The Nation Newspaper

Category: Issues

  • Illegal fishing threatening prospects of blue economy

    Illegal fishing threatening prospects of blue economy

    Illegal fishing on the nation’s territorial waters and the high seas is adversely affecting the economy. In this report, OLUWAKEMI DAUDA looks at the negative and harmful impacts of illegitimate fishing in the light of the government’s economic  rejuvenation agenda.

    In August, this year, President Bola Tinubu established a dedicated ministry to drive the development of the blue economy and marine resources in the country.

    In a move seen and hailed as visionary and forward-looking, stakeholders in the maritime sector said the creation by President Tinubu was a game changer for Nigeria.

     For over three decades, stakeholders in the sector had advocated the creation of a separate ministry to oversee the affairs of the maritime industry like that of aviation. But the advocacy, they said, fell on deaf ears until Tinubu assumed duties and saw the reason to create the special purpose ministry to drive the economy and job creation.

    Impacts of marine resources on economy

    Findings have shown that oceans have a tremendous impact on the nation’s economy in terms of industrial development, fishing, boating, tourism, recreation, ocean transport and more.

    For instance, the United States’ maritime transport carries 95 per cent of the her foreign trade.Therefore, the sector often serve important ecological functions, and, no doubt, provides coastal protection, and critical resources for food, energy, tourism and economic development.

    Nigeria is the fourth largest importer of fish in the world after China, Japan and the United States. Yearly, experts said the country loses $600 million to the Chinese and European trawlers through illegal fishing running to 1.3 million tonnes in its territorial waters using the high seas that fall immediately after its jurisdictions.

    For example, the Federal Government had explained that the country’s fish production stood at 0.8 million metric tonnes as local demand was 3.5 million tonnes yearlly; with a deficit of 2.7 million tonnes, noting that $1.2 billion worth of fish was imported yearly.

    Findings have shown that the vast coastline and the exclusive economic zone of Nigeria possess substantial fish resources which could aid transformation of the country’s economy, if properly utilised by the Federal Government through the Ministry of Marine and Blue Economy

    How to monitor illegal fishing

    One instrument that could be deployed is a hydrophone. A fishing expert, Bankole Ilori, said a hydrophone is an underwater-listening device that records sounds over a designated period of time.

    “This device can be used by our security agents to detect potential illegal fishing vessels and the crude methods, such as bomb fishing.Therefore, the security operatives working on our territorial waters can combine a hydrophone with satellite technology to provide real-time detection of potential illegal, unreported and unregulated (IUU) activity,’’ he said.

    An IUU fishing refers to illegal fishing. It is against the rules and regulations that are in place for that jurisdiction or region. Unreported fish mens catches that are not reported or not reported correctly to the appropriate authorities.

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    Unregulated fishing: This is the fishing taking place by vessels without nationality, or in areas without any agreed rules or regulations being agreed to by the country or jurisdiction of the fisher.

    An IUU fishing is an enduring threat to the sustainability and economic viability of fisheries nationally, regionally and globally.

    Why is illegal fishing  common on our waters 

    A good example is fishing that occurs on the high seas, which are international waters that fall between our  jurisdictions and of others but belong to no nation.The high seas cover nearly 45 per cent of our planet and is where most illegal fishing occurs.

    Costs of illegal fishing

    According to the Nigerian Trawler Operators Association (NITOA), Nigeria loses more than $70 million yearly to illegal fishing.The country is not only battling with the great economic loss from illegal fishing, but also from issues regarding maritime insecurity and sea piracy, which the new Ministry of Marine and Blue Economy was created to tackle.

    Unregulated fishing threatens food security in the country and other parts of the world. However, illegitimate, unregulated and unreported practice has caused the country to have its vessel reduced.

    At various fora, experts in the maritime, fishing and agricultural sectors often the negative impact of illegitimate activities on our ocean and sea might be harmful to the blue economy; although they present a workable solution to the Federal Government.

    Decline in Nigeria’s local catch

    Investigation indicates that the high cost of automotive gas oil is a big disadvantage to the sector. The AGO, findings have shown,  covers over 70 per cent of the sector operational cost and that has led to reduction in the number of local catch.

    Operators said there is a steady decline in nation’s local catch and production of fish. According to an expert, Fisayo Atanda,  “in 1983, domestic production of fish was predicted to be between 600,000 and 700,000 tons, but now local cash has dropped to 441,337, which is not in the interest of the government and the people living across the country’’.

    Efforts by the British and U.S. govt

    Worried by this development, the British and the United States governments expressed their willingness to partner  the Federal Government to tackle the challenge of illegal fishing on the country’s waters as they believe that fishing would support growth and create job opportunities for  youths under the new Marine and Blue Economy Ministry’s plan. 

    The U.S. delegation was led by Ambassador Jessye Lapenn, the Senior Coordinator for Atlantic Cooperation, while that of the British was led by the British High Commissioner to Nigeria, Dr. Richard Montgomery. 

    Ambassador Lapenn said in Abuja that the U.S. Government was willing to offer technical support to the ministry to support Nigeria’s economic growth through the sector.

    Also, Montgomery expressed the government’s desire to partner the Federal Government to tackle the challenge of illegal fishing. Prior to this, China had offered to cooperate in creating a regional framework in West Africa for constructive engagement with stakeholders to facilitate information sharing in fisheries management, with a particular focus on the operations of foreign-owned fishing vessels and companies in West Africa. The country agreed to share data on fishing and improve transparency to better manage fisheries, especially migratory stocks.

    Researchers at the U.S. think tank

    Researchers at the United States think tank, Stimson Centre (SC), has identified China as the world’s top sponsor of distantwater fishing vessels in Nigeria and other countries in West Africa.

    Similarly, the Environmental Justice Foundation (EJF) said Chinese vessels engaged in illegal fishing with the largest distantwater fleet of about 2,701 vessels engaged in high instances of illegal, unreported and unregulated fishing in the country.

    Loss of over 300, 000 work forces

    The researchers said further that the arrival of Distant Water Fishing (DWF) fleets with industrial-scale trawl gear had crippled the West African fishing sector, stressing that DWF vessels in West Africa hailed from China, the EU, Russia, South Korea and Turkey. Consequently, more than 40 per cent of fishing vessels in Nigeria alone has been depleted because of the menace of IUU fishing, leading to loss of over 300, 000 work forces.

    Threats to blue economy prospects

    Last year, the government of former President Muhammadu Buhari licensed 164 fishing vessels as members of  the NITOA. But the new licencees complained that over 250 fishing vessels in operations in 1983 have reduced drastically to about 150 vessels. The body said illegal fishing had threatened the nation’s blue economy prospects.

    What to do

    President, NTOA, Mrs. Ben Okonkwo and other stakeholders said there was the need to establish fisheries terminals in Lagos where about 95 per cent of the industrial fishing operators are based. They also want the government to resuscitate the Export Expansion Grant (EEG) Scheme to make it more workable,  transparent and beneficial to operators in the industry. The government needs to support NIMASA and other security agencies in arresting foreign trawler operators and their local collaborators and prosecution to serve as deterrent to others.The government also needs to address the expensive cost of statutory registration and renewals of the particulars of trawlers by the regulatory agencies.

    Need to engage NITOA

    Also, the Chief Research Officer, Nigerian Institute of Oceanography and Marine Research (NIOMR), Mr. Akanbi Williams, stressed the need by the government to sit with NITOA to chart a common course to harmonise the processes and procedures to attract more local and foreign direct investment.

    Williams noted: “Other areas that the government must look into include high cost of statutory registration and renewals of trawlers’ particulars from the regulatory agencies; occasional pirate attacks at high sea leading to loss of lives and property as well as damage of vessels and machines.’’

  • A new paradigm in EFCC’s anti-graft war

    A new paradigm in EFCC’s anti-graft war

    • The proactive approach of prevention will dismantle the roots of corruption and pave the way for national progress

    In Nigeria’s unyielding battle against corruption, a pivotal shift in strategy has emerged; emphasising prevention as the bedrock of the country’s anti-graft initiatives.

    Simply put, prevention represents a shift from a reactive to a proactive approach to tackling corruption. This paradigmatic change signifies a proactive approach, focusing on eradicating the very origins of corruption rather than merely addressing its symptoms.

     The new paradigm shift was announced by the new Chairman of the Economic and Financial Crimes Commission (EFCC), Ola Olukoyede, shortly after his confirmation by the Senate.

     Without downplaying prosecution, the EFCC will be more primarily concerned with preventing corrupt practices in the country, he vowed. Embracing the wisdom of the well-known proverb “prevention is better than cure” underscores the significance of taking precautionary steps to avert problems before they arise, instead of managing the consequences afterwards.

     This perspective emphasises the importance of proactive and preventive actions. It suggests that it is far more effective and efficient to prevent an issue or challenge from occurring initially, rather than attempting to resolve it once it has manifested.

     Addressing the underlying causes and implementing preventive measures not only saves time and resources but also minimises the efforts that would otherwise be expended on handling the aftermath of a problem.

    Nigeria lost 2.9trn through contract fraud in three years

    He emphasised the crime prevention point with an example illustrating the extent of procurement fraud in Nigeria. He revealed that between 2018 and 2020, approximately ?2.9 trillion allocated for various government projects was misappropriated by contractors for personal gain.

     “I did a survey between 2018 and 2020 on 50 entities in Nigeria, both human and corporate entities. I picked just one scheme, one species of fraud, which is called contract and procurement fraud. I discovered that within the three years, Nigeria lost N2.9 trillion,” he stated.

    The new EFCC boss further stated that the funds pilfered during the assessed period could have been allocated to valuable government initiatives had the past leadership of the anti-corruption agency taken measures to prevent its diversion.

     “When I put my figures together, I discovered that if the country had prevented the money from being stolen, it would have given us 1,000 kilometres of road, it would have built close to 200 standard tertiary institutions. It would have also educated about 6,000 children from primary to tertiary levels at N16 million per child.

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     “It would have also delivered more than 20,000 units of three-bedroom houses across the country. It would have given us a world-class teaching hospital in each of the 36 states of the country and the Federal Capital Territory. This is where we are coming from, this is where we are. Where we are going, it depends on the decision the Senate would take this afternoon,” he said.

     He also canvassed a review of the criminal justice system, stressing that a review of the system would not only reduce the time spent on investigations and trials of suspects but save the country some money. Besides, he wants the federal, state and local governments to establish a transactional credit system to discourage corrupt tendencies in the civil service.

     Olukoyede, who also called for a collaborative effort in tackling corruption, stated that an average individual would steal if given the opportunity. He made reference to civil servants whom he accused of living in luxury homes and buying vehicles that their savings could not afford.

     He said: “The time has come for all anti-corruption agencies to focus more on prevention than enforcement. Enforcement is a very strong tool in our hands and we are going to apply it very seriously. The savings of an average civil servant in Nigeria all through his service years cannot build the type of houses they are building and cars they are riding.

     “The problem we have is just like the proverbial monkey that was locked up in a cage with a bunch of ripe bananas. The owner stood outside with a cane. The monkey would either eat the bananas, get beaten and be alive, or allow the bananas to get rotten and die of hunger. “Everyone wants to live a luxurious life and the incentives are all over the place. I will do more in the areas of blocking the leakages. We spend more money fighting corruption when we could have spent less to prevent it without downplaying the importance of enforcement.”

     Olukoyede pledged to implement a transactional credit system. This system aims to restrict the purchase of luxurious properties with cash, enabling the monitoring of financial transactions. He emphasised that relying solely on enforcement efforts would be insufficient without an effective credit system in place, highlighting the importance of such financial mechanisms in anti-corruption initiatives.

     “There is what we call a transactional credit system. If we continue to allow Nigerians to buy houses, cars and other luxurious properties by cash because we don’t have an effective credit system, 1,000 anti-corruption agencies will not do us any good and that is the reality.

     “We must create an atmosphere to make sure that people have choices. If I don’t steal money, can I afford to train my children in school with good standards? If I don’t steal money, can I buy a car after I have worked for five years? If I don’t steal money, can I put a three-room bungalow in place after I have worked for 20 years? An average Nigerian does not own a home, when he has the opportunity, he would steal. Even if he did not have the opportunity, he would create one,” he said.

