The Securities and Exchange Commission (SEC) will soon issue appropriate guidelines to facilitate an efficient capital raising process for the proposed recapitalisation of banks in the country.
This is even as SEC approved five infrastructure fund shelf programmes totaling N1.5 trillion, in aligning with and directly supporting the federal government’s infrastructure development goals. The commission equally actively supported the growth of the Fund Management industry in 2023 with approvals for new mutual funds (N18.20 billion) and discretionary/non-discretionary investment products (N17.60 billion).
The outgoing director-general of SEC, Lamido Yuguda, who stated this at a virtual press briefing on the 2024 first quarter Capital Market Committee (CMC) meeting held at the weekend, noted that, the SEC is partnering the Central Bank of Nigeria (CBN) and other relevant agencies to ensure a smooth recapitalisation process in the banking industry.
While commending CBN for the recently announced policy on bank recapitalisation, he noted that the commission has drawn useful lessons from the previous bank recapitalisation exercise and will very shortly issue appropriate guidelines to facilitate an efficient capital raising process in the present exercise.
The commission, he said, is committed to a process that will ensure speed, fairness, and good market conduct, adding that, SEC is collaborating with the CBN and other relevant agencies to ensure a smooth process.
He assured that the market will provide needed funds in recapitalisation, saying, the capital market is strong, efficient and resilient and over the past few quarters some large companies have raised significant financing from the market, signifying the depth and ability of the market to provide such financing.
We are confident of the ability of the market to provide the needed funds in the banking recapitalization, he said.
Yuguda, who is also the chairman of the committee, highlighted SEC’s commitment to embracing FinTech innovations while managing associated risks and establishing a regulatory framework for the digital asset space.
He explained that the Lagos Commodities and Futures Exchange shed light on upcoming listings of gold, lithium, and oil and gas, adding that these products are aimed at expanding opportunities for traders and investors in the commodities space.
He said the commission will continue to work with the exchange to overcome challenges on the path to building a strong commodities market in Nigeria.
SEC DG pointed out that, this year, ongoing efforts such as inspection visits to various capital market operators are aimed at ensuring that the market remains fair and continues to be a veritable platform for financing and wealth creation, saying, SEC collaboration with international bodies like the Islamic Financial Services Board (IFSB) and Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) further reflect the SEC’s dedication to ensuring market resilience and global competitiveness
The Nigerian government’s usual failure to ensure transparency in the process of revenue generation and remittance by agencies classified as Government-owned Enterprises (GOEs) has continued to expand an existential revenue leakage despite widening fiscal deficits, higher debt burden and widespread hardship in the country.
Checks by LEADERSHIP have revealed that the failure of the government to aggressively and effectively put the GOEs on check has given the privileged few in charge of those establishments undue advantage in terms of discretionary application of the national wealth even against their counterparts in the same public sector.
A review of the 2024 budget of the government establishments showed that over N93.429 billion was earmarked by 41 GEOs for a vague item of “welfare packages” in the current fiscal year despite the habitual allocation of public funds to non-existing areas or projects in the budget.
The chart table is led by the Nigeria Upstream Petroleum Regulation Commission (NUPRC) which voted N50.4 billion for welfare packages alone in the 2024 fiscal year. Curiously, NUPRC would also be spending N65.20 billion on personnel costs in the year under review aside from other financial votes for frivolities.
Next in line is National Agency for Food, Drug Administration and Control (NAFDAC), with N6.67 billion, and Nigeria Deposit Insurance Corporation (NDIC). From the N21.99 billion budgeted for miscellaneous expenditure by the NDIC, it will spend a whopping N5.3 billion on workers’ welfare alone in 2024.
This newspaper recently revealed how the Budget Office of the Federation earmarked the largest allocation of N920.301 billion for miscellaneous expenses, taking advantage of cozy relations with the National Assembly, which often inflates budget figures for clandestine agendas.
Standard Organisation of Nigeria (SON) also has N2.5 billion approved for welfare packages without details on what it would be spent on, while the Nigeria Civil Aviation Authority (NCAA) appears to have even begun the expenditure of the N1.164 billion budgeted for miscellaneous.
