The Nation Newspaper

Category: Business

  • Excess Crude Account hits $9.6b

    Excess Crude Account hits $9.6b

    The Federation Account Allocation Committee (FAAC) has paid N161.59 billion into the Excess Crude Account (ECA), bringing the new balance to $9.66 billion.

    The Accountant-General of the Federation, Jonah Otunla, stated this yesterday at the end of the Technical Sub-meeting of the FAAC on November returns.

    “I think we have fared very well in the Excess Crude Account. We targeted $10 billion at the end of the year. I am happy to tell you that we have $9.66 billion in the account. On percentage basis, that is about 97 per cent of our aspiration for the year,’’ he said.

    On the recent demand by the 36 Governors for the withdrawal of $1 billion from the oil savings account, he said the federal and state governments would be guided by the “principle of consensus’’ to resolve the matter.

    “I am sure that when they table this request before Mr President, as usual, a consensus will be reached,’’ he stated.

    He explained that the country’s mineral and non-mineral revenue dropped to N569.46 billion in November compared with N640.76 billion realised the previous month.

    A breakdown of the figures showed that N483.2 billion was generated as revenue from mineral resources, while N86.2 billion was derived from the non-mineral sector.

    He attributed the drop to several disruptions in crude oil production and lifting in the Niger Delta.

    He noted that during the period a Force Majeure was declared by Exxon Mobil.

    Otunla said leakage and fire outbreaks at Trans Niger, crude oil theft and maintenance work at oil terminals at Qua Iboe, Brass and Forcadoes also affected crude oil production.

    Meanwhile, a total of N572.89 billion was distributed among the three tiers of government from the Federation Account in November.

    “The total distributable revenue for the month is N407.86billion for statutory revenue, while Value Added Tax (VAT) is N62.72 billion.

    “Because our statutory revenue fell short of the budgeted figure of N467 billion, we excised N59 billion out of the ECA to augment the revenue for the month.

    “So, the total revenue of N572.89 billion was shared this month (November), as against 574.94billion shared last month (October) resulting in a deficit of N2 billion,’’ he said.

    The 13 per cent mineral revenue derivation to oil producing states amounted to N41.8billion in November compared with N46.2billion in October, he statedOn the Nigeria National Petroleum Corporation (NNPC) indebtedness to the Federation Account, the accountant-general said the corporation had continued its monthly refund of N7.6 billion for onward distribution to the tiers of government.

  • Nigeria loses N4b to illegal mining, says NEITI

    Nigeria loses N4b to illegal mining, says NEITI

    The Nigeria Extractive Industry Transparency Initiative (NEITI) released its inaugural solid minerals sector audit report yesterday, saying Nigeria lost N4.048 billion in royalties.

    According to the report covering 2007-2010, the losses were due to illegal mining and lack of capacity to monitor production in the quarries by the regulator, the Ministry of Mines and Steel Development.

    The Chairman of the NEITI National Stakeholders Working Group, Mr Ledum Mitee, who presented the report in Abuja, said information gathered from scoping studies that were conducted earlier in the sector revealed that there are discrepancies between government receipts and operating firms payments in the period.

    The audit, which excluded the production by the artisanal and small miners focused dominantly on the operations of the construction companies across the country.

    Meanwhile, the four-year audit, which was specific on operations in the sector, also indicted Federal Government agencies saddled with regulating the sector of negligence and disregard for the laws guiding operations in Nigeria’s solid mineral sector.

    Mitee noted that prices used for the calculation of royalty payments in the sector were not in tune with the market value of excavated mineral components, thus leading to huge loss of revenue to Nigeria.

    He said: “For example, royalty for a tonnage of granite is still a pittance of N800, which is the price as at 2002. Today, in 2012, the minimum market price on royalty per ton is N2,500. The prices used for the calculations on all mineral deposits are long overdue for review. We calculate that about N4.048 billion is total revenue lost as a result of these outdated rates that have been used for royalties in the sector.”

    He noted that several factors, including illegal mining, inadequate investments and lax regulatory and monitoring framework or measure, have for decades prevented the solid mineral sector from attaining its full potentials, adding that the report as hoped would help Nigeria embrace the potentials in the sector.

    Accordingly, a total of 78 firms were covered in the audit, which spanned physical, financial and process audits; the companies were found to be majorly engaged in construction, manufacturing, artisanal mining and mineral buying centres.

