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Over 200 qualified applicants who are seeking to own houses in a state government housing scheme named Prince Court Estate along Kobape in Ogun State have accused the government of Prince Dapo Abiodun of receiving payment without allocating any house to them since almost 3 years ago.
The representative of the group, Adeyemi Aremu in Abeokuta, who explained that the housing scheme was sold to them by the Ogun State ministry of Housing said the applicants of the third phase of the scheme seeking to become owners of 2 bedroom bungalows in the estate have duly paid but have not been given any property.
He said, the forms for the allocations were purchased in 2022 for five thousand naira (₦5,000) and each house costs five million five hundred thousand naira only (₦5,500,000) with a rebate for retired civil servants who were asked to pay four million nine hundred and fifty thousand naira only (₦4,950,000).
Aremu explained that some paid outrightly or on two instalments while others made their payment through the Gateway Mortgage Bank, owned by Ogun State government.
Aremu who showed various receipts to prove his case said, names of over 200 qualified applicants were approved and pasted and since then, no allocation has been made by the State government.
He said, the need to cry out was necessitated by the fact that the Dapo Abiodun led government has not fulfilled it's part of the bargain despite paying for the shelter and there are various rumours that Governor Dapo Abiodun is planning to increase the price of the shelter or give the available 100 uncompleted semi-detached 2 bedroom bungalow carcass to civil servants who were chased out of Ibara government quarters at the expense of those who have fully paid to the ministry of Housing.
According to him, " It is sad that the Gateway Mortgage bank has not protected their clients or try to get the shelter for them even as many are still paying mortgage with interests till date. The whole process is so discouraging especially for those Ogun people who showed interest to invest in the state and purchased the shelter. Now it is looking like fraud by the state government".
"With the arrangement, some people paid outrightly or on two instalments while others remit on instalments with interest when equity of at least 30 percent contribution is made to the mortgage bank. Immediately we have an agreement with the Gateway Mortgage bank, the houses are supposed to be allocated to us. The bank would pay outrightly, while we would remit on instalments with interests".
"All over the world when you access a mortgage loan through a mortgage bank before you begin the repayment/interest one would have taken possession of the property at least a year, but Ogun State's own under Governor Dapo Abiodun is like throwing a stone to an orange on a tree, the stone is missing and even the orange" Aremu said.
"What then could be the excuse after we have fulfilled our own part of the bargain? " he asked.
The Commissioner for Housing, Jamiu Akande Omoniyi in his reaction attributed the inability of the Ministry to deliver the houses on record time to the inflation in the country, which resulted in the rise in the cost of building materials.
He added that there were ongoing efforts by the state government to resolve the issue, assuring the applicants that their deposits are intact. He, however, called for calm, stressing the matter will be addressed accordingly.
The Nigeria Inter-Bank Settlement System (NIBSS) is experiencing a downtime, leading to delays in completing electronic transactions, the Cable has reported.
Financial technology firms (fintechs) notified customers of the disruption in transactions in separate notices seen by TheCable on Wednesday.
The NIBSS instant payment platform is an account-based, real-time electronic funds transfer (EFT) system.
It enables financial institutions to provide online real-time funds transfer services to their customers through all available electronic channels.
TheCable understands that customers are having a hard time making simple transactions like the payment of electricity bills.
A message sent to customers by Eversend, a financial technology firm, said delays in naira transactions will last for a while.
“NIBSS is experiencing some delays in processing Naira transactions, this may affect your NGN top-ups and payouts in the app,” Eversend said.
Also, Kuda Bank told customers that “NIBSS, the settlement partner for all banks, is having intermittent issues completing transfers at the moment so money sent to your Kuda account might be delayed and transfers to other banks may not be possible”.
“As the issues are being fixed by NIBBS, we’ll keep you updated on our status page – status.kuda.com,” Kuda said.
“Please, note that transfers between Kuda accounts and transfers between Kuda and PalmPay accounts are working fine.”
Other financial institutions are also being affected by the downtime.
A customer of the Guaranteed Trust Bank (GTB) said a transfer made at 2 pm is yet to be received by the recipient.
“I made a transfer and I was debited but the person was not credited till now,” he said.
Another customer of the United Bank for Africa (UBA) said transfers have also been difficult.
Afreximbank has disbursed $925 million to Nigeria's state-owned NNPC, part of a syndicated $3.3 billion crude oil-backed prepayment facility, the African trade bank said on Thursday.
This brings the total disbursement to Nigerian National Petroleum Company (NNPC) to $3.175 billion, African Export-Import Bank (Afreximbank) said.
Afreximbank said the deal was the largest crude-backed facility in Nigeria and one of the largest syndicated debts raised in Africa.
The pan-African lender had been tapping oil traders to finance a $3 billion loan to Nigeria's state oil company after the energy firm approached it for the facility last August, to help the government's efforts in stabilising its naira currency.
