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Dwindling income: States seek World Bank grants

With the dwindling prices of oil in the international market and reducing income to the Federation Account, states are seeking ways to access World Bank grants.

To this end, the governors under the platform of the Nigeria Governors’ Forum (NGF) Wednesday night received presentation on how to access the grants from the Country Director of World Bank, Rachid Benmessaoud.

Briefing State House correspondents at the end of the meeting, NGF Chairman, Abdulaziz Yari said: “We the Nigerian Governors Forum had a meeting today in the banquet hall,we invited the country director of World Bank, Rachid Benmessaoud who briefed the forum on the money lying down in the world bank which largely belongs to state governments but has not been accessed.

“Because of the cumbersome procedure in accessing these funds, most of the governors did not even know they had such funds there, it was the initiative of the Governor of Kaduna state that they should come and make this presentation so that they can educate the governors to know that these monies are there especially in the kind of situation we are the difficulties so that the state can move forward in terms of infrastructure development and other matters in our respective states.

“We have a presentations from the world bank officials and we agreed on terms, the governors contributed that so many things should be involved, most especially the issue of counterpart funding which the world bank accepted they are going to look into.

“Also they agreed that they will give us the details of state by state how much is lying down for each state and how we are going to access it.

He said that in the meanwhile the World Bank has agreed to facilitate a workshop for the state governors, commissioner of finances and other staff.

The workshop, he said, is to show how best to access the funds.

He added: “We discussed sincerely on the issue of counterpart funding. It is more difficult for us to fulfill our own part because we are struggling to see how we can pay salaries that is the most difficult aspect of it and they promised that they will look into it and immediately that is done, the states will move fast to ensure we access it.”

On his part, Kaduna State Governor, Nasir el-Rufai said that the World Bank portfolio for the states for 2016 is $4.25 billion and $3.25 billion out of it is lying undisbursed.

According to him, the states are either not meeting their conditions or not moving fast enough to draw the $3.25 billion.

He said: “You know $3.25 billion can do a lot to improve the lives and livelihood of our citizens in the states and the world bank has expressed its flexibility to look into the challenges we are facing as well as the procedure or bottleneck to ease the access of these monies because the World Bank wants us to withdraw these money as quickly as possible so that our citizens will get the benefits from health to education and the rural access, agriculture and the revival of livestock and water supply.

“These are the areas that most of these funds are dedicated and we all need the money because we are all broke, so we are going to work very hard to try to get these monies in trust.” He stated

On the increase in pump price of fuel, Ogun State Governor, Ibikunle Amosun said that it is a sacrifice that must be paid by all.

He said that the President and the government mean well for the country.

He said: “All of us means well and if truly we are caring for the masses we believe that subsidy only serve the rich, those that are getting us the fuel, not the masses.

“We believe that such money that have been saved from the subsidy would be used for infrastructural development particularly for social services for all of the down- trodden masses.

“We are putting our weight behind it, while urging the federal government and in deed the state governments to see how we can ameliorate all the problems the masses would probably go through in the short run because in the long run they would be the better for it.

“We supported it because we believe that it is in the interest of the masses.” He stated

May 19, 2016
World Bank, Fed Govt partner firm against food wastage

To boost food preservation and reduce post-harvest wastage, indigenous fabricator of agro-allied processing and preservation equipment, Nobex Technologies Ltd, is set to launch a multi-purpose fruits processor for preserving excess farm produce.

This, it will do in partnership with the World Bank and the Federal Government, under the West Africa Agricultural Productivity Programme (WAAPP) Nigeria.

A delegation led by the World Bank Agricultural Economics Task Team Leader for (WAAP-Nigeria), Mr. Shehu Salau and the Ag. National Project Coordinator in the Federal Ministry of Finance, Mr. James Apochi, addressed reporters during an implementation supervision mission to the firm’s factory at Idimu/Ikotun Road, Egbe-Idimu Local Council Development Area, (LCDA), last weekend.

The equipment, which was adopted from Burkina Faso, is 95 per cent completed and will be launched in the next three weeks.