    “Between 2007 and 2010, the audit reports show government receipts was N54.56 billion while remittances from the companies was N53.87 billion reflecting a little over N687 million discrepancies, which is 1.25 per cent of total government receipts over companies’ payments.

  • NIMASA to remit N3b unpaid arrears

    NIMASA to remit N3b unpaid arrears

    The House of Representatives’ Committee on Finance has asked the Nigerian Maritime Administration and Safety Agency (NIMASA) to pay N3.4billion to the Federal Government as arrears of unpaid independent revenue.

    Also, the Central Bank of Nigeria (CBN) has promised to pay up N30billion as balance of its operating surplus for 2012.

    The apex bank has paid N50billion to the coffers of government this year, as part of its N80billion as its independent revenue,

    The CBN Governor, who was represented by the Deputy Governor, Corporate Service, Suleiman Barau, got the commendation of the Committee when it was disclosed that the apex bank’s remittance alone constituted over 80 per cent of remittances by revenue-generating agencies of government for this year.

    NIMASA pleaded with the Committee to pay whatever was regarded as its arrears of independent revenue despite remitting N44.9billion

    However, from records of Fiscal Responsibility Commission (FRC) and the Accountant-General, the agency failed to remit any money in 2010, although it remitted N450million in 2011.

    The Committee mandated the agency to pay N3billion from the N8billion it has generated this year into the coffers of Federal Government.

    The summary of the operating surplus as presented by Otunla showed that Nigeria National Petroleum Corporation (NNPC), Nigeria LNG Limited, Federal Radio Corporation of Nigeria (FRCN), National Film and Censors Board, West African Examinations Council (WAEC), Federal Housing Authority (FHA), NESREA and National Hospital reflecting zero remittance from 2009 to date.

    He said: “When we were pressed to get money in the third quarter to source money for the fourth quarter, from about N145billion operating surplus we got, CBN paid N114billion as operating surplus for 2011 representing about 70 per cent”.

    Otunla also commended the CBN and Nigerian Television Authority (NTA) have complied in the payment of operating surplus into the Consolidated account as and when due”.

    The OAGF document showed that NPA paid N15b in 2012, N6.802b paid by NCC, N5.031b by NDIC while total sum of N185m was paid by NAFDAC.

    Dividends paid by Federal Government owned companies between January 2009 to October 2012 indicated that Bank of Industry generated N3,978,288.78; Transcorp Hilton generated N5.5 billion while Capital Hotels generated N844,578.07.

    NCC paid N26,852,469,732.31 to the government between January and October 2012 generated from spectrum fees ; BPE generated N20,110,764,577.48 from privatisation proceeds and additional sum of N21,741,500 from rent on a property in Lagos within the period under review.

  • NCC blames operators for SIM number portability delay

    NCC blames operators for SIM number portability delay

    Regulator of the telecoms sector, the Nigerian Communications Commission (NCC), yesterday blamed telecoms operators for the undue delays in the take-off of the Subscriber Identity Module (SIM) number portability, warning that if moral suasion fails, it would not hesitate to wield the big stick to whip them into line.

    Speaking at the Telecoms Executives and Regulator Forum 2012, organised by the Association of Telecoms Companies of Nigeria (ATCON) at Ikoyi, Lagos, NCC’s Executive Vice-Chairman/Chief Executive Officer, Dr Eugene Juwah, accused the operators of delaying the implementation of the scheme, arguing that none of them has upgraded their billing system, pre-requisite for the take-off of the scheme.

    He warned that when appeal fails, sanction would be inevitable.

    Juwah however assured that SIM number portability will happen first quarter next year, adding that it is going to be implemented after thorough test so that it does not end In a fiasco.

  • Fed Govt urged on farmers database

    The National Council of Local Government Department of Agriculture has called on the Federal Ministry of Agriculture to domicile the National Farmers Database in the Local Government Department of Agriculture to ensure the registration of genuine farmers and daily update of same.

    The Council said it will be easy to gather data on farmers and farmlands nationwide through the local councils since it is intended not only to address existing data gaps, but most importantly, to improve the effectiveness and efficiency of support services to farmers.

    In a communiqué released at the end of its eight annual national conference/Annual General Meeting (AGM) held in Abuja,the conference said having a reliable data of farmers and farmlands would help government agencies to deliver programmes and services to the intended farmers fast and timely as well as faster tracking and estimate of damages in agricultural lands to make it easier for partner agencies to assess what assistance to provide in a particular area.