The naira had hit 1,000 to the dollar on the black market at the time the NNPC approached Afreximbank for the loan. On Thursday the naira was quoted as low as 1,498 per dollar.
Afreximbank said the funds was raised from a consortium of crude oil off-taker lenders including Oando Group and Sahara Energy Resource Limited.
The trade bank had sought oil traders to fund the crude-backed loan to NNPC, with aim to support Nigeria's macroeconomic stability and growth.
In December, Afreximbank received funding commitments totaling $2.25 million for the NNPC loan request.
Nigeria's president Bola Tinubu launched reforms last year May including devaluing the naira twice in less than six months in January to attract dollars after ending a multiple exchange rate system that keep the currency artificially strong.
The country has since been courting foreign investors for inflows with high yield offer by its central bank at its open market Treasury bill auctions.
In a not-so-surprising development, the federal government has admitted that Nigeria, Africa’s largest oil producer, will be spending up to N5.4 trillion on oil subsidies in 2024.
This admission follows months of repeated denials by government officials who had insisted that there were no subsidies.
The revelation came during a presentation by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, on an Accelerated Stabilisation and Advancement Plan (ASAP).
The plan is designed to address key challenges affecting reform initiatives and stimulate development across various sectors of the economy.
“At current rates, expenditure on fuel subsidy is projected to reach ₦5.4 trillion by the end of 2024. This compares unfavorably with ₦3.6 trillion in 2023 and ₦2.0 trillion in 2022,” stated a draft copy of the ASAP presented by Edun.
Previously, the federal government had maintained that it would no longer subsidise fuel costs, opting instead for a deregulation policy.
In April, Heineken Lokpobiri, Minister of State for Petroleum Resources (Oil), asserted, “As far as I’m concerned, the President removed the subsidy and it remains removed till today. Anybody who is saying that subsidy is being paid, it is left for the person to bring the facts and then we will talk about them.”
Approximately four months ago, Mele Kyari, Group Chief Executive Officer of NNPCL, also denied the return of fuel subsidies. “No subsidy whatsoever. We are recovering our full cost from the products that we import. We sell to the market, and we understand why the marketers are unable to import. We hope that they do it very quickly and these are some of the interventions the government is doing. There is no subsidy,” he stated to State House Correspondents after a meeting with the President at Aso Rock Villa.
President Bola Tinubu, during his inauguration on May 29, 2023 declared that the petrol subsidy was “gone”. This latest admission, however, contradicts those earlier declarations.
Médecins Sans Frontières (MSF), also known as Doctors Without Borders, is facing an overwhelming influx of severely malnourished children at its medical facilities in Northern Nigeria.
The global humanitarian organization raised the alarm in a statement on Tuesday, issued by its Field Communication Officer in Nigeria, Abdulkareem Yakubu.
According to the statement, MSF in-patient facilities in Northern Nigeria have recently recorded an "extraordinary increase in admissions of severely malnourished children with life-threatening complications," surpassing last year’s figures by over 100 percent in some locations.
"For the MSF teams, this is an alarming indication of a premature peak of the lean season and the increase in acute malnutrition that accompanies it, typically anticipated in July. We are resorting to treating patients on mattresses on the floor because our facilities are full. Children are dying. If immediate action is not taken, more lives hang in the balance. Everyone needs to step in to save lives and allow the children of Northern Nigeria to grow free from malnutrition and its disastrous long-term, if not fatal, consequences," said MSF’s Country Representative in Nigeria, Simba Tirima.
MSF called for urgent humanitarian assistance, urging Nigerian authorities, international organisations, and donors to take immediate action to diagnose and treat malnourished children and engage in long-term initiatives to address the root causes of the crisis.
"We’ve been warning about the worsening malnutrition crisis for the last two years. 2022 and 2023 were already critical, but an even grimmer picture is unfolding in 2024. We can’t keep repeating these catastrophic scenarios year after year. What will it take to make everyone take notice and act?" Tirima queried in the statement.
In April 2024, MSF reported that its medical team in Maiduguri, Borno State, admitted 1,250 severely malnourished children with complications to its in-patient therapeutic feeding centre, doubling the admissions of April 2023. By the end of May, the centre was urgently scaled up to accommodate 350 patients, far exceeding the 200 beds initially designated for the peak malnutrition season in July and August.
Similarly, the MSF-operated facility in Kafin Madaki hospital, Bauchi State, recorded a 188 percent increase in admissions of severely malnourished children during the first three months of 2024 compared to the same period in 2023. In Zamfara State, in-patient centres in Shinkafi and Zurmi saw a 30 percent increase in admissions in April compared to March, while Talata Mafara’s facility experienced a 20 percent increase. Major cities like Kano and Sokoto also reported alarming surges, with increases of 75 and 100 percent, respectively. The therapeutic feeding centre in Kebbi State documented a rise of over 20 percent in admissions from March to April.