     The EFCC Chairman emphasised the importance of delivering proper justice in fraud cases by urging judges to consider more than just technicalities when making judgments. He proposed that cases related to fraud allegations should be resolved within a timeframe of not more than five years, spanning from the High Court to the Supreme Court.

     “In order to encourage our criminal justice system to work, the substance should be taken above technicalities. We must encourage our criminal justice system to adjudicate in such a way that it will not drag on for a very long time.

     “Prosecution should not be allowed to last for a maximum of five years from the court of first instance to the Supreme Court.  The Senate can work on that very seriously. If we make the administration of the criminal justice system really work, you will see the great work the anti-corruption agencies are doing,” he stated.

       Evaluating Nigeria’s anti-corruption campaign amidst global standards

    Numerous studies analysing the efforts of anti-corruption commissions worldwide have established specific evaluation criteria for the success of any public policy.

     To achieve its intended goals, a policy must be effective (able to accomplish its stated objectives), efficient (attain its goals with reasonable costs and within a reasonable timeframe), innovative and politically and administratively feasible. This means that Nigeria’s anti-corruption campaign, aimed at minimising corruption to the utmost extent, relies heavily on institutional capacity (including the powers, resources and leadership of implementing bodies), political determination and the actions of key figures such as political and business elites.

     Regrettably, research focusing on anti-corruption commissions in Africa has revealed persistent challenges, often referred to as the ‘seven sins.’ These include economic limitations, political reluctance, legal inefficiencies, organisational weaknesses, governance gaps, performance issues and public scepticism.

     In summary, the effectiveness or success of an anti-corruption agency requires substantial long-term resources, a skilled and motivated workforce, robust legal and administrative authority, solid backing, possibly even from the President, adequate accountability and transparency, a supportive institutional environment, especially within related sectors such as the police and judiciary and accessible financial records.

     Is the described situation applicable in Nigeria? Regrettably, Nigeria’s efforts to combat corruption find themselves ensnared in the aforementioned challenges.

    The key anti-corruption bodies, namely the EFCC and ICPC, suffer from insufficient administrative capacity, including limited powers, inadequate human and material resources and an inefficient legal system.

     Additionally, the lack of widespread support and commitment from major political figures at both the national and sub-national levels, as well as from civil society, exacerbates the issue. This collective failure significantly contributes to the persistent presence of endemic corruption throughout the country, despite the widely publicised anti-corruption campaign.

     Wanted: Legislation on unexplained wealth

    In Nigeria, there is a pressing demand to establish comprehensive, internationally recognised legislation to tackle the possession of unexplained wealth or assets. This urgent need was underscored during a recent workshop conducted by the EFCC and the National Judicial Institute (NJI), aimed at enhancing the capacities of judges and other anti-graft stakeholders.

     During the workshop, Wahab Shittu (SAN) highlighted the absence of legislation in Nigeria addressing unexplained wealth, unlike other jurisdictions such as the United States, United Kingdom, Hong Kong, and Kenya.

    The Communique addressed various crucial issues, emphasising the necessity for advanced training of judicial officers and anti-corruption agency staff. 

    This training should cover new trends and skills vital for intricate processes such as asset tracking and seizures, plea bargaining, cryptocurrency,  data protection, artificial intelligence, and emerging types of economic and financial crimes.

    Participants also stressed the importance of full implementation of the Proceeds of Crime (Recovery and Management) Act of 2022; ensuring that criminals do not benefit from their ill-gotten gains.

     Additionally, there was a call for the development of a comprehensive Whistleblower and Witness Protection Act to facilitate the investigation and prosecution of corruption cases by relevant agencies.

    The three-day workshop, attended by esteemed jurists, including Supreme Court Justices, Court of Appeal Judges, Federal and State High Court Judges and Senior Advocates of Nigeria (SANs), highlighted the need for future engagement with members of the National Assembly and the Nigerian Bar Association, as the discussed issues also impact their constituents.

    The way forward

    Prevention, as a strategy, moves beyond punitive measures and delves into the heart of the matter. It aims to eliminate environments conducive to breeding corrupt practices, fostering a culture of integrity, transparency and ethical conduct.

    But this is possible only when there are effective corruption prevention strategies. One of such strategies is holistic educational initiatives. Implementing comprehensive anti-corruption education programmes from primary education onwards, nurturing a generation equipped with ethical values and a strong moral compass and institutional strengthening is essential to the attainment of success.

     Fortifying governmental, educational and corporate institutions to ensure robust governance structures, enforce transparency and uphold the rule of law also have a role to play.

     To succeed in its anti-graft battle, Nigeria needs to work on establishing secure channels for reporting corruption, safeguarding whistle-blowers and encouraging citizens to actively participate in exposing corrupt practices; embracing innovative technological solutions such as e-governance platforms, block-chain and data analytics to create transparent systems, minimising human intervention and reducing avenues for corruption; promoting ethical leadership within public and private sectors, emphasising accountability, fairness and integrity; thus setting high standards for professional conduct.

     There is also the need to overcome cultural acceptance of corrupt practices, which requires a gradual shift through awareness campaigns, by highlighting the societal benefits of integrity and ethical behaviour. So also are legal reforms. Regularly revisiting and enhancing anti-corruption laws to address emerging challenges, closing legal loopholes, and ensuring stringent penalties for offenders and the need to address the root causes such as poverty and lack of access to basic amenities through social welfare programmes and economic reforms to reduce susceptibility to corruption.

     Incorporating prevention as the cornerstone of Nigeria’s anti-corruption drive can pave the way for a transformative era. By nurturing ethical citizens, fortifying institutions, leveraging technology and addressing challenges head-on, Nigeria can lay the foundation for a society where integrity reigns supreme.

  • Diezani’s UK trial: Justice abroad?

    Diezani’s UK trial: Justice abroad?

    • The former petroleum minister may join the growing list of politically exposed Nigerians who evaded justice at home but got served abroad

    Since she left the country just days before the end of former President Goodluck Jonathan‘s administration in May 2015, hardly has a month passed without one allegation or the other against former petroleum minister Diezani Alison-Madueke surfacing in the news. This month was no exception, but this time, the news was from abroad.

     The internet was awash on October 2 with news that Ms. Allison-Madueke had been arraigned for alleged bribe-taking by the United Kingdom (UK) police. The former minister, who currently lives in St John’s Wood, an upmarket area of West London, is alleged to have accepted £100,000 in cash, chauffeur-driven cars, flights on private jets, luxury holidays for her family, and the use of multiple London properties from oil and gas contractors.

     Other gratifications listed against her by the International Corruption Unit of the UK’s National Crime Agency (NCA) are furniture gifts, renovation work and staff for the London properties, payment of private school fees for her son, and gifts from high-end designer shops such as Cartier jewellery and Louis Vuitton goods. Appearing at Westminster Magistrates Court, Alison-Madueke spoke only to give her name, date of birth and address. She was not asked to formally enter a plea, although her lawyer Mark Bowen told the court she would plead not guilty.

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     The charges against her, read out in court, all related to events alleged to have taken place in London. Prosecutor Andy Young said she was alleged to have accepted a wide range of advantages in cash and in kind from people who wanted to receive or continue to receive the award of oil contracts, which he said were worth billions of dollars in total. District Judge Michael Snow granted Alison-Madueke bail but imposed terms including an 11:00 p.m. to 6:00 a.m. curfew, an electronic tag to be worn at all times and a 70,000-pound surety to be paid before she could leave the court building. Her next court appearance will be at Southwark Crown Court, which deals with serious criminal cases, on October 30.

     Following the news, the Economic and Financial Crimes Commission (EFCC) said it had obtained an arrest warrant for Alison-Madueke and initiated extradition proceedings. “She will soon have her day in our courts,” it said in a statement.

    The 63-year-old Bayelsa-born former senior official of Shell Petroleum served as a key figure in the administration of former President Goodluck Jonathan administration between 2010 and 2015. She also acted as president of the Organisation of the Petroleum Exporting Countries (OPEC). The former minister has been on bail since first being arrested in London in October 2015.

    Andy Kelly, head of the NCA International Corruption Unit, said: “We suspect Diezani Allison-Madueke abused her power in Nigeria and accepted financial rewards for awarding multi-million-pound contracts. These charges are a milestone in what has been a thorough and complex international investigation. Bribery is a pervasive form of corruption, which enables serious criminality and can have devastating consequences for developing countries.” 

    Kelly said that assets worth millions of pounds in relation to the case have been frozen as part of the investigation. In March, the NCA which targets international and organised crimes, provided evidence to the United States Department of Justice allowing them to recover assets totalling $53.1 million linked to Alison-Madueke’s alleged corruption. The Federal High Court Abuja had in January 2022 issued a second arrest warrant against Allison-Madueke over money laundering by the Economic and Financial Crimes Commission (EFCC).

    Failed extradition bids

    When news of her current travails broke, it renewed interest in Nigerian anti-graft agencies’ eight-year bid to prosecute her for alleged looting. Alison-Madueke has been in the sights of EFCC since leaving office and, following a series of direct and indirect links with several corruption cases, has become one of the country’s most politically exposed persons since the era of former President Muhammadu Buhari. The Buhari administration often cited Alison-Madueke’s activities at the Ministry of Petroleum Resources and the Nigerian National Petroleum Corporation (NNPC) as part of the worst forms of corruption under Jonathan.

     However, several attempts by the Buhari government to bring her home from abroad and put her in the dock failed.  The suspended EFCC chairman, Abdulrasheed Bawa, who was at one time appointed by Magu to head the team investigating Alison-Madueke and her allies, once travelled to the United Kingdom to interrogate the former minister but could not gain access to her.

    EFCC’s investigations culminated in the money laundering charges filed against her in 2018. The commission also targeted high-worth assets it believed she acquired with proceeds of crimes for forfeiture. The Federal High Court, Abuja, on January 24, issued an arrest warrant against Alison-Madueke, over corruption charges pending against her. It was the second arrest warrant to be issued against the ex-minister. On December 4, 2018, a judge of the High Court of the Federal Capital Territory (FCT), Valentine Ashi (now deceased), ordered the EFCC, the Police, the Department of State Security (DSS), and all other security agencies to arrest her within 72 hours.

     Similarly, the International Criminal Police Organisation (Interpol) on February 3, 2023 said the UK Government rejected its request to extradite the former minister. Assistant Inspector General of Police (AIG) Garba Baba Umar, who is the Head of Interpol’s National Central Bureau (NCB), Abuja, stated this on the side-lines of an investigative hearing by a House of Representative Adhoc committee. The committee was investigating the alleged illegal sale of 48 million barrels of crude oil. Umar told the Committee that mutual legal assistance (MLA) processes were followed in a bid to bring Alison-Madueke back but the UK government refused.

    Billions in cash, assets seized

    If EFCC failed in extraditing her, it did succeed at confiscating billions in cash and assets reportedly linked to her through the judicial system. About N47.2 billion and $487.5 million in cash and properties were traced to Alison-Madueke after investigations, according to an EFCC statement. However, the EFCC was not the first to record some success against the former minister’s perceived assets.

     On October 3, 2015, Alison-Madueke was arrested with four other people by the International Corruption Unit (ICU) of the UK’s National Crimes Agency (NCA). She was, however, granted bail after she had been detained for several hours. The agency announced that the arrests were part of an investigation into suspected bribery and money laundering offences. Two days later, the NCA secured the seizure of the sum of £5,000 and $2,000 from Alison-Madueke’s mother, Mrs. Beatrice Agama. The court also seized £10,000 from Melanie Spencer, one of the other persons arrested in the case. The NCA also secured the seizure of the sum of £27,000 (N8,155,164.37) in the case involving Alison-Madueke at the Westminster Magistrates Court, London.

     But the former minister has consistently maintained her innocence. On May 26, she accused the EFCC and the Attorney-General of the Federation (AGF) of falsely portraying her as corrupt. Alison-Madueke sued them for N100 billion as compensation for their alleged libellous publications which, she said, falsely portrayed her “as a common looter of the national wealth and a debased and corrupt public officer.”

