THE Central Bank of Nigeria (CBN) has disclosed Federal Government plan to borrow N814.78 billion ($4 billion) in Treasury bills between September 17 to December 3, this year. The bank said it would auction N215.14 billion worth of the three-month paper, N193.64 billion in the six-month debt and N406 billion worth of one-year paper.
The total debt proposed for the fourth quarter is 6.66 per cent short of the N872.96 billion raised in the second quarter of the year, the data released by the bank at the weekend showed.
Meanwhile, more investors could exit Nigeria’s bond market on concerns that new foreign exchange policy would hinder capital repatriation.
The CBN restricted access to forex by importers in its bid to protect its reserves, but dealers say the measure is threatening the future of Nigeria’s bonds on JP Morgan government Bond Index. The rules curb access to forex to fund purchase of foreign shares and bonds, among others.
Yields rose across maturities last week, spurred by the sell-off by some offshore investors cutting their risk in emerging markets and lack of interest from local pensions. “We have seen a number of offshore investors exiting their positions in the debt market in reaction to the new central bank foreign exchange measures and this trend will continue until we have a clear policy direction from the new government,” a dealer said.
Traders said some banks are also exiting their positions in the long tenor debt market and switching to short-dated paper because of the fore control measures by the central bank. JP Morgan has threatened to eject Nigeria from its Government Bond Index (GBI-EM) by the end of the year unless it restores liquidity to currency markets in a way that allows foreign investors tracking the benchmark to conduct transactions with minimal hurdles.
Tag: Fed Govt
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Fed Govt to raise N814b in TBs by year-end
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‘Fed Govt won’t force IDPs out of FCT’
Three agencies of the Federal Government have assured Internally Displaced Persons (IDPs) in the Federal Capital Territory (FCT), Abuja, that they will not be forcefully evicted from their camps.
They said the IDPs would be allowed to remain in the city until the government resettled them.
The Executive Secretary of the National Human Rights Commission (NHRC), ProfBem Angwe; the Director-General of the National Emergency Management Agency (NEMA), Muhammed Sani Sidi and Director, Internal Security, Office of the National Security Adviser (ONSA), Isaac Idu, spoke yesterday in Abuja at a meeting of a committee set up to address the plight of IDPs in the FCT.
The committee, chaired by Lambert Oparah of the NHRC, presented a draft report of their activities.
A meeting of stakeholders, comprising representatives of relevant government agencies, will consider the report to find a solution to the challenges the IDPs were facing.
Angwe noted that from his interaction with the IDPs, most of them were willing to return to their home towns.
He said it was the responsibility of the relevant government agencies to facilitate the IDPs’ resettlement.
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Stakeholders urge Fed Govt to review FADAMA 111
Agro-allied investors, agricul-turists, and farmers have urged the Federal Government to review the Third National Fadama Development Project for better impact on the agriculture sector.
A cross section of stakeholders made the call in Abuja.
They said the project could be managed properly to spur widespread interests in farming and associated agro-allied businesses.
According to them, the present project is not having expected impact as farmers and agriculture stakeholders are no longer the central focus.
The development objective of the ‘Third National Fadama Development’ (Fadama III) Project for Nigeria is to increase the incomes of Fadama users.
Chief Executive of Tamole Farms Nig. Ltd, Mr Bolanle Akogun, said the entire policy framework of the project need to be reviewed to capture more clusters.
Akogun said the project should be used to boost mechanised farming instead of the present heavy concentration on “negligible grants’’ to rural farmers.
“The World Bank assisted project is elitist on paper and pedestrian in practice thereby leaving room for misappropriation of funds.
“President Muhammadu Buhari would be doing the agricultural sector the needed service if the project is further reviewed to reposition it well enough to drive the non-oil sector,’’ he said.
Mallam Musa Keffi, an agriculturist, said the project, no doubt, had the basic impact in rural farming, adding that it could be made to achieve food security for the country.
“We are very good in developing policies, but I think we should show more seriousness in the implantation of the ideals of the project.
“We have many people in my locality that are captured and had benefited from the project in one way or the other but there is not feasible large scale impact,’’ he said.
On his part, a food exporter, Chief Anabi Oko , said “the fundamentals of the project appears to be fading away as the handlers across the country have developed ways for funds leakages.’’
The National Coordinator of the Fadama III project, Tayo Akinwunmi, expressed delight on the implementation of all identified elements of the project.