Despite the dire situation, MSF stated that the overall humanitarian response remains inadequate. Other non-profit organizations active in the region are also overwhelmed. In May, the United Nations and Nigerian authorities issued an urgent appeal for $306.4 million to address the nutritional needs in Borno, Adamawa, and Yobe states, but this amount is deemed insufficient for the broader region.
"The catastrophic nutritional situation seen in recent years calls for a bigger response. Reductions in already limited funding for the North-west have dangerously affected the provision of crucial therapeutic and supplementary food. Supplies were completely unavailable in Zamfara for the first four months of this year and are now only available in lower quantities," the statement noted. This reduction has limited treatment to the most severe malnutrition cases, compromising early intervention and increasing the risk of mortality.
MSF warned, "We are alarmed by the reduction in aid at these critical times. Reducing nutritional support to only severely malnourished children is akin to waiting for a child to become gravely ill before providing care. We urge donors and authorities to increase support urgently for both curative and preventive approaches, ensuring that all malnourished children receive the care they desperately need."
On Wednesday, a train bound for Kaduna from Abuja derailed at Asha station in the federal capital territory (FCT), leaving many passengers stranded. A passenger reported to TheCable that the derailment occurred at approximately 3:52 pm, less than 30 minutes after the train departed from Kubwa station in Abuja.
"Passengers are currently stranded as there are no signs of authorities being notified," said the passenger, who wished to remain anonymous.
This incident marks the second derailment on this route in two weeks. On May 26, a train traveling from Rigasa station in Kaduna to Abuja derailed in a mountainous area near Jere. In that incident, three carriages went off the tracks, but there were no casualties.
Security operatives were reportedly present at the scene to assist and safeguard the stranded passengers.
No fewer than 30 state governments of the federation spent N986.64bn on recurrent expenditures, including refreshments, sitting allowances, travelling, utilities, etc., in the first three months of 2024, according to a Punch report.
The states’ budget implementation reports, which were obtained from Open Nigerian States, a website supported by BudgIT that acts as a repository for public budget data, were analysed.
For the first three months of the year, our correspondent examined budget implementation data from thirty states; data for six states was not available.
Benue, Imo, Niger, Rivers, Sokoto and Yobe States were the ones without Q 1, 2024 data.
A breakdown showed that the 30-state government spent N5.1bn on refreshments for guests, N4.67bn on sitting allowances to government officials, N34.63bn on local and foreign travel expenses, and N5.64bn on utility bills, amounting to N50.02bn in the first three months of 2024.
The general utilities include electricity, internet, telephone charges, water rates, and sewerage charges, among others.
The sub-nationals also paid N405.77bn as salaries to their workers.
Other recurrent spending items covered in the report included the amount spent on foreign and domestic travel, Internet access fees, entertainment, foodstuff, honorarium/sitting allowance, wardrobe allowances, telephone bills, electricity charges, stationery, anniversaries/special days, welfare, aircraft maintenance, and more.
In the first three months of 2024, Abia State spent N10.92bn on its recurrent expenditures, including N165.38m on refreshments and feeding, N39.26m on utilities, N214.57m on sitting allowances, N127.1m on local and foreign travels, among miscellaneous expenses.
During this period, Adamawa State expended N23.7bn on recurrent expenditures with N287.61m spent on refreshments and feeding, N109.62m on utilities, N79.57m on sitting allowances, N768.77m on local and foreign travels.
For Akwa Ibom State, recurrent expenditure gulped N46.85bn, which included N4.46m on refreshments and feeding, N223.32m on utilities, N6m on sitting allowances, N214.61m on local and foreign travel.
Anambra State disbursed N9.91bn for recurring expenses with N78.18m on refreshments and feeding, N32.52m on utilities, N42.09m on sitting allowances, N188.39m on local and foreign travel.
Also, recurrent expenditures cost Bauchi State Government N35.75bn with N397.58m going to utilities, N50.8m on refreshments, N287.11m on allowances, and N413.56m on trips.
Bayelsa State spent N35.1bn on recurrent expenditures, comprising N28.4m on utilities, N156.14m on refreshments and N279.99m on trips.
Similarly, Lagos State disbursed N189.62bn for recurrent expenditures, including N1.21m for refreshments, N383.12m for utilities, sitting allowances costing N52.79m and N633.37m on travels.
Borno spent N18.79bn, Cross Rivers (N17.44bn), Delta (N68.68bn), Ebonyi (N14.95bn), Edo (N32.32bn), Ekiti (N32.8bn), Enugu (N7.51bn) and Gombe with N20.89bn.