     The suit filed at the High Court of the Federal Capital Territory (FCT), Abuja, is challenging publications that date back to 2016. Through her lawyer, Mike Ozekhome (SAN), she urged the court to declare some specific corruption allegations, which appeared on various news platforms and EFCC websites between 2016 and 2022 as false. Apart from asking for compensation, the former minister also urged the court to order the EFCC and the AGF to retract the alleged libellous publications. She also urged the court to order the EFCC and the AGF to “publish an unreserved apology in at least three (3) national newspapers, including ThisDay, The Punch and The Sun newspapers within seven (7) days from the date of judgment.”

     She has also addressed the belief that she fled the country shortly after the Jonathan administration ended in May 2015 in fear of being caught and prosecuted by the Buhari government. Alison-Madueke said she flew to the UK on 22 May 2015, about a week before the new government came to power, to attend to her failing health. She said towards the end of the Jonathan administration, she was diagnosed with “the most aggressive form of breast cancer –Triple Negative Cancer and was hurriedly flown to England on 22 May 2015, in order to undertake a critical course of treatment.”

     The treatment she took, according to the former minister, “consisted of two operations, eight months of intensive chemotherapy and five weeks of radiotherapy and I have remained in England ever since then, undergoing medical care and treatment.” In November 2015, a photo showing an emaciated Ms Alison-Madueke was released on social media platforms by a media personality, Dele Momodu.

     But the former minister seems to have made a full recovery. A crisp photo of her at an event surfaced online on July 20, in a rare public show since she declared her struggle with cancer. It featured her smiling beside Senator Ben Bruce during the celebration of her son’s graduation from the University of Reading. Her son’s achievement is a testament to the power of good parenting. Excellence indeed runs in the family.” The photo, however, raised curiosity as to whether she was indeed sick ab initio.

    Will Alison-Madueke go the way of Ibori?

    Britain, the former colonial power of Nigeria, has always been a favoured destination for wealthy members of the Nigerian political elite looking to enjoy the fruits of their wealth. But this is not the first time a Nigerian politician has been accused of and charged with financial crime abroad. The charges mostly result in convictions. An exception is the case of the former governor of Bayelsa State, Deprieye Alamieyeseigha, who was arrested in London in 2005 on charges of corruption amounting up to $1million. He however fled and escaped trial.

     In March 2023, an agreement was signed between the United States and the Nigerian government to return the amount. In 2012, former Delta State Governor James Ibori pleaded guilty at London’s Southwark Crown Court to 10  charges of fraud and money laundering and was sentenced to 13 years in jail. Earlier in May this year, Senator Ike Ekweremadu, his wife and a doctor were sentenced to prison by British courts for attempted organ harvesting in the UK. Ekweremadu was sentenced to nine years and eight months. His wife, Beatrice, was sentenced to four years and six months, and the doctor, Obinna Obeta, was sentenced to 10 years at the Old Bailey in the UK.

     In a country where corruption trials involving politically exposed persons often last or are stalled for years with eyebrow-raising outcomes, many in Nigeria will see Alison-Madueke’s UK trial as, perhaps, their best chance for justice whether she is convicted or acquitted.

  • Repositioning Nigeria Customs through multi-stakeholders collaboration

    Repositioning Nigeria Customs through multi-stakeholders collaboration

    The Acting Comptroller-General, Nigeria Customs Service (NSC), Adewale Bashir Adeniyi, has been traversing the length and breath of the nation in the last 100 days or so, visiting various Customs formations and Area Commands to reposition the Service to take its rightful place as a leading revenue generating agency for the Federal Government, curb smuggling and re-invigorate cross border trade to meet President Tinubu’s vision of evolving a viable, private sector driven economy, writes Group Business Editor, SIMEON EBULU

    President Bola Tinubu’s appointment of Mr. Adewale Adeniyi to head the Nigeria Customs Service (NCS) was informed by the urgent need to reposition the Service to perform its primary role of revenue generation, tame smuggling and drive trade facilitation.

    Tinubu came to office with a mission to shift the management of the economy from the hands, as it were, of neophytes, and place it in the purview of professionals and tested technocrats, most especially in the critical sectors of revenue generating agencies.

    The objective, no doubt, is to beef up sufficient liquidity to attend to the yearning desires of Nigerians spanning infrastructure provisions, bridge the lack of health and education facilities, and create jobs, among others. Part of the President’s goal, is to upscale the nation’s revenue base to guarantee early realisation of his set goals of developing the economic ecosystem wholesale from the very onset in the life of his administration.

     His desire to address the shortcomings of the Central Bank of Nigeria (CBN), and the other related revenue collecting agencies, early in the life of the government, is a pointer to where the President is headed. And the Acting Comptroller-General of Customs (CGC) is leveraging his erstwhile brief as the Services’ spokesperson for many years, to align the NCS with Tinubu’s goal for the organisation

    It is instructive to appreciate the scope of Adeniyi’s brief in line the president’s goal. He is responsible for the overall management and direction of the NCS, as well as the Accounting Officer and the Vice Chair of the Nigeria Customs Service Board, which is chaired by the Minister of Finance.

    In that capacity, he has embarked on an extensive tour to the various Customs formations, including Customs Zonal Offices, Area Commands and border formations, all geared towards enhancing service efficiency through international collaborations, application of cutting-edge technologies, such as AI-driven solutions, and innovative projects that will shape the future of Customs operations in Nigeria.

    As a matter of deliberate policy to enhance service delivery through strategic engagement, Adeniyi has sort and cultivated partnership with professionals and global expertise, geared towards making informed decisions that will promote trade facilitation, security, ensure efficient deployment of human and material resources, guarantee operational effectiveness and operability in the present setting. And he has essentially pulled through and is accomplishing set goals engaging his policy thrust of Collaboration, Consultation and Innovation.

    In so far as these elements are concerned, the Ag. CGC has leveraged massively, to say the least, on his many years as the NCS’ image maker, to tap on the various stakeholders, from within and without to advance the course of the Service. Adeniyi, from the onset, had stressed the need for collaboration with international partners, local law enforcement agencies, government agencies, the media and the Customs’ formations of other friendly countries and trade partners.

    He said: “As we embark on this new journey, we recognise the need for collaboration and partnerships. We value the relationships we have built with our partner government agencies and the private sector. These collaborations have been vital to our adoption of technology as a tool to enhance revenue generation and streamline processes,” adding: “We will strengthen these partnerships and engage with stakeholders through revitalised platforms. By promoting dialogue, we can resolve disputes and advance mutually beneficial solutions that lead to more efficient and effective service. The Nigeria Customs Service will continue to treat its esteemed stakeholders as partners who have a stake in our success.”

    To further advance and expand these engagements, the Service made collaborative engagements to operationalise the use of Geospatial Intelligence to enhance the efficiency of NCS enforcement operations and contribute to overall efficiency.

    Geospatial intelligence, or GEOINT, which is the exploitation and analysis of imagery and geospatial information to describe, assess and visually depict physical features and geographically referenced activities on the Earth.

    The Ag. CGC has equally engaged in strategic discussions with partners such as the World Customs Organisation (WCO), Japan International Cooperation Agency (JICA), and the Japan Customs Administration.The discussions aim to garner support for establishing a Customs Laboratory for the country.This is a significant milestone in enhancing Customs operations and trade facilitation across Nigeria.

    The NCS Laboratory is expected to provide comprehensive solutions to address challenges such as counterfeit goods, smuggling and non-compliant imports thereby bolstering revenue generation and ensuring the protection of public health and safety. With its advanced analytical capabilities, the laboratory is expected to deliver precise identification, verification and classification of goods, enabling efficient enforcement measures and informed decision-making, while fostering an environment of trust and credibility within Nigeria’s trade ecosystem.This will mark a transformative step towards achieving seamless Customs operations, trade competitiveness and national economic growth in line with the vision of the President Tinubu-led Administration.

    His engagements extended to fruitful discussions with relevant experts and donors, focusing on crucial areas such as conducting a Time Release Study (TRS), implementing the Authorised Economic Operator (AEO) program, leadership, and management development. These discussions underscore his commitment to a comprehensive improvements and his inclination to adopt innovative solutions across various Customs domains, ultimately enhancing operations.

    About two weeks ago, September 12, to be precise, Adeniyi expressed his commitment to synergise with Benin Republic to enhance trans-border security and regulate trade between the two countries.

    Other areas that the partnership will address include enhancing the proper use of International Transit Guidelines to govern transit-bound goods and fees from Cotonou Port to Nigeria; Integration of Nigeria into the Interconnected System for the Management of Goods in Transit

    He said the treaty between the two agencies “will prepare the way for an in-depth mechanism to harmonise the import prohibition lists of products banned by the two countries. A joint Communiqué signed by Adeniyi, who is conferred with the National Honour (MFR), and Director-General of the Bennese Customs, Alain Hinkati, highlighted that their meeting favours the desire of the two countries’ presidents – Tinubu and Patrice Talon – to strengthen shared commitment to enhancing trade facilitation and promoting economic development.

    Other areas that will benefit the countries are fostering closer ties to Nigeria and Benin and reactivating the Joint Committee for Monitoring Trade and Transit Relations. Adeniyi has also affirmed the partnership with the United Nations Human Settlements Programme (UN-Habitat) to combat smuggling. He made this known in Abuja last week when he received Ambassadors of the UN-Habitat, led by Dr. Raymond Edoh, at the Customs Headquarters, Abuja.

    The CGC appreciated the collaboration between the NCS and UN-Habitat and believes that the collaboration signifies a commitment to tackling smuggling and enhancing trade facilitation in the nation, and thus setting the stage for a more prosperous future. “What we’re trying to do,” he said, “is to raise a modern Customs Service through partnering  stakeholders to achieve our goals because we value partnership, and I am happy that you extended your hands of collaboration to work with us.”

    UN-Habitat is the UN’s entity for developing urban policies and translating them into action to create sustainable cities and promote viable urban development and adequate shelter for all.

    Adeniyi has equally taken strident steps in his drive to reach out to the Ministries, Departments and other agencies of government (MDAs), including seeking collaboration with the Federal Ministry of Transport to decongest ports. He received the assurance of the Permanent Secretary, Ministry of Transportation, Magdalene Ajani, that Overtime Cargo Disposal Committee is working assiduously to implement policies that will decongest the four major ports in the country. “We are working in different dimensions, but the result will be prodigious, after launching the sensitisation to stakeholders and members of the ports community about the process.” she said.

    The relentless Ag. CGC has also visited to the National Security Adviser (NSA), Mallam Nuhu Ribadu, to seek seek ways of addressing the menace of the nation’s porous borders and the attendant insecurity. “The porous nature of the nation’s borders necessitates this visit to the NSA to fashion the best way to tackle the menace of smuggling, which has adverse effects on our economy and security,” the CGC stated.

    In what seems like one of the most productive collaborations towards enhancing national security and curbing revenue loss, the Federal Road Safety Corps (FRSC) and  NCS commenced an intensive vehicle database integration of the two government agencies.

    The collaboration was effected during the visit of Adeniy to the Corps Marshal, Federal Road Safety Corps (FRSC), Dauda Ali Biu, at the national headquarters of the Commission on Thursday.

    Speaking during the visit, the Acting CGC emphasised NCS’s renewed commitment towards working with the Corps in the area of human resource development, information and communication technology, as well as sports.

    He stated, among others, that a handshake and effective consolidation of vehicle information in the National Vehicle Identification Scheme database domiciled with the FRSC and vehicle database of the NCS would curb vehicle smuggling, improve revenue generation and enhance national security.

    The Corps Marshal, while responding to the CGC, applauded the initiative, stating that the handshake and data sharing would not only strengthen the bond between the two agencies but also positively impact the fight against the smuggling of vehicles.

    Biu stated that the collaboration would also entrench ease of doing business as it would make tracking vehicles without customs duty certificates very easy for the Corps at the point of registration.

    On Thursday, August 3, the Customs boss visited the Acting Inspector-General of Police, Kayode Egbetokun, at the Force Headquarters, Abuja. The visit sought inter-agencies’ cooperation and collaboration to fast-track sustainable working relationships between the Nigeria Customs Service and Nigeria Police Force to ensure adequate security of lives and properties in the country.