On its part, the Nigeria Export Processing Zones Authority (NEPZA) is taking N1.224 billion as welfare packages for staff that are already taking N978.57 million outsid of allowances.
The GEOs hide under the cover of revenue generating agencies with the permission to withhold a certain percentage of the revenue as cost of collection to unduly enrich themselves and deny the government and Nigerians their duly supposed income.
For instance, after taking a whopping N15,131,971,394.22 billion for staff allowances, N10,449,982,489.32 billion as personnel cost for its relatively slim staff payroll and N1,806,781,323 billion to purchase office building at a time many government (seized) assets are left to rot away, National Pension Commission (PenCom) is set to spend N2.8 billion on a vague miscellaneous aside the N342.6 million that is earmarked for welfare packages in 2024 alone. That is aside from other suspicious expenditure.
The National Information Technology Development Agency (NITDA) has also set aside N1.4 billion for miscellaneous expenses in the budget year.
National Space Research and Development Agency (NASRDA) would also be spending N24,704,730,325.78 as total expenditure in 2024. Its staff salary will cost Nigeria N16,173,855,919.44 in the year under review. Aside that, N2,429,660.25 would be taken by the agency for welfare packages, while the National Sugar Development Council (NSDC) will take N39.6 million for the same purpose.
Others include the National Inland Waterways Authority (NIWA), N367,500,000; National Insurance Commission (NAICOM), N129.991 million; National Lottery Regulatory Commission (NLRC), N25,419,200 million, aside a total miscellaneous package of N30,478,850 million; National Lottery Trust Fund (NLTF) allocated N691,990,785.32 for miscellaneous items alone while the National Office for Technology Acquisition and Promotion (NOTAP) has N8.76 million as welfare package.
A further look into the budgets of the GOEs reveals that Oil & Gas Free Zone Authority would take N126.9 million, while the Raw Materials Research and Development Council (RMRDC) will spend N350 million on staff welfare, with Nigerian Television Authority (NTA) earmarking N73.8 million for the same reason.
Nigeria Immigration Service (NIS) would draw N891,240,537.18 million for staff welfare from the national treasury for the same personnel who will take a total of N79,860,915,182 billion.70 as salary.
From the N 1,854,983,014 billion expected revenue from the Nigeria Integrated Water Management Commission (NIWMC), N10,427,878.75 million will be taken for an unspecified staff welfare package.
Nigeria Meteorological Agency (NIMET) has N925,976,298.50 million approved for it as welfare package in the same year that the Nigeria Social Insurance Trust Fund (NSITF) is taking N100 million for welfare package after drawing N25.63 billion from the federation account.
Nigerian Agricultural Insurance Corporation (NAIC) on its part will take N796.6 million for miscellaneous expenses from the expected revenue generation of N1.45 billion.
Nigerian Airspace Management Agency (NAMA) has N200 million for welfare, while Nigerian Bulk Electricity Trading (NBET) takes N385 million for welfare packages from an expected revenue of N463.4 billion on behalf of the government.
Other agencies include: National Health Insurance Scheme (NHIS), N120 million; National Film and Video Censors Board, N10.83 million; National Broadcasting Commission (NBC), N746.4; and National Automotive Design and Development Council (NADDC), N491.16 million; Corporate Affairs Commission (CAC), N449.87 million, for social benefits; Federal Mortgage Bank of Nigeria (FMBN), N87.5 million; Federal Road Safety Corps (FRSC), N186.0 million; Administrative Staff College of Nigeria (ASCON), N8 million;
Lagos International Trade Fair Complex Management Board, N7.9 million; Financial Reporting Council (FRC), N105.94 million; Joint Admissions and Matriculation Board (JAMB) N950.0 million; Nigerian Communication Commission (NCC), N953.73 million; Nigerian Communication Satellite Ltd (NIGCOMSAT) N6.4 million; Nigerian Copyright Communication, N45.85 million; and Nigerian Electricity Management Services Agency (NEMSA), N50 million.
Others are the Nigerian Electricity Regulatory Commission (NERC), N250 million, and the Nigerian Export Promotion Council (NEPC), N3.3 million.