Within the same period, Jigawa State spent N15.52bn on the recurrent expenditures, Kaduna expended N34.69bn, Kano (N34.41bn), Katsina (N21.87bn), Kebbi (N11.67bn), Kogi (N37.4bn), Kwara (N24.34bn), Nasarawa (N18.61bn), Ogun (N47.12bn), Ondo (N31.12bn), Osun (N24.39bn), Oyo (N40.12bn), Plateau (N24.70bn), Zamfara (N13.46bn), and Taraba (N20.93bn).
Government spending has come under increased scrutiny in recent times, particularly in light of the country’s worsening economic challenges.
At different fora, financial experts have also raised concerns about states’ spending on recurrent expenditure, highlighting the need to embrace financial innovations.
A development economist, Aliyu Ilias, said many states had yet to fully develop themselves as industrialised and marketable to attract investors.
Ilias urged governors to develop an area of strength they could leverage to attract foreign investments.
He said, “Going forward, what they could do is identify one area of strength. For instance, Bayelsa has oil and should be able to attract investments. I think it is about policy. They should give the policy a chance that would allow people to come and invest. They should also create an attraction and develop an economic summit that will make sure they showcase and attract investors.”
An economist and former Vice-Chancellor of the University of Uyo, Prof. Akpan Ekpo, urged the states to increase their revenue by improving service delivery.
On his part, a Professor of Economics at Babcock University, Segun Ajibola, stated that the enduring problem of high governance expenses had persisted at the state level, with inadequate oversight and accountability resulting in minimal economic benefits for grassroots citizens.
The former president of the Chartered Institute of Bankers lamented that state assemblies had also abandoned their oversight duties, leaving the state governors to operate with no iota of transparency and accountability.
He said, “The first issue is the perennial complaint about the high cost of governance in Nigeria and at all levels. When you look at these issues, attention is often concentrated on the Federal Government, so the searchlight is always more on the central government. Most often, nobody cares about what is happening in the states and local government, and that is where the problem is.
“There are so many institutional frameworks in place to look at what is happening at the federal level but who cares about the states? The cost of governance in relative terms is even much higher in states than the federal and that is why you hardly feel the impact of governance in most states.
“Only a few states can boost a significant presence in the lives of their people in our states. The state assemblies are expected to conduct oversight functions on the activities of the executives in their respective states, but in reality, how many states are doing that, leaving the executives to be all in all in incurring high costs.”
The Organised Labour has suspended the nationwide strike for five days to give room for uninterrupted meeting with the tripartite committee on the new national minimum wage, according to a vanguard report.
A source with the leaders of Labour disclosed how Labour leaders had a successful meeting with the Secretary to the Government of the Federation, SGF, George Akume, and other government officials on Monday and reached a resolution that President Bola Ahmed Tinubu was committed to a new minimum wage higher than N60,000.
They equally resolved that the Tripartite Committee would meet every day for the next one week with a view to arriving at an agreeable National Minimum Wage.
Today at a meeting with FG Tripartite Committee scheduled by 10am, Labour suspended its srike.
With this development, every government and private offices are expected to reopen and function as usual.
The Transmission Company of Nigeria (TCN) says its workers’ union has shut down the national grid, resulting in a nationwide blackout according to a Premium Times report.
The TCN General Manager, Public Affairs, Ndidi Mbah, disclosed this in a statement on Monday.
Ms Mbah said the national grid shutdown occurred at about 2.19 a.m. on Monday.
“The Transmission Company of Nigeria hereby informs the general public that the Labour Union has shut down the national grid, resulting in a blackout nationwide. The national grid shutdown occurred at about 2.19 a.m. this morning, 3rd June 2024,” she said.
Ms Mbah said at about 1:15 a.m., the Benin Transmission Operator under the Independent System Operations unit of TCN reported that all operators were driven away from the control room.
She said workers who resisted were beaten while some were wounded in the course of forcing them out of the control room. The operations of the Benin Area Control Center were, thus, brought to zero.
“Other transmission substations that were shut down by the Labour Union include the Ganmo, Benin, Ayede, Olorunsogo, Akangba and Osogbo Transmission Substations. Some transmission lines were equally opened due to the ongoing activities of the labour union,” she added.
On the power-generating side, she explained that some power-generating units from different generating stations were forced to shut down.
She added that the Jebba generating station was forced to shut down one of its generating units while three others in the same substation subsequently shut down at very high frequency.
“The sudden forced load cuts led to high frequency and system instability, which eventually shut down the national grid at 2:19 a.m.
“At about 3.23 a.m., however, TCN commenced grid recovery, using the Shiroro substation to attempt to feed the transmission lines supplying bulk electricity to the Katampe Transmission Substation,” she said.
She noted that the situation is such that the labour union is still obstructing grid recovery nationwide.
“We will continue to make efforts to recover and stabilise the grid to enable the restoration of normal bulk transmission of electricity to distribution load centres nationwide,” she said.
The Strike
Nigeria’s labour unions on Monday commenced a nationwide strike amid uncertainties.