    Addressing the leadership of the Force, Adeniyi assured the IGP that Nigeria Customs is willing to learn more from the Nigeria Police Force in investigation and other operations through coordinated capacity-building programs.

    “Criminal activities are inter-connected, thus a need for the two security agencies to collaborate to mitigate the menace of smuggling, which will help the Nigeria Customs Service to generate revenue for the nation. I will, therefore, request to build a strong relationship between the Nigeria Customs Service and the Nigeria Police Force.” the CGC said.

    He added that the major issues bothering the two organisations could be mitigated through sharing intelligence to help achieve a common goal in the fight against criminals.

  • Unease over emerging technologies

    Unease over emerging technologies

    Technology has continued to evolve. From the first generation (1G), which dealt with analogue voice to 2G, which was essentially digital voice to 3G with focus on data; 4G on mobile broadband to 5G, which was designed to connect  everything and everyone, so have come what is known as merging technologies. Artificial intelligence (AI), augmented reality (AR), blockchain and others are some emerging technologies. While technologies have provided solutions to human challenges over the years, there are fears that AI would replace jobs, writes LUCAS AJANAKU.

    The Nigerian Communications Commission (NCC) has pledged commitment to driving the deployment and adoption of emerging technologies such as Internet of Things (IoT), Big Data, Blockchain, Robotics and Virtual Reality (VR), FinTech, Artificial Intelligence (AI) and telemedicine, to stimulate greater contribution of the sector.

    “For us as a country to reap the full benefits of all these emerging technologies in ways that further spur growth in our national economy, NCC prioritises the need to improve and expand broadband infrastructure and the deployment of new technology such as 5G. Our efforts in diligently driving this will facilitate the actualisation of the set targets in the Federal Government’s digital economy policy,” Executive Vice Chairman/CEO, NCC, Prof Garba Danbatta, said.

    According to him, with the rapid digital transformation happening through the telecom sector, the country will be in a better position to create an alternate economy for diversification, innovation and creativity in e-commerce and digital entrepreneurship, thus empowering a significant number of the populace to become self-reliant and self-employed.

    Like the NCC, the National Information Technology Development Agency (NITDA) has created a National Centre for Artificial Intelligence and Robotics (NCAIR), which, it said, is one of its special purpose vehicles (SPVs) to promote research and development on emerging technologies and their practical application in areas of national interest.

    The centre, a state-of-the-art facility, along with its modern digital fabrication laboratory (FabLab), is co-located in the same building complex with the Office for Nigerian Digital Innovation (ONDI), at Abuja.

    NCAIR as a digital innovation and research facility is focused on AI, Robotics and Drones, IoT and other emerging technologies, aimed at transforming the digital economy, in line with the National Digital Economy Policy and Strategy (NDEPS).

    NCAIR said it is also focused on creating a thriving ecosystem for innovation-driven entrepreneurship (IDE), job creation and national development.

    However, sack fever has gripped virtually everyone, no thanks to these emerging technologies. From front desk officers, cashiers, drivers and translators, the fear of losing jobs to AI is real, especially with the emergence of Chat GPT on the stage.

    Investment bank Goldman Sachs had predicted that 300 million jobs would be lost or degraded by the emergence of artificial intelligence (AI).

    The World Economic Forum also found out that the global economy will shed 14 million jobs over the next five years as the economy weakens and companies boost the adoption of AI technologies.

    Tidio, a customer service platform offering live chat, survey has shown that more people are open to the idea of incorporating AI into their lives. They do not mind AI taking over  tasks or being involved in decision-making.

    A report by Digital PR and Content Specialist at Tidio, Matt Baranowski, showed that nearly 69 per cent of college graduates believe AI could take their job or make it irrelevant in a few years.

    Graduates are the ones most afraid of losing their jobs due to AI development. About 68.5 per cent of them fear being replaced by AI, compared to just 55 per cent of other respondents.

    Cashiers, drivers, and translators are among the jobs most likely to be replaced by AI according to the research.

    For cashiers (63 per cent of respondents), drivers (51 per cent), and translators (42 per cent) were named as the professions most likely to be taken over by AI technology. About 25 per cent of respondents also believe customer service representatives and warehouse workers are next in line.

    The report also showed that more than 45 per cent of people have a positive attitude towards AI taking control of the economy.

    Some claim that AI could prevent corruption and improve the economy. About 45per cent of respondents want AI to adjust fiscal policy and the budget of their country. Still, opinions are highly polarised. Nearly 29per cent think it’s a terrible idea.

    More than 60 per cent of respondents would use a self-driving AI taxi during heavy traffic, underscoring the fact that a lot of faith is placed on AI when it comes to transportation and logistics. More than a half of respondents would not mind taking a self-driving taxi (60 per cent) or having AI manage air traffic (57per cent).

    The report showed that people are seven times more worried about the negative impact of AI on the job market than fair treatment of robots.

    According to 32 per cent of the survey respondents, robot rights-similar to human rights or animal rights-is a topic that shouldn’t elicit attention.

    On information dissemination, almost 78 per cent of respondents are convinced that AI will be used to spread misinformation.

    Apart from the fear of AI taking away jobs (42 per cent of respondents) or being used by criminals (51 per cent), respondents are concerned about the misuse of AI technology to spread misinformation. Some 78 per cent strongly believes this will be the main AI threat. By comparison, only three per cent believe that AI will take revenge on humanity.

    Men place significantly more trust in AI technology than women. They are about twice as likely to have an AI robot operate on them or teach their children. They are also less concerned about potential threats posed by the technology.

    Male respondents are 20 per cent more willing to interact with robots and AI

    Existing robot and AI representations from fiction and real life are more appealing to men than women. After the use of a range of examples, respondents were asked if they were willing to interact with the selected robots. On average, 65per cent of male respondents answered yes, but only 45 per cent of women did so.

    According to a widely-commented study on the future of employment, known as the Oxford Study, about 47per cent of total US employment is at risk due to rapid computerisation.

    As Alana Semuels from Time notices, many people of colour and low-wage workers lost their jobs due to the COVID-19 pandemic. She pointed out that they were primarily, “cashiers, food-service employees, and customer service representatives, which are among the 15 jobs most threatened by automation.” Now, they have problems with getting employed again.

    Some 65per cent of respondent suspect they could lose their jobs to AI in the next few years; and nearly 79 per cent believe that rapid automation is an important issue that people should be particularly concerned about.

    The fact is that certainly, there will be job disruption because what’s going to happen is robots will be able to do everything better than human beings.

    Tido, as a company that develops AI chatbots for the ecommerce sector, said it is also aware of its contribution to the changes in the job market. Customer service representatives are one of the top positions for professions that may soon become obsolete.

    Cashiers, drivers, and translators are popular jobs that are already becoming gradually automated. Self-service checkouts, autonomous trucks, and real-time translation software are part of modern day reality. It shouldn’t be surprising that the majority of respondents-63per cent and 51per cent predict that cashiers and drivers are the jobs most likely to be replaced by technology.

    Reprieve

    However, police officers, doctors, lawyers have been voted professions that will survive the AI revolution. Professions associated with creativity appear to be even less vulnerable to the disruptive effects of AI technology on the job market. Artists and musicians were selected by almost 39 per cent and 36 per cent of respondents as the jobs least likely to be taken over by artificial intelligence.

    Read Also: Aircraft manufacturers jostle for market with maintenance offer

    While AI is playing an increasingly important role in law or healthcare, AI and robots tend to play intermediate roles between experts and clients or patients.

    Grace, a robotic “nurse” created by Hanson Robotics, is still more of a receptionist for hospitals rather than a real nurse. And the majority of patients would feel uncomfortable around her anyways, which brings us to the next part of our study.

    Former President, Nigerian Computer Society, Prof Adesina Sodiya, believes AI will take jobs but would also create jobs.

    “Even where people are saying IT is going to take their jobs; robots are going to take their jobs, it’s also creating other opportunities and in our drive for digital transformation, we are really not there yet and that’s why we are not benefitting immensely from what’s going on.

    “There are so many organisations that are still being run manually. And because of that, the ability to use digital for economic development is still challenged,” Sodiya said.

    The job loss malaria notwithstanding, the Association of Licensed Telecom Operators of Nigeria (ALTON) President, Gbenga Adebayo, said opportunities actually exist to create jobs in the ICT space in the country.

    “If you look at what’s happening in other parts of the world, the biggest job creator is actually the digital economy. That’s where you have fintechs, virtual trading, virtual markets; you have the likes of Jumia and Konga and the rest of them. These are virtual markets. We have what is called the home office. People work from home digitally; banking is going digital. If you look at all of that, what the government has to do is to provide the platform for it to thrive. Not that the government will go directly to create digital employment; that’s not what we expect.

    “But the government should give the platform for digital trade to thrive; encourage young entrepreneurs; encourage digital natives to do what they want to do; give them access where they need to fund, give them access, when they need the enabling environment, give it to them.

    “You cannot have a digital economy if you don’t have access to data, especially if you don’t have a resilient network.That means we need to look at infrastructure, particularly energy, remember that telecoms, on account of the activities of government agencies sealing infrastructure, in an attempt to extract revenue have to stop. Such actions must be seen as criminal actions. For any government agency to go and seize telecom sites in the name of collecting tax; that should be seen as criminal,” Adebayo had said in response to President Bola Tinubu’s one million digital jobs target.

    Sodiya said there are limitless opportunities in the digital space to create jobs. The youths are eager, many of them are going to commit crimes because they do not have jobs, they do not have enough things to satisfy their quest.

    “There are so many opportunities in IT. It depends on the interest of the government, it depends on the people that are working with them (the government); it depends on the people that are coming up with these suggestions. If they truly understand how to create jobs on the digital space, the opportunities are there. Because of the development in IT, there are so many opportunities that are coming up. If you have to go into building websites for small and medium enterprises (SMEs), helping them to promote their businesses, using social media because people are now experts in social media, so there are opportunities, it’s just requires some basic soft skills, skills that you don’t need to go to the university to acquire; when you don’t want to be doing some researches; just the ability to learn some things by yourself.

    “And if you also want to talk about another level of app development, our people that have made breakthroughs all over the world are bringing a lot of funds into this country, so, the opportunities are there. If you go into the area of data science, being able to make projections, many organisations abroad now are looking for data scientists that will work remotely because data science is about being able to discover knowledge that can make organisations to plan very well and have competitive advantage,” he had said.

    Project Management Institute (PMI) has laso assured the youth that the invention and usage of CHATGPT by organisations will not take their jobs.

    Its Youth Lead, Sub-Saharan Africa, PMI, Joanna Baidu, said arguments around job loss to AI have gained prominence since the emergence of CHATGPT.

    Baidu said: “Concerns around the use of AI, from its potential misuse and ethical implications to the balance of innovation vs disruption, have been swirling since ChatGPT went mainstream. There is great unease at the thought of AI replacing jobs.

    “Students across various educational institutions have good reasons to be anxious. According to the Institute of the Future, 85per cent of the jobs that will exist in 2030 have not been invented yet! While it is easy to speculate about the types of jobs automation will make obsolete, it is with no certainty that we can make any assumptions.

    “There is no denying that AI will profoundly impact the future of work. Tech innovations of the past decade have already made bank tellers, cashiers, telemarketers, and travel agents relics of the past. “Generative AI holds the potential to take over segments of marketing, copywriting, design, customer support, legal work, etc. It remains aware of its limitations, though, and believes that “jobs that require a high degree of creativity or interpersonal skills are less likely to be replaced by AI. These skills are innate to project managers.”

    PMI’s Talent Gap predicted an increase in the number of jobs requiring project management-oriented skills from higher demand due to economic growth and retirement rates. These trends will create a global need for 25 million new project professionals by 2030. If the roles are not filled, it could result in a possible loss of up to $345.5 billion in global gross domestic product (GDP).