According to Salau, Nobex Technologies is one of the collaborators of World Bank under WAAPP to produce locally-made multi-purpose fruit processors.

His words: “The World Bank and Federal Government approved this project and we are impressed with the level of work so far. The technology was brought from Burkina Faso and the intention is to collaborate with Nobex to improve on it for the Nigerian market.

“This will eliminate wastages, increase our income base, discourage importation, as well as improve our local contents policy by making made-in-Nigeria products available to the people.”

He added that WAAPP is executing other projects in 13 countries in the sub-region “and every project has its area of competence. In Nigeria, apart from the latest invention, there is the aqua-culture project. Thus, the multipurpose fruit processor, which has been certified by the National Agency for Food, Drug, Administration and Control (NAFDAC), is a work in progress”.

On the economical advantage to the country, Apochi said: “Post harvest losses in Nigeria are high, hence, the need to reduce this trend. Once functional, farmers will have enough to take home in terms of profits. It will also encourage exports, thereby increasing Federal Government’s foreign exchange earnings.”

Managing Director of Nobex Technologies Mr. Idowu Adeoya explained that the minimum and maximum capacity the processor can produce daily varies according to the type of the machine and quantity of the produce available for processing.

May 12, 2016
World Bank funding coming for Lagos agric

More funding is expected from the World Bank to boost Lagos State government’s efforts to expand its agriculture sector to provide food security and improved nutrition of the rural poor.

The Lagos Commissioner for Agriculture, Hon Suarau Oluwatoyin who spoke yesterday in a press briefing to commemorate the 1st year of the administration of Governor Akinwumi Ambode in Lagos, said the state is partnering with the World Bank for financial support to boost agric productivity.

According to him, Lagos needed an agricultural system that produces more food to feed its residents more efficiently.

Under its Commercial Agriculture Development Project supported by the World Bank, he said 29 investment plans valued at N233.3 million were implemented after project restructuring for 208 entrepreneurs.

The state, he also said received no objection for 38 investment plans for 376 common interest groups (CIGs) entrepreneurs valued at N288.81 million.

He said 55 participants of its Women and Youth Programme are awaiting empowerment, while the selection of 255 additional participants is progressing.

May 5, 2016
Buhari to World Bank: Facilitate speedy repatriation of stolen funds

President Muhammadu Buhari on Wednesday urged the World Bank to do all within its powers to facilitate the speedy repatriation of stolen funds back to Nigeria.

He made the call during a meeting with the visiting Managing Director of the World Bank, Ms. Sri Mulyani Indrawati, at the Presidential Villa, Abuja.

Buhari said the repatriation of the additional $320 million in Switzerland, which has been identified as being illegally taken from Nigeria during the late Sani Abacha’s administration, will help to ease the current economic hardship in the country.

The President, in a statement issued by his Senior Special Assistant on Media and Publicity, Garba Shehu, assured Ms Indrawati that his administration was taking appropriate steps to ensure that public funds are no longer stolen or misappropriated by government officials.

He said: ‘‘We need the support of the World Bank for the repatriation of the funds.

“We are as concerned as the World Bank about accountability. If such repatriated funds have been misapplied in the past, I assure you that the same will not happen with us.

“$320 million is a lot of money and we will not allow it to be misappropriated or diverted.”

One of the conditions given by the Swiss Authorities for the repatriation of the funds is that it should be expended on social programmes for the benefit of Nigerians in an efficient and accountable way, guaranteed by the monitoring of the World Bank.

President Buhari also assured the World Bank Managing Director that his administration will honour all agreements with the bank that will help to stimulate Nigeria’s economy and reduce the level of poverty in the country.

April 27, 2016
Panama Papers: Tax evasion hurts anti-poverty fight, says World Bank

.•IMF urges Nigeria to approve budget, seek economic help

Tax evasion through international tax havens and other international illicit transfers of money undermine the fight against global poverty, World Bank President, Jim Yong Kim has said.

“This is a great, great concern,” Kim said as he opened the Spring Meeting of the World Bank and International Monetary Fund yesterday.

In a report obtained from the bank’s website, Kim said the global lender is very concerned about illicit financial flows, amid intense attention on the recent leak of Panama Papers’ showing how powerful officials and businesses in many countries make use of thousands of anonymous companies in tax free centres.

