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Nigeria spent N1.85tn on food import in nine months – Buhari economic aide

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A total of N1.85 trillion was spent by Nigeria on import food for nine months during the closure of international land borders last year, President Muhammadu Buhari’s chief economic adviser, Dr Doyon Salami, has said.

He said this was an indication that the nation lacked the capacity to feed itself.

Salami, an ex-member of the Central Bank of Nigeria (CBN) Monetary Policy Committee (MPC), is the Chairman of the Presidential Economic Advisory Council.

He spoke at the presentation of the National Economic Outlook for 2021 organised virtually by the Chartered Institute of Bankers of Nigeria (CIBN) on Tuesday in Lagos.

He said, “Despite border closure, our national import of food amounted to N1.85 trillion between January and Sept 2020 – a 62 per cent increase when compared to same period 2019. This suggests a weakness in our ability to feed ourselves and raises the need to consider review of intervention policies in agriculture.”

He said agriculture had continued to decelerate, growing at 1.7 per cent year-to-date while consumer-sensitive sectors like manufacturing and distribution continue to contract, in double digits.

According to him, serious climatic concerns are undermining agricultural output with 2.5 million farmers being impacted by flooding in 2019.

He noted that preliminary assessments suggested that 2020 was worse with persistence into 2021 to adversely affect output and food prices.

Salami said during the period, Nigeria’s cumulative trade deficit amounts to N4.6 trillion ($12 billion).

He said Nigeria’s external imbalances were increasingly precarious, with continuing concern over exchange rate differentials.

He said uncertainty around foreign exchange – convergence, market-reflective rates and transparent determination mechanism, balance of payment imbalances were large and would remain key questions in 2021.

Salami said by the measure driving the value of the naira based on the naira/dollar inflation differential, the currency, should be trading around N439/$ at the official market.

The agricultural sector, ICT,  real estate and oil and gas are vulnerable to a probable major adjustment to the foreign exchange rate, according to him.

Salami said official payment data showed that about $30 billion (almost 10 per cent of national economy) was obtained from sources outside the CBN, adding that the gap between the official and other exchange rates was a source for concern.

He said the COVID-19 shock of 2020 represented the third major shock to the Nigerian economy in 12 years.

He noted that ahead of the crisis, the Nigerian economy was contending with a set of pre-existing conditions such as macro Instability, stagflation – slow growth and rising inflation, pressure on households – in the form of rising inflation, unemployment, and poverty and pressure on corporate(s) margins – weak consumer and cost pressures.

He said there were also growing fiscal and external imbalances, monetary Policy distortions – the bifurcation of sovereign instruments leading to a distortion of the interest rate term structure.

Salami stated that with the impact of COVID-19, prices continued to rise – at the end of November 2020, overall inflation was 14.8 per cent with food prices increasing at 18.3 per cent when compared with November, 2019.

He, however, noted that the stay-at-home imposition implied greater use of telco/tech communication platforms.

“A health crisis morphed into an economic crisis resulting in humanitarian and in some cases, security challenges, a global development visiting great disruption to established norms – largely negative short-term impact but some positives – especially with technology deployment, the full impact of which will manifest in the years ahead,” he stated.

The international economic environment, he said, deteriorated sharply last year but recovery expected in this year, based on the capacity to suppress the virus through vaccination.

He also said transport and hospitality sectors were gravely affected by the lockdowns of April/May as well as by voluntary containment measures and/or imposed restrictions post-lockdown.

President/Chairman CIBN, Mr Bayo Olugbemi, represented by second Vice President Prof. Pius Olanrewaju, said the National Economic Outlook initiated in 2014 was designed to bring together relevant stakeholders together to discuss emerging and pertinent issues facing national and global economies and their implications for businesses.

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NNPC takes over operation of Production Sharing Contract (PSC) for 4 oil wells from Addax

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The Nigerian National Petroleum Company Ltd (NNPC) said it has taken over the operation of the Production Sharing Contract (PSC) for four oil wells from Addax Petroleum Development Nigeria Ltd.