    Baidu said: “Regardless of which way the pendulum swings and which jobs AI swallows, it is prudent that the youth commit to lifelong learning and upskilling. Joining a professional association is strongly recommended for students and early career professionals. Staying informed about trends, access to learning resources, and being intentional about professional development will give the youth the head start to prepare for the future of work. Power or soft skills are one of the most essential skills a membership can help you sharpen. Being a member of an association opens avenues to volunteer. One can step into multiple “official” roles, such as youth ambassador and student coordinator, which will help develop power skills.

    “Having real-world experience using power skills to accomplish goals or overcome obstacles gives one a tremendous edge when job-hunting. There are associations or organisations that cater to nearly every type of profession.”

    Baidu explained that at PMI, student members enjoy the same valuable benefits afforded to practitioners. Student members receive digital downloads of the latest PMBOK Guide, certification discounts, and access to tools and resources such as PMI’s Career Navigator, which supports career progression by creating a personalised plan. Student members also gain access to networking opportunities through various events and activities and instantly join a network of over 450,000 project professionals worldwide.

    According to reports, ChatGPT has had more airtime than the world’s most renowned celebrity. Its arrival has sparked questions and concerns that some did not even think to ask, including if it is a threat to our critical thinking skills.

  • Oil theft: Between economic gains and deterrence

    Oil theft: Between economic gains and deterrence

    The onslaught against crude oil theft has been reinvigorated with the security personnel recording impressive results. However, stakeholders warn that there is a need to distinguish between legitimate and illegitimate oil businesss. Besides, economic and environmental experts, among others, insist that there are grave consequences ahead if the process of seizure and destruction of such vessels are not properly guided. MUYIWA LUCAS reports.

    The country’s security forces are furious. Their fury stems from the continued operations of economic saboteurs in the mold of crude oil thieves who have perfected their criminal activities that are bleeding the country’s finances and throwing it into a quagmire.

    Not only has this sordid act denied the country of valuable revenue, it has also boxed her into a corner such that in the last five years, the allocated crude oil production output to the country by the Organisation of Petroleum Exporting Countries (OPEC), has not been met as a result of crude oil theft and other leakages in the system.

    A peep into the loss inflicted by oil theft is well captured in a March 2022 Oil and Gas Industry Report of the Nigeria Extractive Industries Transparency Initiative (NEITI). The five-year report, showed that 272.2 million barrels (mmbbls) of crude oil was lost to mainly oil theft between 2016 and 2020.

    Then, this volume loss amounted to $14.65 billion based on the prevailing international crude oil price in those times. Specifically, losses recorded in 2016 was about 101.05 mmbbls; in 2017, it was 36.46 mmbbls; 2018, 53.28 mmbbls; 2019 recorded 42.25 mmbbls loss and in 2020, 39.16 mmbbls.

    Read Also: Oil theft: Navy to extend surveillance to creeks

    The immediate past Speaker of the House of Representatives, Femi Gbajabiamila, drawing from a report submitted to him, also expressed concerns over a $23 billion loss looming over the country as a result of the activities of crude oil thieves.

    It is, therefore, instructive that the security forces have moved in to stem this tide, recording successes in the fight against the oil marauders. For instance, last month, the Nigerian National Petroleum Company Limited (NNPCL) said a private security contractor, Tantita Security Services, owned by former Niger Delta militant Chief Government Oweizide Ekpemupolo, popularly known as Tompolo, had intercepted a suspicious vessel with a cargo of crude oil on board.

    “The vessel, MT Tura II (IMO number: 6620462), owned by a Nigerian company, Holab Maritime Services Limited with Registration Number RC813311, was heading to Cameroun with the cargo on board when it was apprehended at an offshore location (Latitude: 5.8197194477543235°, Longitude: 4.789002723991871°), with the captain and crew members on board,” it said.

    According to the NNPCL, investigations showed that the crude oil cargo was illegally sourced from a well-jacket offshore in Ondo State, as there was no valid documentation for the vessel or the crude oil cargo onboard at the time of the arrest.

    “Further investigation into the activities of the vessel at the NNPC Limited Command and Control Centre also revealed that the Vessel has been operating in stealth mode for the last 12 years. The last reported location of the vessel was Tin Can Port in July 2011,” the statement said.The arrested vessel was subsequently set ablaze with its 150, 000 metric tonnes of crude oil.

    Earlier this month, another vessel bearing a Togolese flag for transporting stolen crude in  Koko, Delta State, was purportedly arrested by the same  private security outfit, TSS. The TSS said the 1, 117 tons vessel was carrying about 8,100 barrels of crude, and was being escorted by some naval officers led by a senior commander.

    Recall that last October, security agents also destroyed a vessel used for crude oil theft off the Niger Delta creeks after the vessel was reportedly arrested by Tompolo’s firm.

    However, the Navy said the vessel was certified by the government agency for regulating midstream and downstream petroleum operations in Nigeria.

    “MT Praisel was duly approved by Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA)” to load 1,114,721 Litres of High Pour Fuel Oil (HPFO) from Greenmac Energy Storage/Tarus Jetty Koko from July 26 to August 8, 2023.

    On August 5, the Air Component of Operation Delta Safe (OPDS), destroyed three boats loaded with stolen crude and another illegal refinery with reservoir and tanks in Rivers State.

    The Director of Public Relations and information, Air Cdre Edward Gabkwet, in a statement, said one of the operations took place at about four Nautical Miles Southeast of Bille, a riverine area located west of Bonny Island and South of Port Harcourt, in Rivers State.

    According to him, the NAF aircraft on surveillance sighted three boats tapping crude oil from a pipeline.“Consequently, the boats were engaged and destroyed by the aircraft. Again, flying towards Port Harcourt, the crew also observed an active illegal refining site with tanks and reservoirs loaded with suspected refined products, about four miles Southeast of Idama in Rivers State. The site was also attacked and destroyed,” he said, adding that air strikes against economic saboteurs would be sustained until they desist from their acts of thievery and sabotage.

    But experts and stakeholders have expressed divergent views over the destruction of crude oil alongside the vessels arrested. While some are in agreement, saying it would send a strong message to perpetrators of the crime, others see it as a loss to the country, insisting that there is a need to distinguish between oil theft and genuine participants in the business. Yet, for others, it is an attack on the environment.

    The Executive Director, Environmental Rights Action/Friends of the Earth Nigeria (ERA/FoEN), Mr. Chima Williams, rued the implication of such exercise. According to him, destroying and wasting stolen crude, is a disfavour to the economy, as such crude could generate funds that would build infrastructure and better lives.

    “Destroying badges of crude that runs into millions is equivalent to denying the nation and its people of the revenue that can be derived from such large amounts of crude. This is a country in dire need of resources to rebuild the economy, to build infrastructures and to better the lives of the people. The country is in heavy debt, yet we are destroying sources of enhancing our economy. The burnt vessels can be transformed into other uses like enhancing the work of seafarers in the country,” he noted.

    Williams further argued that the burning of crude oil laden vessels released a high level of chemical content into the water bodies that destroys the eco lives and aquatic organisms that humans need to survive.

    “Destroying such vessels with their crude contents produces high level chemical debris that follows tidal movement to other parts of the country. This kind of devastation destroys the aquatic organisms needed to satisfy man’s nutritional and survival needs,” he added.

    An Abuja-based public affairs analyst, Akintayo Balogun, also described as economic waste the destruction of crude oil seized from oil burglars as a wasteful, unnecessary, and a very bad decision economically, environmentally, psychologically, and unwise.

    “The revenue that the nation should have generated vide the said crude oil is being thrown away for nothing. Nigeria is in serious debt and has spent the last eight years living on borrowed funds. While this is the situation, Nigeria is carelessly throwing away the bath water and the baby. This ought not to be,” he noted in a statement.

    Another public analyst, Mayowa Sodipo, noted that there was the need to define what constitutes crude oil theft and licenced operators. He explained that the conflicting positions held by the TSS and the Navy over the arrest of the vessel MT Praisel should serve as the reason restraint should be further exercised in destroying vessels alleged to be involved in oil theft.

    “TSS said the vessel MT Praisel was arrested for crude oil theft and was led by a Naval officer guiding it, but the Navy came out to explain that the vessel had permit to load crude oil. Suppose due diligence was not carried out to ascertain the truth what and the vessel was burnt, who bares the loss?” Sodipo asked.

    Process

    Under the terms and conditions for the sale and purchase of crude oil, Part II of the contract for 2021-2023, Section 5.2.1 under  “Vessel Vetting/Clearance” stipulates that each vessel, which is to load crude oil pursuant to the contract shall be nominated in writing by the buyer to the seller not later than 30 days before the first day of the date-range in which the buyer wishes to lift crude oil. Such notices shall specify the following: The name of vessel, date built and flag; the vessel’s dimensions and other specifications, which shall be within the maximum and/or minimum limits specified by the seller from time to time and shall satisfy the standards and regulations of the terminal operator at the relevant time. It shall further indicate the quantity and grade(s) of crude oil to be delivered, the co-loading date and crude stream of co-loads (if any). There shall be at least 24 hours’ time allowable between co-loads of different crude streams.

    Section 5.4 on “Documentation instructions” says the buyer shall submit in writing to the seller, documentation instructions not later than 10 days before the first day of the date range in which the buyer wishes to lift crude oil. Such documentation instructions shall specify the following: vessel name; quantity to be loaded; crude oil grade/stream; SDWT; IMO Number; Draft; LOA; Beam; Flag of vessel; Year built; the ETA of the vessel.

    Clearly, it further stipulates that any deviation exceeding six hours from the original ETA or where any delayed arrival of the vessel will prevent her from being berthed or moored the same day due to any night–time navigational or any other applicable restrictions shall immediately be advised by buyer to seller and terminal operator supported with reasons for such deviation or delay.

    Given these stipulations, stakeholders have continued to wonder why crude oil theft thrives because if these regulations are adhered to, then no vessel could have made it to the loading vicinity as they are expected to have transmitted their documentations ahead of time.  

  • Making sense of NBS data on unemployment

    Making sense of NBS data on unemployment

    Explaining the new methodology behind Nigeria’s 4.1 per cent unemployment figure, NBS said the latest figure doesn’t change current jobs crisis and that the methodology used in collecting labour market data is in line with the latest guidelines of the International Labour Organisation

    By the time the National Bureau of Statistics (NBS) released the labour report for the fourth quarter (Q4) of 2022 and the first quarter (Q1) of 2023 last week, little did it know it was courting controversies. The report averred that the new methodology sanctioned by the International Labour Organisation (ILO) was used in data gathering. Under the old methodology, the NBS pegged Nigeria’s unemployment rate at 33.3 per cent as at Q4 2020, but the revised methodology put it at 4.1 per cent in Q1 2023.

     In simpler terms, the NBS said the unemployment rate stood at 4.1 per cent in the first quarter, down from 5.3 per cent in the fourth quarter of 2022. The NBS last published unemployment data in March 2021, where it reported a record high 33.3 per cent jobless rate in the fourth quarter of 2020. Under the revised system, the NBS defines employed persons as those in paid jobs and who worked for at least one hour in the last seven days, and considers underemployment as those working less than 40 hours a week and declaring themselves willing and available to work. The NBS said the revised data “aligns with the rates in other developing countries where work, even if only for a few hours and in low-productivity jobs, is essential to make ends meet, particularly in the absence of any social protection for the unemployed.”

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     As defined by the ILO, an unemployed person is a person aged 15 or over who simultaneously meets three conditions: being unemployed for a given week; being available to take a job within two weeks; having actively sought a job in the last four weeks or having found one starting in less than three months.

     The latest Nigeria unemployment report has raised some believability questions. The Statistician-General of the Federation, Prince Adeyemi Adeniran, gave the Nigeria Labour Force Survey (NLFS), Q4 2022 & Q1 2023. Critics were quick to raise issues about how unemployment could suddenly decline from 33.3 per cent in the first quarter of 2020 to 5.3 per cent in the fourth quarter of 2022 to 4.1%. NBS Director, Publications and Public Relations, Mr. Wakil Ibrahim, explained that the data was not of unemployment but that of hours at work. He explained that the Nigeria Labour Force Survey (NLFS) was conducted by the NBS in collaboration with the World Bank (WB) and the ILO in response to the labour market dynamics. According to him, the report covers the fourth quarter of 2022 and the first quarter of 2023, presenting an in-depth analysis of key labour market indicators including unemployment, underemployment, informal employment and hours worked.

