Category: Business

AUNITED States Diplomat, Douglas P. Climan, said the American Embassy is interested in how the Nigeria’s Excess Crude Account (ECA) and finances is managed.

In a statement, the Office of the Accountant-General of the Federation (OAGF), said  Climan made the request during a visit to the Accountant-General of the Federation (AGF), Mr Jonah Otunla, at the Treasury House, Abuja.

It said the diplomat told the AGF that he “came to the Treasury House to understand the budgeting and the operation of the Federation Account.

“He said he would also like to know how ECA withdrawals are made, and how the unspent balance of capital is managed.”

It explained that after listening to Otunla, the diplomat expressed optimism that the 2013 budget would be passed before the end of this fiscal year.

Also, the AGF said measures introduced by the government, ministries, department and agencies (MDAs) in 108 establishments, have unearthed 45,000 ghost workers. He said it was the outcome of the adoption of Government Integrated Fiscal Management System (GIFMIS).

“Since the inception and adoption of GIFMIS, about 45,000 ghost workers have been detected. It has helped in manpower planning and budgeting; how many people are on the payroll of government and the cost implication,” he said.

On the Integrated Payroll and Personnel Information System (IPPIS), the Government Integrated Financial Management Information System (GIFMIS) has led to the improvement in Cash Management System through Treasury Single Account (TSA), and other non-financial Reforms he added.

The House of Representatives is set to investigate how N13 billion debt was incurred by the country’s missions.

Besides, it has raised a 23-man special committee to further fine-tune the Petroleum Industry Bill (PIB) which has passed second reading.

The lawmakers condemned the 2013 budget of the Ministry of Foreign Affairs for lacking focus on programmes aimed at promoting the worth of the country in the comity of nations.

The House Committee on Foreign Affairs, during the 2013 budget defence of the Ministry of Foreign Affairs yesterday also faulted the allocation of N788,496,120 to a conference on women empowerment.

For its Abuja headquarters, Directorates excluding the Nigerian Institute of International Affairs (NIIA) and its 118 overseas Missions, excluding three, the Ministry is proposing N23,516,878,688 for personnel and N23,487,974,123 for overhead totalling N47,004,852,810 for its recurrent expenditure for 2013.

For capital expenditure the Ministry is proposing N23,646,102,870 for its Abuja headquarters, overseas Missions,excluding three and its five Directorates excluding the NIIA.

The Ministry was led to the House by the Minister, Olugbenga Ashiru.

Chairman of the Committee, Nnnena Ukeje, said the Ministry ought to have learnt to be a change agent in promoting the interest of the country rather than accepting everything shoved at it by other countries without aiming to get anything in return.

The Committee also questioned the N13 billion debt owed by the country’s missions, insisting that the Ministry must present evidence on how the debt was incurred.

“Has the N13billion become a recurring decimal as it is appearing again in 2013 budget?” Ukeje asked.

Though Ashiru said the money has not been released as it was not appropriated for in the 2012 budget, the Committee disclosed that it would probe how the debt was incurred.

The Speaker, Aminu Waziri Tambuwal, announced the members of the Special Ad-hoc panel after the closure of the second day of debate on the contentious bill with the title: “A Bill for an Act to provide for the establishment of a legal, fiscal and regulatory framework for the Petroleum Industry in Nigeria and for other related matters and a Bill for an Act to establish the National New Frontier Agency for the purpose of exploration and production of oil and gas in the Frontier of Chad Basin, Dahomey Basin, Imo Basin, Benue Trough, Bauchi Basin and Sokoto Basin and for other matters connected therewith”.

Tambuwal, who named the Chief Whip of the House, Ishaka Mohammed Bawa, as head of the Ad-hoc panel and Minority Whip, Samson Osagie as the Deputy Chairman of the panel, said the members were to take further legislative action of aspects of the PIB.

The Ad hoc Committee is to conduct a public hearing on the bill.

Many of the lawmakers who spoke on the provisions of the PIB pinpointed perceived loopholes, inconsistencies and what they believed would have negative impact on the nation and their regions.

Delay in getting letters of administration from the Probate Registry arm of the Lagos High Court has stalled payment of the outstanding $7,000 per individual to families of those who lost their relatives in the June 5 Dana Air crash, it was learnt yesterday.

The Director-General of Nigeria Civil Aviation Authority (NCAA), Dr Harold Demuren, made this known at a meeting with representatives of Dana Air and family members of the crash victims.

He said without such a vital document, it would be difficult for the insurers to facilitate the payment of the outstanding compensation.

Demuren explained that so far, the airline has paid $30,000 to 80 individuals, while efforts were on to resolve multiple claims, a problem which  had been stalling the payment to the other 73 passengers, whose family members were yet to be paid.

He explained  that without securing the letters of administration, it would be difficult for the family members to get the outstanding claims.

Demuren said NCAA had been holding meetings with the Lagos State Government to fast-track the processing of Letters of Administration.

The Federal Government has flagged off a 30mega watts solar power plant project in Kankiya Local Government Area of Katsina State.

