The Development Bank of Nigeria (DBN) in partnership with Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) has launched an innovative MSME Equipment Leasing Initiative aimed at strengthening financing options for Micro, Small, and Medium Enterprises (MSMEs) in Nigeria.
The groundbreaking event held at DBN’s Lagos Office in Victoria Island, had in attendance key representatives from DBN, GIZ, Equipment Leasing Association of Nigeria (ELAN), financial institutions, MSME owners, and media professionals.
In his opening remarks, the Chief Operating Officer, Development Bank of Nigeria, Bonaventure Okhaimo described the program as a game-changer for alternative financing options for MSMEs who are the bedrock of Nigeria’s economic growth.
“This initiative that we have successfully launched today is expected to have a profound impact on the MSME ecosystem, which is a critical driver of economic growth, job and wealth creation in our country. By facilitating easier access to essential equipment, DBN and GIZ are directly addressing one of the major hurdles faced by small businesses, thereby enhancing their competitiveness and capacity for innovation,” he stated.
Head of Programme, GIZ Nigeria/SEDIN, Markus Wauschkuhn, while speaking at the launch said that the Micro, Small, and Medium-sized Enterprises (MSMEs) in Nigeria constitute a significant portion of the economy, and their importance to the economy cannot be overstated.
“In Nigeria MSMEs play a pivotal role in propelling economic growth, contributing to job creation, innovation, and sustainable development. They serve as the backbone of the Nigerian economy with huge contributions to her GDP.”
On his part, the Executive Secretary/CEO, Equipment Leasing Association of Nigeria (ELAN), Andrew Emonuwa lauded DBN and GIZ for creating such an initiative at a critical time where small businesses are struggling to stay afloat in the face of current economic realities. “I must commend the Development Bank of Nigeria and its partners for coming up with such a creative concept. We are so excited about this initiative, because it will deepen the penetration of leasing for MSMEs and reshape the economy for sustainable growth,” he said.
The African Export-Import Bank ,Afreximbank, on Monday unveiled its second African Quality Assurance Centres, AQAC, in Imo state.
The unveiling ceremony took place at Umuowa in Ngor Okpala Council Area of the state.
According to state Governor, Hope Uzodimma, while unveiling the project alongside Afrexim representatives, he stated, “I am very delighted to participate in this ceremony. What the bank has done and still doing is to provide a homegrown solution. I recall how our people were subjected to untold scrutiny just to export African products. Now Afreximbank has risen to the occasion and is bringing a solution.
“From what I have seen any certification derived from here cannot be subjected to another scrutiny. I am happy, Imo is the second to have this centre in Nigeria.
The Nigeria National Development plan is in line with this.
“My administration is centred on prosperity for all which is to activate opportunities for economic growth. Afreximbank’s decision to cite this project here will not be regretted. I have no doubt we will have a win-win situation. We will give you every support you need to achieve results. It will create jobs for our people. The economic gains coming out of this project surely, we will be the ultimate beneficiary. We will support it to encourage foreign direct investment in Imo.”
In his remark, the president and chairman of the Board of Afreximbank, Benedict Okey Oramah, said the centre would end the era of African products being rejected at the international level.
Oramah who was represented by the executive vice president, intra-African trade, Afrexim bank, Kanayo Awani, stressed: “With the unveiling of the African Quality Assurance Centre, what it means is that products made in Africa, Nigeria and Imo will meet international standard and safety as well as it will ensure products meet regulations and quality so as to meet the technical and certification of product that it requires.
“Imo is an ideal location for this project because of it’s centrality. And Imo is known for agriculture and food production. Again what attracted us to Imo was because we looked at the industrial policies of the state and we found an alignment that is why we are here to construct on the five hectares of land provided to us.”
In her comment, the Afreximbank director of Export Development, Oluranti Doherty, said: “This is the second African Quality Assurance Centres, AQAC, in Nigeria. One of the key challenges to our various African exporters in accessing regional, international trade is lack of compliance with quality standard regulations so to resolve this we set up this African Quality Assurance Centres, AQAC, to assist the growing African economy.”
Former President, Olusegun Obasanjo has said innovation in agriculture is key to human survival and development.
