BusinessDay 10 Apr 2018
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Tuesday <strong>10</strong> <strong>Apr</strong>il <strong>2018</strong><br />
C002D5556<br />
BUSINESS DAY<br />
33<br />
NEWS<br />
CBN sees external reserves hitting $50bn...<br />
Continued from page 4<br />
Monday at the ongoing seminar<br />
for finance correspondents and<br />
business editors in Uyo, Akwa<br />
Ibom State.<br />
Nigeria’s external reserves currently<br />
stand at $47.3 billion as of<br />
<strong>Apr</strong>il 5, <strong>2018</strong> up <strong>10</strong>5 percent from<br />
a low of $23 billion in October 2016.<br />
Foreign exchange supply has<br />
improved since the CBNs establishment<br />
of the Investors and<br />
Exporters (I&E) Window, with<br />
autonomous inflows of over US$20<br />
billion through this window alone<br />
from <strong>Apr</strong>il 2017 to date.<br />
Exchange rate has appreciated<br />
significantly from over N525/US$1<br />
in February 2017 to about N360/<br />
US$1 today, tapering premium<br />
across various windows and segments<br />
of the market.<br />
The inflation rate has declined<br />
from a peak of 18.7 percent in January<br />
2017 to 14.3 percent currently.<br />
“As the sentiments improve<br />
in the macro economy and supported<br />
by proactive monetary,<br />
Shell paid FG $4.32bn for 2017 production...<br />
Continued from page 1<br />
for production entitlement.<br />
According to the corporation’s<br />
sustainability report released yesterday,<br />
the company through its<br />
Nigerian affiliate, Shell Petroleum<br />
Development Corporation (SPDC)<br />
Joint Venture said it has contributed<br />
$23 billion to the Nigerian<br />
government from 2013–2017.<br />
Shell further said the share of<br />
royalties and corporate taxes it<br />
paid to the Nigerian government<br />
in 2017 amounted to $1.1 billion,<br />
it subsidiaries, SPDC paid $0.4<br />
billion while Shell Nigeria Exploration<br />
and Production Company<br />
SNEPCo paid $0.7 billion.<br />
When contacted, Ndu Ughamadu,<br />
NNPC spokesman said he<br />
would confirm the claims but was<br />
yet to get back to <strong>BusinessDay</strong><br />
before publication.<br />
However, if NNPC were a real<br />
company accountable to shareholders<br />
including the Federal government<br />
and States , its reported<br />
loss of N6billion in December<br />
alone should raise eyebrows and<br />
concern . However, this pattern of<br />
losses has been the norm for the<br />
past 30 years.<br />
Between 2012 and 2016, NNPC<br />
generated N15.5 trillion in revenues<br />
but it also recorded a deficit<br />
of N3.1 trillion, and recorded<br />
expenses valued at N18.6 trillion<br />
in the same period, according to<br />
an investigation by a senate committee.<br />
Former Central Bank governor,<br />
Sanusi Lamido Sanusi, raised<br />
alarm in September 2013, that between<br />
January 2012 and July 2013,<br />
NNPC had diverted the sum of $20<br />
billion meant for the Federation<br />
Account.<br />
Probes carried out by PwC Nigeria,<br />
a professional service firm,<br />
revealed unaccounted oil sales,<br />
including $20 billion established<br />
for 2014 alone.<br />
NNPC claims the bulk of its<br />
losses comes from subsidy on fuel<br />
importation which Ibe Kachikwu,<br />
minister of state for petroleum<br />
resources recently put at over N1.4<br />
trillion in a year.<br />
Rafiq Raji, chief economist at<br />
Macroafricaintel, said the NNPC<br />
is in the best position to explain<br />
to Nigerians what it does with the<br />
revenue it gets.<br />
trade, industrial and fiscal policies,<br />
we expect a continued uptick in<br />
GDP growth with a positive spill<br />
over to improved unemployment<br />
rate,” Emefiele said.<br />
Emefiele noted that GDP recovered<br />
after five quarters of continuous<br />
contraction recording positive<br />
growths of 0.7 and 1.4 percent in<br />
quarters two and three of 2017,<br />
respectively, and signalling an exit<br />
from the recession.<br />
“We expect a re-doubling of<br />
strong policy coordination and cooperation<br />
which flourished during<br />
the very difficult times. To sustain<br />
our recovery, the need is greater<br />
now than ever for a robust collaboration<br />
between the key members<br />
of economic policymaking space,”<br />
Emefiele added.<br />
This he said would include<br />
fiscal, monetary, exchange, and<br />
trade policies, which must be targeted<br />
at protecting farmers to boost<br />
agricultural outputs, supporting<br />
