Business

Osinbajo, Finance Minister, Aig-Imoukhuede Launch EnterpriseNGR

The Vice President, Prof. Yemi Osinbajo, yesterday joined hands some eminent Nigerians to launch the EnterpriseNGR, a professional and financial service advocacy group that he described as a game changer in Nigeria’s quest for economic development.

Osinbajo said the launch of the initiative would position Nigeria as the premier financial centre of Africa in the same way The CityUK transformed London to become the nerve centre of global financial service.

He said: “Today (yesterday) may pass quietly like other days but its significance in the years to come is bound to be huge. The reason is that we are formerly establishing the united and powerful voice of the Nigerian business and professional community the EnterpriseNGR, a professional policy advocacy group with the overarching vision to be a leading voice and champion for the development and transformation of the Nigeria economy and the mission to advance Nigeria’s transformation as Africa’s premier financial service centre.

“There is no doubt that the Enterprise Nigeria is a game changer when the informed Nigerian professionals and business community speak with one voice to issues of domestic or international business policy.

“On behalf of Mr. President and the federal government I will like to commend the initiators for their farsightedness in establishing the EnterpriseNGR, the first in the African region. It is our hope and prayer that the EnterpriseNGR will achieve its transformative objectives.”
Speaking in the same vein, the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, described the establishment of the EnterprseNGR as a testimony of coming of age of Nigeria’s financial industry and its realisation of the critical role of the private sector could play in ensuring a thriving economy.

She said: “I congratulate and salute the efforts of the founding members of this nobel organisation. I am confident that the EnterpriseNGR will go a long way to improve the business terrain in Nigeria. I hope that your work will aid the acceleration of the economic development of our country.”

The Founding Chairman of the EnterpriseNGR, Mr. Aigboje Aig-Imoukhuede, said the non-profit advocacy group was established to collaborate with the public sector in championing the advancement of the Nigerian financial service sector.

Aig-Imoukhuede said: “We believe that the private sector and the government must work hand in hand to ensure that our nation takes off and reaches its full potentials. That is what Enterprise NGR is all about.”

He said the story of the EnterpriseNGR dated back to his years as the council president of the NSE when the council was introduced to The CityUK, a private sector advocacy organization that is renowned for its role as the key driver of the London’s current position as the global financial services power house.

“We were convinced then that Nigeria could achieve similar successes driven by Nigerian equivalent of The CityUK. We need to build a powerful coalition of financial services players who will work hand in hand with policy makers and regulators to transform Nigeria’s financial system.

“Similar to The CityUK, we aimed to engineer win-win positive results, such as GDP expansion, increased employment and of course national growth.

“We have lofty ambitions but we are confident that with right partners we can make this ambition a reality. I welcome you to a new era of opportunities to Nigeria’s financial services sector,” he said.

The Chairman and Managing Partner, Global Infrastructure Partners, Mr. Bayo Ogunlesi, charged the EnterpriseNGR to advocate for the emergence of strong financial system in Nigeria that could attract and match users and providers of capital.

Ogunlesi said: “Nigeria will never achieve its full potentials unless it raises a very strong financial system. It has to make it clear to the world that it is open to business. What the EnterpriseNGR will do is to be a powerful voice that makes sure that the country continues moving in the right direction.”

The CEO of the EnterpriseNGR, Ms. Obi Ibekwe, said it would require a strong strategic collaboration between the private and the public sectors for effective change that would help Nigeria to take its place in the world stage to occur.

Ibekwe added: “This is precisely the vision that informed the establishment of the EnterpriseNGR. Every country that has achieved economic development was powered by a strong financial system.

“Our goal is to promote a favourable environment where business sector advocate are able to effectively engage with policy makers by working closely with government authorities and other key stakeholders.”

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Nigeria’s economy to shrink in Q4 2022 –IMF

The International Monetary Fund (IMF) has predicted Nigeria’s economy would shrink by 0.5 percentage point in fourth quarter (Q4) of 2022.

The IMF put Nigeria’s economic outlook for Q4 of 2021 at 2.4 per cent while it projected 1.9 per cent for Q4 of 2022, representing a decline of 0.5 percentage point.