    Explaining the

    new methodology

    The NBS, in April 2023, announced that it would be changing the way it calculates the unemployment rate. It said the new approach, which would align with the International Labour Organisation’s (ILO) guidelines, was expected to reveal a sharp drop in the country’s job data. Since it was released, the report has drawn flaks, with many analysts quizzing the accuracy of the new methodology. The new figures may lead to an underestimation of the true level of unemployment crisis in the country, they argued.

     In the old methodology, the ‘unemployed’ were categorised as people of working age who worked below 20 hours or did not work but searched and was available in the reference week. However, under the new NBS methodology, if you have not worked in the past seven days, have been looking for work in the past four weeks, and are ready to start work, you are considered unemployed.  Also, in the old methodology, the NBS sampled 33,300 households quarterly; while the new approach adopted a sample size of 35,520 households spread across 12 months. The old system data collection was between 17-21 days every quarter; while data was collected continuously for a period of 12 months under the new methodology.

     The NBS said some people who were previously classified as unemployed are now categorised as employed. How?  The new methodology does not require people to have worked for at least 20 hours per week to be considered employed. As a result, people who are working in the informal sector, or who are only able to find part-time work, are now classified as employed.

    The NBS, he said, embarked on a revision of the methodology through the adoption of the 19th International Conference of Labour Statisticians (ICLS) “Resolution concerning statistics of work, employment, unemployment, and labour under-utilisation,” and the latest International Labour Organisation (ILO) model questionnaire which includes unemployment among persons engaged in “Own Consumption work.” He explained that the revised methodology aligns with that of Nigeria’s neighbours in Africa such as Ghana, Niger, Chad, Cameroon, Benin Republic, Gambia, etc., in line with international best practices.

     The NBS boss explained further that the enhanced methodology, which was informed by the need to produce comparable labour statistics, focuses on the review of definitions and concepts, data collection, coverage, etc. According to him, “the revised methodology defines employed persons as those working for pay or profit and who worked for at least one hour in the last 7 days, and considers underemployed persons as those working less than 40 hours per week and declaring themselves willing and available to work more. Unemployed persons are those not in employment but actively searching and are available for work (i.e. did nothing for pay or profit). In addition, working-age population covers ages 15 and above, and a distinction is made between commercial and subsistence agriculture in the revised methodology.”

     He also added that the old methodology defines the working-age population as those within the age bracket of 15-64 years, considering those working between 20 and 39 hours as underemployed, and those working between 1 and 19 hours as unemployed (including those who did nothing). Continuing, Adeniran explained that subsistence agriculture and temporary absentees from employment work were not properly represented in the old methodology. These improvements, among others, captured in the revised computations will make Nigeria’s Labour Force data comparable with other countries.

    Key highlights of the report

    The report showed that about three-quarters of working-age Nigerians were employed – 73.6% in Q4 2022 and 76.7% in Q1 2023. This indicates that most people were engaged in some type of job for at least one hour in a week, for pay or profit during the time under review. “The unemployment rate was 5.3% in Q4 2022 and 4.1% in Q1 2023.” This aligns with the rates in other developing countries where work, even if only for a few hours and in low-productivity jobs, is essential to make ends meet, particularly in the absence of any social protection for the unemployed.

     “Active search for employment in the NLFS refers to specific action individuals take within the previous four weeks to actively seek a job or start a business. Examples of such actions could include submitting job applications, attending job fairs, networking, reaching out to potential employers, and registering with employment agencies amongst others,” the NBS report said.

     The NBS boss said the share of wage employment was 13.4% in Q4 2022 and 11.8% in Q1 2023, while more Nigerians operate their own businesses or engaged in farming activities, recorded at 73.1% in Q4, 2022 and 75.4% in Q1, 2023. The report also revealed that about one-third (36.4% in Q4 2022 and 33.2% in Q1 2023) of employed persons worked less than 40 hours per week in both quarters. This was most common among women, individuals with lower levels of education, young people, and those living in rural areas. It pointed out that underemployment rate, which is the share of employed people working less than 40 hours per week and declaring themselves willing and available to work more, was 13.7 per cent in Q4 2022 and 12.2 per cent in Q1 2023.

     The rate of informal employment including agriculture among the employed Nigerians was 93.5 per cent in Q4 2022 and 92.6 per cent in Q1 2023.  “The report not only offers a snapshot of the current employment landscape but also provides a foundation for evidence-based policymaking. It’s an insight into labour market statistics to empower stakeholders to make informed decisions that can shape the country’s labour market and economy.”

     The Bureau in a similar the Bureau revealed that in the first quarter 2023, about 76.7% working – age Nigerians were employed. It added that the figure rose from the 73.6% recorded in the preceding quarter. This was contained in its summary of: “Nigeria Labour Force Survey Q4 2022 & Q1 2023.” The document explained that NBS has enhanced its methodology of collecting labour market data through the Nigeria Labour Force Survey (NLFS) in line with ILO guidelines. It noted that the data collection for the revised NLFS is based on a sample of 35,520 households nationwide.

     According to NBS, it is conducted continuously throughout the year, with national-level results produced quarterly and state-level results at the end of a full year. “The results presented in this report are for the reference periods of Q4 2022 and Q1 2023. About three-quarters of working-age Nigerians were employed – 73.6% in Q4 2022 and 76.7% in Q1 2023.”

     The International Labour Organisation (ILO) sees an hour at work in a week as employment, yet backtracking to submit that the data is not about employment but about hour at work. In other words, the NBS seems to have lost its believability in the framework of semantics. Following the ILO standard, NBS reduced the hours from 20 to an hour. Alluding to the ILO, Ibrahim submitted that whoever works for an hour in a week is deemed employed. “We were using 20 hours before. And the ILO has passed that one. They have brought it to one hour. If you work for one hour in a week, then you are employed,” he said.

    According to him, one hour at work was used to calculate the rate that culminated in 4.1 per cent. “It is the hours that were reduced from 20 hours as working hours to one hour. That is what was released. And we got that figure from which unemployment reduced from 33% to 4.1 per cent. It is the hours that were reduced from the 20 hours as working hours to one hour. That is what was reduced and we got that figure. There are different methodologies. It is not the same methodology. It is from one hour employment that we got 5.3% and from 20 hours we got 33.3 per cent.”

     The NBS spokesman pointed out that the methodology served as a peer review mechanism to put Nigeria on a labour scale with its counterparts in Africa: Ghana, Niger, Chad, Cameroon, Benin Republic, and Gambia. He said from 20 hours at work, the NBS arrived at 33.3 per cent unemployment rate which ought to have been the news. That is the news but the way you people (media) reported it that it reduced from 33.3 per cent to 4 per cent, it is incorrect. It is not unemployment. We are talking about hours of work. From 20 hours to one hour as it is from the ILO International as definition of labour.”  

  • Reforming taxation to raise revenue

    Reforming taxation to raise revenue

    • President Tinubu’s tax transformation agenda is necessary to support sustainable development

    Our aim is to transform the tax system to support sustainable development while achieving a minimum of 18 per cent tax-to-GDP ratio within the next three years. Without revenue, the government cannot provide adequate social services to the people it is entrusted to serve.” With these words, President Bola Ahmed Tinubu, last week, set an ambitious target for the Presidential Fiscal Policy and Tax Reform Committee to grow the country’s Tax to Gross Domestic Product (GDP) ratio by 18 per cent in three years. In other words, President Tinubu has directed the Committee to find ways of raising between $56.5 billion (N44.12 trillion) to $89.61 billion (N69.98 trillion) in the next three years.

     If this is achieved, it means that Nigeria would have completely closed the N20 trillion tax gap (shortfall in revenue) in one fell swoop. The tax-to-GDP ratio is a comparison between a country’s tax revenue and its gross domestic product (GDP), which measures the government’s control over economic resources. This ratio provides insights into the economic position and potential growth of a nation. By collecting a percentage of the GDP as tax revenue, the government determines the tax-GDP ratio. For Nigeria, the tax-to-GDP ratio for 2021 has been revised upward by the National Bureau of Statistics (NBS) to 10.86 per cent, contradicting the earlier reported figure of six per cent.

     Looking at successful tax reforms implemented between 2004 and 2015 in four low-income and emerging market economies, which showed significant revenue gains, provides some insight. The experiences of Cambodia, Georgia, Guyana, and Liberia demonstrate that, despite any challenges, countries can strengthen their tax collection capacity by implementing reform strategies with specific features. When it comes to the highest tax rates globally, Bhutan leads with rates up to 50 per cent tax-to-GDP, followed by Hungary with a standard rate of 27% per cent; while Croatia, Denmark, Norway, and Sweden share the third spot with a standard rate of 25 per cent. In Africa, improved mobilisation of both tax and non-tax revenues helped countries increase their tax revenue. According to the list, the top ten highest taxed African countries include Côte d’Ivoire, South Africa, Uganda, Senegal, Zimbabwe, Guinea, the Democratic Republic of Congo, Mauritania, Morocco, and Zambia.

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    What experts are saying on the issue

     Prof. Uche Uwaleke, Director Institute of Capital Market Studies, Nasarawa State University, Keffi thinks the three-year tax-to-GDP ratio of 18 per cent is attainable, being a little above the Sub-Saharan average of 15 percent. “To begin with, Nigeria’s tax collection efficiency ratio is among the lowest in the world. So, I think the plan is to significantly increase this through centralising revenue collection in the Federal Inland Revenue Service (FIRS). This will no doubt result in more efficient revenue collection as opposed to the current fragmented structure.”

     Bernardin Akitoby, an assistant director in the IMF’s Fiscal Affairs Department said “a typical developing economy collects just 15 per cent of GDP in taxes, compared with the 40 per cent collected by a typical advanced economy. “The ability to collect taxes is central to a country’s capacity to finance social services such as health and education, critical infrastructure such as electricity and roads, and other public goods. Considering the vast needs of poor countries, this low level of tax collection is putting economic development at risk.

     The IMF Fiscal Affairs expert noted that “although reform must be tailored to individual circumstances, three lessons stand out: tax reform requires first and foremost a broad social and political commitment; it rests on broad-based strategies that recognise that what and whom to tax should go hand in hand with how to tax; and it should be developed with the longer view in mind.”

     Speaking to the 18 per cent tax-to-GDP assignment given to him and other members of his committee, Taiwo Oyedele, Chairman, Presidential Fiscal Policy and Tax Reforms Committee explained that “there are three pillars to the mandate of this committee, one of it is fiscal governance and the other one is tax reform and the third one is growth facilitation.” These three pillars, he said, also have five dimensions: fiscal management, tax policy review, tax law reform, competitiveness and business enabling as well as revenue administration. What that means is within a period of one year, which is the period that Mr. President has directed for this committee’s work to be done.

     “We know that the likes of IMF for example prescribe a minimum of 15 per cent tax-to-GDP ratio for you to meaningfully finance development for a country, and we know that the average tax-to-GDP ratio for Africa is in the region of 17-18 per cent. So the target that has been set for this committee is to help Nigeria move towards 18 per cent thereabout over the next three years. We are currently at about 10.86 per cent if you look at the revised number of tax-to-GDP ratio that was produced up until 2021 fiscal year. We don’t know what the figure for 2022 is yet, but whatever that is, we are looking to roughly double our revenue from taxes for over a period of three years.

     “We do not want to introduce new taxes, in fact we want to get rid of many of the taxes we currently have that are not productive so it would then seem counter intuitive that you are going to reduce the number of taxes that people pay and yet you want to collect more,” Oyedele said.

    Taxes that will drive the proposed 18% growth

    According to Oyedele, South Africa is the second largest economy in Africa. Nigeria, which is the largest economy, has about 220 million people while South Africa is nearly 60 million people. So Nigeria is almost four times the number of South Africa in terms of population, in terms of economic size, may be about 20-30 percent but when you look at the tax numbers, it calls for sober reflection. South Africa, last year, collected about N78.2 trillion equivalent from tax service; that amount is more than the budget of the federal government or the states in Nigeria.