Obasanjo, who disclosed this at the AgriConnect Summit in Lagos recently, said when strategically harnessed, innovation and collaboration can tackle challenges confronting Nigerian agriculture.
Speaking on the theme of the event, “Bridging the Divide: Cultivating Collaboration and Innovation for a Sustainable Agricultural Future,” Obasanjo, who was the chairman of the event, said: “Innovation is very important. Land is important. But, without money your land is useless. You cannot do agric business without money and innovation.’’
Commending research institutes in Africa and across the world, Obasanjo also canvassed mentorship for young farmers. Obasanjo recalled at the event attended by Minister Of Communication, Innovation & Digital Economy, Dr Bosun Tijani, and agric experts how he convinced one of his sons to embrace farming despite having a PhD from the University of Cambridge in the United Kingdom.
According to the organisers of the AgriConnect Summit, put together in collaboration with Obasanjo Farms Nigeria Limited, the initiative aims to foster a more unified approach to agricultural development.
“At the AgriConnect Summit 2024, we are resolutely dedicated to dismantling barriers and fostering collaboration among diverse stakeholders. By convening leaders from technology, finance, government, developmental organisations, and agriculture, we aspire to co-create actionable strategies to surmount the obstacles faced by farmers and fortify food security in Nigeria,” said one of the organisers, Dr Toyosi Obasanjo.
Speaking in a similar vein, another member of the organising team, Temire Egbe Bob, described the event as an opportunity to inspire the youth, adding that collaboration is key.
Managing director, Prime Agro Seeds Limited, Meka Nwabuko, who was one of the panellists who discussed the role of technology in transforming agriculture reiterated the need for collaboration. Emphasising cluster farming and cooperatives, Nwabuko said: “Smallholder farmers are at the heart of food cultivation and production and remain the dominant producers across the country.’’
OPay, a leading financial technology company, has reaffirmed its strict prohibition of cryptocurrency and virtual asset trading on its platform.
As a compliant organisation committed to upholding legal, constitutional, and regulatory duties, OPay said it prioritises the safety, strength, and integrity of the financial system.
CEO, OPay Nigeria, Mr. Gotring Wuritka Dauda, in a press statement, made available to LEADERSHIP said OPay does not permit trading in any form of cryptocurrency or virtual currency on its platform.
Additionally, OPay accounts and wallets must not be used in connection with such activities. To ensure compliance with this directive, OPay conducts daily scans of its platform to detect any unauthorised cryptocurrency or virtual currency trading. Any account or wallet found in breach of this policy will be closed immediately, with details reported to the relevant regulatory authorities, he added.
For absolute clarity, Dauda affirmed that OPay has never condoned, nor will it permit, the trading of cryptocurrency or virtual assets on its platform.
He continued by urging all customers to ensure their OPay wallets and accounts are not involved in cryptocurrency or virtual currency transactions.
Non-compliance with this policy will result in account closure.
The CEO appreciated all customers for their continued trust and support as they work together to maintain a secure and compliant financial environment.
OPEC also extended Nigeria’s 1.5 million barrels daily crude production quota to 2025. The cartel announced the extension during its 37th OPEC and non-OPEC ministerial meeting.
The agreement reached in Riyadh on Sunday exceeds market expectations in some ways, extending so-called “voluntary” cuts from key members including Saudi Arabia and Russia well into next year.
However, it also began rolling back those supply reductions in October, earlier than some OPEC-watchers had assumed.
The deal suggests group leader Saudi Arabia, which hosted ministers in its capital after initial plans for a gathering at the OPEC headquarters in Vienna were canceled, is attempting to strike a balance between competing interests.
The agreement aims to keep supporting crude prices while also easing the production restraints against which some members, such as the United Arab Emirates, have chafed.
“We will maintain our precautious and preemptive approach,” Saudi Energy Minister Prince Abdulaziz bin Salman told reporters after the meeting. That includes the possibility of pausing or even reversing the phase-out of the cuts, he said.
Crude prices have recently been in decline amid a fragile economic outlook in top consumer China and doubts about the pace of interest-rate reductions in major industrialized economies. Brent futures settled at $81.62 a barrel on May 31, a drop of 7.1 per cent for the month.