In a statement, the Nigerian Electricity Regulatory Commission (NERC) said yesterday that the project on completion would boost the economy of the state.

According to the statement, the  project was conceived as part of the Nigerian-German Energy Partnership.

The statement reads in part: “The coming of this project is a major milestone in achieving sustainable energy via renewable means. Investment into this field has never been attractive due to the high capital outlay needed. A critical concern by investors when setting up a power plant is that of cost recovery, and this is achieved through a wholesale tariff that allows for reasonable rate of return on investment.

“To promote investment in renewable energy, NERC had proposed a number of incentives, such as a guaranteed market for renewable, simplified licensing process, land access and, most importantly, a feed-in- tariff that is robust enough to allow for operators to recover their costs over a period of time.

The lingering fuel scarcity in the country is expected to last till next year, a report of the House of Representatives Committee on Petroleum Resources (Downstream), has indicated.

The report listed outstanding debts of over N141billion owed oil marketings as one of the reason for fuel scarcity in the country.

The report, which blamed the Mnister of Finance, Dr Okonjo Ngozi-Iweala and the Petroleum Products Pricing and Regulatory Agency (PPPRA) for the scarcity, said the debts have discouraged petroleum marketers from further importion, given that banks are no more willing to extend further credit to them.

These disclosures are contained in the report of the House of Representatives Committee on Petroleum Resources (Downstream) on the re-occurrence of long queues in filling stations across the country.

It said Nigerians should be prepared for an extended scarcity of Premium Motor Spirit (PMS) as commercial banks are no longer willing to give credit facilities to petroleum products’ marketers.

In addition, the Committee said System 2B, which distributes about 70 per cent of petroleum products from Lagos, Mosimi, Ejigbo, Ibadan, Ore and Ilorin has collapsed, and has affected the petroleum product distribution system.

The report was presented to the House yesterday by the Chairman of the Committee, Dakuku Peterside.

In the executive summary of the report obtained by The Nation, the Committee expressed fears that due to a number of factors, “the current scarcity will last for a fairly long time beyond the first quarter of next year.”

The committee said apart from the the Ministry of Finance withholding payments of marketers under investigation, there was inadequate provision in the 2012 budget for payment of subsidy. It said only N306billion was allocated to PMS in the N888billion set aside for payment of subsidy.

It said: “The delay in payment to petroleum marketers traceable to the Ministry of Finance is adversely affecting the availability of reduced and credit worthiness of marketers. At a point, it took not less than six months to process payment due importers.

“The collapse of Syatem 2B which distribute about 70 per cent of petroleum products starting from Lagos, Mosimi, Ejigbo, Ibadan, Ore and Ilorin severely affected the distribution system.

“Too many inconclusive investigations are affecting the willingness of banks to give credit, and thus importers given allocations by PPPRA cannot perform. For instance, out of 37 companies that were given fourth quarter allocation, only 19 performed by bringing the product into the country.

“There is a marked decline in investment in the downstream sector due to very low profit margin that has been gradually building up due to lack of storage facilities as has been observed over time.”

The Committee recommended that the Ministry of Finance should as a matter of urgency, pay every marketer being owed and whose claims have been verified by all relevant authorities, adding that all necessary measures should be taken by the Nigerian National Petroleum Corporation (NNPC) to immediately fix fix the collapsed System.

“That in 2013 budget, the Petroleum Support Fund (PSF) should be skewed in favour in PMS by the Ministry of Petroleum.

“That all investigations carried our by the Prsodency in the oil and gas industry should be concluded within a time limit.

“That PPPRA should give allocation to only marketers that had performed

“All necessary steps should be taken to determine the actual quantity of daily consumption of PMS that will enable the country plan ahead”.

It would be recalled that the Committee was mandated to carry out the investigation following the adoption of action by Bashir Baballe (PDP, Kano) on 7th November, 2012.

According to Pererside, the purpose of the report was to find out from relevant authorities why the country is experiencing fuel scarcity and profer ways of resolving the issues.

The Federal Government has commenced the process of transforming the Abuja Securities and Commodity Exchange into a first-class commodity exchange as part of the Ministry’s broader Nigerian Industrial Revolution Plan.

The transformation is expected to have been completed in the next 12 months.

The Managing Director, ASCE, Mr. Yusuf Abdurrahim, disclosed during a stakeholders’ sensitization workshop on the revitalization of the Exchange in Abuja, that a new bill for the establishment of the Nigerian Independent Ware House Regulatory Agency would soon be sent to the National Assembly.

He said, “The Minister of Trade and Investment, Mr. Olusegun Aganga, had already initiated reforms aimed at making Abuja Securities and Commodity Exchange a world class institution in line with the Transformation Agenda of President Goodluck Jonathan’s administration.

“The programme we have just concluded is another round of sensitization where we brought together stakeholders in the Commodity Exchange Project to continue to discuss the various building blocks of a functional Commodity Exchange. This includes a Ware House Receipt Bill which we discussed extensively during the Sensitization Workshop.