The global financial body equally lowered its global growth projection for 2021 to 5.9 per cent while retaining 2022 figures at 4.9 per cent.

The 5.9 per cent figure is 0.1 percentage point lower for 2021 than in the July forecast.

The latest growth figures are contained in the IMF World Economic Outlook released yesterday which finds that, “although global recovery continues, momentum has weakened, therefore , there is a slight downward revision for global growth this year and an unchanged projection for next year (4.9 percent).”

IMF explained that the downward revision for 2021 reflects a downgrade for advanced economies—in part due to supply disruptions—and for low-income developing countries, largely due to worsening pandemic dynamics.

This, it said, is partially offset by stronger near-term prospects among some commodity-exporting emerging market and developing economies.

It added that rapid spread of Delta and the threat of new variants have increased uncertainty about how quickly the pandemic can be overcome. Policy choices have become more difficult, with limited room to maneuver.

It explained that modest headline revision masks large downgrades for some countries, the Fund reports in its World Economic Outlook.

“The global recovery continues, but momentum has weakened, hobbled by the pandemic. We have a slight downward revision for global growth for this year to 5.9 per cent. For next year, our projection remains unchanged at 4.9 percent.

“The divergences in growth prospects across countries, however, persist and remains a major concern,” said Gita Gopinath, Economic Counsellor and Director of the Research Department at IMF.

Gopinath added that risks to economic prospects have increased and policy trade-offs have become more complex in the ongoing COVID-19 pandemic. Monetary policy will need to walk a fine line between tackling inflation and financial risks and supporting the economic recovery.

“One of the major risks remains that there could be new variants of the virus that could further slow back the recovery. We’re seeing major supply disruptions around the world that are also feeding inflationary pressures, which are quite high and financial risk taking also is increasing, which poses an additional risk to the outlook,” explained Gopinath.

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Business

POS transactions in Nigeria surge by 45%, hit N4.1 trillion in 8 months

Point of sale transactions carried out in Nigeria in the first eight months of the year stood at N4.06 trillion, representing a 45% increase compared to N2.81 trillion recorded in the corresponding period of 2020. This is based on data obtained from the Nigeria Inter-Bank Settlement System (NIBSS).

According to the data, POS transactions hit its highest levels for any eight-month period, increasing by 44.8% and 108% compared to N2.81 trillion and N1.96 trillion recorded in the similar period of 2020 and 2019 respectively.

Similarly, the volume of POS transactions recorded between January and August 2021 stood at 619.3 million, increasing by 61.8% compared to 382.9 million recorded in the corresponding period of 2020. It is worth noting that a total of 686,577 POS terminals were deployed nationwide as of August 2021, representing an 84.4% increase compared to 372,333 recorded as of the same period of 2020.

Details later

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Business

NCC disqualifies Nigerians below 18 years from getting SIM

The Nigerian Communications Commission has disqualified anyone below the age of 18 from registering and owning a Subscriber Identity Module in Nigeria.

This is according to the draft copy of the modified Registration of Telephone Subscribers Regulations published on the commission’s website.

In the modified regulations, NCC limited telecoms subscribers to only include anyone above the age of 18.

“‘Subscriber’ means a person not below the age of 18 years who subscribes to communications services by purchasing a subscription medium or entering into a subscription contract with a licensee.”

The Licensee refers to ‘a provider of communications services that utilises a subscription medium in the Federal Republic of Nigeria’.

The regulations were made in line with the powers conferred upon the commission by section 70 of the Nigerian Communications Act,2003.

In accordance with Section 57 of the Act, the NCC conducted a Public Inquiry on the Registration of Telephone Subscribers Regulations, alongside the draft SIM Replacement Guidelines and the draft Spectrum Trading Guidelines at its head office in Abuja on Tuesday.

NCC’s Executive Commissioner Stakeholders’ Management, Mr Adeleke Adewolu, gave the opening remark at the event.

He said, “The public inquiry is an avenue that enables the commission develop and review its regulatory instruments by incorporating the comments and suggestions of industry stakeholders.”