Responding to the exorbitant spending on welfare at a critical time Nigeria is suffering fiscal deficit and mounting internal and external debt, the group executive chairman of Lancelot Group, Mr. Adebayo Adeleke, said such allocation only serves as a breeding ground for corruption.
He said, “It appears to me that at this critical junction in our national economics, the government still builds official channels of corruption into governance structure. How do you measure disbursement or impact of such huge amounts of money tagged ‘welfare’?
“The irony is that with this profligacy, we are still borrowing from foreign institutions. How do you borrow to fund inefficiencies?”
Similarly, a member of the Nigeria Labour Congress (NLC) who wants to remain anonymous said the congress is not convinced with such blanket budget figures.
He called for a proper breakdown of what these MDAs tag as welfare for proper accountability.
“We expect the government and each agency to spell out their own allocation for workers’ welfare. In fact, whether it is much or little, we cannot comment on such because it is not well spelt out. We are aware that some people in the name of workers’ welfare are diverting such funds into their private pockets to the detriment of Nigerian workers.
“Nigerian workers are shortchanged while some few people are hiding under the names of ministries and agencies to corner the money meant for them. In order to have proper accountability, each agency or budget ministry should specify what is meant for each department,” he pointed out.
Legal tussle over the legality of Economic and Financial Crimes Commission (EFCC’s) bid to arraign ex-Kogi State governor Yahaya Bello over alleged N80.2 billion frauds will begin on Monday at the Court of Appeal in Abuja as the appeal court is expected to hear the EFCC’s application, seeking to set aside the interim injunction of the Kogi State High Court.
This is just as Justice Emeka Nwite of the Federal High Court in Abuja is expected to deliver his ruling tomorrow over the EFCC’s request for the court to grant an order to effect substituted service of the charges on Yahaya Bello.
Justice Isa Abdullahi of Kogi State High Court had on February 9, 2024, given an interim restraining order against the commission from taking any action against Bello, pending the determination of the substantive matter.
But the EFCC later approached the Court of Appeal on March 11, 2024, asking the appellate court to set aside the interim restraining order.
The EFCC further informed the appellate court that the lower court lacked the jurisdiction to assist Bello to escape the deserved vengeance of the law, saying that Bello could not use the lower court to escape invitation, investigation and possible prosecution.
According to ECCC, “Whatever orders made when the court lacks jurisdiction are null and void orders. We therefore most respectfully urge this court to allow this appeal and to set aside the interim orders made by the trial Court on 9th February 2024 in the interest of justice.”
But the hearing of the EFCC’s Appeal over the interim order will also face fierce legal argument as the Kogi High Court on Wednesday, April 17, 2024, delivered its substantive judgment in the matter and directed the commission to seek the leave of the Court of Appeal before taking further step against Bello.
The development indicates that the EFCC will have to appeal against the fresh substantive judgement, get the appellate court’s pronouncement before it can proceed with any action against Yahaya Bello.
It is instructive to note that Justice Abdullahi had in his latest verdict, held as follows: “Looking at the Orders sought by the applicant (Yahaya Bello), I am inclined to grant them subject to some alterations which in my view will meet the justice of this case, in the following terms;
An order is hereby granted enforcing the fundamental rights of the applicant to liberty and freedom of movement and fair hearing, by restraining the respondent (EFCC) by themselves, their agents, servants or privies from continuing to harass, threaten to arrest or detain or in any manner whatsoever arresting, detaining or prosecuting the applicant on the basis of the criminal charges now pending before the Federal High Court, Abuja to wit; Charge No. FHC/ABJ/CR/550/2022 between FRN v. Ali Bello & Anor, without prejudice to the power of the said Federal High Court, to make any order as it may deem just in the determination of the rights of the applicant and the Respondent as may be submitted to her for consideration and determination.
An order is hereby granted directing the respondent to bring before the said Federal High Court, or any such appropriate court, such criminal charge, allegation or complaint in respect whereof the Applicant is reasonably believed by the Respondent to have committed any offence subject of its jurisdiction, provided that the respondent shall not invite, arrest or detain the applicant on account of a reasonable belief that the applicant has committed any financial crime, without first obtaining the leave of a superior court of record, especially haven regard to the antecedents of the Respondent in the manner it has managed its engagements with the applicant.”
