the nation’s highways.

“As from this first quarter, we should be able to begin to move petroleum products from Lagos by rail up to the north, so as to reduce the impact of trailers and tankers on our roads”, Amaechi said.
Advertisement

He added that the ministry would focus on completing the construction of the Lagos to Kano and Lagos to Calabar railway lines with a view to developing a faster railway system.

The minister gave an assurance that if the ministry got the loan to finance the project from the China-Nexim Bank, it would speed up the completion of a standard gauge railway track.

According to Amaechi, before the end of 2016, trains would start running on the Kaduna-Abuja standard gauge line, which is currently near completion.

Besides, he said that the ministry will harness the potentials in the railway sector to create employment and ensure the easy movement of goods across the country.

    
    

Nigeria Ends Oil Swap Deal In March

The minister of state for petroleum resources, Dr Ibe Kachikwu, has disclosed that the federal government would save $1 billion from the Direct-Sale–Direct-Purchase (DSDP) arrangement which will replace the crude-for-refined products exchange arrangement popularly referred to as crude swap, a policy that would take off next month.

The minister also disclosed that the price modulation policy had rid the federal government of the burden of subsidy on imported petroleum products in January 2016.

Also, the Federal Inland Revenue Service (FIRS) is targeting N4.95 trillion revenue in the 2016 fiscal period to help fund the federal government budget.

Kachikwu made these disclosures yesterday when he appeared before the House of Representatives Ad-Hoc Committee set up to investigate the Corporation’s offshore processing and crude swap arrangement for the period between 2010 to date at the National Assembly.

He explained that the DSDP was adopted to replace the Crude Oil Swap initiative and the Offshore Processing Arrangement so as to introduce and entrench transparency in the crude oil for product transaction by the Corporation in line with global best practices.

Under the old order, crude oil was exchanged for petroleum products through third party traders at a pre-determined yield pattern.

But Kachikwu, in a statement issued yesterday by the NNPC spokesman, Ohi Alegbe, noted that the DSDP option eliminates all the cost elements of middlemen and gives the NNPC the latitude to take control of sale and purchase of the crude oil transaction with its partners, adding that the initiative would save $1 billion for the federal government.

He said, “When I assumed duty as the GMD of NNPC, I met the Offshore Processing Arrangement (OPA) and, like you know, there is always room for improvement. I and my team came up with the DSDP initiative with the aim of throwing open the bidding process. This initiative has brought transparency into the crude-for-product exchange matrix and it is in tandem with global best practices.”

According to Kachikwu, the DSDP initiative whittles down the influence of the minister in the selection of bid winners, as it allows all the bidders to be assessed transparently based on their global and national track record of performance before the best companies with the requisite capacities are selected.

Clarifying the need for the introduction of the DSDP, the minister told the committee that the policy is aimed at reducing the gaps inherent in the OPA and the losses incurred by the NNPC in the past.