The nationwide strike was declared by the unions to compel the government to agree on a new minimum wage for workers and review the increase in the price of electricity for some consumers.
On Sunday, a meeting between representatives of the federal government, leadership of the National Assembly, and officials of the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) over the proposed national minimum wage ended in deadlock.
The meeting which began around 5:50 p.m. and ended at 8:45 p.m. held behind closed doors at the National Assembly complex, Abuja.
Earlier on Friday, the NLC and the TUC declared a total indefinite strike.
The unions expect numerous other workers’ unions, including those of doctors, university lecturers, airport workers, and electricity workers to join in.
In a notice issued on Saturday regarding the indefinite nationwide strike, the General Secretary of NLC, Emmanuel Ugboaja, urged all affiliated bodies to mobilise their members for full compliance with the industrial action directive.
Mr Ugboaja emphasised the importance of ensuring a comprehensive closure of all workplaces, noting that the success of the strike hinged on the collective determination and resolve of their members.
The Federal Government borrowed N20.1 trillion from domestic investors in the first year of President Bola Tinubu’s administration, representing a year-on-year YoY increase of 117 per cent from former President Muhammadu Buhari’s last year in office, prompting concerns over the impact on the economy including likely additional pressure on inflation, increased debt service cost and higher borrowing cost from businesses.
Analysts noted that the sharp increase in Federal Government’s borrowing has the potential to compound the historic high inflationary trend in the country which may lead to further interest rate hikes by the Central Bank of Nigeria, CBN and by extension increased cost of borrowing for businesses and individuals.
The Federal Government borrows from domestic investors through issuance of FGN Bonds, FGN Savings Bonds, and Sukuk Bonds by the Debt Management Office, DMO. In addition to these are the Nigeria Treasury Bills, NTBs, issued by the CBN on behalf of the FG.
Analysis of data from the DMO and CBN showed that in the 12 months ending May 31st (June 2023 to May 2024), also the first year of Tinubu as president, the FG borrowed N20.09 trillion through these instruments, representing YoY increase of 117 per cent from the N9.275 trillion borrowed in the previous 12 months, namely June 2022 to May 2023.
Most of the increase in borrowing was through the NTBs auctions conducted by the CBN, which also constituted 66 per cent of FG’s domestic borrowing during the period.
Borrowing details
According to data from CBN, FG’s borrowing through NTBs rose YoY by 188 per cent to N13.235 trillion in the 12 months ending May 2024 from N4.592 trillion in the 12 months ending May 2023.
FG’s borrowing through the monthly FGN Bond auctions, which constituted 32.8 per cent of total domestic borrowing during the period, rose, YoY by 42 per cent to N6.476 trillion in the 12 months ending May 2024 from N4.537 trillion in 12 months ending May 2023.
FG’s borrowing through Sukuk Bonds, which accounted for 1.7 per cent of total domestic borrowing during the period, rose, YoY by 169 per cent to N350 billion in the 12 months ending May 2024 from N130 billion in the 12 months ending May 2023.
FG’s domestic borrowing through FGN Savings Bonds accounted for 1.5 per cent of total borrowing during the period, also spiked, rising YoY by 116 per cent to N29.17 billion in the 12 months ending May 2024 from N16.07 billion in the preceding 12 months ending May 2023.
Interest rate hike
Among other things, the 117 per cent YoY increase in FG’s domestic borrowing in the 12 months ending May 2024 was driven by investors’ response to the high interest rate regime during the period following hike in the Monetary Policy Rate, MPR by the CBN.
Analysis showed that the average MPR rose to 20.32 per cent in the 12 months ending May 2024, representing 4.11 percentage points increase from 16.21 per cent in the preceding 12 months ending May 2023.
As a result, the average interest rate on NTBs rose to 9.1 per cent in 12 months ending May 2024, representing 5.1 percentage points from 4.0 per cent in the preceding 12 months ending May 2023.
In the same vein, the average interest rate on FGN Savings Bond rose to 17.91 per cent at the May 2024 auction from 10.89 per cent at the May 2023 auction.
Analysts’ comments
Notwithstanding the influence of the high interest rate regime, analysts expressed concern that the sharp rise in FG’s borrowing from domestic investors is harmful to the private sector as it makes it costlier for businesses to borrow.
The analysts were however divided on the impact of the borrowings on inflation.
Commenting, Co-Founding Partner, Comercio Partners, a Lagos based investment bank, Nnamdi Nwizu, said: “The increase in borrowing by the government means that there will be more spending by the government, which will have a huge impact on inflation as it will drive demand for goods. Governments are always the largest spender in the world, so the more money they spend, the higher the attendant inflationary pressure. Note also that since they are borrowing at record levels, it means that when they are servicing the debt, they will put a lot more funds in the hands of the public.