Prior to the meeting, traders and analysts had widely expected OPEC+ to prolong its voluntary supply reductions in order to offset soaring output from its rivals, with some predicting they would be maintained until the end of 2024. Under the new agreement, the eight nations participating in these additional curbs will have added about 750,000 bpd to the market by January.
The accord prolongs roughly 2MMbpd of cuts, which have played a key role in supporting crude prices above $80 a barrel this year but were set to expire at the end of June.
The curbs will continue in full in the third quarter then be gradually phased out over the following 12 months, according to a statement from the Saudi Energy Ministry.
Those “voluntary” cuts by OPEC and its allies were in addition to an earlier group-wide agreement capping crude output at about 39 MMbpd, which ran until the end of this year. The alliance said in a statement that it also agreed to prolong that accord to the end of 2025.
Reaction to the deal was mixed, with some analysts citing the bullish impact of the extension.
“It removes a significant chunk of oil from our balances both this year and next,” said Amrita Sen, director of research and co-founder of Energy Aspects Ltd. The deal keeps OPEC+ in charge of the market, she said.
Others voiced concern about the market’s ability to absorb extra barrels in October.
“We see the meeting as bearish,” analysts at Goldman Sachs Group Inc. said in a note. The detailed plan to unwind the extra cuts “makes it harder to maintain low production if the market turns out softer than bullish OPEC expectations.”
If oil prices were to fall further this year it could improve the economic outlook by offering some relief to central banks grappling with persistent inflation. Yet it would also threaten revenue for producers like Saudi Arabia, which needs prices close to $100 a barrel to fund the ambitious spending plans of Crown Prince Mohammed bin Salman, the International Monetary Fund estimates.
In parallel to the OPEC+ meeting on Sunday, the Saudi government completed a $12 billion sale of shares in state oil giant Aramco, raising funds to help pay for a massive economic transformation plan.
Sunday’s agreement also resolves, albeit temporarily, a potentially fraught debate on some nations’ oil capacity. The alliance had commissioned an external review of its members’ capabilities with the intention of resetting baseline production levels used to measure cuts in 2025.
Several major exporters were seeking to have their levels upgraded, possibly posing a risk to the group’s efforts to stabilize world markets. The deadline for completion of that process has now been pushed back by a year to November 2026.
However, the UAE was given a 300,000 bpd boost to its production target for next year, making it the clear winner from Sunday’s negotiations.
The Gulf country has invested heavily in new oil projects in recent years and clashed sporadically with Riyadh over its production level, including a showdown in 2021 that threatened to rupture the group.
“It’s not about favoring the UAE,” Saudi Arabia’s Prince Abdulaziz told reporters after the meeting. The adjustment brings the proportional cut for the country in line with other members, he said.
The UAE’s energy minister said he was pleased with the outcome. “We wanted to come together and make a decision that keeps the market balanced and gives a good heads up of what’s to be expected,” Suhail Al Mazrouei told reporters after the meeting.
To ensure that market conditions remain tight as the cuts are gradually wound down, the coalition may also need to ensure that members are fully implementing their pledged cutbacks.
While some nations including Saudi Arabia, Kuwait and Algeria promptly fulfilled their agreed share, others like Iraq, Kazakhstan and Russia dragged their heels, and continue to collectively pump several hundred thousand barrels a day above their designated quotas.
All three have pledged to improve their performance, and make additional “compensation” cuts to offset the initial overproduction. But they have a patchy track record when it comes to compliance.
Iraq has chafed against OPEC+ limits for years as it needs revenue to rebuild an economy shattered by war and sanctions, while Russia seeks cash to finance President Vladimir Putin’s war against Ukraine. Kazakhstan meanwhile is eager to deploy new investments in production capacity.
…Be calm, we’ll ensure safety of depositors funds – Reps
Following the revocation of the banking licence of Heritage Bank Plc by the Central Bank of Nigeria (CBN) the Nigeria Deposit Insurance Corporation (NDIC) said it has commenced the liquidation of the bank with immediate verification and payment of insured deposits to the bank’s depositors.