Akinwunmi expressed satisfaction at the approval of the project’s work and procurement plans by both the World Bank and Ministry of Agriculture and Rural Development.
The Federal Government in 2013 approved $200 million (N39 billion) loan for the additional financing of the ongoing Fadama III project.
According to him, the World Bank supports project stands to increase income for users of rural lands and water resources within the Fadama areas.
He said it would also improve the value chain of agricultural commodities in line with the need to boost the non-oil sector.
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Fed Govt urged to key into process technology
The Federal Government’s efforts to overhaul the petroleum industry has been commended. Giving the commendation was the Principal Consultant, Lonadek Oil and Gas, Dr Ibilola Amao, who said process technology must be given given urgent attention to exploit the abundant natural resources including oil and gas, which the country is endowed with.
Process technology is basically taking crude and putting it into a process whereby it is translated from its natural state to finished products. Amao said lack of process technology strategy was the end result of poverty, unemployment and lack of value creation ravaging the nation’s economy.
She stated that the energy and power equation would be solved when gas is utilised appropriately to drive the Independent Power Projects (IPPs), adding this would ensure uninterrupted power supply in the country. According to her, with process technology in place, crude and other mineral resources would rather be refined in-country and be exported as finished products
The oil and gas sector accounts for about 35 per cent of gross domestic product while petroleum export revenue represents over 90 per cent of total exports revenue. Economic analysts say Nigeria is losing so much money by exporting the crude to other countries and importing them as finished products. “According to them, when you export crude you are at the same time exporting other by-products” she said.
Amao, who spoke with The Nation on telephone, said Nigeria is wasting money exporting crude oil blaming the development on lack of process technology strategy. “With process technology strategy in place, our refineries and the petrochemical plants would be working. We will be optimising our natural resources, and with this, the country would become an industrial and agro-based economy,” she said.
She said the country does not have enough qualified personnel to understudy the experts and also lack the zeal and passion to acquire knowledge. If this development is not checked, she noted, technology transfer would only be a mirage, documented on paper with little or no result.
“We really need to get carrier counseling in place, people with the right passion to acquire technology and deploy them with a strategic roadmap that will give the succession plan a minimum number of years,” she said.
She also said there was the need to address the calibre and number of human resources in the regulatory arm of the hydrocarbon industry in the country. This, she said, would help to address some of the anomalies that currently plague the industry. She said some of the regulatory bodies such as the Department of Petroleum Resources (DPR); Nigerian Content Development and Monitoring Board (NCDMB); Nigerian Maritime Administration and Safety Agency (NIMASA) and National Oil Spill Detection and Response Agency (NOSDRA) charged with the responsibility of developing, communicating and enforcing regulation as well as supervising compliance through monitoring and evaluation, are, however, do not focus on certification, competency and field development.
According to her, some of the regulatory bodies do not have the right manpower to do their jobs effectively, which she said makes it possible for people to practise what they like and get away with it.
“We really need to be focused on the development and socio-economic transformation of the nation, but if you and I go about soliciting for our own comfort and our private well-being, we will continue to be in economic decay in this country,” she said.
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Assembly urges Fed Govt to intervene
The Bauchi State House of Assembly has urged the Federal Government to intervene in the incessant killings of travellers passing through Plateau State.
The Assembly advised governors of Adamawa, Bauchi, Borno, Gombe, Taraba and Yobe states to meet with their Plateau counterparts to end the lingering killings in the state.
A Bauchi State lawmaker representing Shira Constituency, Auwal Hassan, spoke yesterday in Bauchi, the state capital, when he presented a motion on matters of urgent public importance.
He said: “It is a cardinal duty of every government, whether state or federal, to ensure the security of life and property of persons living in Nigeria.”
Hassan noted that the security and welfare of people living in Nigeria should be the primary purpose of every government.
The lawmaker decried “the prolonged and unabated hostilities among some communities in Plateau State, which always lead to frequent loss of hundreds of human lives”.
He said property worth millions of naira were always destroyed in such confrontations.
Hassan acknowledged the of Plateau and Federal governments to curb the menace.
The lawmaker added that “so far, nothing concrete has been achieved.”
According to him, some parts of Plateau State have become notorious with what he called deep-rooted mistrust among the residents, which he said has undermined public safety.
Hassan noted that travellers faced threats and dangers when they pass through Plateau, especially during clandestine attacks among warring communities.