local companies and enhancing<br />
manufacturing and industrial ca-<br />
But the organisation is unwilling.<br />
While it claimed over the<br />
weekend that it has completed<br />
outstanding audit on its financial<br />
statements from the years 2011<br />
to 2016, it has refused to make it<br />
public. Scrutiny from the lawmakers<br />
has made as much impact as a<br />
wink in the dark.<br />
Value realised from the sale of<br />
Nigerian crude have had little impact<br />
on Nigerians. The life expectancy<br />
in Africa’s biggest economy is<br />
a paltry 53 years, in Norway a fellow<br />
oil producer, it is 82 years and 64<br />
years in Rwanda. Nigeria has the<br />
fourth worst maternal mortality<br />
rate in the world, ahead of only<br />
Sierra Leone, Central African Republic,<br />
and Chad and one in three<br />
Nigerian children is chronically<br />
malnourished.<br />
“Tragically, 40 years after Beko<br />
Ransome-Kuti helped other countries<br />
set a course for the future,<br />
the Nigerian primary health care<br />
system is broken. The evidence for<br />
this can be found in the epidemic<br />
of chronic malnutrition, or stunting.<br />
As the name suggests, chronic<br />
malnutrition is not a disease children<br />
catch. It is a condition that develops<br />
over time because they are<br />
deprived of a diverse diet and the<br />
services a strong primary health<br />
care system provides,” Bill Gates<br />
told Nigerian leaders in a recent<br />
address at the National Executive<br />
Council meeting.<br />
Africa’s biggest economy relies<br />
on donor assistance to fund and<br />
immunise its children and equip<br />
primary health centres.<br />
“Your national income level is<br />
about to make you ineligible for<br />
certain kinds of development assistance<br />
and loans that you’ve been<br />
relying on to fund your health system<br />
and other priorities. Without<br />
more and better spent domestic<br />
money, investment in your people<br />
will decline by default as donor<br />
money shrinks—a lose-lose scenario<br />
for everyone,” said Gates.<br />
Rising from its 260th Monetary<br />
Policy Committee (MPC) and the<br />
first for <strong>2018</strong>, on <strong>Apr</strong>il 4, the Central<br />
Bank of Nigeria warned that the<br />
country’s penchant to eat all the<br />
proceeds from its oil resources<br />
without a robust savings programme<br />
to wade-off future shocks<br />
from falling oil prices, would be<br />
pacities, with a view to diversifying<br />
the economy away from oil and<br />
fossil fuels.<br />
In his address, Okafor Nwokoro,<br />
branch controller, CBN, Uyo said<br />
the naira which had exchanged for<br />
as high as N540 per dollar a year ago<br />
has since stabilised at N360 per dollar<br />
in a record time proving wrong<br />
the notion that in Nigeria, when<br />
prices go up they don’t come down.<br />
The Central Bank of Nigeria<br />
(CBN) is also in the process of<br />
finalizing the creation of a N500<br />
billion fund in partnership with<br />
the Nigeria Export- Import Bank<br />
(NEXIM) to assist local manufacturers<br />
interested in non-oil exports,<br />
Emefiele revealed.<br />
This is part of the regulator’s<br />
efforts towards providing access<br />
to much-needed credit to sectors<br />
with the potential to create jobs on<br />
a mass scale.<br />
Nigeria has recorded persistent<br />
increase in unemployment rate to<br />
16.2 percent in the second quarter<br />
of 2017, from 8.2 percent at the same<br />
period of 2015, according to National<br />
Bureau of Statistics (NBS), data.<br />
We did not take money from FG for tomato...<br />
Continued from page 1<br />
policies in the manufacturing<br />
sector are inconsistent and<br />
mean only death for local<br />
manufacturers.<br />
“Government should decide<br />
whether they want tomato<br />
to be made-in-Nigeria or made<br />
in other countries. If they want<br />
indigenous manufacturers to<br />
shut down, then we are ready<br />
to shut down and join importers,”<br />
Umeofia says.<br />
According to him, foreigners<br />
are deeply interested in<br />
the Nigerian economy and<br />
are ready to sabotage it because<br />
they want to perpetuate<br />
importation and kill local<br />
investors.<br />
The Erisco chairman says<br />
he restrained himself from<br />
retrenching workers (but even<br />
added more staff) during recession<br />
and when times were<br />
tough in the country, but may<br />
be forced to retrench workers<br />
if things do not change.<br />