In a statement on Tuesday, NNPC said it amicably terminated Addax 24-year PSC relationship.

It said three months after the execution of the Addax Transfer, Settlement, and Exit Agreement (ATSEA) for the PSC oil blocks, OMLs 123/124 and 126/137, operated by Addax all closing obligations have been concluded and the assets have been transferred to the Concessionaire, NNPC Limited.

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“Consequently, NNPC has taken necessary steps to take over the assets and oversee a clean, amicable, and speedy exit for Addax Petroleum Ltd., operate the asset on an interim basis as a first step and subsequently appoint a competent replacement PSC contractor while NNPC continues to remain the Concessionaire,” it noted.

While the TSEA was signed in November 2022, the transfer of the oil wells to NNPC took place on Tuesday, January 31, 2023.

NNPC Ltd has also appointed the Transition Team lead, Mr Sagiru Jajere, as the Managing Director of Antan Producing Ltd.

Addax and NNPC had a long-running battle over the operation before the latest amicable settlement.

Daily Trust

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Chief of Defence Staff threatens action as petrol prices hit N400/litre

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Chief of Defence Staff (CDS) General Lucky Irabor

The Chief of Defence Staff (CDS), Gen. Lucky Irabor, yesterday threatened that the Federal Government would not fail to activate alternative actions should the marketers of petroleum product fail to end the prolonged fuel scarcity.

The CDS and Nigerian National Petroleum Company Limited (NNPCL) held a meeting with Major Oil Marketers Association of Nigeria (MOMAN); the Depot Petroleum Products Marketers Association of Nigeria (DAPPMAN), and Nigerian Association of Road Transport Owners (NARTO) in Abuja.
The Group Chief Executive Officer of NNPCL, Malam Mele Kyari, said pricing was an issue and not petrol supply as NNPCL has over 800 million litres of petrol in marine and over 700 million litres on land across retail outlets, sufficient for 30 days.

“We do have 24-day sufficiency for AGO (diesel) and the aviation we have 45 days of stuffiness for ATK aviation fuel,” he said.

He added that there is fuel in every depot and evacuation  was ongoing.

The NNPC boss noted that petrol smuggling was on the rise as over 67million litres of petrol has been evacuated daily but the crisis has prevailed.

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“We have evidence now and we’re following this through that some of our customers are actually taking products to other countries. And we’ll get to the root of this. And the appropriate government security agencies will deal with this,”  Kyari said.

The NNPC head also blamed the marketers, saying they did not follow the official petrol price rate at the depots and increased prices arbitrarily as some depots sell from N172 to N260/l above the agreed price, saying the marketers could not buy at that rate and sell at official rate.

“We have challenged IPMAN to bring documents on depots selling at N260 to them, but no one will bring a record,’’ he added.

The Chief Executive, Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed, confirmed there were several pacts with the marketers and transporters but such deals had not been followed through.

“But again, the more we agree, the more you lift the lever. We cannot continue like that,” he said.

He said recently NMDPRA sanctioned seven depots as deterrents but that did not work.

He urged marketers to help provide names of depots selling above ex-depot price but they refused.

CDS Irabor said: “It’s a crisis of internal nature which security and Police should lead but if it gets above that, there is an alternative.

“If there is no solution, let me reiterate that the government is not handicapped and there is an alternative and we pray that we don’t get to the level where the alternative will be activated,” Irabor said.

The Inspector General of Police Usman Alkali Baba, said the problem is in distribution, and urged operators for increased monitoring of the process.

“I think it is our role to assist the NNPC in monitoring the process of distribution if that will help us leverage the problem.”

Chairman of the Major Oil Marketers Association of Nigeria (MoMAN) Adetunji Oyebanji, said there are other costs that operators incur outside the ex-depot price. As he urged members to work to ensure products are supplied at the official rate.

Chairman of the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN), Mrs Winifred Akpani, said the depot owners met last week on how to solve the price problem and distribution too.