“When taxes are evaded, when state assets are taken and put into these havens, all of these things can have a tremendous negative effect on our mission to end poverty and boost prosperity,” he said.

The publication early this month of the Panama Papers, a dossier of files on anonymous companies set up by a Panama law firm, has sparked a new push for ending the secrecy offered by tax heavens worldwide, he said.

He said leaders in developing countries regularly ask him for help in tracking down the exodus of cash whether to avoid taxes or to hide graft.

He said the one answer is increasing transparency. “The message I would send is that transparency is not going to move backwards. The world is going to become only more and more transparent as we move forward. So, I would just say, be very careful”.

Meanwhile, the International Monetary Fund (IMF) Managing Director, Christine Lagarde said Nigeria should seek economic help from international institutions.

Speaking at the IMF conference hall in Washington DC, Lagarde said Nigeria needs to be open-minded on foreign exchange, and swiftly approve the 2016 budget. “Our recommendation is that Nigeria seeks help from the international institutions that can best help,” she told the audience.

“Second, that Nigeria is open-minded in using flexibility of the exchange rates, in order to absorb some of the shocks. We believe that this is more efficient than to have a list of products that are barred from being imported to the country.

“Third, we believe that it’s really important that budget be completed, decided and approved and we stand ready to help Nigeria, if it wants to seek our help.”

“Nigeria is full of energy, smart people, and can really transform some of its activities including the agricultural sector where there is just too much by way of import, when there could be a lot of transformation in Nigeria and local consumption.”

April 15, 2016
Falana advises against World Bank, ADB loans

Lagos lawyer Femi Falana (SAN) has urged the Federal Government to recover over $200 billion stolen wealth instead of taking a loan of $3.5 billion from the World Bank and the African Development Bank (ADB).

Falana said if government refused to accede to the request, “we shall have no alternative than to initiate legal proceedings at the Federal High Court with a view to restraining the Federal Government from further plunging the nation into external indebtedness”.

The request was contained in an April 8 letter, addressed to the minister of Finance, titled: “Request for the collection of outstanding revenue of $200 billion withheld from the federation account or stolen by looters”.

In his initial letter to the minister dated February 12, the lawyer urged the Federal Government to explore alternative sources of raising revenue to fund the 2016 budget, instead of increasing the nation’s external debt of $64 billion.

He had also requested the Federal Government to recover the $42 billion withheld from the Federation Account from 1999-2012 by some transnational oil companies, Nigeria National Petroleum Corporation and other agencies, noting that the minister, in her reply dated March 17, gave assurance that the issues raised were receiving attention.

“We were, therefore, surprised to learn that the administration had applied to the Chinese Government for another loan of $2 billion. In urging the Federal Government to desist from taking the loan of $2 billion from China or any other country, we are compelled to advise the Federal Government to intensify efforts to recover the nation’s wealth, which has been criminally diverted by a handful of local and foreign looters”, he said.

Falana advised government to direct the relevant agencies and the anti-graft bodies to collect the stolen wealth, and listed 17 areas where such funds will be collected.

According to him, “the National Extractive Industries Transparency Initiative has confirmed that from five cycles of independent audit reports of NEITI, covering 1999-2012 the NNPC, some oil companies and certain agencies of the Federal Government withheld $20.2 billion for the Federation Account. The indicted oil companies and agencies should be made to remit the $20.2 billion into the Federation Account.

”In 2006, the Central Bank of Nigeria apportioned $7 billion of the nation’s external reserves to 14 Nigerian banks. In 2008, the CBN also gave a bailout of N600 billion ($4 billion) to the banks”.

He recalled “on September 6, 2016, the NNPC announced that arrangements had been concluded to recover $9.6 billion in over-deducted tax benefits from joint venture partners on major capital projects and oil swap contracts. Since the NNPC is said to have recovered $9.6 billion it should be remitted into the Federation Account”.