The NDIC in a statement issued on Monday said it commenced the liquidation process in pursuant to Section 12(2) of BOFIA, 2020, and in accordance with Section 55 sub-section 1 & 2 of the NDIC Act 2023.
The CBN earlier yesterday announced the revocation of the bank’s licence with immediate effect.
The apex bank said the action became necessary due to the bank’s breach of Section 12 (1) of BOFIA, 2020. The board and management of the bank have not been able to improve the bank’s financial performance, a situation which constitutes a threat to financial stability.
The withdrawal of operational licence is in accordance with its mandate to promote a sound financial system in Nigeria and in exercise of its powers under Section 12 of the Banks and Other Financial Act (BOFIA) 2020, hereby
This follows a period during which the CBN engaged with the bank and prescribed various supervisory steps intended to stem the decline.
“Regrettably, the bank has continued to suffer and has no reasonable prospects of recovery, thereby making the revocation of the licence the next necessary step,” CBN’s spokeswoman, Hakama Ali said in a statement on Monday.
The CBN took the action to strengthen public confidence in the banking system and ensure that the soundness of our financial system is not impaired.
The CBN also said the NDIC has been appointed as the Liquidator of the bank in accordance with Section 12 (2) of BOFIA, 2020.
“We wish to assure the public that the Nigerian financial system remains on a solid footing. The action we are taking today reflects our continued commitment to take all necessary steps to ensure the safety and soundness of our financial system,” the statement reads in part.
Relatedly, to be verified, the NDIC said “depositors of the bank that have alternate accounts within the industry will be paid up to the insured amount of N5 million per depositor using their Bank Verification Number (BVN) to locate their alternate account. While depositors with funds in excess of N5 million will be paid liquidation dividend upon realisation of the bank’s assets and recovery of debts owed to the bank.
For the verification and payment of depositors without alternate bank account, the NDIC, urged them to “visit the nearest branch of the bank with proof of account ownership, verifiable means of identification such as driver’s licence, permanent voter’s card, National Identity Card, together with their alternate account and Bank Verification Number (BVN) for the verification of their deposits and subsequent payment of insured sums.”
The statement by the Director Communication and Public Affairs of the NDIC Bashir A. Nuhu noted that claims can also be filed online by visiting the NDIC website claims page. Depositors are expected to download and fill the claims forms and upload the required documentation.
Creditors are also advised to visit the nearest branch of the bank to file their claims or via the online platform. Please note that the process of payment of creditors will commence immediately after all depositors have been paid.
The NDIC also urged debtors that are yet to complete the repayment of loans are advised to contact the Corporation’s Asset Management Department (AMD).
“The NDIC wishes to assure the entire banking public of its commitment to the continued safety of depositors’ funds in all licensed banks. As such, depositors are urged to continue their banking businesses without fear as banks whose licences have not been revoked remain safe and sound.
Meanwhile, the House of Representatives has assured depositors and stakeholders of Heritage Bank that it will carry out its constitutional oversight functions to ensure that revocation of the bank’s licence by the Central Bank of Nigeria (CBN) does not negatively impact them.
The House said, relevant House Committees on Banking Regulations; and Insurance will be up to their duty, thoroughly examine the circumstances surrounding the CBN decision and the subsequent steps taken by the Nigeria Deposit Insurance Corporation (NDIC).
Spokesperson/Chairman, House Committee on Media and Public Affairs, Hon. Akin Rotimi, who gave these assurances in a statement issued in Abuja on Monday, urged all depositors and stakeholders to remain calm and be assured of our dedication to protecting their interests.
Rotimi said the priority of lawmakers was to safeguard the interests of all depositors and maintain the stability of the financial system.
He also said the Green Chamber will engage with the CBN, NDIC, and other relevant stakeholders to ensure a transparent and orderly resolution process, providing necessary support to mitigate any potential negative impact on the public.
The House Spokesperson urged the CBN and NDIC to establish clear channels of communication to allay the fears of the public and prevent any loss of trust in the country’s financial system, saying effective public engagement was crucial to maintaining confidence during the period.