    The conference appreciated the gesture of the Federal Ministry of Agriculture and Rural Development for admitting the Council(NCOLGDA) into the National Council of Agriculture(NCA) on observer status.

    The conference commended the Agricultural Transformation Agenda of government and called for the support of all to ensure its proper implementation. It particularly solicited for the full integration of Local Government Department of Agriculture in the programme.

    Thwith pride the progress made through the Growth Enhancement Support programme (GES) and called on the Federal Government to involve the directors of Agriculture in the local government in the implementation of future programmes.

    The conference viewed with concern the dwindling budgetary allocation to agricultural sector at the Federal, state and local government and called on governments to implement the 10 per cent budgetary allocation to agriculture as agreed to in the Maputo declaration of 2003 of which Nigeria is a signatory.

  • Fair on agric holds today

    The Lagos State Radio Service and Point Management Consultants, are mounting food and agricultural fair in Lagos from December 14 to 21. With the theme : “Availability of quality foods: a positive step toward sustainable agricultural growth and poverty eradication”,the fair is expected to host more than 400 exhibitors, comprising farmers, manufacturers, agro-processors, producers and investors.

    The Principal Consultant, Point Management Consultants, Mr Lanre Bello said the fair is to project, modernise, and move agriculture to a highly commercial level.

    Bello said agriculture continued to be an important part of national development, people should be encouraged to take up the venture as an essential aspect of national life.

    Bello said it would offer an opportunity to scientists, engineers, agricultural institutions, buyers, exporters, dealers and suppliers of agro inputs and machinery to showcase their talents and inventions in the quest to address problems and challenges facing the agricultural sector.

    Whether it is crop or any of the other numerous agriculture and agri-food products exported by producers and processors, he said they are committed to continuing these and other market access efforts to improve opportunities and profitability for the entire sector.

    He said the fair should inform stakeholders in agriculture about the state of the industry and do more to uplift it.

  • CADP to boost farms infrastructure

    Lagos State Commercial Agriculture Development Project(CADP) is working on improving infrastructure to link some farms in the state.

    The Commissioner for Agriculture and Cooperatives,Prince Gbolahan Lawal, said the project has also rehabilitated 10 rural access roads totalling 22.4 kilometres across the state valued at N640 million.

    He said 10 communities have benefited from the rural energy support under the project through the supply and installation of transformers, high tension and low tension wires in farm estates and clusters to aid processing and increase profits.

    Lawal said better transportation infrastructure allows producers to obtain inputs, move their commodities over large distances and access the market.

    According to him ,the high productivity of agriculture will be complemented by producers’ ability to quickly bring their perishable and high value goods to market.

    Lawal said the state government was doing all within its capacity to maximise the agricultural land usage and expect the continuous support of the World Bank through its various intervention projects in terms of infrastructural development and support services.

    He stressed that the present administration takes food security very important and with the support of Governor Babatunde Fashola, the state was doing its best to meet responsibilities in terms of requirement for the projects such as the counterpart contributions and all the neccessary support.

    In another view, the State’s Project Coordinator, CADP, Mr Bolaji Balogun, said the project enables participating small and medium scale commercial farmers gain access to improved technology, infrastructure, finance, information and output markets.

    Balogun listed the five states benefitting from the project as Lagos, Kaduna, Enugu, Kano and Cross-River states, adding that three value chains were selected in each of the three states based on comparative advantages.

    He explained that in Lagos State the three selected value chains are, rice, aquaculture and poultry, while maize, rice and dairy were selected for Kano State.

    Balogun said that Enugu state has maize, orchard and poultry selected as value chains by CADP while maize, dairy and orchard were selected for Kaduna State and oil palm, cocoa and rice were selected for Cross River State.

    He revealed that Lagos would contribute N168 million to the project yearly for the duration of five years.

    Balogun also listed some key achievements of the project since its inception e to include the development of Commercial Agricultural Plans to guide Commercial Agriculture Development Associations (CADA), which serves as the apex body for Commodity Interest Groups (CIGs).

    He said 136 CIGs comprising of 1,471 individual small and medium scale commercial farmers across the three value chains of poultry, rice and aquaculture have been supported to over N300 million to effect expansion in their enterprises.