     Substantial tax revenue can be generated exclusively through the collection of personal income tax (PIT), Oyedele said. “The most underperforming tax in Nigeria is the personal income tax, because personal income tax across the world is the highest revenue yielding head, whether developing or developed country. Countries make the most money from personal income tax. South Africa made N27.7 trillion from personal income tax. I couldn’t find the figure for Nigeria in 2022 so I put 2021 and the amount is not pretty but I just wanted it to look decent and it’s N1.6 trillion.

     In value added tax (VAT), Oyedele said South Africa made N19.5 trillion last year while Nigeria collected N2.5 trillion. In company income tax (CIT), South Africa generated N16 trillion while Nigeria, plus Petroleum Profit Tax (PPT) considered a CIT as well, made N7 trillion. “Individually, each of their (South Africa) PIT, VAT and CIT is more than our entire tax collection in Nigeria across all the three levels of government. So, in other words, the solution to our problem is not to introduce more taxes but to focus on the fields that are high revenue yielding and easy to administer and difficult to evade and we will make far more than we are collecting today in the form of taxes; we do not need many taxes to collect more revenue but the reverse – less taxes, more revenue,” Oyedele said.

    How to achieve the task ahead

      The first task is how to close the tax gap. Said Oyedele: “We think that, as of today, the tax gap is somewhere in the region of N20 trillion and what that means is if you just focus on the major taxes, VAT, CIT, PIT, there are people who as of today should be paying and they are not compliant. Some people and businesses are in the tax net with just one finger, how do you then get all the body to be inside of the tax net.

     “The other areas where we think we can generate revenue from is, really bringing down the cost of collection. The cost of collection in Nigeria is so huge despite collecting little in revenue, particularly because you have too many agencies trying to collect revenue and those are not their core mandate. So these agencies are actually being distracted from doing what they are supposed to be doing to support the economy. So take those functions away from them, they focus on their primary responsibility, which means they facilitates economic growth and the FIRS for example will then collect those revenue more efficiently and save us the cost of collection.”

     Oyedele and his Committee members will attempt to make some savings by looking at the incentives; tax holidays and waivers “and ask whether these incentives are productive, if you give away one naira and you are getting less than one naira in return then maybe that’s time to review those incentives,” he said.

    He also believes that Nigeria is not “at that point yet where we want states to start setting their own tax rate because if you don’t do that within a proper framework, what’s going to happen is it becomes chaotic. Because you find that in large parts, many of the organisations that really have the volume and employing a lot of people as well as across the value chain, they tend to cut across states. We don’t want to make doing business with them more difficult than it is currently.

    “If you are earning so little, you shouldn’t have to pay income tax at all. That also helps us see who has the ability to pay and is not paying their fair share. If for example we are able to come out with a harmonised tax code even for local government and states, you can then replicate that for states to adopt so they are not starting from scratch and we have some level of consistency across the country, so I think we will get to a point but I don’t know how quickly that will be, when states will be able to compete by giving incentives to attract investments to their domain, etc.,” Oyedele said.

    The Executive Chairman of the FIRS,  Muhammad Nami, under whose watch Nigeria’s tax-to-GDP was increased from six per cent to 10.86 per cent, said the SAMA (Strategic Account Management Association) strategy that was used to increase the country’s tax-to-GDP to 10.86 per cent will also be employed to achieve President Tinubu’s target. “Sources which previously put the country’s tax-to-GDP ratio at between 5% and 6% did not consider tax revenue accruing to other government agencies in their computation. Particularly, revenues collected by agencies other than the FIRS, Customs and States Internal Revenue Service were excluded. This situation was peculiar to Nigeria as most other countries operate harmonised tax system (all or most tax revenues are collected by one agency of government) with single-point tax revenue reporting.  As such, all relevant tax revenues are included in the computation of the tax-to-GDP ratio. In re-computing the ratio, key indicators that were previously left out were taken into account. This resulted into a revised tax-to-GDP ratio of 10.86 per cent for 2021 as against six per cent hitherto reported.”

     Mr. Nami further noted that Nigeria’s tax-to-GDP ratio should ordinarily be higher than 10.86 per cent “but for certain economic and fiscal policy factors, including tax waivers and leakages occasioned by the country’s fragmented tax system. It is important to note that the tax-to-GDP ratio for Nigeria should be higher, but for the impact of tax waivers contained in our various tax laws (including exemptions to Micro, Small and Medium Enterprises brought-in by Finance Act, 2019), low tax morale, leakages occasioned by the country’s fragmented tax system and the impact of the rebasing of the GDP in 2014,” he explained.

     Showing the direction the FIRS would like to take in meeting the President’s target, Nami urged “the government to consider reviewing its policies on tax waivers thereby guarantying increased revenue to prosecute its programmes and positively move the needle of the country’s tax-to-GDP ratio.

  • Unlocking Nigeria’s untapped mining potential

    Unlocking Nigeria’s untapped mining potential

    Nigeria is endowed with over 44 strategic solid minerals in about 450 locations across the country. This puts her mining sector in a vantage position to dislodge oil as major revenue earner and economic diversification driver to create jobs and significantly cut down forex spending. Experts, however, say that reaping the sector’s bountiful but untapped benefits depends on how the administration tackles the challenges holding down mining operations across the country. They also put forward some key initiatives to unlock the sector’s immense potential and achieve its N284 billion revenue and three per cent contribution to Gross Domestic Product (GDP) targets by 2025. Assistant Editor CHIKODI OKEREOCHA reports.

    In its heydays in the 1960s and 1970s, the mining sector, next to agriculture, was economy’s major growth driver, contributing approximately four to five per cent to the Gross Domestic Product (GDP), according latest report by multinational professional services firm PricewaterhouseCoopers (PwC Nigeria). Nigeria was a significant player in most of the core global mining commodities such as coal, tin, columbite and gold.

    For instance, coal fully met the nation’s needs for the railway system and electricity supply. Tin also yielded substantial foreign exchange earnings. Other strategic minerals that gave Nigeria a competitive edge in the global minerals market included iron ore, barite, lead/zinc, bitumen, and limestone. The extraction of those minerals provided employment opportunities for Nigerians either as miners, supporting staff or workers in auxiliary mining services.

    Sadly, however, the fortunes of the once minerals-abundant nation, where over 44 different solid minerals were later discovered in about 450 locations across the country, have since declined, with the sector’s contribution to GDP crashing precipitously to a meager 0.17 per cent over the past five years (2018 – 2022). No thanks to the discovery of oil in 1956 which diverted the interest of both government and investors (local and foreign) from mining of solid minerals to the new resource (oil).

    Since then, Africa’s biggest economy has been monolithic, depending on the oil and gas sector, which contributes about 40 per cent to nominal GDP, over 90 per cent of export earnings and 75 per cent of gross revenues. Oil export is also the country’s major foreign exchange earner. But, like the rejected stone that became the builder’s cornerstone, there has been push to force the mining sector back into reckoning, following the sharp decline in revenue from crude oil in recent years.

    The thing is that falling oil prices and the economic downturn that ensued compelled a strategic rethink in favour of economic diversification with the mining sector as the arrowhead. The belief is that mining, given its huge potential, can create opportunities for growth and development through enhanced revenue derived from export earnings, taxes and royalties, job creation, knowledge, skill and technology transfer, as well as provision of infrastructure and social services.

    Accordingly, a Mining Roadmap was developed in 2016 by the Federal Government to drive the Nigerian mining industry’s growth and development, create a globally competitive sector capable of contributing to revenue and GDP, provide jobs and also advance social and human security for Nigerians. It lso focused on using the nation’s mining assets to drive domestic industrialisation initially, and then migrate to winning in global markets.

    A roadmap and its ambitious targets

    The mining sector’s contribution to GDP, albeit less than one per cent between 2015 and 2021, increased steadily from 0.13 per cent in 2015 to 0.23 per cent last year, according to PwC, the Mining Roadmap of 2016 targeted to increase the sector’s contribution to GDP from 0.5 per cent to approximately three per cent by 2025.

    Its revenue target is no less heart-warming. The sector has increased its solid mineral revenue generation since 2015, with the Federal Government’s solid mineral receipts witnessing a growth of 78 per cent from N64.46 billion recorded in 2015 to N114.8 billion in 2020. While a trend analysis of the sector’s earnings revealed a snail speed growth, the roadmap targeted N284 billion by 2025.

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    Similarly, the mining sector, as at 2015, employed over 86,000 of the workforce. This number rose to over 111,000 in 2017 and subsequently to 130,000 in 2020. While its employment-generation potential is, admittedly, far from being realised, the roadmap targeted about three million jobs by 2025.

    A roadmap and its targets

    Ambitious and promising, no doubt, PwC, however said in order to achieve the three per cent target set in the Mining Roadmap for 2025, significant efforts must be undertaken to catalyse growth in the sector.

    “The Nigeria’s mining industry continues to attract domestic and international investors despite that it is still quite underdeveloped.

    “Given the industry’s potential as a major revenue earner for the country, government needs to tackle the challenges in the mining industry if it is to reap the benefits of the sector,” PwC, in the report, entitled ‘Nigerian Mining – Progress, But Still a Long Way To Go’, said.

    The report, which was published last week, and made available to The Nation, comprehensively reviewed the mining sector’s macroeconomic environment, looked at mining and Environmental, Social, and Governance (ESG) and also reviewed the mining regulatory framework.

    The publication also reviewed some of the strategic minerals in the sector, and concluded that the mining of iron ore, baryte and coal, for example, is weak, while the mining of lead/zinc and gold is moderate; the mining of limestone is a bit strong.

    It added that in spite of the presence of mineral resources like Iron ore, baryte, lead/zinc, gold and coal, Nigeria still import steel and local scrap that are processed from iron ore, as well as roofing sheets and batteries that are processed from lead/zinc, and jewelry that are processed from gold. It also stated that there is a minimal local use of coal in the country. The report also highlighted some of the achievements of the previous administration in this sector and how well the mining roadmap has been implemented to date. For instance, analysing the report, Partner, Mining Leader, PwC Nigeria, Cyril Azobu, said the former President Muhammadu Buhar’s administration made a significant breakthrough with the launch of the Electronic Mining Cadastre plus (eMC+).

    The eMC+ is a digital cadastral system that grants access and manages titles for all existing investors and prospects in real-time and around the world.

    “In line with the Nigerian Minerals and Mining Act 2007, each state across the country has inaugurated a Mineral Resources and Environmental Management Committee (MIREMCO).

    “The purpose of MIREMCO, according to the Mining Act, is to oversee mining operations, supervise the environmental aspects of mines and tackle illegal mining and trafficking of minerals across the states of the Federation,”Azobu added.

    Other achievements of the past administration, according to the report, include hosting of the annual Nigerian Mining Week, an annual event, physical and online, for all the mining stakeholders and influencers in the public and private sector wanting to do business in Nigeria; establishment of mineral value processing clusters across the country; bitumen bid round to enable Nigeria to harness its bitumen resources through private sector investment

    Others are initiation of a fresh concession programme for the Ajaokuta steel plant and its key source of Iron Ore; the Presidential Artisanal Gold Mining Initiative (PAGMI) designed to mine and aggregate gold from artisanal and small-scale miners, including developing a production to market plan for the Gold sector; the National Integrated Mining Exploration Programme (NIMEP) designed to de-risk investment in the sector and provide geoscience data.

    “The current administration should build on these, while embracing needed improvements and added initiatives to expedite the mining sector’s journey towards shared prosperity,” PwC said, blaming the challenges of the sector on insecurity, smuggling, tax alignment issues, illegal mining and inadequate funding on the part of government. For instance, the report quoted the former Minister of State Mines and Steel Development, Uchechukwu Ogah, as saying that Nigeria lost revenue estimated at $5 billion to smuggling of gold in the past six years. “The spike in gold smuggling in the country has once again highlighted the socio-institutional and structural challenges in governance,” the report said.

    Charting the path forward

    Apparently believing that if fully harnessed and processed, Nigeria’s rich solid minerals endowment could be the wedge to push through the current administration’s renewed hope agenda, Partner, Head Mining Sector Business Development at PwC Nigeria, Habeeb Jaiyeola, advised President Bola Tinubu to consider moving the sector forward.