“Lending to the Private Sector has been impacted with corporates issuing bonds and Commercial Papers at record levels.
“Whilst we continue to see a lot of issuances by the private sector (above 25% yields), we also see that the smaller corporates are struggling as the government is crowding them out. If an investor can invest in one year risk-free NTBs at 25% yields, they would naturally ask for a premium when lending to the private sector. How many companies can afford to borrow at these steep levels and still be profitable? Also, the higher lending rates will lead to inflationary pressures as the corporates have to increase prices to cover for the higher borrowing rates.
“With respect to fiscal policy, we are yet to see the borrowing by the government have an impact on fiscal policy. Yes, we have the Coastal roads being built, but we would like to see more with regards to policies to help increase production output in the economy. Also, we expect to see a significant increase in debt servicing costs, factoring in the higher rates and increase in domestic borrowing.
“With respect to monetary policy, whilst the Central Bank continues on its hawkish trend, we expect pressure from the government on the Central Bank as its debt service costs rise. The government cannot afford to borrow at these levels for an extended period of time. Government spending can also lead to more pressure on the currency as it means more Naira available to chase the greenback.”
Similarly, Head of Equity Research, FBN Securities Limited, Tunde Abidoye, said: “Government borrowing could potentially fuel inflationary pressures. In addition there’s an indirect effect on exchange rates. Also, there’s the crowding out effect for private sector lending. As it is, not many businesses can afford to borrow at the elevated interest rate. Finally, the monetary policy response to all this may be to continue to raise interest rates in a bid to tame the spiraling inflation.”
However, Chinazom Izuorah, Senior Associate, Investment Brokerage, differed on the impact of the FG’s domestic borrowing on inflation, though she also noted it will make it costly for businesses to borrow.
She said: “The Federal Government’s domestic borrowing program has not changed in the last year. The government’s calendar for offering FGN bonds, savings bonds and Treasury bills remains consistent and in line with historical practice.
“The reason for the increase in value is due to the increase in MPR and the knock-on effect on interest rates for the FGN securities.
“At interest rates of 17% and above, the government’s instruments are more attractive than in the previous year and consequently there is increased interest and participation. This is also consistent with the CBN’s objective of reducing inflation by mopping up liquidity. In simple terms, higher interest rates create an incentive to save.”
She stated the impact of this in terms of inflationary pressure is that with the greater incentive to save, there will be less money in circulation which is crucial to limiting inflation.
“In terms of lending to the private sector: Higher interest rates on government securities, which are considered the safest instruments, is a disincentive to lending to the private sector, which is considered riskier.
“Money tends to fly to safety. Banks, other financial institutions and fund managers have little incentive to take-on riskier assets when they can get attractive returns lending the funds to the government.
“On the fiscal policy front the government uses the funds raised through the issuance of securities to fund the national budget. The present administration has earmarked a significant portion of the budget to capital expenditures, portions will also be used to fund recurring expenditures and debt service.
“The higher interest rates mean that the government is paying a higher rate to investors.
“However domestic borrowing is more sustainable than external borrowing as the monies are borrowed in the local currency. Governments look to external borrowing due to lack of capacity to meet funding needs from the domestic market.
“There is a lot of benefit to having a financially literate citizenry and high domestic savings rates. The most critical issue for Nigeria and Nigerians is that monies are judiciously employed for the purposes they are raised and projects executed efficiently.
“The increase in domestic borrowing values is indicative of the success of the administration’s monetary policy positioning.
“It can be assumed that the sustained rise in the MPR has been favorably received by the market and has stimulated increased participation in the domestic bond market.”
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Poverty and staggering debt remain the albatross on the shoulders of the federal government, 36 States and the Federal Capital Territory (FCT) and the 774 Local Government Areas, despite sharing a whopping N17.9 trillion as the cumulative Federal Account Allocation Committee (FAAC) revenue under President Bola Tinubu.
The figure, which is the highest by the Nigerian government in history, represents a 42.6 per cent surge when compared to N12.56 trillion it was a year earlier.
The increase sprang from the removal of petrol subsidy which freed more funds for monthly FAAC payouts.
The revelation came from a recent FAAC report released by the National Bureau of Statistics (NBS).
Widening poverty
Regardless of the higher monthly subvention, a report from the World Bank indicates that Nigeria’s poverty rate rose from 40 percent in 2018 to 46 percent in December 2023. It means that the number of poor people increased from 79 million to 104 million.
According to the report, more people have fallen below the poverty line due to sluggish economic growth and rising inflation.
“Sluggish growth and rising inflation have increased the poverty rate from 40 percent in 2018 to 46 percent in 2023, pushing an additional 24 million people below the national poverty line,” the World Bank said.
The report added that the number of poor people in urban areas (more exposed to inflation) increased from 13 million to 20 million, while the number of poor people in rural areas rose to 84 million from 67 million within the same period.
