Wednesday, 12 February 2020

The Federal Government of Nigeria said on Tuesday mismanagement and incompetence by officials led to the demise of the old national carrier, the Nigeria Airways.

The Permanent Secretary, Ministry of Aviation, Engr. Hassan Musa, who disclosed this at the 7th Aviation Workers’ Week in Abuja, described Nigeria Airways as one of the “positive legacies” of colonial rule in the country.

Nigeria Airways, according to the permanent secretary, if it had been well managed, would have remained a major contributor to the nation’s economy today.

Hassan, however, pledged the commitment of the present administration to bringing back the glorious days when Nigeria Airways was the preferred choice of Nigerians across the social strata.

He said: “You will agree with me that right from the inception of Nigeria’s nationhood, our founding fathers had resolved to sustain some positive legacies of our departing colonialists among which was the existence of a national carrier.

“Sadly, while it was expected that the then national carrier would serve as a cash cow among other revenue generation sources for the nation, brazen degree of mismanagement, incompetence, nepotistic tendencies and old-fashioned system of aviation business crept into the operations of the airline.

“The end result of all these noxious factors is well documented for posterity. It’s indeed a very sad chapter in Nigeria’s chequered history.

“With the benefits of insight coupled with the zeal and determination of the current minister to return the nation to its glorious past, Nigeria in collaboration with other core investors and stakeholders is on the path to resuscitating the national carrier project.

“The concept of this noble dream is well thought out while a phased execution of this resuscitation has reached advanced stages of fruition in the nearest future.”

Published in Travel & Tourism

In a new twist to its imposition of Forex restriction on milk importation into the country, the Central Bank of Nigeria (CBN) Tuesday gave six companies the nod to import the product into the country.

The major policy shift limited all the Forms ‘M,’ required for importing milk and its derivatives into the country, to the following firms – FrieslandCampina WAMCO Nigeria, Chi Limited, Promasidor Nigeria Limited, Integrated Dairies Limited, Chi Limited and Nestle Nigeria PLC (MSK only).

The CBN disclosed that the gesture aimed at stimulating local production of milk, its derivatives and dairy products.

Apparently, the measure rewarded compliance, by granting the companies that conformed with the CBN backward integration policy the liberty to import milk, why it punished others who did not meet its conditions by withholding approval.

Backward integration refers to a situation where a company takes ownership and control of one or more key component(s) of its supply value chain. In this context, the six companies that have keyed into the CBN backward integration must have invested directly in major segments of the supply value chain like dairy farming, milk extraction, etc.

The apex bank last July said plan to curb forex for milk production was afoot.

The new measure had sweeping industry-wide reverberations with many Nigerians misconstruing the restriction for an outright ban.

While stakeholders like the Manufacturers Association of Nigeria (MAN) and the Lagos Chamber of Commerce and Industry (LCCI) claimed there were not carried along, the Nigeria Employers’ Consultative Association (NECA) called on the CBN to revisit the decision with a view to rescinding it.

The CBN is concertedly seeking to up local milk production from the present 500,000 metric tonnes per annum to about 550,000 tonnes in twelve months.

The measure aims among other things to promote local production, create employment, conserve foreign exchange and trigger economic growth.

Published in Business

Nigeria lost a mind-blowing sum of N4.57 trillion to oil theft activities in the four years between 2015 and 2018, estimates of the Nigeria Natural Resource Charter (NNRC) has shown.

Put differently, the Federal Government lost about 43 per cent of its revenue to oil theft in four years.

Bunmi Olatunde, Deputy Director of Programmes at New Nigeria Foundation, who made revelation at a workshop titled Creating Innovative Technology for Artisanal Refineries in Lagos on Tuesday, admitted that oil theft and illegal oil bunkering practices were eroding government income generation potential acutely.

Just last October, Nigeria officially became the oil theft capital of the world when the NNRC released data, suggesting that the highest ever reported crude oil theft in the world took place in Nigeria.

The sobering statistics emphasised that Nigeria, as the most notorious country in the world for oil theft, lost roughly 400,000 barrels per day (bpd), dwarfing the figure (between 5,000 and 10,000 bpd) posted by Mexico, who came distant second by at least 3,900%.

By implication, more than one fourth of Nigeria’s average daily production (1.57 million bpd as of December 2019) is currently lost to oil theft.

According to the NNRC October 2019 study, revenue lost by the Federal Government between 2011 and 2014 ranged from $7 billion to $12 billion (between N2.545 trillion and N4.362 trillion) every year.

It is worthy of note that Nigeria’s budgets for 2011, 2012, 2013 and 2014 stood at N4.6 trillion, N4.8 trillion, N4.99 trillion and N4.962 trillion respectively.

One wonders why the Federal Government could choose to burden the citizenry with VAT increase and its negative consequences of rise in inflation and plunge in the value of Naira when it could easily cast its glance elsewhere by making diligent efforts to generate more income by curbing oil theft in order to fund its budget.

Beyond the outrageous revenue erosion that oil theft triggers, Mrs Olatunde also made mention of negative impacts such as environmental degradation, loss of livelihoods, loss of lives, violence and health hazards posed to the host communities.

Babajide Soyode, an engineering consultant with Dangote Refineries, who also spoke at the symposium pointed out that only the government had the capacity to make enduring social investment in the oil producing communities by holding the relevant agencies responsible for developing such communities accountable.

He said “how does Niger Delta Development Commission spend the money allocated to it? The agencies of the government should be held accountable. What alternative services can be provided for the youths in the Niger Delta region? The solution is not modular refinery.”

He went further to say that “crude oil theft has grown into a multibillion-dollar enterprise with a lot of actors at various levels. Therefore, no single approach can solve the problems. Interventions should be multifaceted at different levels.”

On its part, Alex Ogedengbe, Vice President Nigeria Academy of Engineering, affirmed that erecting artisanal refinery was not an answer to crude oil theft and illegal oil refining in the Nigeri Delta given that it constituted enormous hazards to the operators.

Published in Business
Wednesday, 12 February 2020 07:48

CBN injects $210m into Forex Market

The Central Bank of Nigeria (CBN) has injected the sum of 210 million dollars into the inter-bank Foreign Exchange Market to boost liquidity in the sector.

The bank’s Director, Corporate Communications Department, Mr Isaac Okorafor made this known in a statement in Abuja on Tuesday.

Okorafor explained that authorised dealers in the wholesale segment of the market received the sum of 100 million dollars, while the Small and Medium Enterprises segment received the sum of 55 million dollars.

He said customers who were seeking foreign exchange for Invisibles such as tuition fees, medical payments and Basic Travel Allowance, among others, were allocated a total of 55 million dollars.

The director stated that the CBN’s commitment to sustaining liquidity and ensuring stability in the market remained paramount on the minds of the management of the bank.

According to him, the continued intervention by the bank underscored the resolve of the Governor, Godwin Emefiele, to guarantee access to all those who genuinely required foreign exchange from the forex market.

The bank was on Friday, injected the sum of 218.41 million dollars and CNY18 million into the Retail Secondary Market Intervention Sales segment.

Meanwhile, the Naira on Tuesday, remained stable, as N358 was exchanged for a dollar in the Bureau de Change segment of the market.

Published in Bank & Finance
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