“This system has made a<br />
contract with poverty. The<br />
truth is that President Muhammadu<br />
Buhari wants to chase<br />
out poverty but the MDAs<br />
have signed a contract with<br />
poverty,” he states.<br />
He stresses that government<br />
agencies have refused to curb<br />
importation of cheap tomato<br />
pastes into Nigeria, thereby<br />
killing the factories built by<br />
people like him that have<br />
invested billions into local<br />
manufacturing in the country.<br />
“Who will see cheap items<br />
from China and buy Nigerian<br />
products?” he asks.<br />
“I have advised the government<br />
to support indigenous<br />
manufacturers to develop this<br />
country but all policies seem<br />
to be in favour of importation,”<br />
he added.<br />
Babatunde Fashola, Minister of Power, Works and Housing (2nd r); Okezie Ikpeazu, governor of Abia State (r);<br />
Eze Uhuegbu, traditional ruler of the host community, Ohiya (l), and Emeka Nwachukwu, former commissioner<br />
for Works (2nd l), during the commissioning of 40MVA, 132/33kv mobile power transformer, shortly before the<br />
26th meeting with operators in the power sector hosted by the Transmission Company of Nigeria (TCN), at the<br />
Ohiya Transmission Substation, Umuahia, Abia State, yesterday.<br />
disastrous.<br />
“MPC observed increasing<br />
monetization of oil proceeds as<br />
evident in the growing Federation<br />
Accounts Committee (FAAC)<br />
distribution, relative to the 2017<br />
level of disbursements. The Committee<br />
urged the Government<br />
to initiate strong stabilization<br />
programmes and to freeze the<br />
growth in its aggregate expenditure<br />
and FAAC distributions in<br />
order to create savings; needed<br />
to stabilize the economy against<br />
future oil price related shocks,”<br />
said Godwin Emefiele, the CBN<br />
governor.<br />
Shell Petroleum Development<br />
Company (SPDC) in the 2017 sustainability<br />
report also stated that<br />
oil spills in its operational areas<br />
are caused by oil theft, sabotage<br />
of pipelines as well as illegal oil<br />
refining.<br />
“In 2017, close to 90% of the<br />
number of oil spills from SPDC JV<br />
facilities were due to illegal activities.<br />
Regrettably, spills also occur<br />
due to operational reasons,” it said.<br />
It stated that regardless of the<br />
cause, it cleans up and remediates<br />
areas impacted by spills that come<br />
from its facilities and in the case of<br />
operational spills, it also pays compensation<br />
to people and communities<br />
impacted by the spill once<br />
the clean-up and remediation are<br />
completed, the work is inspected,<br />
and, if satisfactory, approved and<br />
certified by Nigerian government<br />
regulators.<br />
Crude oil theft from SPDC JV’s<br />
pipeline network amounted to<br />
around 9,000 barrels of oil a day<br />
(b/d) in 2017, an increase from<br />
around 6,000 b/d in the previous<br />
year. The increase in 2017 can<br />
partly be explained by the militantinduced<br />
shutdown of the Forcados<br />
export terminal in 2016, which reduced<br />
opportunities for third-party<br />
interference.<br />
The number of sabotage-related<br />
spills in 2017 increased to 62<br />
from 48 in 2016. In 2017, 92 sites<br />
were remediated and certified<br />
(out of 251 identified f), with 32 in<br />
Ogoniland. During 2017, 84 new<br />
sites requiring remediation were<br />
identified, of which eight were in<br />
Ogoniland. In total, there are 243<br />
oil spill sites that require remediation,<br />
according to Shell.<br />
On the Ogoni clean up, the reports<br />
said the company is working<br />
with the relevant stakeholders to<br />
implement the 2011 UN Environmental<br />
Programme (UNEP) report<br />
on Ogoniland.<br />
“Over the last six years, SPDC<br />
has taken action on all the UNEP<br />
recommendations addressed<br />
specifically to it as operator of the<br />
joint venture and has completed<br />
the majority of these recommendations”.<br />
The UNEP report recommended<br />
the creation of an Ogoni Restoration<br />
Fund with $1 billion capital,<br />
to be co-funded by the Nigerian<br />
government, the SPDC JV and<br />
other operators in the area. SPDC<br />
is supporting and contributing its<br />
share to the fund and on behalf<br />
of the SPDC JV made $<strong>10</strong> million<br />
available in 2017 to help set up<br />
the Hydrocarbon Pollution and<br />
Remediation Project (HYPREP), a<br />
government-led body to clean up<br />
contaminated sites.