She urged NNPC to only deliver products to depots (members) that will supply the right way, alleging that DAPPMAN does not regulate depot owners who are non-members.

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“We have all determined to ensure that we can help where we can help,” adding that profiteering is causing many problems to the country.

NARTO president, Yusuf Othman, lamented the increase in freight rate due to market reality saying officially it is N42 per kilometre but in reality it’s over N50 and so truckers give preference to marketers that pay cash and the market rate.

He decried the rising cost of buying trucks which he now said is over N60m as well as rising diesel cost of N880/l.

He noted that only major marketers pay twice for freight and that only OVH/NNPC give diesel at rebate, others do not.

According to Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), President, Comrade Williams Akporeha, said marketers have no right to increase the price because petrol is subsidized.

“Our position at NUPENG is that any depot or filling station that sells above the price must have the wrath of Nigerians to face,” he said.

The price of petrol across the country averaged between N380 and N400 per litre yesterday as the scarcity of the product assumed a disturbing dimension, nearly grinding economic activities.

Our correspondent who monitored some petrol stations in Aba, the commercial nerve of Abia state reports that most major marketers were out of stock of the product.

A visit to MRS filing by Asa road and among others revealed that they dispensed their PMS to customers at N400 per liter.

Commercial bus and tricycle operators operating within Umuahia capital city and Aba have since increased their fares with N50, N100 or more depending on the distance.

In Osun State, petrol was sold for N400, N370 and N365 per liter.

Although there is no long queues at the petrol stations selling at these prices, there are still are still long queues in other stations where it is sold for cheaper rates.

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Long queues still surfaces at Bovas, NNPC, Matrix, NIPCO among others in the city.

Residents of Makurdi, Benue State capital and its environs are passing through hell to buy petrol too.

Yesterday, petrol was sold at #355 per litre in all the Independent marketers filing stations in Makurdi.

Getting the products was difficult as motorist remained on long queue for hours lamenting in frustration

The situation remained same in Adamawa State.

Car owners and commercial vehicle operators queued up in the few filling stations dispensing fuel where prices ranged at between N370 and N390 per litre within the state capital, Yola, and as much as N500 per litre in rural communities in the southern and northern tips of the state.

The whole of Yola had just one NNPC mega station selling fuel at the ‘sane’ price of N199 per litre yesterday, but the queue is usually so long that only people with the luxury of servants or unattached staff could send such persons, usually to buy large volumes of the commodity.

In Kaduna State, scarcity of petrol persisted in Kaduna, as price of the product reached N625 in the black market.

Also, our correspondents observed that, few major and independent petrol stations dispensing petrol for N210 per litre, had unprecedented queue, while filing stations on the outskirts of the metropolis, especially on Kaduna-Zaria highway, Kaduna-Abuja and Kaduna-Kachia roads, were selling for between N350 to N380 per litre.

The Nigeria Midstream and Down Stream Petroleum Regulatory Authority (NMDPRA) said it has intensified routine patrol and monitoring of servicing stations to enhance steady fuel supply in Adamawa.

While going round some of the filling stations in Yola , it was observed that a team of officials led by the State Coordinator  of the   Regulatory Agency directed all filling stations which had products to begin selling to consumers or risked being sanctioned.

In Edo State, Godwin Obaseki led administration promised quick end to the scarcity and hike in the price of Premium Motor Spirit (PMS), thereby receiving 780,000 litres of petrol.

It also set up of a task force to monitor the distribution and sale of petrol in filling stations across the 18 local government areas of the Southsouth state.

Edo Commissioner for Mining and Energy, Ethan Uzamere, an engineer, who was accompanied by his counterpart in the Ministry of Communication and Orientation, Chris Nehikhare, and the Special Adviser to Obaseki on Media Projects, Crusoe Osagie, made the disclosure yesterday afternoon in Benin at a news conference.

The news conference took place after the meeting between the representatives of Edo government and leaders of the protesting Civil Society Organisations (CSOs) in the state.