He quoted the Chairman of the House Committee on Banking Regulations, Hon. Mohammed Bello El-Rufai said: “The Committee on Banking Regulations will closely monitor the liquidation process to ensure that the rights of depositors are protected and that the process adheres to the highest standards of transparency and accountability.”
According to Rotimi, the chairman of the House Committee on Insurance and Actuarial Matters, Hon. Ahmed Usman Jaha assured that the panel, “will work diligently to oversee that the NDIC executes its mandate effectively, ensuring the protection of depositors’ funds and maintaining confidence in the financial sector.
“The NDIC Act and the Banks and Other Financial Institutions Act (BOFIA) are clear in their provisions that depositors’ funds are insured and protected.”
The Niger Delta Development Commission, (NDDC) has appealed to International Oil Companies (IOCs) operating in the region to honour their financial obligations to the commission as new projects aimed at developing the region are capital intensive and require consistent funding.
The managing director/CEO of the commission, Samuel Ogbuku, who made the passionate appeal at the Media tour and sensitisation engagement said, the agency is embarking on new projects that are intended to provide jobs and infrastructure to the region.
Ogbuku said the commission was committed to the completion and commissioning of all on-going projects across the Niger Delta region.
Addressing senior media officials through a virtual presentation at the NDDC’s region-wide media engagement, in Port Harcourt, Dr Ogbuku said, the recent inauguration of five mega projects in Abia, Edo, Ondo, Bayelsa and Akwa Ibom States was a testimony of the new passion with which the commission was delivering on its mandate.
The NDDC CEO stated that president Bola Ahmed Tinubu had charged the commission to complete and commission signature projects that would impact the lives of Niger Deltans.
Ogbuku stated that the NDDC had, so far, inaugurated the 132/33kv electricity sub-station at Ode-Erinje in Okitipupa local government area of Ondo State, to light up five local government areas in the state, as well as the 25.7-kilometre Ogbia-Nembe Road in BayelsAa State, which we executed in partnership with Shell Petroleum Development Company(SPDC).
He said, the NDDC also inaugurated the 600-meter Ibeno Bridge and the 6.87-kilometre Iko-Atabrikang-Opolom-IwuoAchang Road, in Ibeno Local Government Area, of Akwa Ibom State, as well as the 9-kilometre Obehie-Oke-Ikpe Road in Ukwa West Local Government Area of Abia State.
Taking the media executives on a virtual tour of NDDC projects, the executive director, Projects, Sir Victor Antia, said the commission had constructed and rehabilitated 5,141.3 kilometres of roads through swamps and virgin forests. He added that the Commission had also built 42 bridges, thousands of hydraulic structures and 87 jetties across the Niger Delta region.
He said, the commission had resumed its Free Healthcare Programme which caters to the needs of rural communities, as part of the it’s commitment to enhance healthcare delivery to the people of the Niger Delta region.
“In the on-going free medical outreach across the nine Niger Delta states, 20,000 surgeries have been performed, while 45,000 patients have been attended to and 27,000 eyeglasses distributed,” he said.
Speaking earlier the NDDC executive director, Corporate Services, Hon. Ifedayo Abegunde, acknowledged the contributions of the media to the growth of democracy and public accountability.
He said: “Today, NDDC is setting a landmark precedent in its engagement with the Press. This strategic engagement is in line with the new management’s mantra of Transition from Transactions to Transformation (TTT). Consequently, the management of NDDC has decided to transit from sectional engagement with the Press to a more elaborate and strategic engagement to solidify our partnership and strengthen our bond with the press.”
Speaking at the media event, the President of the Nigerian Guild of Editors (NGE), Eze Anaba, remarked that the NDDC slogan which says, ‘Transiting from Transaction to Transformation,’ was inspiring and forward looking.
LEADERSHIP reports that the Shell Petroleum Development of Nigeria Ltd (SPDC) and Shell Nigeria Exploration and Production Company Limited (SNEPCo) paid a total of $142.5 million to the Niger Delta Development Commission (NDDC) last year.
Details provided by the oil major showed that the SPDC paid $112.5 million while SNEPCo remitted $30 million compared to $59.04 million by SPDC and $20.73 by SNEPCo in 2022.