Falana said Mobil Producing Nigeria Unlimited since 2009 has been owing government $1.9 billion, being outstanding of the $2.5 billion charged the oil company for the renewal of licences adding: “From 1998-2014, the Federal Government collected over $4 billion from the over $5 billion stolen from the CBN by the late General Sani Abacha. I have submitted a petition to the Economic and Financial Commission to investigate the alleged criminal diversion of the recovered loot by some former public officers. The governments of the United States and Switzerland have promised to repatriate $458 million and $321 million recovered from the loot.

“In 1999, the Abdulsalami Abubakar military junta enacted theDeep Offshore Inland Sharing Contract Decree to give effect to certain fiscal incentives for the oil and gas companies operating in the Deep Offshore and Inland Basin under production sharing contracts. Thus, by virtue of Section 5 of the Act, the payment of royalty in respect of the Deep Offshore production sharing contracts shall range from four to 12 per cent while no royalty shall be paid whatsoever in areas in excess of 1,000 metres depth! Since the 15-year period for non-payment of royalties expired in June 2014, they should collect arreas of royalties running to hundreds of million of dollars owed by the oil and gas companies operating in the area”.

Other areas include “the abandoned $470 million contract awarded to ZTE (a Chinese company) in 2009 by the Federal Government for the construction of CCTV cameras in Abuja and Lagos . Hence, the cameras, which were installed, did not capture the criminals, who launched bomb attacks in Abuja, and killed scores of citizens. Since the contract was not executed, the Federal Government should recover the $470 million.

“In the Appropriation Act, 2011, N245 billion was earmarked for fuel subsidy. In violation of the budget law, the Federal Government fraudulently paid out N2.5 trillion ($16 billion) to a cabal of fuel importers. The investigation conducted into the large scale fraud by the Police and the anti-graft agencies was compromised due to pressure from the Jonathan administration. The EFCC should revisit the matter.”

He went on: ”For contravention of the law on compulsory registration of SIM cards, the NCC imposed a fine of $5.2 billion on MTN last year. Based on pleas by the MTN management and the intervention of South Africa, the fine was reduced to $3.9 billion, of which MTN paid $250 million. Since MTN has withdrawn the suit challenging the payment of the fine, the Federal Government should ensure the prompt payment of the balance of $3.65 billion.

“Under the ex-President Goodluck Jonathan administration, it was estimated that the nation was recording oil theft worth $7 billion to criminals annually. An investigation by a team of lawyers hired by the Federal Government confirmed that hundreds of millions of barrels of oil were stolen by oil companies and shipped to many countries. According to the lawyers, the amount recoverable by the government from the sellers and buyers, who stole Nigeria’s hydrocarbons and shipped same to the United States from January 2011 to December 2014, stands at $12.7 billion. Since the verification is programmed to cover 10 years, it is estimated that Nigeria can recover not less that $100 billion from the undeclared millions of barrels of oil shipped to the United States and other countries. The EFCC should collaborate with the lawyers to recover the missing fund and prosecute the transnational oil companies involved in the grand oil theft.”

April 11, 2016
World Bank to mobilise $25b to fight climate change

The World Bank has promised to mobilise 25 billion dollars in private financing for clean energy by 2020 to fight climate change in developing countries.

This is contained in a Climate Change Action Plan, released by the bank on Friday in Washington, with a promise to add 30 gigawatts of renewable energy to the world’s energy capacity.

Jim Kim, World Bank Group President said the plan was designed to help countries meet their Paris COP21 pledges and manage increasing climate impacts.

He disclosed that to complement the World Bank’s efforts, the International Finance Corporation, a member of the World Bank Group, promised to expand its climate investments from the current 2.2 billion dollars a year to a goal of 3.5 billion dollars a year.

Kim said it would also lead on leveraging an additional 13 billion dollars a year in private sector financing by 2020.

The president, said under the plan, the Bank would quadruple funding for climate-resilient transport and integrate climate into urban planning through the Global Platform for Sustainable Cities.

He said it would also boost assistance for sustainable forest and fisheries management.

Kim said this has become imperative because climate change threatened to drive 100 million more people into poverty in the next 15 years.

“Following the Paris climate agreement, we must now take bold action to protect our planet for future generations.