During the public inquiry, which was held physically and virtually, key stakeholders, including MTN, urged the commission to revise the age limit.

MTN asked the commission to make the age limit 14 years and above.

The NCC, however, insisted on 18 years and above for anyone who wants to own and register a SIM in Nigeria.

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Business

CBN: $2bn Spent on Wheat Importation Annually

The Central Bank of Nigeria (CBN) yesterday revealed that the importation of wheat costs the country about $2 billion annually, thereby exerting pressure on the country’s food import bill.

This is just as the CBN has stated that the much-awaited Central Bank Digital Currency (CBDC), known as the eNaira would improve monetary policy effectiveness and enhance government’s capacity to deploy targeted social interventions and boost remittances through formal channels.

Also, in what appears to be a setback for the country’s cashless policy, a Federal High Court in Awka, has said it was not proper for the CBN as a federal institution to adopt discriminatory policies in its operations.

Commenting on the country’s food import bill, the central bank stated that wheat was its second highest contributor with over five million Metric Tons (MT) imported yearly.

The apex bank however, restated its commitment to addressing the existing challenges in the wheat value chain as part of efforts to shore up the country’s foreign reserves.

This was made known by the CBN Director, Development Finance Department, Mr. Philip Yila Yusuf, at the Wheat Conference and Stakeholder Engagement, with the theme: “Improving and Sustaining the Wheat Value Chain Development in Nigeria,” in Abuja.

He noted that the wheat value chain had enormous potential for ground-breaking impact in the agricultural sector, adding that the central bank would focus attention on the commodity value chain for 2021/2022 dry season planting following the sustainable progress made across the rice and maize value chain.
The CBN director, further estimated that only one per cent or 63,000MT of wheat, out of the 5-6 MT consumed annually, was produced locally.

He said the CBN intervention had become critical due to the high demand for wheat in the country as well as the inability to meet that demand.

He said, “The CBN plans to address key problems in the value chain through financing massive production of wheat in Nigeria and seeks to facilitate sustained availability of high yield seed variety in country and improve general productivity.”

While admitting the enormous challenge before the bank, which would require concerted efforts to address, he assured stakeholders of the CBN’s readiness in changing the narrative in the sector by working with relevant industry players.

However, the Minister of Agriculture and Rural Development, Mohammed Abubakar, expressed dismay that the country’s wheat importation had continued to increase in recent years, urging stakeholders to collaborate to reverse by investing more in the value chain.

Also speaking at the occasion, Kano State Governor, Dr. Abdullahi Umar Ganduje, charged stakeholders in the wheat value chain to be transparent in their dealings and to commence preparation for both farming and production of wheat.

The governor commended the CBN for its efforts in boosting the commodity value chain and encouraged the bank to expedite action in releasing funds.

Represented by the Kano State Deputy Governor, Dr. Nasiru Yusuf Gawuna, Ganduje emphasised that partnership among stakeholders in wheat production value chains remained critical in boosting the country’s quest to be self-sufficient in the production of wheat.
Earlier in March, CBN Governor, Mr. Godwin Emefiele, had indicated that the bank remained committed to improving local production of wheat and reducing importation by 60 per cent over the next two years.

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Naira crashes to record N557/$1 at black market as demand pressure worsens

Naira appreciated against the US dollar on Tuesday, to close at N412.08/$1 as against the N412.75/$1 recorded at the close of trade on Monday, 13th September 2021, representing a 0.16% gain.

The exchange rate at the parallel market depreciated again to another all-time low on Tuesday to close at N557/$1 compared to N550/$1 recorded in the previous trading session. This represents a 1.3% depreciation and further widens the gap between the black market rate and the official rate.

The local currency crashed by N7 at the black market to hit a new low following CBN’s actions to channel forex demand away from the window as buyers scramble to buy the scarce dollars.

Currency speculators are taking advantage of the huge exchange rate difference between the official market and the black market.

The demand pressure for forex continued despite an 8% improvement in dollar supply at the official window.