    He added that over 1,800 farmers have also benefited from capacity building and linkages to improved markets and market information while over 29,000 have benefited indirectly from project interventions.

    Balogun enumerated some of the equipment, which the project has assisted the farmers in Lagos with, in order to increase physical output to include 571 units of collapsible fish tanks, 174 units of fish plastic fish tanks, 50 units of fish smoking kilns, one unit of fish smoke drying plant and five units of fish extrusion plants.

    He added that the project has also assisted Lagos State farmers in acquiring four 4WD tractors fitted with implements, 985 units of nipple fitted battery cages, mini combine harvesters, storage bins, agro inputs and tricycles for farmers to use in conveying their products.

    Balogun also said the project has supported rice farmers in Itoikin and Itoga in Lagos State, in cultivating over 200 hectares of farmland during the 2011 planting season.

  • Fed Govt to set up 774 agric input centres

    The Federal Government has said it will establish one-stop shop agro-input centres in the 774 local governments in the country.

    The initiative became imperative to ensure that agricultural inputs, such as fertiliser, tractor rental service among others are made readily available, accessible and affordable for all farmers nationwide.

    The Minister of State for Agriculture and Rural Development, Bukar Tijani stated this at the inauguration of 62 centres built by the Federal Government at Wushishi, Niger State.

    The Minister added that this was part of the Agricultural Transformation Agenda (ATA) aimed at strengthening the nation’s food security programme.

    Tijani, who restated that at least one-stop shop centre would be built in each local government in the country, with each having facilities for about 500 tonnes storage capacity for fertiliser, seeds and agro-chemicals as well as provide tractor hire service, primary processing and extension services.

    Tijani said:”The Ministry is very much mindful of the serious impediment of inaccessibility of good quality agricultural inputs such as fertilizer, agro-chemicals, seeds and seedlings, livestock feeds, veterinary drugs, tractor hiring, primary processing and extension services by farmers in a bid to maximising aggregate agricultural production output for the nation.

    “This impediment as well as the Federal Government’s preparation to withdraw from direct procurement and distribution of all agricultural inputs informed the decision of the Ministry to propose the establishment of at least a one-stop shop Agro-Input Centre in each Local Government Area of the Federation by the year 2015.”

    According to him, the centres which will be jointly supported by states and local governments through operational support tools like tractors and ancillary services will also provide market information services, promote private sector investment in viable commercial agriculture and enhance food security and enhance the activities of the Growth Enhancement Support (GES) programme.

  • ‘Document indigenous knowledge on climate-resilient farming’

    A United States based International Food Policy Research Institute(IFPRI) has urged the Federal Government to assist farmers in adapting to climate change by improving meteorological services and integrate indigenous knowledge of climate and early warning.

    In a report done on agriculture and climate change,IFPRI said about half of the working population in Nigeria is engaged in agriculture. However, the report noted that the share that agriculture contributes to Gross Domestic Product(GDP) has declined from about 50 per cent in 2,000 to about 30 per cent.

    The report said there is a likelihood of heavy rains and farmers may need to switch to new crops or varieties that are tolerant of the new rainfall patterns.

    According to it, maize performs relatively better in the face of climate change.”

    The estimated gain in yield is 5–25 per cent over large portions of the country, with a few areas where yields are projected to rise by more than 25 percent. The loss of harvested area is projected to be greater for sorghum than for maize. In addition to areas of yield gain, there are also significant areas where yield will decline.

    The report noted that there was a decrease in harvested area in the northern Sahelian zone, which is already prone to desertification. ‘Except in pockets in Kebbi and some inland valleys, all predicted yield loss is within five –25 per cent, with a few areas showing even greater losses.”

    In an interview with The Nation, Dr Kola Adebayo urged the government to improve climate alert preparedness to avoid hunger.

    Adebayo, who is Reader and Deputy Director,Grants Management, Federal University of Agriculture,Abeokuta, said farmers need information and knowledge to help them innovate and adapt to climate change.

    According to him, climate change and natural disasters are becoming a very serious contributing factor, affecting food security and creating challenge for farmers.

    He expressed the need to develop climate information services, as farmers need reasons to change traditional farming methods.

    He said climate change has become a real challenge for farmers across the country and urged extension officers to work closely with them on how to reduce its effects.