The NNPC Ltd has reiterated its commitment to sustain the Company’s march towards process improvement, regulatory compliance and performance excellence.
NNPC’s executive vice president, Business Services, Inuwa Danladi, disclosed this while speaking on the recent certification of the International Ship and Port Facility Security (ISPS) Code Compliance obtained by the Company, from the Nigerian Maritime Administration and Safety Agency (NIMASA).
The ISPS certification, issued in April 2024 and covering all NNPC jetties nationwide, is crucial for the Company’s business continuity as it prevents potential operational disruptions and financial losses.
Beyond demonstrating NNPC’s continuous adherence to regulatory compliance, Inuwa said the certification also grants the Company entry into the Global Integrated Shipping Information System (GISIS), enhancing its reputation as a safe and reliable business destination and potentially reducing the company’s insurance premiums.
Inuwa listed some of the rigorous processes followed in obtaining the certification to include the upgrading of relevant security facilities at the nation’s ports and jetties; the establishment of the ISPS Code Command Center; as well as the engagement of NIMASA Recognised Security Officer (RSO), who played a crucial role in managing key regulatory processes.
Inuwa added that the development of Port Facility Security Assessment (PFSA) & Port Facility Security Plan (PFSP), coupled with the meticulous Verification Inspection Exercise (VIE) from NIMASA have also underscored NNPC’s commitment to ensuring adherence to the highest standards of maritime security in the Company’s operations.
“This achievement is a testament to our consistent dedication, and we pledge to continue striving towards attaining regulatory excellence in all our operations,” Inuwa noted.
As the current government under the leadership of President Bola Ahmed Tinubu clocked one year on May 29, 2024, the pledge of N200 billion Intervention Fund for Small and Medium Enterprises (SMEs) made at the inauguration of this government is yet to materialise as most Micro, Small and Medium Enterprises (MSMEs) in the country claimed they are yet to benefit from the scheme, LEADERSHIP learnt.
The intervention fund, as announced by the President in his inaugural speech, was to energise the Micro, Small and Medium Enterprises (MSMEs), Nano businesses and manufacturing sector in the country.
Meanwhile, in April 2024, the federal government announced the launch of a N200 billion Presidential Intervention Fund for Micro, Small and Medium Scale Enterprises (MSMEs) and manufacturers in the country.
The minister of Industry, Trade and Investment, Doris Uzoka-Anite, who made the announcement in a post on her X, formerly Twitter, page, said the gesture was targeted at supporting one million nano businesses across the country, the government has decided to include both MSMEs and manufacturers in the initiative.
The trade minister said the new grant will be recovered in monthly equal instalments with no moratorium, spanning a three-year term.
Under the scheme of arrangement, N75 billion was expected to be distributed to MSMEs while another N75 billion will be distributed to players in the manufacturing industry under the Presidential Intervention Fund.
Despite the N200 billion intervention funds rolled out to energise the manufacturing sector to improve local content drive and strengthen local economy for manufacturers in the country, the Micro, small and medium enterprise claimed they are yet to access any of the intervention funds to revolutionise the sector.
This is even as most SMEs are groaning under an excruciating and tough business operating environment that has led to collapse of some, while the remaining existing ones have downsized to cope with the current economic realities.
Aside from the fact that this development has further bloated the already saturated labour market, it has equally taken a toll on the balance sheets of the affected businesses.
Other challenges businesses are grappling with, include; fuel subsidy removal, forex market volatility, multiple taxation, electricity tariff, among others.
Reacting on the N200 billion intervention funds by MSMEs, experts and SMEs stakeholders claimed they are yet to see any evidence of the intervention funds allotted to the sector, adding that the disbursement focused more on the manufacturing sector than MSMEs in the country.
Checks by LEADERSHIP revealed that MSMEs ranks third in terms of the least allocation within the intervention programmes, trails behind the export sector with a meagre two per cent allocation and the health sector, which barely constitutes per cent of the total intervention programmes.
Hence, SMEs stakeholders raised alarm, stressing that, frequent policy flip-flops, high interest rate on loans, hyper-inflation, astronomical energy cost, multiple charges and a generally toxic operating space among other constraints, have made them endangered species such that only pragmatic solutions, not just rhetorics can save them from the final gasp of ruins.