The worst five states in poverty headcount rate for 2019, according to Statista are; Sokoto, 87.73%, Taraba, 87.72%, Jigawa, 97.02, Ebonyi, 79.76% and Adamawa, 75.41%
The lowest five states are; Lagos, 4.5%, Delta, 6%, Osun 8.5%, Ogun 9.3% and Oyo, 9.8%
Analysts say the figures have not improved because the factors responsible for the worsening poverty, like terrorism, climate change crisis, lack of farm input, inflation and others, are yet to abate.
The World Bank, however, predicted a silver lining, explaining that the increase in poverty rate will be undone by the recent reforms of President Bola Tinubu from 2024 onward, reversing the rise to 44 percent in 2026.
High sovereign debt
Figures from the Debt Management Office (DMO) show that Nigeria’s total public debt stock as of December 31, 2023, was N97. 34 trillion or $108.229 billion.
Sub-national domestic debt stood at N5.863 trillion, while external debt stock was $4.61 billion.
Topping the debtor list is Lagos State, Nigeria’s commercial hub, had an external debt of $1.24 billion in 2023. However, this figure is slightly less than the $1.25 billion in 2022. The slight decline is likely due to a dependance on more domestic debt, which is about N1.05 trillion. Following closely is Kaduna State, which has an external debt of $587.07 million in 2023, climbing from $573.74 million in the previous year. Also exposed to offshore lenders is Edo State with external debt jumping to $314.45 million in 2023 from $261.15 million in 2022.
Highest and lowest FAAC receivers
An analysis by the whistler shows that Delta, Rivers, Akwa-Ibom, Bayelsa, Lagos and Kano states got the highest FAAC allocation under Tinubu.
On the flip side, Gombe, Ekiti, Ogun and Cross-River States for the lowest.
Despite the fatter monthly FAAC income, there are genuine concerns as 15 Nigerian states have yet to implement the N30,000 minimum wage for their workers since it was signed into law in 2019.
Considering the humongous funds available to states, the organized labour is insisting on a monthly minimum wage of about N600,000 as millions of Nigerians battle multi-dimensional poverty.
According to BudgiT, even though 15 states are yet to implement the minimum wage of N30,000, the 36 states of the federation grew their cumulative personnel cost by 13.44 per cent to N1.75 trillion in 2022 from N1.54 trillion in 2021.
Also, these states grew their overhead bills by 23.42 per cent to N1.24 trillion in 2022.
Under the current administration Delta, Rivers, Akwa-Ibom, Bayelsa, Lagos and Kano states got the highest FAAC revenue during the period.
However, at the end of the 10 months of February 2023 under former President Muhammadu Buhari, Delta, Akwa-Ibom, Rivers, Bayelsa, Lagos and Kano states received the highest revenue.
Further breakdown showed that Delta state despite being the state with the most allocation in both periods, saw a decline of 3.77 per cent to N326.64 billion as against N339.44 billion it got under Buhari.
Rivers, which is the second state with the highest allocation under Tinubu, dropped by 0.88 per cent to N261.48 billion against the N263.79 billion which it got under Buhari.
Experts preach frugality
Experts have pushed for more frugal management of resources across the three tiers of government so that the gains of good governance can cascade down to all nooks and crannies of the society.
The Director General, Centre for the Promotion of Private Enterprise (CPPE) Muda Yusuf, said it was disheartening that development at the sub-national level has remained appalling, calling on governors to look beyond the state capital to develop the rural areas where the bulk of the citizens reside.
He said: “It’s not nice that poverty has continued to ravage the citizens despite higher FAAC disbursements.
“The additional revenue should be spent on projects that positively impact the lives of the people.
“It’s not about governors building flyovers at state capitals and neglecting many parts of their states.
“Look at what your citizens are predominantly engaged in. Are they farmers, fishermen, traders and so on? You invest in what they do so you make the state more inclusive, not just building airports, flyovers etc.
“Corruption is a major issue actually. The more money available, the more the corruption component of it.
“People should be made accountable. A system carrying too many parasites cannot grow.
The citizens should demand accountability and not just lament and go to bed after voting”, he said.
A Kano State High Court presided over by Justice Amina Adamu Aliyu on Monday, May 27, ordered the commissioner of police in Kano to immediately evacuate Aminu Bayero from the Nasarawa palace where he is presently staying.
The court issued an interim injunction restraining Alhaji Aminu Ado Bayero and four other dethroned emirs of Bichi, Rano, Gaya and Karaye from parading themselves as emirs, pending the hearing and determination of the motion on notice filed by the applicants.
The presiding judge gave the order upon hearing of exparte application by counsel to the Applicants, Barrister Ibrahim Isa Wangida dated 27th May 2024.