President Bola Tinubu recently announced the appointment of Emomotimi Agama as the director general of the Securities and Exchange Commission (SEC). Ajuri Ngelale, special adviser…
Emomotimi Agama
President Bola Tinubu recently announced the appointment of Emomotimi Agama as the director general of the Securities and Exchange Commission (SEC).
Ajuri Ngelale, special adviser to the president on media and publicity said Agama will take over from Lamido Yuguda.
According to Ngelale, Agama, who holds a Ph.D. (Economics), is a Chartered Management Accountant, Economist, Investment Analyst, A Chartered Stock Broker and a Risk Manager.
Before his new role, He was Managing Director at the Nigerian Capital Market Institute (NCMI), a subsidiary of the Securities and Exchange Commission.
He was previously the Head Registration, Exchanges, Market Infrastructure and Innovation Department, Special Assistant to the Executive Commissioner Operations and Head, Public Offerings at the Securities and Exchange Commission, where he superintended over the fund raising of most companies. Timi was a Secondee to the US Securities and Exchange Commission in 2018.
Agama is a ranking member of the Rules Committee and a member of the SEC committee on the adoption of IFRS in Nigeria and the SEC arrow head for the introduction of Derivatives trading in the Nigerian Capital Market.
Prior to joining the SEC, he was at various times with the University of Benin and Office of the Accountant General of the Federation and a Fellow of the IFC-Milken Institute Capital Markets Program.
He also holds an honors degree in Accountancy from the Rivers State University of Science and Technology Port-Harcourt, a Master’s degree in Banking and Finance and another Master of Science degree in Economics both from the University of Benin, Benin City Nigeria and a Ph.D. in Economics with distinction from the Nile University of Nigeria where his Ph.D. dissertation was titled Impact of Cryptocurrency Operations on Macroeconomic Variables in Nigeria.
A graduate certificate holder in Capital Market from the George Washington University Washington DC USA, and also a graduate of the International Housing Finance Program of the Wharton Business School USA, New York Institute of Finance, Core Analyst Program.
He also holds The Advanced Risk Management Certificate from the University College London and PRMIA, a graduate of Strategic Enterprise Analysis and PRINCE 2 Project Management of the SEEC, York University Toronto Canada, as well as a graduate of the Duke University USA program on Fintech law and Policy.
He represents the Nigerian SEC as a plenary member of the Regulatory Oversight Committee (ROC) of the Global Legal Entity Identifier where he also sits on the board of the global body as a Vice Chairman. He has led various initiatives at the Nigerian SEC including serving as the Project Manager for the Nigerian Capital Market Master Plan (2015-2025), a major driver of the resuscitation of the Commodities Market, a fintech enthusiast and a global contributor to the Fintech discourse.
The Presidential Enabling Business Environment Council (PEBEC) has revealed that only 10 out of 39 Ministries Departments and Agencies of government scored above 50 per…
The Presidential Enabling Business Environment Council (PEBEC) has revealed that only 10 out of 39 Ministries Departments and Agencies of government scored above 50 per cent in the Business Facilitation Act (Business Facilitation (Miscellaneous Provisions) Act (BFA) 2022 performance results for the year 2023.
The results released by PEBEC Sunday therefore urged MDAs to set up a Business Facilitation Act (BFA) implementation Reforms Committee.
The PEBEC said: “With only 10 MDAs scoring above 50% and a weighted average score of 34.87% across the 39 MDAs, strategic measures to enhance sector-specific metrics will need to be prioritized. Thus, MDAs must take concrete steps to improve efficiency and transparency ratings before the end of the 2024 reporting period.
“Most importantly, MDAs should as a matter of urgency set up BFA Implementation Reform Committees. These committees will be responsible for steering BFA implementation initiatives in the MDAs, and accelerating the strides taken in promoting a culture of transparency and accountability.