“We have drawn experiences from our local practice and that of Ethiopia. Probably, this might be the last discussion on the Ware House Receipt Bill before it goes to the National Assembly.

“The Commodity Exchange is a very important infrastructure for agricultural transformation, as well as looking into a transparent market for solid minerals and energy sectors. Already, the Minister has initiated some reforms and he is working hard to make the Abuja Securities and Commodity Exchange as viable, vibrant, and effective as possible so that it can serve the needs of the Nigerian economy very efficiently.

Speaking, the Permanent Secretary, Ministry of Trade and Investment, Mr, Dauda Kigbu, said that the development of the Ware House Receipt System would boost the operations of the Abuja Securities and Commodity Exchange and also help farmers overcome the problem of post-harvest loss.

The Ware House Receipt System is a basic infrastructure that will improve the operations of the Abuja Securities and Commodity Exchange. A WHR system enables farmers to use their stored commodities to secure credit from banks and other financial institutions. Storing their commodities in standard warehouses will enable them to avoid post-harvest losses and defer sales till the price of their commodities appreciates. Also, they have an option of using the WHR as collateral to obtain loans from banks to enable them meet other obligations.”

Speaking on the sidelines of the event, the Managing Director/ Chief Executive Officer, Ethiopian Commodity Exchange, Dr. Eleni Gabre- Madhin, said the government of Ethiopia had begun a collaborative initiative with Nigeria in other to transform the Abuja Securities and Commodity Exchange into a world class institution that would drive the Transformation Agenda of President Goodluck Jonathan’s administration.

She added that the situation now is that Nigeria is very exciting and promising because there is a very strategic alignment between the objectives of the Industrial Revolution Plan Agricultural Transformation Agenda, and the Central Bank of Nigeria which are all committed to the development of agriculture. I think the objective of the Nigerian Government is to use the Abuja Securities and Commodity Exchange to transform the Nigerian economy but also to become a continent –wide and regional power house.”

The naira appreciated yesterday, snapping three days of declines, after the Central Bank of Nigeria sold the highest amount of the currency in eight weeks of auctions.

The currency gained less than 0.1 per cent to N157.80 a dollar. It has strengthened by 2.8 per cent this year, the second-best performer in Africa, according to data compiled by Bloomberg.

The CBN sold $200 million at an auction yesterday, it said in an e-mailed statement. That brings its sale at its two scheduled auctions this week to $350 million, the highest in eight rounds, according to data on its website. The regulator sells dollars on Mondays and Wednesdays to keep the currency within a three per cent band around N155 a dollar.

“The apex bank’s supply strengthened the naira, given limited dollar demand at this time,” Edgar Ebinum, an analyst at Lagos-based Cowry Asset Management Limited., said in a telephone chat.

The CBN has left the benchmark interest rate unchanged at a record 12 per cent this year, increased lenders’ reserve requirements and limited access to money auctions to stop dealers from buying foreign currency using naira purchased from the bank at a discount.

The yield on the nation’s 16.39 per cent naira debt due January, 2022, was unchanged at 12.74 per cent, according to yesterday’s prices compiled by the Lagos-based Financial Markets Dealers Association.

Also, borrowing costs on the nation’s $500 million Eurobonds due January, 2021, declined 10 basis points to 4.28 per cent yesterday.

Any Deposit Money Bank (DMB) that violates the policy stopping lenders from taking transaction charges from customers that use Automated Teller Machines (ATMs) from other lenders will be sanctioned, the Managing Director, Nigeria Deposit Insurance Commission (NDIC) has said.

Speaking yesterday at the NDIC media workshop in Jigawa, he said customers whose accounts are debited after ATM transactions should lodge complaints at the Consumer Protection Unit at the CBN.

The Bankers’ Committee made up of Chief Executive Officers of banks, directors and top officials of the CBN and NDIC had last Tuesday unanimously agreed to bear all charges associated with the use of ATMs. Before then, account holders had been made to pay a flat rate of N100 per withdrawal any time they used other banks’ ATMs.

The NDIC boss said the decision to stop the charge would help to increase the patronage of ATMs, thus deepening the financial inclusion strategy.

Ibrahim has also called for the institution of Agency Banking to support the apex bank’s drive for financial inclusion. He said that the Agency Banking provides financial services to the widely dispersed population at affordable price and has assisted some countries in decongesting existing customers from crowded branches. He added that it will equally serve same purpose in Nigeria.

According to him, agency banking provides financial services by a third-party agent to customers on behalf of a licensed, prudentially-regulated financial institution.

The NDIC boss listed other projects meant to promote financial inclusion to include the cashless policy designed to bring low-cost, secure and convenient financial services to urban, semi-urban and rural areas across the country.

He also called for the promotion of all-women microfinance banks, adding that evidence from other countries indicate that such institutions have the potential to promote easy access to credit among rural women, especially at the group levels. He said the platform can also be used to mobilize large pool of funds from the group.