    He urged “cultivating technology,” not just “transferring” technology, because transferring technology may just mean machines and tools that can reduce employment, which leads to other problems.

    He said the government should work with the private sector to decrease poverty and to protect natural resources

    Adebayo said it was important extension workers are able to interpret climate information to farmers for them to make sound decisions at the time of planting, the varieties to plant as well as probabilities of having dry mid seasons.

    He said communities have indigenous knowledge that can be tapped to enhance the management climate change.

    Adebayo also reiterated the need to improve irrigation and livestock farming in order to broaden the sector and help improve livelihoods for ordinary people.

    He said the government needs to support farmers to produce more economically viable and short term crops and to enhance food security production in a more manageable manner.

    Adebayo said there is a growing demand for food due to increasing population .He said the government should adopt action-oriented projects in addressing infrastructural bottlenecks, market access and resource limitations. He said strong performance of the agricultural sector would not only guarantee food security, but accelerate economic growth and sustainable development.

  • Shareholders approve UBA holdco

    Shareholders of United Bank for Africa (UBA) Plc yesterday gave final approval to the restructuring of the pan-Africa financial services group into a holding company (holdco) structure, in a one-for-four deal that saw shareholders having equities in four companies from the unbundling of the far-strewn assets.

    Immediately after the overwhelming approval of the holdco, share price of UBA trended upward at the Nigerian Stock Exchange (NSE), rising by 0.63 per cent to close at N4.86 per share.

    At the court-ordered Extra-Ordinary General Meeting in Lagos yesterday, shareholders commended the restructuring process adopted by the bank, noting that it has significantly unlocked values for investors.

    Under the new structure, all non-commercial banking businesses with the exception of Afriland Properties Plc and African Prudential Registrars Plc shall be consolidated in UBA Capital and spun off to the existing shareholders. In additIon to UBA Plc, the three emergent companies will be listed thereafter on the NSE, bringing to four the quoted companies that will replace the current listing on the NSE.

    Each eligible shareholder will receive one ordinary share in African Prudential Registrars Plc; one ordinary share in Afriland Properties and four ordinary shares in UBA Capital Plc for every 33 shares held as at the terminal date.

    Speaking at the meeting, group managing director, United Bank for Africa (UBA), Mr Phillips Oduoza said UBA Capital Plc and African Prudential Registrars Plc will be listed immediately after the completion of the scheme arrangements, while Afriland Properties will be listed at a future date.

    He noted that the share exchange was derived from the paid up capital of the scheme entities.

     Executive Director, UBA, Mr Emmanuel  Nnorom, said the process of listing the shares of Afriland Properties on the NSE would be completed by the middle of January 2013.

    Shareholders approved that the proposed scheme of arrangement  for the internal restructuring and reorganization of the capital of the bank and its members dated November 15, 2012 has been submitted and approved by the chairman; that the board of directors of the bank has been authorized to effect the following  transfers to UBA Capital: and  transfer of 4,500,000 ordinary shares of N1.00 each in UBA Insurance Brokers Limited  to UBA Capital; transfer of 499,999,998 ordinary shares of N1.00 each in UBA Asset Management Limited to UBA Capital Plc.

    They also mandated that directors of the bank be and are hereby authorized to consent, on behalf of parties authorized to conclude pending transactions including recapitalization of and/or   reorganization of capital from any of the subsidiaries and affiliates.

    Meanwhile, the bullish rally at the NSE continued yesterday with the benchmark index appreciating by 0.54 per cent to reach a new high. Average year-to-date return at the stock market rode on the back of gains by several large and mid-cap stocks to peak at 33.44 per cent.

    The All Share Index (ASI), the main index at NSE, rallied to close at 27,663.51 points as against its opening index of 27,514.18 points.

    Aggregate market value of all quoted equities added N48 billion to close at N8.839 trillion compared with its opening value of N8.791 trillion.

    While there were 24 losers against 21 gainers, capital gains by highly capitalized companies such as Guinness Nigeria, Ecobank Transnational Incorporated, Nestle Nigeria, Nigerian Breweries and Guaranty Trust Bank skewed the overall market position to the positive.

    Total turnover stood at 464.23 million shares valued at N3.73 billion in 4,877 deals. The three most active stocks were Zenith Bank, with 61.74 million shares;  Universal Insurance, with 46.59 million shares and Niger Insurance, which saw exchange of 39.45 million shares.