“We strongly urge the MDAs covered in this report to draw insights from empirical data and past BFA reports (since 2018) to drive essential improvements in efficiency and transparency,” it stated.
Meanwhile, the BFA performance results for the year 2023 showed that the Nigerian Content Development and Monitoring Board (NCDMB) has the highest score of 70.07% placing the agency on the top of the chart in efficiency and transparency compliance ranking scale among the other Ministries, Departments, and Agencies (MDAs) in the country.
Notably, the detailed analysis of the latest result covering January 2023 – December 2023 (BFA Compliance Report) showed top five MDAs with commendable performance among which are NCDMB 70.07%, Standards Organization of Nigeria (SON) 69.5%, Corporate Affairs Commission (CAC) 65.12%, Federal Competition and Consumer Protection Commission (FCCPC), 65.04%, and Nigerian Export-Import Bank (NEXIM) 63.51%.
Commenting on the results, Dr Jumoke Oduwole, the Special Adviser to the President on PEBEC and Investment, noted that over the past seven years, PEBEC has consistently published Compliance Reports, providing an empirical analysis of the monthly reports from MDAs.
She said an MDA’s EO1 performance score is based on efficiency and transparency measures, with a 70% to 30% ratio, respectively.
The Board of Directors of First Bank has announced Segun Alebiosu, Executive Director and Chief Risk Officer of First Bank, as the acting Managing Director…
The Board of Directors of First Bank has announced Segun Alebiosu, Executive Director and Chief Risk Officer of First Bank, as the acting Managing Director and Chief Executive of the bank to replace Adesola Kazeem Adeduntan, who resigned suddenly.
He is expected to take the job for an interim period until he is cleared by the Central Bank of Nigeria (CBN).
In a released by the bank. Segun brings to the Executive Management of FirstBank over 28 years’ experience in the banking and financial services industry with cross-functional exposure to Credit risk management, Financial planning and control, Credit and marketing, Trade, Corporate and commercial banking, Agriculture financing, Oil and Gas, Transportation (including Aviation and Shipping) and Project financing.
The board of the bank had convened a meeting to review the fast paced developments that have followed the cancelation of the planned extra-ordinary general meeting and the sudden resignation of Adeduntan, who wrote in from Washington to say he was quitting as CEO effective April 20.
It is expected that Adeduntan will formally hand over to Alebiosu on April 29 when he would have returned from the US where he is attending the World Bank/IMF spring meetings.
More facts have emerged about the circumstances surrounding the sudden departure of Adeduntan.
His departure is seen to be connected to the intrigue that followed the cancellation of the extraordinary general meeting of the financial institution planned for April 30, 2024 to approve plans for a capital raise.
Before this sudden resignation there had been expectation that Adeduntan will take up the position of Managing Director at the HoldCo level but it is unclear if this plan was abandoned because the regulator withheld its approval of the request from the bank.
On April 28, 2021, former directors at a board meeting of the bank had voted for Adeduntan to be retired as his second term was to expire but he regained his position after the board was sacked by then CBN Governor, Godwin Emefiele.
The federal government is expecting a fresh $2.2 billion single-digit interest loan from the World Bank and another budget support facility from the African Development…
The federal government is expecting a fresh $2.2 billion single-digit interest loan from the World Bank and another budget support facility from the African Development Bank (AfDB).
The Minister of Finance, Wale Edun, disclosed this during a press briefing at the end of Nigeria’s activities at the World Bank/IMF Spring Meetings in Washington DC in the United States.
While speaking on the sources of international funding to the Nigerian economy, Edun listed diaspora remittances, foreign portfolio investments and facilities from the World Bank and other international development partners.
He said, “We have qualified for the processing just this week to the Board of Directors of the World Bank of a total package of $2.25bn of what you can call ‘the closest you can get to a free lunch’; virtually a grant. It’s for about 10 to 20 years moratorium and about one per cent interest.
“In addition, there is a similar budgetary support – low-interest funding – from the African Development Bank (AfDB) and, clearly, there are also ongoing discussions with foreign direct investors across many sectors.”