Uzamere revealed that the supplied product (780,000 litres) would be distributed among the major and independent marketers of petroleum products in Edo’s three senatorial districts.

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He stated that Edo government would monitor the sale of petrol in the state, in order to ensure that members of the public were not exploited by the owners of the various filling stations.

The commissioner for mining and energy in Edo disclosed that members of the petroleum monitoring task force would be unveiled later yesterday evening, while assuring that all efforts would be put in place to ensure that no product supplied to the state was diverted.

He said: “Edo government has heard the cries of the residents of the state on the issue of fuel scarcity in Edo. The state government is working to ensure the availability of the product.

“As part of the measures, Edo government has set up a task force to monitor the situation, and ensure that no resident of the state is exploited. We also wish to announce that already, the state has received 780,000 litres of petrol, which will be distributed to major and independent marketers.

“The task force, whose members will be announced before the close of work today (Tuesday), will monitor the distribution and sale of petroleum products in Edo State.”

Nehikhare, in his remarks, gave an assurance that the welfare of the residents of Edo was very crucial, and being taken seriously by the state government.

Edo commissioner for communication and orientation also hailed leaders of CSOs for the maturity displayed in handling the protest that erupted on Monday, over petrol scarcity and price hike, while assuring that Obaseki’s administration would continue to engage all the major stakeholders, in order to find a lasting solution to the fuel challenge.

Osagie, while also speaking, noted that part of the duties of the task force’s members would be to monitor prices of petroleum products in Edo, while warn the marketers against arbitrary increase in the prices of the products,.declaring that anyone caught would be severely punished according to the dictates of the law.

The Nation

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$1bn investment recorded in auto industry – Minister

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The Federal Government has recorded more than one billion dollars’ worth of investments in the automotive industry. Minister of Industry, Trade and Investment, Otunba Adeniyi Adebayo, said this in Abuja on Tuesday when he featured at the 20th edition of President Muhammadu Buhari’s administration scorecard series organsied by the Federal Ministry of Information and Culture.

“Over one billion dollars in investment has been recorded in the automotive sector and we are ready to move on to the next phase for the automotive industry,” the minister said.

He said the review of the National Automotive Industry Development Plan (NAIDP) was almost completed, adding that the plan was going through validation process.

Adebayo restated the ministry’s commitment toward enabling business environment to attract and retain investments.

According to him, the ministry and the Nigerian Investment Promotion Council (NIPC) are committed to attracting and protecting investments that genuinely benefit Nigeria and its citizens.

He said that the revised Bilateral Investment Treaty (BIT) would boost investment.

“Nigeria has successfully revised its model Bilateral Investment Treaty (BIT) to include a specific provision for investment facilitation, which institutionalizes the principle of assisting investors in completing their investments.

“We are proud to offer Nigeria’s first investment policy to the Federal Executive Council (FEC) for approval.

“This strategic statement, which will outline our priorities, aims, commitments, and expectations, is a turning point for the Federal Ministry of Industry, Trade, and Investment and Nigeria as an investment destination,” he said.

Adebayo, who said that Nigeria had Investment Promotion and Protection Agreements (IPPAs) with Singapore, Morocco, and Saudi Arabia to attract and retain investments, said the ministry was developing more.

“We have IPPAs with Singapore, Morocco, and Saudi Arabia to attract and retain investments. The president ratified both accords on Sept. 16, 2022 and we are developing more IPPAs,” he said.

Adebayo said the ministry also distributed 5,571 acceptance certificates worth N7.7 trillion to 2,665,800 firms.

“The acceptance certificates allow businesses claim tax reduction when computing Company Income Tax.

“We also issued more than 130 Production Day Certificates, a crucial Pioneer Status Incentive step,’’ the minister said.

To further accelerate industrialisation, Adebayo said that the ministry was expediting the establishment of Special Economic Zones (SEZs) across the country.

According to him, the special economic zones will increase infrastructure availability and provide fiscal incentives for value addition.

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