Speaking in a telephone conversation with LEADERSHIP, President, Association of Small Business Owners of Nigeria (ASBON), Dr. Femi Egbesola, noted that the subsidy removal and consequent hike in the pump price of fuel eroded the capital base of small businesses hence, leading to sharp drop in sales and decrease in liquidity for small businesses.
He recalled that president Bola Tinubu, in his inaugural address on May 29, 2023, announced the removal of fuel subsidy and plans to unify the foreign exchange (forex) market, based on which the Central Bank of Nigeria (CBN) subsequently liberalised the forex market.
Commenting on the impact of these policy measures so far on the MSMEs, Egbesola stated that: “Small businesses have suffered additional shocks and multiple headwinds with great significant losses and setbacks due to the fuel price increase as a result of subsidy removal. Many small businesses are no longer running at profit levels. Sales have dropped sharply and turnover is low with supply side inflation.
‘‘This has inadvertently resulted in a drop in production/sales below capacity, job losses, decrease in cash availability and ultimately a handful of businesses had gone moribund or experienced total closure. It is indeed a sorry case.”
He noted that the resultant effect of the action is already manifesting in increasing the prices of goods and commodities. “This is already evident as prices of goods and commodities have risen and it will remain on the upward trend. The reality has downed us as many of our MSME (Micro, small and medium enterprises) members complained bitterly of low sales or no sales.
“It is unfortunate that there aren’t palliatives put in place to cushion the negative effects of subsidy removal, particularly on poor households and small businesses before its eventual implementation. This has added to the myriads of challenges beseeching MSMEs at this time,” he pointed out.
To him, “We have not seen any policy in sight directed to the SMEs, we have not seen any Interventions for SMEs and large corporations, we have not seen any formidable plan in black and white. We have not had any actionable policy that has been implemented to drive the micro economy. The only thing on ground are paperwork and mere speeches. We are yet to see any roll out of intervention funding programmes for SMEs and the informal sector. What we see are mere speeches, promises without economic blueprints to energise the sector.”
Egbesola further suggested that, small businesses can mitigate the impact of the policies by, ‘relearning new ways of managing funds, avoiding bank loan for reason of it’s high interest rate.’
On his part, the chairman, SMEs Group of the Lagos Chamber of Commerce and Industry, (LCCI), Daniel Dickson Okezie said, after the removal of fuel subsidy, about 10 per cent of SMEs closed down from reports and obviously since then till now about 10 to 15 per cent of SMEs have closed shop.
“Eventually, this will affect the government’s revenue in terms of taxes as well as other multiplied problems. And other companies that depend on multinationals and local companies will have to go out of business which will increase the problems of the economy,” he said.
On his part, executive director of CISLAC, Auwal Ibrahim Musa (Rafsajani) stressed that, despite various establishment and agencies created to support the SMEs in the country, access to finance continues to be the most pressing problem as only about five per cent of SMEs have been able to access adequate finance for working capital and for funding business growth.
He highlighted varieties of government backed organisation, notably the Small and Medium Enterprises Development Agency of Nigeria, (SMEDAN), Bank of Industry, (BOI), Nigeria Export-Import Bank, (NEXIM), Central Bank of Nigeria and Nigeria-Incentive Based Risk Sharing system for Agriculture Based Lending, (NIRSAL) while positing that, despite the creation of these establishment to assist the MSMEs, by setting up SME development agency across 26 states in Nigeria, the MSMEs have been impacted by weak funding policy and in most cases, lack of access to finance.
He said, government should improve access to finance for SMEs, strengthen statutory allocation for both legal, and financing institutions to strengthen platforms for SMEs while calling on the government to interface for fiscal support and mutual growth expansion for SMEs.
On the other hand, the chairman of the National Association of Small and Medium Enterprises (NASME), Oyo State, John Karunwi, believes that, the last one year of the administration was plagued by inflation, forex challenges, floating of currency, multiple exchange rate and devaluation of Naira which eroded investors’ confidence in the country.
NASME called for price stability, inflation control, and reliable power supply, saying the aforementioned were crucial to the survival and growth of MSMEs in Nigeria.