The president said the bank is moving urgently to help countries make major transitions to increase sources of renewable energy and decrease high-carbon energy sources.

Kim said it would also include developing green transport systems, building sustainable and liveable cities for growing urban populations.

April 8, 2016
Power biggest problem for businesses, says World Bank

The World Bank has identified inadequate electric power supply as the biggest problem facing Nigeria’s private sector operators.

According to its study titled: The Nigerian Private Sector and its Challenges, presented by its Specialist, Finance and Private Sector, Mr. Michael Wong, in Abuja, yesterday, the two other worst problems of confronting businesses are corruption and access to finance.

He said: “Nigerian managers of formal firms were most likely to report electricity, corruption and access to finance as serious obstacles to business performance. Firms in Nigeria are significantly more affected by power outages than firms in comparator countries. Nigerian firm managers reported that losses due to power outages were approximately 17 per cent of sales. Firms in Lagos and other Southern states reported the highest losses- equivalent to more than 20 per cent of sales. Firms in Northern states rank political instability among the biggest constraint.”

The report berated “the drive to shore up Internally Generated Revenue of the last Lagos State government under Mr. Babatunde Fashola as an impediment to operational growth by companies that responded in the study.”

March 16, 2016
Boko Haram: FG, World Bank, others end mission to Northeast

The Federal Government, the World Bank, European Union, and the United Nations have concluded a two-week recovery and assessment mission in the Northeast region ravaged by Boko Haram insurgency.

The mission was part of ongoing Recovery and Peace Building Assessment (RPBA) programme initiated by the global agencies.

Led by the Senior Special Assistant to the President on Internally Displaced Persons (IDPs), Dr. Mariam Masha, the recovery and assessment team visited Adamawa, Taraba, Gombe, Bauchi, Borno and Yobe States.

A statement issued by the Senior Special Assistant on Media and Publicity to the Vice President, Laolu Akande, said during the visits, the team actively engaged with state governors, decision-makers as well as top government functionaries, civil society organizations, private sector players, traditional rulers, the Internally Displaced Persons (IDPs), emergency management agencies, humanitarian and relief agencies and other active partners in the recovery efforts in the affected states.

The statement said: “In the course of the tour in the affected areas, the team of officials visited several camps and resettlement centres for the IDPs in the different states as well as insurgency –ravaged public institutions like hospitals, markets and military formations.

“The team also gained first hand knowledge of human and physical conditions in the camps and resettlement centres affording them the opportunity to empathize with the people and also reassured them of the commitment of the Buhari administration towards addressing their challenges.

“In furtherance of the importance of the recovery and assessment mission, the team’s top level engagements with relevant stakeholders centred on sector recovery and needs assessment strategy in the three major components of Infrastructure and social services, peace building, stability and social cohesion as well as the economic recovery of the affected people in the six states.”

February 14, 2016
‘Renewables alone won’t cut it!’

Uwe Lauber, CEO of the German mechanical engineering company MAN Diesel & Turbo, talks about the energy situation and the company’s plans in Nigeria.

Mr. Lauber, you are visiting Nigeria as part of the delegation accompanying the German Federal President. What are your impressions so far?

First of all, let me say that it is a great honor for me to be able to visit Nigeria together with our Federal President and to be welcomed on such a high level. Nigeria is an impressive country with a buoyant and dynamically developing economy. That buoyancy is especially tangible in Lagos, a city that seems to be bursting with energy. Take for example the Eko Atlantic City project. The sheer dimension of it is nothing short of stunning. This is without any doubt one of the most ambitious land winning projects of our time.

We are guessing you are here for business? MAN Diesel & Turbo is engaged in various fields, ranging from power generation and turbo machinery for the oil & gas industry to marine propulsion. For which segment do you see the biggest opportunities in Nigeria?

Nigeria is already an important market for our turbomachinery business, where we are working together with the oil and gas and process industry on a number of projects. Some groundbreaking projects are being developed at the moment, e.g. the Dangote refinery, which will be of huge strategical value for the country and will turn Nigeria into an exporter of refined petroleum products instead of an importer. It is projects like this, where we see the most substantial growth potential. But Nigeria also has a developing shipbuilding industry, to which we are paying close attention. As one of the world’s leading providers of ship engines, we want to be well positioned by the time this market takes off. And then, of course, there is the energy sector, where we specialize in solutions for distributed energy generation. We already have over 60 engines for energy generation installed in the country.