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VAT: Lagos applies to join Rivers as FIRS appeals High Court ruling

The Lagos State Government on Friday applied to the Court of Appeal, Abuja Division to be joined as a co-respondent in the appeal filed by the Federal Inland Revenue Service challenging the judgment of the Federal High Court, Port Harcourt.

The PUNCH had earlier reported that the Federal High Court in Port Harcourt had declared that the FIRS has no power to collect VAT and Personal Income Tax in Rivers State.

The matter slated for the day’s activity in court on Friday was the application filed by FIRS seeking for stay of execution of the trial court’s judgment.

However, the Attorney General of Lagos State, Moyosore Onigbanjo (SAN) informed the court of their application for the Lagos State Government to be joined as a party in the appeal.

He argued that the application for joinder should be taken first before FIRS’ application for stay of execution.

However, the counsel for the FIRS, Mahmoud Magaji (SAN) argued that their application for stay of execution should take precedence over the application for joinder.

Majagi relying on the case of Pam V. Mohammed argued that the court can restrict itself to the business of the day.

After listening to submissions from all the parties, the court stood down the matter for the ruling.

The Attorney General of Rivers State, Zacchaeus Adangor, and E. C. Nkala (SAN) for Rivers State.

Tijjani Gazali (SAN) represented the Attorney General of the Federation.

Also in court is the Rivers State Commissioner for Finance, Isaac Kamalu, and the Deputy Director & State Coordinator of Rivers, Edo, and Delta Zone, FIRS, Hamisu Mohammed Ibrahim.

Details later…

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Bar/Bench

More Trouble as States Drag FG to S’Court over Stamp Duties Collection

It now appears that more states of the federation have woken up from slumber and are now determined to achieve fiscal federalism, following the institution of a legal action against the federal government over its continued collection of stamp duties in the country.

The state governments in the suit filed last month at the apex court is claiming specifically that the right to collect stamp duties on financial transactions between persons or individuals in a state is the exclusive reserves of the states, hence the apex court should intervene and restrained the federal government from further collection of the monies.

Also, a few months ago, the state governments had dragged the same federal government to court over its failure to remit to the federation accounts, trillions of naira received from recovered assets.
In the same stretch, the Rivers State government, last week, secured a court victory over the federal government in the collection of Value Added Tax (VAT) in the state.

Justice Stephen Pam of a Federal High Court in Port Harcourt had in a judgment delivered on august 9, held that the Rivers State Government and not the federal Inland Revenue Services (FIRS), had the right to collect VAT, Personal Income Tax in the state.
Justice Pam, in the judgment, subsequently restrained the Attorney General of the Federation and FIRS (1st and 2nd defendants) from collecting VAT in Rivers and directed the state government to take charge of the duty.
As a result, the Lagos State government, has also commenced move to stop the collection of VAT by the FIRS in the state and it is believed that in the nearest future, more states would follow suit.

In the current legal action dated August 19, 2021 and filed 24th, the 36 state governments in an 18-paragraph affidavit deposed to by one Chijioke Chuku, Director Legal Services of the Nigerian Governors Forum (NGF), claimed that FG’s collection of stamp duties and retention of same in financial transactions between individuals was contrary to the provisions of the law.

Plaintiffs in the suit marked SC/CV/690/2021, claimed that between 2015 to 2020, the federal government had collected and retained a total sum of N 176,067,400,000,00 from stamp duties on individual persons’ transactions within their respective states.
The Attorney General of the Federation and Minister of Justice, Malam Abubakar Malami, was the sole defendant in the suit filed by Mr Yusuf Alli, SAN ,on behalf of the plaintiffs.

Alli stated that his client resorted to the court action after efforts to resolve the issue with the defendant failed to yield desired result. The plaintiffs attached a copy of their letter dated September 16, 2020 to the federal government asking it to stop both the FIRS and NIPOST from collection of the said monies accruing to them as exhibit A.

According to the senior lawyer, some of the issues brought before the apex court for determination were that whether “having regard to the mandatory provisions of Section 4(2) of the Stamp Duties Act Cap. S8 Laws of the Federation of Nigeria (LFN), the plaintiffs (all the state attorneys) are not the sole authority to administer and collect stamp duties on all transactions involving individuals/persons within their respective states?”

