We've no hand in Abia Crisis - FG

18 — Vanguard, MONDAY, JULY 04, 2016
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MoU SIGNING - From left: Commissioner of Finance, Cross River State, Mr. Asuquo Ekpenyong
Jr.; CEO, Vine Advisory Partners Limited, Mrs Bola Allison, and Business Development
Director,Vine Advisory Partners Limited, Mr Ajibola Adams during the signing of MoU between
Cross River State and Vine Advisory Partners Limited On Communications Infrastructure
Maintenance Initiative in the State.
MDAs operate bank accounts
in violation of TSA guidelines
Continued from page 17
it was difficult accessing the
funds early enough,
especially the money for
feeding of the boarding
students at the beginning of
the term.
MDAs advertise
bank accounts
Vanguard investigations also
revealed that some of the
MDAs even advertised bank
accounts for collection of
sundry fees. For example,
University of Port Harcourt in
advertisement published in
Punch Newspaper on Monday
June 20th, 2016, page 41
stated, “Application fee of
fourteen thousand naira
should be paid online at any of
the following banks: U&C
Microfinance Bank, UBA,
Union Bank, Access Bank,
Ecobank and First Bank”.
Similarly, Federal Polytechnic
Kaura Namoda, Zamfara state,
advertised in Punch Newspaper
June 20th 2016, page 45,
stating, “Application forms in
respect of programmes in 1.0-
4.0 are obtainable from the
following centers on
presentation of non-refundable
fee of Two thousand nine
hundred naira (N2, 900),
Ecobank Plc, Kaura Namoda;
Ecobank Plc, Gasau, Zamfara;
Access Bank, Bida Road,
Kaduna, Kaduna State; Access
Bank, Katsina, Katsina State;
Access Bank, Sokoto, Sokoto
State; Access Bank, Kano, Kano
State, Access Bank, Dutse,
Jigawa State”.
The Upper Niger River Basin
Development Authority, an
MDA under the Federal
Ministry of Water Resources
also advertised its Keystone
Bank account. In an
advertisement titled, “Request
for Expression of Interest/
Invitation to tender for projects
under the Authority’s Year 2016
Appropriation, published on
June 20th, page 48, Punch
Newspaper, the agency said,
“Payment of Non-Refundable
Tender fee should be made
into the following bank details:
Account Name: Upper Niger
River Basin Development
Authority, Minna; Bank Name:
Keystone Bank; Account
Number: 1001165435”.
It is illegality-CBN
But a top official of CBN
describes such accounts as
illegal. Speaking under
condition of anonymity, he said:
“No MDA is permitted to have
any account with any bank and
for any purpose. Doing so
amounts to illegality. We are
aware of incidences of some
MDAs using pseudo names to
open and operate bank
accounts. It is criminality that
will attract severe sanctions."
Another CBN staff who spoke
to Vanguard on condition of
anonymity confirmed this
development saying what some
MDAs do is to have an
arrangement with a bank to
open a bank account either with
a pseudonym or with name of
one of the officials of the MDA.
“Whenever anybody comes to
make payment in the name of
the MDA, the money will be
paid into the account without
‘MDAs are not
allowed to
transfer funds
from their CBN
Sub Accounts to
commercial banks
or other financial
institutions before
spending. All
payments are to
be made from the
CBN Sub Accounts
directly to
beneficiaries.
the knowledge of the payee”.
Provision Accounts
for Special purpose
Though the TSA guidelines
make provision for MDAs to
have sub-accounts for special
purpose, such accounts are
however supposed to be
domiciled with the CBN.
The guidelines from the
OAGF stated, “Where a donor
to an MDA requires that a
separate account be maintained
for the purposes of managing
such funds, a Donor Fund Sub
Account will be opened at CBN
for that purpose. All counterpart
fund accounts are to be
domiciled at the CBN. All
Donor and Counterpart Fund
Accounts are to be linked to the
TSA as Sub Accounts. Spending
from such accounts will be based
on approved budget.