As you know, the generation of and access to electricity is one of the biggest challenges this country is facing. What is your perspective on the situation?

The power sector is, without question, one of the key constraints on the country’s economic development. According to the World Bank, power cuts in Nigeria slow down annual growth by an average of 3-4 percent. That is very substantial. Nigeria is the biggest economy on the African continent and yet almost 50 percent of the population is without access to electricity. Imagine the untapped potential! Without a doubt, action is needed. But things are progressing, and in the past years, Nigeria has made remarkable efforts to address the situation in a systematical way: The 2013 privatization of the power sector created the foundation on which an electricity market based on rules, efficiency and reliability can develop. Going forward, it will be essential to generate the trust and incentives needed for independent power producers to further invest in and expand the generation capacities and distribution infrastructure.

What technical solutions do you recommend for the country’s energy challenge?

With regards to generation capacities, I think flexibility is key, which is why distributed energy solutions based on gas or dual-fuel engines are well-suited to Nigeria. They are very efficient and can feed into the grid or operate in captive mode. And this technology also works well with renewable energies, like solar or wind power, which offer a huge potential in Nigeria.

The Nigerian government intends to increase the share of electricity from renewables to 23% by 2025 and to 36% by 2030. Coming from a country that has already reached a +25% share – any advice?

It’s hard to compare the situations: In Germany, the main challenge was and still is to completely restructure an energy system that has evolved over decades in a short period of time. In Nigeria, it is about building up a new energy system, partly from scratch – a system that needs to supply twice as many people, in a country that is almost three times as big as Germany. Having said that, I think there are three lessons that we had to learn the hard way, which might be of general value: First, “Make a plan and share it!” – Get all the players to the table and let them know where the journey is going. Secondly, “Don’t forget about the grid!” – It needs to carry the load and takes a lot of time to build. And thirdly, if it is also climate protection we are talking about, “Renewables alone won’t cut it.” You need to choose the right back-up as well.

What would be the right back-up in your eyes?

In Germany, we have been facing the seemingly absurd situation of constantly rising shares of renewable energy generation and rising CO₂ emissions at the same time. What had happened was that more and more subsidized renewable energy pushed into the market and led to a drastic erosion of wholesale prices for electricity. As most gas-fired power plants could not compete on that price level, the share of energy generated from coal increased. And that had a significant impact on the carbon footprint. What this has taught us: Renewables need a fossil back-up that is low in emissions, which is why natural gas is essential when it comes to reaching our climate goals.

Speaking of climate goals, what is your assessment of the recent climate agreement made at the COP21 in Paris?

The climate agreement has to be considered a historical breakthrough. Never before has the UN been able to get everybody to commit to a common climate goal. This is a unique result. But we have to be aware that the actual work is only starting now, as the agreement does not define any mandatory actions. So the next step will be just as decisive, which is for the countries of the world to hand in binding plans for their factual contribution to limit global warming.

You have opened a new office in Lagos at the end of last year. What are your further plans in Nigeria? Are you planning to open additional offices?

As a next step, we are considering opening up a local service workshop. Our market-leading service is an essential element of the MAN brand experience and, of course, a strong selling point for any new business we create in Nigeria. And since we already have a strong local base, this is worth looking into.

In 2014 you acquired a small engineering company in South Africa. Is M&A something you are also looking into for the Nigerian market?

We are not on a shopping tour, but we follow a concept that we like to call “intelligent growth”. That means acquisitions are definitely part of our playbook, and Nigeria is no exception. However, it also means that we place very high demands on the commercial viability of any possible transaction. We look at M&A as a tool to help us open up new fields of technology, sales markets or supply chains. If that is the case, we may be interested. But we will always remain a lean and flexible player in the market. Our customer proximity and fast market response allow us to counteract the size difference to some of our competitors.

February 11, 2016