The order reads: “That an order of interim injunction is hereby granted restraining the 1st 2nd, 3rd 4th & 5th Defendants either by themselves, servants, privies, and or any other persons or officers serving under them or acting in connection with any other person from parading themselves as Emirs of Kano, Bichi, Gaya, Rano and Karaye pending the hearing and determination of the motion on notice filed by the applicants.
“That an order is hereby granted to the extent that the Commissioner of Police Kano State should immediately take over the palace of the Emir of Kano situated at State Road Kano and evict the 1 Defendant/Respondent from the said palace pending the hearing and determination of the motion on notice dated 24 May, 2024.
“That an order of this Hon. Court is hereby granted restraining the 1st 2nd 3rd 4th & 5th Defendants from parading themselves as Emirs of Kano, Bichi, Gaya, Rano, and Karaye in the interest of peace in Kano pending the hearing and determination of the motion on notice.
“That an order is hereby made that 1- 5th Defendants be through the office of the Commissioner Police, Kano State who is to ensure immediate implementation of the order of the Hon. Court in the interest of justice.”
Justice Aliyu fixed 11th June 2024 for the hearing of the motion on notice.
No fewer than 200 officials of the Central Bank of Nigeria were on Friday relieved of their duties, adding to the long list of ongoing disengagements in the apex bank.
This adds to the list of 117 staff sacked by the bank between March 15th and April 11, 2024.
The termination of appointments affects directors, deputy directors, assistant directors, principal managers, senior managers and lower-ranking staff.
Impeccable sources who are staff of the bank confirmed the sacking to our correspondent on Friday, adding that the sacked personnel were more than 200.
They revealed that the latest purge included older directors who were not affected by the last round of retrenchment.
One of the sources in a 20-second call stated, “It is true and confirmed.”
The staff who could not disclose further details for fear of being tapped added that the purge had caused palpable apprehension amongst staff of every cadre as the management had not specified any known criteria for the decisions.
Another authoritative source confirmed the information, indicating that additional dismissals are expected in the months ahead, spread out in phases.
The official said, “It is real and is even more than 200 officials but the actual number is unconfirmed yet. The sacking is coming in staggered phases and that is why we can’t confirm the number yet.
“But it is not less than 200. The sacked persons include directors and other cadres but the ones that are easily known are the directors. Some of the old directors that were not affected during the last round of sacks are now affected.”
The sack letter issued by the Human Resources Department on May 24, 2024, indicated that the policy was to reorganise the organisation for effective operations.
The letter, lacking a signature, read, “The new strategic direction of the bank has been widely publicised. In line with our new mission and vision, the bank is currently undergoing a significant organisational and human capital restructuring process.
“As a result of this review, I have been directed to notify you that your services will not be required with effect from Friday, 24th May 2024. Your final entitlements will be calculated and paid to you in due course. Thank you”
In February, at least 1,500 members of staff of the apex bank of Nigeria were redeployed from the headquarters located at Central Area to its Lagos office.
At the time, the CBN said the action was necessitated by several factors, including the need to align the bank’s structure with its functions and objectives and redistribute skills to ensure a more even geographical spread of talent.
It added that it was also in compliance with building regulations, as indicated by repeated warnings from the facility manager, and the findings and recommendations of the Committee on Decongestion of the CBN Head Office.
Efforts to get the reaction of the Director of Corporate Communication, Hakama Sidi Ali, was not successful as she did not respond to several calls sent across to her or reply the text messages to her line.
Nigeria’s economy grew at a slower than expected rate in the first quarter as a sharp currency slump and adverse weather impacted the non-oil sector.
Gross domestic product expanded an annual 2.98% in the three months through March, compared with growth of 3.46% in the previous quarter, according to data released by the National Bureau of Statistics on Friday. The median estimate of eight economists in a Bloomberg survey was 3.5%.
Key contributors to the slower-than-expected growth were agriculture, due to bad weather and insecurity, and manufacturing where profits have been knocked by an almost 70% slump in the naira against the dollar since last year.
Weaker growth in those sectors contributed to the non-oil part of the economy expanding 2.8% - its slowest pace in two quarters.
One bright spot was the oil sector which grew for a successive quarter because of higher oil production. Output rose to 1.57 million barrels per day in the period, up from 1.51 million barrels a year earlier, helped by better security in the Niger Delta region.
Improved oil output is expected to continue. Minister of State for Petroleum Heineken Lokpobiri said Thursday that production - which includes crude and other hydro-carbons - is now at 1.7 million barrels per day from a low of 1.1 million barrels when Tinubu took office. Nigeria hopes to further lift production by opening bids for a dozen oil blocks and concluding several divestment deals with international oil companies in coming months.
The government is targeting an economic growth rate of about 3.8% in 2024 and a return to 6% or more in the coming years, which it last achieved in 2014. The International Monetary Fund projects 3.3% economic growth for 2024, which will lower Nigeria’s ranking to fourth largest in Africa.