He said: “Most victims of this crisis are unsuspecting innocent motorists coming from or going to the Northeast. Plateau State, being the closest gateway linking Abuja and other Southern states makes them to easily fall victims.
The northeast states are: Adamawa, Bauchi, Borno, Gombe, Taraba and Yobe.
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Fed Govt urged to scrap council legislature
Youths in the Federal Capital Territory (FCT) under the auspices of Abuja Original Inhabitant Youth Empowerment Organisation (AOIYE) have called on the federal government to scrap local government legislative houses, which they described as comatose.
The President of the indigenous organisation, Commandant Isaac David who made this call in Abuja on behalf of the youths, in a press statement, blamed the prolonged and negative relationship between the councils and the FCT administration on the incompetence of the area councils legislators.
According to David, the FCT administration which is being run by bureaucrats who are not close to the grassroots, rely on information and data metrics fed them by the leadership of the area councils who run the councils as a family business without enough consultation with the public.
“The Legislative Houses are comatose and may need to be scrapped as they are not doing their work. Because of their incompetence, the chairmen run the council as if it is their family business.
“Recently, the media has been inundated with commentaries on the management of resettlement issues in the programme of the Land Swap and especially the Centenary City and how the original inhabitants were shortchanged in the process.
“All this adverse publicity would have been avoided if the area councils being managed by the elected representatives of the people did their work in a transparent and accountable manner. There is also not only poor communication between the Councils and the public, but also internal communication among themselves.
“Government communication involves not only sending out persuasive messages to the public, but also explaining working policies, creating awareness of the rights of citizens, and developing mechanisms that enable two-way communication between citizens and the government. The Councils need to understand that government communication is not propaganda,” he said.
Commandant David further said that effective public communication efforts enable citizen participation, but the FCT area councils lack a culture of consultation and participation, exacerbated by low literacy rates and lack of information provision even with the passage of the Freedom of Information Act.
“Without better communication governments risk losing public support for their programmes, policies and development interventions. We note that it is the intention of Government to provide the public with timely, accurate, clear, objective and complete information about its policies, programmes, services and initiatives. The public has a right to such information,” he said.
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Fed Govt to review rice import policy, others
The Federal Government at the weekend, announced plans to review the import policy of staple food items such as rice, wheat and fish.
Describing the policy as “unfavourable,” the government said it would ensure the country was self-sufficient in food production before the restriction was enforced.
Permanent Secretary of the Federal Ministry of Agriculture and Rural Development, Sonny Echono, spoke in Abuja at a meeting with the Executive Secretary of the Nigeria Investment Promotion Council (NIPC), Uju Hassan-Baba.
A statement by the Director of Information and Protocol, Mr. Tony Ohaeri, quoted Echono as saying: “The ministry would in the next three years, seek the review of the current unfavorable policy by the Federal Government, which allows the importation of staple food items such as rice, wheat and fish into the country.”
The statement said the ministry and NIPC would partner to promote strategic investments in the agricultural sector.
It underscored the need to attract more investments in the sector, explaining that Nigeria has comparative advantage in the development of its agricultural sector in view of her vast arable land, huge population and markets.
The permanent secretary pointed out that the ministry was out to guarantee food security, as well as export food items to other West African countries, even as he stressed the need to link Nigerian farmers to the market, because according to him, it would determine their productivity and income, as well as promote exports.
Hassan-Baba called for the re-establishment of the synergy that existed between the commission and the ministry.
She said there was an increase in the demand for information on agricultural activities in Nigeria by foreign investors, adding that a Desk Officer from the ministry should be posted to the NIPC’s One Stop Shop.
The executive secretary said the commission would hold a stakeholders’ forum on promoting investment in the agricultural sector, noting that the ministry had a role to play to ensure the success of the proposed forum.
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Fed Govt identifies errors in second Niger bridge contract
The Federal Government is scrutinising the contract cost and contract conditions of the second Niger bridge.
The Director-General of the Infrastructure Concession Regulatory Commission (ICRC), Aminu Diko, spoke with State House correspondents after making presentations to President Muhammadu Buhari at the Presidential Villa, Abuja yesterday.
According to him, the Ministry of Works has been asked to review the cost of the project.
He also said the Commission had also identified some errors in the project.
He said: “The second Niger bridge is one of the projects that we discussed with the President. We have been discussing the transaction with the Ministry of Works. But before it can be finalised, the commissioner has to give a certificate of compliance, but we haven’t given that because we have seen a lot of issues that we are uncomfortable with.