Alli also wanted the court to determine, “whether having regard to the provisions of Section 4(2) of the Stamp Duties Act Cap. S8 of the Laws of the Federation of Nigeria read in conjunction with the provisions of Section 163, items 58 and 59 of the Second Schedule part I and items 7 (a) and (b) of the second Schedule part II and other provisions of the Constitution of the Federal Republic of Nigeria, 1999 (as amended), the defendant (Malami) could claim, retain, distribute or in any other manner deal with the monies or sums collected as stamp duties on individual persons transactions within the respective states of the plaintiffs without reference to, concurrence of, input or agreement of the plaintiffs?”

Furthermore, the plaintiffs wanted to know whether or not they were “entitled to 85% of all stamp duties collected on electronic money transfer levy, on electronic receipts or electronic transfer for money deposited in deposit money banks and financial institutions, on any type of account to be accounted for and expressed to be received by the person to whom the transfer or deposit is made in the plaintiffs’ respective states”.

In the event, the questions raised by the plaintiffs were determined in their favour, even as they urged the Supreme Court to declare that they “are the sole authorities entitled to administer and collect stamp duties on all transactions involving individuals within their respective states.
“A declaration that the defendant is not entitled to collect, administer, or keep the proceeds of any stamp duties on transactions involving individuals within the respective states of the plaintiffs or any manner interfere with the Plaintiff’s right and authority in the administering the provision of Section 4(2) of the Stamp Duties Act Cap. S8 Laws of the Federation of Nigeria,” they prayed.

“A declaration that the plaintiffs are entitled to all the sums of money collected by the defendant as stamp duties through whatever source or means in their respective states from 2015-2020 and thereafter till the time of the judgment of this court with respect to individual persons’ transactions.
“A declaration that the plaintiffs are entitled to 85% of all stamp duties collected on electronic money transfer levy, on electronic receipts or electronic transfer for money deposited in deposit money banks and financial institutions, on any type of account to be accounted for and expressed to be received by the person to whom the transfer or deposit is made in the plaintiffs’ respective states.”

Consequently, they wanted the court to make an order directing the AGF to account for and pay back all monies collected by way of stamp duties on individual persons’ transactions within the respective states of the Plaintiffs from the period 2015-2020 and thereafter till the time of the judgment.
Specifically, they wanted the court to order the defendant “to pay over to the Plaintiffs all the sum of monies amounting to One Hundred and Seventy Six Billion, Sixty Seven Million, Four Hundred Thousand Naira (N 176,067,400,000,00) representing ascertained and admitted collected stamp duties on individual persons’ transactions within their respective states for the period of 2015- 2020 and thereafter till the time of the judgment of this court or any other sum as the plaintiffs may be found entitled by the court.

“An order of perpetual injunction restraining the defendant by himself, privies, agents or any persons by whatever name or how so ever called from appointing anyone for the purpose of collecting Stamp Duties on individual persons’ transactions within the respective states of the plaintiffs henceforth.”
The defendant, however, has 21 days to respond to the suit starting from the date it was served.

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NNPC rejects Customs proposal on petrol smuggling stoppage

The Nigerian National Petroleum Corporation, on Wednesday, confirmed the claim by the Nigeria Customs Service that Nigeria’s subsidised petrol was being smuggled out of Nigeria in large quantities.

It, however, rejected the proposal put forth by the Customs on how to stop the illegal business.

The Group Managing Director of the NNPC, Melee Kyari, while noting that smuggling of petroleum products is almost impossible to stop, disclosed that the President, Major General Muhammadu Buhari (retd.), has ordered involvement of security and anti-graft agencies in the war against the economic sabotage.

Kyari said these in Abuja on Wednesday at the ongoing public hearing organised by the House of Representatives Committee on Finance on the 2022-2024 Medium Term Expenditure Framework and Fiscal Strategy Paper.

The Controller-General of the NCS, Col. Hameed Ali (retd.), had while appearing before the same committee on August 16, 2021, said petrol was being smuggled out of Nigeria in large quantities after it had been subsidised by the Federal Government.