Edun also tapped issuing dollar-denominated securities specifically targeted at Nigerians in the diaspora and those with foreign-denominated savings in Nigeria as another measure to attract forex inflows into the country.
He said the federal government hoped to issue the bonds later this year.
He highlighted the efforts of the fiscal side of the economy in complementing the recent monetary policy reforms by the Central Bank of Nigeria (CBN).
He said that issuing government securities at an interest rate closer to the CBN’s Monetary Policy Rate (MPR) was an indication of the collaboration between both sides of the economy in tackling inflation in the country and attracting forex inflows.
He listed the agricultural sector as one area the Bola Tinubu administration was looking to spur growth in the medium-term, noting that efforts in that area included the distribution of fertilisers and seeds to reduce food prices and enhance food security.
Other programmes, according to the minister, are increasing power generation to about 6,000 megawatts within six months, provision of infrastructure, especially housing, with the goal of making low-interest mortgages available to Nigerians, revamping of the social investment programme and proposed economic stabilisation plan.
The Nigeria Sovereign Investment Authority (NSIA) has charted its course for 2024, outlining strategic priorities aimed at bolstering its foundational operations, workforce, and overall effectiveness. the managing director/chief executive officer of NSIA, Aminu Umar-Sadiq highlighted these priorities during a media engagement to present the NSIA’s earnings for 2023.
Umar-Sadiq emphasised four key areas of focus: enhancing fiscal responsibility, attracting foreign investment, becoming the environmental, sustainability, and governance partner of choice, establishing a long-term saving mechanism, and ensuring effective project execution. He underscored the importance of operationalising subsidiaries to attract capital effectively and achieving household recognition akin to previous successful ventures such as the Development Bank of Nigeria and Infracredit.
The four priority areas include, Enhanced fiscal responsibility; Attracting foreign investment; Environmental, Sustainability and Governance partner of choice; Long-term saving mechanism; and Effective project execution.
He said, “So in terms of our strategic priorities, I think there are four. The first is all of these subsidiaries that we have mentioned to continue to operationalise them to make sure that they actually are able to disburse that attract capital operationalise effectively so that they become kind of household names that are previous subsidiaries like Development Bank of Nigeria, Nigeria mortgage financing company into Infracredit already have.
“And then the second is around operational excellence and efficiency. We have a very broad and ambitious digitization and distribution strategy. We have a lot of cost efficiency strategies to continue to outperform on the cost efficiency side as effectively as we continue to do on the financial performance side.
“The third is around innovation and strategic growth. So continue to focus on those new sectors and continue to lead the pioneering and transformative in terms of the initiatives that we put in place.
“And then lastly, and importantly, continues to build strong stakeholder relationship management with our regulators, with our strategic partners, with our DFIs to ensure that we continue to undertake all of our pretty broad mandates as seamlessly as possible,”
In its 2023 financial report released on 28th of March, the NSIA stated that it raked in a Profit After Tax of N1.184 trillion up from N102.351 trillion representing a 1,122 per cent growth over the 2022 figures.
In its 11 years of operations, the Authority continues to record positive earnings with a cumulative growth rate of 117.3 per cent. This is despite the challenging global macroeconomic and geo-political landscape.
Also, its net assets grew 119 per cent to N2.22 trillion in Dec-23 (Dec-22: N1.02 trillion).
“NSIA’s core Total Comprehensive Income (excluding foreign exchange gains) rose from N21.39 billion in the previous year to N164.69 billion, marking a 670 percent increase attributable to the Authority’s robust strategic asset allocation and adherence to best-in-class enterprise risk management processes,” it said.
He said the NSIA is not only focused on making money but also impacting lives, and said its impact has been seen in the number of employment it has been able to generate in the economy.
Umar-Sadiq said more than 245,000 direct jobs and an estimated 200,000 indirect jobs have been created across various sectors of the economy.
He further revealed that a total of 236,000 farmers have so far been supported by the Authority through its various agro projects.
“13,504 affordable houses under construction; 3 hospital projects with over 282,100 patients served and 150,000 chemotherapy sessions; over 3,500 youths received formal education through partnered educational institutions; three projects in motorways with a length of 515.4km,” he stated.