“There are situations where
some fully or partially funded
MDAs (eg Universities, other
tertiary educational and health
institutions) raise funds through
fees, donations, endowments
and sponsorship for specific
tasks like sports, research,
prizes, trainings and
workshops. Any fully funded
MDA with such arrangement is
to apply to the OAGF for
approval to operate TSA Sub
Account at the CBN for such
purpose. All such applications
will be accompanied by details
of sources of funding and
proposed spending plan.
‘MDAs are not allowed to
transfer funds from their CBN
Sub Accounts to commercial
banks or other financial
institutions before spending. All
payments are to be made from
the CBN Sub Accounts directly
to beneficiaries. The
Monitoring and Enforcement
Team will ensure that any act of
non-compliance is detected and
sanctioned. The use of multiple
Sub Accounts at CBN is not
encouraged. MDAs are advised
to use relevant books of
accounts to keep track of
different receipts and
payments.”
Investing in agriculture: Way out of
current economic challenges in the
country
We are faced with realities that oil cannot do it
alone anymore, going by the current oil
price. It is evident that Nigeria does not
produce oil directly. We do it through joint venture patterns
like Exxon Mobil, Shell, Chevron, and Agip. Their
production cost per Barrel is about $20, after deducting
production cost, the profits are then shared 60: 40 between
Nigeria and the oil major. At $100/ barrel, with a
production cost of $20/ barrel; the gross profit left the oil
companies deduct their cost by $80 per barrel, which
would then be split between the companies and Nigeria at
60: 40 ratio. This means that at $100 per barrel Nigeria
gets about $48/ barrel (60% of the $80 gross profit per
barrel) which translates to about $40 billion per year.
At the current oil price of $30 per barrel, the gross profit is
only $10 per barrel after deducting the $ 20 per barrel
production cost. Remember that Nigeria takes only 60% of
the gross profit. What that means is that Nigeria gets $6 per
barrel, which translates to about $5 billion per year at 2.3
million barrels per day.
The economic situation of Nigeria as a result of this is in a
dilemma. Where do we go and what shall we do? This is the
question millions of Nigerians are asking.
The answer to this question is a shift from oil dependency
to agriculture. Our entrepreneurs and government should
focus their investment on Agriculture.
Nigeria spends about $10 billion a year on the importation
of agricultural and forest products. This is about 19% of our
total imports. While it is noble for the Buhari government to
be making the case for Nigerians to look inwards, talk alone
States do not need to depend on
government alone to generate
revenue to pay workers’ salaries
and execute development projects.
will not do the job. We cannot eliminate the $2.2 billion per
year we spend on animal products and derivatives if we
rely exclusively on Fulani herdsmen that have to walk
across the whole country looking for grass for their cattle.
We cannot eliminate the $1.5 billion per year we spend on
the importation of wheat alone if we do not resuscitate this
sector. Wheat farmers in Northern Nigeria can produce all
the wheat Nigeria needs if the policy is enacted to support
them by introducing varieties that can enhance yields from
the current 2 tons per hectare to global benchmarks of 4-5
tons per hectare. Financing has to be provided to the
farmers to support the mechanization of their farms. The
government will have to step in albeit temporarily, to create
marketing boards that will help establish market exchanges
that will ensure that farmers are matched up with
purchasers. Instead of creating “grazing corridors” across
all of Nigeria as the Agriculture Minister recently
announced, Nigeria should be working to mechanize and
commercialize the work of Fulani nomads. The nomads
roam the country looking for grass for their cattle. However,
grass can be farmed year-round along the banks of the Niger
and Benue, in Northern Nigeria. And those millions of youth
that the government plans on giving N5, 000 per month as
unemployment payments can be gainfully deployed to
support these agricultural initiatives.
If our entrepreneurs and youths are involved in agriculture
with the full support of government both at federal and state
level. The economy will boom, there will be jobs, food for
local consumption and more for export for foreign exchange
generation.
States do not need to depend on government alone to
generate revenue to pay workers’ salaries and execute
development projects. They need to invest more in
agriculture; the security vote they receive every month can
be diverted to this venture. We made mistake before to dump
agriculture for oil, we should not allow that mistake repeat
itself again.
Note: Peter Osalor is always available for public speaking.