    He said this could be done by tackling insecurity, harmonising policies and regulations in the mining sector, driving strategic minerals development and de-risking investments in the sector.

    For the Manager, PwC Nigeria, Eche Uduji, “The new administration should focus on creating more private sector-driven success stories, which will contribute to attracting other stakeholders into the sector and creating a vibrant gold value chain in Nigeria.

    Uduji said the Federal Government, through effective collaboration with host communities, should use technology and licensing databases to improve tracking and formalisation, adding that this will also aid targeted support by the government on training, access to equipment and funding, and implementing safe mining practices.

    The PwC manager noted that although, the Artisanal and Small Scale Mining (ASM) department of the Ministry has taken steps in this direction, this needed to be significantly enhanced.

    The report also stressed the need to institute and implement mineral value addition policy. “The Federal Government should develop mineral-specific value addition policies, to encourage downstream processing and enhance sustainable economic growth through value addition. The policy would also position local industrial activities to be aligned with mining activities,” it stated.

    However, PwC’s pathway to a revitalised mining sector is not limited to government alone. Its report also said ESG remains crucial to the mining industry. “The mining industry must demonstrate its commitment to addressing environmental, social, and governance (ESG) issues in all aspects of its operations, while also recognising the associated risks and opportunities.

    “By doing so, mining companies can deliver long-term benefits to governments, shareholders, workers, and the communities in which they operate. Companies that proactively respond to these emerging trends tend to perform better financially,” the report stated.

    Indeed, in a previous study, PwC said it found that mining companies with higher ESG ratings outperformed the overall market during the peak of the COVID-19 crisis.

    “These companies achieved an average total shareholder return of 34 per cent over the previous three years, surpassing the general market index by 10 per cent. This demonstrates the positive correlation between strong ESG practices and financial success,” the report said.

    Conducive regulatory framework is also key

    To further attract investment, generate revenues and develop the local mining industry, the Federal Government has begun legal, regulatory, institutional, and fiscal reforms for the mining sector.

    Key initiatives in this regard include the establishment and recent automation of a cadastral system for mineral title administration and the review of the Minerals and Mining Act, 2007.

    The revision of the mining act is expected to introduce regulations which align with global best practices and create an enabling environment for much more involvement of both local and foreign investors.

    The industry’s principal law is the Nigerian Minerals and Mining Act 2007 (Chapter N162 Laws of the Federal Republic of Nigeria 2004 (the Mining Act) and the Minerals and Mining Regulations 2011 issued pursuant to the Minerals and Mining Act.

    Under the constitution and the Nigerian Minerals and Mining Act 2007, the Federal Government has title to all mineral resources beneath or upon any land within Nigeria, including Nigeria’s continental shelf, territorial waters, and exclusive economic zone. However, private parties may acquire the right to search for or exploit minerals through one of the following mining titles: a reconnaissance permit, an exploration licence, a mining lease, and small-scale mining lease.

    Currently, mining titles are granted on a first- come, first-served. However, Minerals and Mining Act of 2007 grants the Minister of Mines and Steel Development the power to designate certain areas where a mining lease or exploration license may be granted further to a competitive bidding exercise. While the Ministry is the policy maker for the sector, the Federal Ministry of Environment is responsible for environmental matters in the relevant state for the mining and co-regulate environmental matters The report noted that in Nigeria, mining is largely a greenfield sector and is in the process of developing an attractive mining value chain.

    “Nigeria should focus on investor friendly fiscal and regulatory policies in order to attract Foreign Direct Investment (FDI) ahead of other countries,” it said.

  • NNPCL: new era of deregulation

    NNPCL: new era of deregulation

    The Petroleum Industry Bill (PIB) was first presented to the National Assembly in 2008, during the leadership of President, Umar Yar’Adua, now late.

    Energy experts were confident that the bill would turn around the misfortunes of the oil and gas industry in the country.

    In spite of the several roadblocks encountered then, the experts knew that it was a matter of time for things to begin to take shape, as European and American companies dominated the nation’s oil exploration.

    Shell Petroleum Development Corporation, Chevron, Total Energies and ExxonMobil had being the front liners.

    Attempts were made to incorporate companies from China, Saudi Arabia and India into the country’s oil exploration.

    However, but the existing Nigerian laws would not allow the leasing of oil wells to prospective companies from abroad since most of the Oil Mining Leases (OMLs) were in firm grip of the existing International Oil Companies (IOCs).

    The firms had held the OMLs for many years before the bill was proposed, and to change the situation, an overhaul was needed in the country’s energy law. Interestingly, this development necessitated the introduction of the PIB.

    Furthermore, the expectation of the proposed reform in the oil industry was that the sector would be free from government control in a deregulated environment and at the same time unbundle the Nigerian National Petroleum Company Limited (NNPCL).

    It was like prayers answered when the former administration of Muhammadu Buhari signed the bill into law in August 2021.

    Forty eight hours after signing the legislation into law, Buhari approved a steering committee to oversee its implementation, stressing that Nigeria lost an estimated $50 billion worth of investments in just 10 years.

    Buhari was quoted by the media as saying that the loss was created by the uncertainty of non-passage of the PIB.

    It was on this premise that Malam Mele Kyari, the Group Chief Executive Officer (GCEO), NNPCL, recently made moves to set new investment benchmark post Petroleum Industry Act (PIA) 2021.

    The NNPCL had sealed multiple deals running into over $48.15 billion to rejuvenate the hitherto inept company.

    Other key investment project slated for Final Investment Decisions (FID) by the NNPCL, include the $25 billion West African Gas Pipeline project (Nigeria-Morocco gas pipeline).

    The company will stake $12.5 billion to secure a 50 per cent equity and the $2.8 billion Ajaokuta-Kaduna-Kano (AKK) gas pipeline project among others.

    Also, in its quest to boast it financial base, the Nigerian government in June 2022 renewed talks with Algeria and Niger to kickstart the $13 billion (€12.8 billion) Trans-Saharan Gas Pipeline (TSGP).

    No wonder oil and gas experts were full of expectations that with time, things would turn around for good in the sector.

    Associate Professor of Energy and Natural Resources, Olanrewaju Aladeitan, told News Agency of Nigeria (NAN) that what NNPCL was doing with the Trans-Sahara Gas Pipeline (TSGP) project was what Nigeria should have done in 1970s, or thereabout.

    He said that Nigeria would have been taking advantage of the vacuum created by the non-supply of oil to Europe by Russia and expand its gas projects penetration the European market.

    “If we had done that, by now we would be smiling to the bank because we would have utilised the opportunity of market that was left by the withdrawal of Russia.

    “So if we can achieve the same aim through the Trans-Sahara pipeline, it will be fine.

    “We also have the West African Gas Pipeline, which passes through Benin Republic, Togo to Ghana, and that has also been in the works for some time.

    “This is what has informed Nigeria looking at constructing these pipelines to Europe and the gas can flow from there,” he said.

    The need for the NNPCL model of investments was also highlighted at the Nigeria International Energy Summit (NIES 2023).

    Speaking during business leaders and regulatory dialogue session at the event, Mrs Nkechi Obi, Group Managing Director of Techno Oil Limited, called for significant investments and infrastructure to achieve global energy mix and sustainable energy.

    The firm is an indigenous oil and gas company,

    “There are about eight mitigants to achieving the global energy mix but the provision of infrastructure, reduction in biomass and fossil fuel were key to achieving success, especially in the downstream sector.

    “Nigeria needs an enabling environment to drive investments to position itself strategically in view of global trend to transit to cleaner energy.

    “She said the passage of the Petroleum Industry Act (PIA 2021) was a big relief in pursuit of a cleaner energy”, she said.

    Obi’s call was not different from what the country is trying to achieve through the investments embarked upon by the NNPCL, as gas is expected play a bigger role in the global energy mix and that Nigeria had enough of it to drive the industry.

    Mr Olabode Sowunmi, Senior Legislative Aid to the former Senate President on Gas and Power said the industry particularly the gas sector, offers Nigeria great opportunities for industrialisation.

    Sowunmi advocated consistency in the Nigeria Gas Master Plan, especially on projects such as AKK, Trans-Saharan Gas Pipeline and West African Gas Pipeline.

    He expressed satisfaction that some reforms have started in the industry in view of the implementation of the PIA 2021.

    Besides the multiple investments stakes, the company under the leadership of Kyari, has also taken positive measures aimed at blocking the loopholes in crude oil leakages, theft and vandalism.

    Energy experts say the step is expected to propel NNPCL into a global profit-making brand like other major oil giants across the globe.

    In pursuit of this role, the company in the last 24 months engaged in exploring new business ventures, investment opportunities.

    It has also taken measures that had seen the nation’s dismal crude production of less than a million barrels per day increase to over 1.6 million barrels per day in the last 12 months.

    The company successfully signed and acquired a 20 per cent Federal Government stake in the Dangote 650,000-barrel-per-day oil refinery for $2.76 billion.

    It also secured over $3 billion local and foreign investment interests in the Kolmani Integrated Development Project.

    The Kolmani project houses a 120,000-barrels per day refinery, a 500-million standard cubic feet per day gas processing plant, a 300-megawatt capacity power plant, and a fertiliser plant of 2,500 tons per day.

    Earlier in 2023, the NNPC Renewed Oil Production Pact With its Partners For 10 billion barrel aimed at putting an end to the protracted dispute between the state-owned company and the contractor parties in OMLs 128, 130, 132 and 133, as well as 138 PSCs.

    The agreements are the production sharing agreement, dispute settlement agreements, settlement repayment agreement, and Escrow agreement.

    The signing of the agreement took place at the NNPC headquarters office in Abuja.

    According to the NNPC Limited, the signing of the new PSCs is a key milestone achievement, which will ultimately unlock opportunities within the Nigeria upstream sector.

    Only last Thursday, the NNPCL signed a Heads of Terms (HoT) agreement with UTM Offshore Limited for the construction of the nation’s first indigenous floating liquified natural gas (LNG) project with a $5.6 billion funding package from Afreximbank.

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    Speaking on the UTM deal, Mr Garba Deen Muhammad, Chief Corporate Communications Officer, NNPCL, in a statement said the agreement was a step towards bolstering Nigeria’s energy security and promoting the utilisation of its abundant gas resources.

    “In a major step towards bolstering Nigeria’s energy security and promoting the utilisation of its abundant gas resources, the NNPC Ltd and UTM Offshore Limited have today in Abuja signed a Heads of Terms (HoT) agreement.

    “It is for the construction of the nation’s first indigenous Floating LNG project,” the company said.

    The NNPCL as a company grew its profit after tax from N287 billion in 2020 to N674 billion in 2021.

    It would be recalled that for the first time in the history, the company, last Thursday, July 20, 2023, it commenced the payment of interim dividend and Petroleum Sharing Contracts (PSC) profit oil into the Federation Account Allocation Committee (FAAC) with the of N123 billion.

    A breakdown of the amount showed that the National Oil Company paid N81 billion as monthly interim dividend and N42 billion as 40 per cent PSC profit oil, this is in addition to compliance on payment of royalties and taxes.

    Commenting on the NNPC Limited’s performance, Mr Horatius Egua, spokesman of the immediate past Minister of State for Petroleum Resources, Chief Timipre Sylva, said Sylva’s in ensuring the passage of the PIA was instrumental to the new feats.

    According to Egua all that NNPC Limited has achieved today would not have been possible if the Petroleum Industry Bill (PIB) was not passed into law.

    “Thumbs up must be given to Chief Sylva, the leadership of the National Assembly and former President Muhammadu Buhari”, he said.

    He also praised Kyari for providing the leadership in the NNPCL that had enabled the company attain its present status.

    “It is one thing to have a law but if you don’t have competent people to drive and implement that law, it becomes useless.

    “So Malam Kyari has done well in his own capacity as the boss of the NNPC Limited.

    “However, he needs to do more to take the company to a greater height like the Saudi Aramco, China Petroleum & Chemical Corp., Exxon Mobil Corp., and others,” he said.

    Report by Emmanuella Anokam, News Agency of Nigeria (NAN).