He said the fertiliser blending plant in Akwa Ibom would help to address the issue of over-reliance on imported raw materials.
“The MRPL is called the multiple choice industrial platform project. It is actually an offshoot of the presidential fertiliser initiative. So the Presidential fertiliser initiative briefly is a backward integration strategy so that we can start supplying them.”
The Nigeria Electricity Regulatory Commission (NERC) has said the federal government must pay N3.2 trillion as subsidy for the electricity sector in 2024 if the electricity tariffs hike is to be reversed.
NERC chairman, Sanusi Garba this at a stakeholders’ meeting convened by the House of Representatives Committee on Power at the National Assembly Complex in Abuja on Thursday.
Garba said current investments in the power sector were not enough to guarantee steady power supply, adding that if nothing concrete is done to address issues in the sector, it will be heading for doom.
He said prior to the recent review in tariff Distribution Companies (DisCos) were only obliged to pay 10 per cent of their energy invoice, adding that the lack of cash backing for subsidy is creating a liquidity challenge in the sector.
The chairman also said that due to the non-payment of subsidy, gas supply and power generation have continued to dip, adding that the continuous decline of generation and system collapse are largely linked to liquidity challenges.
Garba raised an alarm of what he called a looking risk not totally shut down by the Generation and distribution companies, achieving cost effective tariff is key to the sustainability of the sector.
He said: “If sitting back and doing nothing is the way to go, it would mean that the National Assembly and the Executive would have to provide about N3.2 trillion to pay for subsidy in 2024.”
According to Garba, only N185 billion of the N645 billion subsidy in 2023 has been cash backed, leaving a funding gap of N459. 5 billion.
In his intervention, Chairman, House Committee on Power, Victor Nwokolo said the meeting was aimed at addressing the recent increase in tariff and the issue of band A and others.
Nwokolo said the officials of NERC and DISCOS have given the committee useful Information, adding “we have not concluded with them because the Transmission Company of Nigeria were not here and the Generation Companies too.
“We will hold further consultations with them by next week. But from what they have said, which is true is that without the change in tariff, which was due in 2022, the industry lacks the capital to bring the needed change.
“Of course, with the population explosion in Nigeria, the areas being covered are beyond what they have estimated in the pastpast and because they need to expand their own network, they also need more money.”
The minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has expressed optimism that Nigeria may receive the nod to host the African Energy Bank (AEB).
The bank, he said, is key to driving the necessary investment needed to boost the country’s oil production and increase government’s revenue.
To him, “For the African Energy Bank, we are running with Ghana. It is now between Nigeria and Ghana on which of them will be able to get the headquarters of the African Energy Bank. The African Energy Bank starts with $5 billion. If we have it in Nigeria, in four to five years, it will grow to About $120 billion. Imagine what that will do to the GDP of our economy. We must try our best to ensure we get the headquarters of the African Energy Bank to Nigeria,” Lokpobiri said, while speaking during an energy event in Lagos.
“The solution is to talk to ourselves to reach out to the banks we have in Nigeria. We should put funds into our banks to make them strong enough. As a government, we will do everything globally possible to attract the desired investments. We are willing to remove all bottlenecks in the industry. The president has directed that we should remove all the bottlenecks. And that is why we are trying to remove the problem of OML425, the popular Malabu Oil Field.
“If we don’t attract investments, this resource we have will just be buried under the soil with no value addition. I’ve accompanied the president to several countries of the world and I’ve heard him tell potential investors that, ‘bring in your money and take out your money at will’. That means, come and invest and divest at will. We are not against any company that wants to divest.
“If in the next few years, we are able to ramp up production and increase our revenue base, we will not necessarily need the Big 5’s to monopolise our investment”.
Lokpobiri stated, “But the summary of what I want to say today is that, as a government, our own policy is to ensure that we do everything that is globally possible that other countries don’t have and that other countries are doing to attract investment, so that we can attract the desired investment.
“We are willing to remove all bottlenecks in the industry because every country that has oil, prioritises investment in the oil and gas sector, and that is why as a government, the president has directed that we should resolve all problems we have in the industry.”