Deal to boost Nigeria’s oil production in for 700,000bp
The Nigerian National Petroleum Company (NNPC) Limited has announced the signing of a settlement agreement facilitating the divestment of ExxonMobil’s stake in Mobil Producing Nigeria Unlimited (MPNU) to Seplat Energy Plc after
The $1.28 billion deal, first announced in February 2022, has been entangled in regulatory hurdles for over two years.
According to a statement released on Thursday by NNPC, the agreement involves MPNU, Mobil Development Nigeria Inc., and Mobil Exploration Nigeria Inc.
With the signing of the settlement agreement, Nigeria could add at least 700,000 barrels per day (bpd) to its current daily crude oil production volume, to hit about two million bpd before the end of the year.
“Settlement agreement between NNPC Ltd. and Mobil Producing Nigeria Unlimited, Mobil Development Nigeria Inc., and Mobil Exploration Nigeria Inc. signed regarding the proposed divestment of a 100 per cent interest in Mobil Producing Nigeria Unlimited to Seplat Energy Offshore Limited,” NNPC stated.
This development comes after a directive from President Bola Tinubu to the Ministry of State for Petroleum Resources (Oil) and NNPC on May 28 to resolve the divestment issue that had stalled the Seplat and ExxonMobil deal for over two years.
Tinubu had assured the ExxonMobil delegation that the federal government was committed to resolving the divestment issues between NNPC and Seplat Energy.
Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri stated, “Mr. President has given a clear directive to the NNPC GCEO and I to resolve the issue of divestment, and we are doing whatever we can to achieve that.”
Lokpobiri had earlier revealed that Nigeria lost $34 billion in the last two and a half years due to the fall in production from the assets being divested by ExxonMobil to Seplat Energy, as assets declined from 600,000 barrels per day (bpd) to current 120,000bpd, leaving a shortfall of 480,000bpd, which he said amounted to $34 billion loss at a conservative $80 per barrels, in the last two and a half years.
In February 2022, Seplat announced an agreement to acquire ExxonMobil’s 40 per cent stake in MPNU, expecting the transaction to be completed in the second half of the year. However, on May 19, 2022, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) declined to approve Seplat’s proposed acquisition, citing “overriding national interest.”
Two months later, Seplat reported that NNPC had secured a court injunction preventing ExxonMobil from selling its assets in Nigeria. This opposition led former President Muhammadu Buhari to reverse his initial authorization for the acquisition on August 10, 2022, shortly after granting approval.
Amid the delay in securing approval, Seplat extended the share sale and purchase agreement (SSPA) with ExxonMobil for the acquisition of its stake in MPNU in May 2023. On May 17, Seplat indicated progress in acquiring MPNU assets, and a week later, the company extended the SSPA again.
This is as ExxonMobil is reducing its presence in Africa’s biggest oil-producing country, shrinking its office space and scaling back operations in the country.
Exxon has reportedly vacated its large office in Lagos, opting for a smaller, more centralised location. Similar downsizing is expected in other Nigerian cities where the company has a presence.
According to Reuters, Exxon is relocating staff from the 12-floor Mobil House, reportedly leased at the cost of $10 million annually, to a six-floor office building 22 kilometres away in the upscale Ikoyi area, built to accommodate half the personnel working at the former offices.
“The new office leaves no one in doubt about its future plans for Nigeria,” a staff member of the company told Reuters.
The exact number of employees affected by the office closures is unclear, but the move is likely to result in job losses and a smaller overall footprint for Exxon in the country.
ExxonMobil has been operating in Nigeria for over 50 years and is one of the largest oil producers in the country. The company’s scaling back is likely to have a significant impact on the Nigerian oil and gas sector, as well as the broader economy.
Industry analysts suggest that Exxon’s decision is part of a wider trend among international oil companies (IOCs) in Nigeria. Many IOCs are facing pressure to reduce costs and streamline operations, leading to a shift towards smaller, more efficient teams.
The long-term impact of Exxon’s downsizing on the Nigerian oil and gas sector remains to be seen. However, the move underscores the challenges facing the industry and the need for adaptation in the current economic climate.