Chairman of the committee, James Faleke, on Wednesday asked the GMD to confirm if the NNPC monitored the volume of product imported, distributed and consumed on a daily basis in the country.

Kyari said, “Yes. There is a single point of import, which is the NNPC. And the evacuation data is coming from the records that we receive from the PPPRA.

“I can confirm to you that anytime we supply less than 60 million litres per day – average – consecutively for two weeks, we will see shortages coming on the streets. Sometimes, it is not visible to the public but we see the constraint and we take necessary actions to close those gaps.

“Much as I believe personally that our national consumption may not be 60 million litres per day, I am convinced that anytime you supply less than 60 million litres per day, you will have a challenge here. A number of things are happening.

“Without any contradiction, the oil that we import into this country gets everywhere. It is found in many West African countries. It goes as far as Sudan; we have records to show this.

“It is found in many countries that are proximate to us but as far as the Central African Republic. This is very true. In addition to this, once you have a situation of price arbitrage, everything can happen. And I can confirm that it is very difficult to contain it.”

He added, “Mr President has personally directed me to take every step possible to make sure that we contain the issues around cross-border smuggling; issues around early pilferages in the depots and any involvement of anyone to get this resolved.

“We have taken several steps. We have involved the EFCC, the Department of State Services; we are collaborating and engaging with the Customs Service; we are engaging and collaborating with the Department of Petroleum Resources; and everybody that has a stake in this.

“With the best of action and the best of intention, you will still have a challenge containing cross-border smuggling. As you are aware, we have up to 3000 kilometres of land borders.

“In many of the locations, they practically don’t exist; you don’t need to ply the road to cross into another country. That is the reality. I need your help to contain this but the reality still remains that we are supplying everyone else.”

Faleke also asked the NNPC GMD about the advice given by the Customs boss that the NNPC and private Nigerian investors should establish fuel depots and stations in the neighbouring countries to check smuggling.

Responding, Kyari stated that the NNPC had been skeptical to invest in the potentially ‘bad business’, adding that fuel smuggling would be addressed by the full implementation of the Petroleum Industry Act, which would end the present subsidy regime.

He said, “I have also seen the recommendation by the CG of Customs, that we should go and establish fuel stations across our borders to curtail smuggling. The people who are smuggling are not looking for officially priced petroleum products, unfortunately.

“So, when you go ahead, across the countries, and establish fuel stations…except you are going to see it at N162 (per litre), then everybody will come to you. As long as you are going to sell at the market rate…it is the same reason that is bringing them here to smuggle.

“At the risk of being repetitive, the people who take products across the border will not sell at the official price because when you buy here at N162 and the official price, say in Niger, is N400 per litre, that is what you will buy at the fuel station. So, when you establish a fuel station, you must sell at N400.

“We have thought of this; as a matter of fact, we are already engaging the national oil company of Niger in particular to establish NNPC Retail fuel stations in the country, but we are also conscious of the very fact that it can be a bad business because you are going to compete with the people who are coming to collect (and smuggle).”

He added that at the moment Nigeria exited the regulated environment, smuggling would be curtailed.

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Akpabio: International Oil Companies Owe NDDC over $4bn

Minister of Niger Delta Affairs, Senator Godswill Akpabio has said that International oil companies (IOCs) operating in Nigeria owe the Niger Delta Development Commission (NDDC) more than $4 billion.

The Minister, who spoke Thursday at the weekly ministerial press briefing organised by the Presidential Communications Team at the State House, Abuja, said statutorily the IOCs were required to provide 3% of their annual budgets to the commission as their contribution to its funding, but none of the IOCs had paid so far.

His words: “All the international oil companies are owing their statutory contribution to NDDC running into over $4 billion for many years and efforts are ongoing to recoup the money”.

Akpabio also said the NDDC on its part was owing contractors about N3 trillion, noting however that not all contracts awarded with costs can be regarded as debt.
According to him, the over N600 billion of emergency contracts that had been awarded had not been implemented and cannot therefore be regarded as NDDC debt.

Details later…

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