“We are talking with the Ministry of Works for them to correct it. The communities around that area are clamouring that their lands have been taken and that they have not been compensated adequately.
“As a matter of fact, we got a letter from Onitsha Traditional Council complaining that they have not been adequately represented in this transaction.
These kind of issues we are not saying that something has not been done properly but we need to be convinced that these few problems are sorted out properly.
“We will also talk about the actual cost of the bridge. Eventually, we have asked the Ministry of Works to review it and justify how much the project should cost.”
On the status of the project, he said: “I have no idea about the status of the project. What I need to tell Nigerians is that PPPs take a long time to mature. There is a difference between the project which you have money in your pocket or in your account and you just bring it out and tell somebody to go and do it.
“But when it is PPP transaction, you first engage a number of people. You have banker, lawyers, engineers. They all collaborate to form consultancy for that transaction.
“For the second Niger bridge there will be a lot of studies that need to be done on the integrity of the bridge itself which will take time. It is not something we can see being completed in the next six months.
“I will like us to be patient about it, we know that it is a critical road. We also know how Nigerians suffer during festive holidays and we hear people sleep on that old bridge. The time has come for us to bring succour to Nigerians.”
He said that mission of the Commission to the Villa was to tell the President about the imperative of PPPs in nation building.
“Unfortunately, we realised that we were coming to preach to the converted because only on Sunday the President was at the NBA conference where he made a profound statement regarding infrastructure deficit in Nigeria. The government cannot do it alone.
“So the private sector both in and outside the country must be accepted as a partner in progress, provided that the nation will not be shortchanged in anyway. Private sector will be allowed to invest in the country and recuperate their investments and ICRC will be there to guide ministries department and agencies on how to structure these transactions and when it is properly signed and executed we will also take custody of those agreement to ensure that there is total compliance.”
He also said some of the limitations of the Commission were also discussed with the President.
He added: “One of which is the most significant is the law that we operate. It is very ineffective. So, we have proposed an amendment to the law and he has agreed to support the passing of the bill when it comes back to him from the Attorney-General’s office.
“We also discussed some of the legacy concession that we inherited, the port terminals the one at Lagos International Trade Fair, the one over Tafawa Balewa square and the Lagos-Ibadan expressway.
“We also discussed all the projects that were started under the ICRC Act – one of which is the second Niger Bridge, the National Theatre complex, Lagos. These are important projects to the country and in addition to that this country is proposing to build three deep sea port for Nigeria with combined estimated cost of about $6 billion.
“So, you can imagine the kind of opportunities it can create as far as job creation is concerned and as far as vibrancy of the economy is concerned.
“So, we are reviewing these proposals, with the Ministry of Transport and in due course we will come out with a position on that.” He stated
He said Buhari gave the Commission two directives.
His words: “He gave us two directives, especially on agricultural silos. We did tell the President that this nation has already built about 33 agricultural silos that is spread all over the country but government has sunk in money there and the management of those silos will be granted to the private sector.
“What the President has directed is that we should involve the state governors to see how best they can encourage their farmers to utilise these silos when they come into effect.
“He also addressed another issue which is very important. ICRC regulates how public private partnership transactions come in to being, but before they come in to being they have to be developed.
“ICRC does not develop projects and also does not give funding for the development of the project. So, the President directed that MDAs should ensure that they have adequate funding for development of project in their budgets and if they don’t, they should look for alternative ways of getting such funding.
“We acknowledge that some of the developments institutions have already begun to grant Nigeria such attention. Recently, the African Development Bank offered to finance the engagement of a transaction adviser for the Nigeria Trans-Sahara gas pipeline that Nigeria is building, which is part of the African Heads of Government commitment to develop Africa in general.
“World bank has also given some facilities to Nigeria some of which could be used for project development and capacity building for relevant MDAs. So, the complexities of the transactions can be tackled head on.”
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Fed Govt, states, LGs share N490.2b for July
• ECA grows to $2.257b
The three tiers of government of the federation got a shock to their finances yesterday as they recorded a drop in the allocation they shared for the month of July from the Federation Account.
At the end of the monthly Federation Account Allocation Committee (FAAC) meeting in Abuja yesterday, N490.222 billion was shared by the federal, states and local governments for July lower than the N518.533 billion shared in June.
After deductions and refunds were made to the collecting agencies of Federal Inland Revenue Service (FIRS) and the Nigerian Customs Service (NCS), N411.866 billion was shared by the three tiers of government with the Federal Government pocketing N202.111 billion (52.68 per cent); states went away with N102.513 billion (26.72 per cent) while local governments received N79.033 billion (20.60 per cent). The balance of N28.209 billion was shared among the oil producing states under the 13 per cent mineral revenue derivation formula.
The sum of N71.947 billion was shared as Value Added Tax (VAT) with the N10.792 billion or 15 per cent; states received N35.974 billion or 50 per cent and local governments got N25.181 billion or 35 per cent of value added tax (VAT) proceeds. N6.409 billion exchange rate gains was also shared by the three tiers of government.
N6.330 was refunded to the Federal Government by the Nigerian National Petroleum Corporation (NNPC) furtherance to the decision to compel the NNPC to refund what it withheld from the Federation Account in the past.
The reason for the drop in what was shared for July was attributed to the “shut-down and shut-in of production for maintenance and emergency repairs as well as the declaration of of force majeure by Shell Petroleum Development Company (SPDC)” as the major issues that negatively impacted crude oil revenue. Also there was revenue loss of $22.53 million as a result of the drop in average price of crude oil from $65.76million in May to $61.27million June, this year.
Addressing reporters at the end of the meeting, the Permanent Secretary, Federal Ministry of Finance, Mrs. Anastasia Nwaobia said the accruals into the Excess Crude Account (ECA) increased slightly to $2.257 billion.
Also speaking, the Accountant General of the Federation (AGF) Alhaji Ahmed Idrissaid there will be no exceptions or exemptions of any government agency from remitting all their proceeds to the Treasury Single Account (TSA).
Idris said the Federal Government is coming up with the guidelines for government agencies to comply with on their remittances to the Federation Account.
He insisted that all agencies were already complying with the directive. The TSA, he said will allow the Federal Government to know how much it has in its account to enable it control and manage its revenues.
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Fed Govt intervenes in Agip, Arco feud
Resolution of the conflict between the local arm of the Italian oil giant, Nigerian Agip Oil Company (NAOC) and an indigenous oil service company, Arco Petrochemical Engineering Company, a subsidiary of Arco Group, over the maintenance of the OB-OB/Kwale/Ebocha gas plant contract, is in sight as the Presidency has intervened to restore peace, it was learnt.
The project is owned by the Nigerian National Petroleum Corporation, Agip (NNPC/Agip) Joint Venture (JV).
The case was brought before a Federal High Court in Port Harcourt presided over by Justice Lambo Akambi, a few months ago. Also the immediate past administration tried to resolve the feud, and the Port Harcourt zone of the National Union of Petroleum and Natural Gas Workers (NUPENG). The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), had threatened to embark on strike, all aimed at seeing an end to the prolonged dispute, yet the case remained unresolved.
A source at the Petroleum Resources Ministry told The Nation in confidence that current intervention by the Presidency will yield result and will not only save the emerging Nigerian content from collapse but also the nation’s oil industry.
The Agip-Arco faceoff started when Agip refused to renew an interim contract for Arco for the maintenance of the OB-OB/Kwale/Ebocha gas plant turbines. Arco had been a sub-contractor to the project since 2006, when the Board of the NNPC awarded a five year contract ending in 2011 to the duo of the then Nuovo Pignone, now GE, and Arco as the local technical partner.
On expiration of the 2006/2011 contract, another five-year contract was being processed after the necessary tender process. But pending conclusion of the tender, an interim or stop-gap maintenance contract is expected to be awarded to the contractor on site, which is Arco/GE or Arco as the local technical partner. The essence of the interim contract is to keep the gas plants under proper maintenance. However, after inconclusive discussions on the tender for the stop-gap contract by GE and Arco with the JV Partners, the National Petroleum Investment Management Services (NAPIMS) an arm of NNPC and NAOC (NAPIMS/NAOC), NAPIMS asked GE and Arco to individually submit quotes. NAPIMS found Arco’s quote lower than GE’s, it was learnt.
However, Agip reportedly awarded the contract to a Nigeria-based Italian-managed company called Plantgeria Company Limited without regards to due process and Nigerian Content but Agip said Plantgeria offered the best commercial bid of US$10million per annum as against Arco’s US$37million per annum.