…As Oil slips below $61 following weak demand outlook***
The House of Representatives Committee on Finance has demanded further explanation on the $469 million Abuja CCTV camera project from the Ministry of Finance.
The Chairman of the committee, Rep. James Faleke (APC-Lagos), at a budget defence session with the ministry on Thursday in Abuja, said that there was a need for Nigerians to get value for monies paid.
“I want to know the position of this loan, I am sure we are paying back but the CCTV is not working.
“Any time we take loan from China, the Chinese will come and do the job, they will bring all their equipment, the personnel and the goods and yet we do not have value for the money, especially that of the CCTV.
“Where are we? I need you to look into it and send us a memo on this particular aspect”, he said.
“Before this administration, we collected some loans and the one that strikes me the most is the 460 million dollars for CCTV installation in Abuja.
Responding, the Minister of Finance, Mrs Zainab Ahmed, said that Nigeria was servicing the loan but she had no explanations on the status of the project.
“We are servicing the loan but on the project, we will have to ask the Federal Capital Territory (FCT) Authority because the project was deployed in the FCT, I have no information on the status of the CCTV.
“The the conditions of the loans that we take from China always will be that a Chinese company will provide the infrastructure services.
“These are loans that are of three per cent, the rail lines are being rolled out, the Abuja-Kaduna, Lagos-Ibadan rails are all loans from China and are being executed by Chinese companies,” she said.
Ahmed said that the Abuja, Lagos, Port Harcourt and Kano airport rehabilitation projects were done by Chinese companies and were supervised by the relevant ministries and the National Assembly to ensure quality work.
She said that there were a lot of Nigerians working with Chinese on the projects.
On the 2019 budget releases, the minister said that by October, the ministry had released 100 per cent for personnel cost.
Ahmed said that for debt service, payment was also 100 per cent and that for overhead, six out of 10 months had been released.
She said that some critical ministries had, however, received overhead for nine months.
The minister said that as at October 15, N654 billion had been released for capital expenditures.
According to her, the plan is to ensure that by December, every Ministry, Department and Agency has received at least 40 per cent of its capital expenditure.
The Permanent Secretary, Mr Mohammed Dutse, said that N1.3 billion was earmarked for overhead in the ministry and N664 million released.
He said that N3.3 billion was allocated for capital expenditure in the ministry but only N1.8 million had been released.
For the ministry’s 2020 budget, the permanent secretary said that N4.36 million was proposed for personnel cost, N1.3 billion for overhead and N3.3 billion for capital expenditures.
Meanwhile, Oil slipped below 61 dollars a barrel on Thursday as concern over the demand outlook offset a surprise drop in U.S. crude inventories and the prospect of further action by OPEC and its allies to support the market.
In the latest sign of economic weakness that has prompted lower oil demand projections, employment in Germany’s private sector fell for the first time in six years in October, survey showed on Thursday.
Brent crude LCOc1 fell 39 cents to 60.78 dollars a barrel by 0844 GMT, having risen 2.5 per cent on Wednesday and touched it highest since Sept. 30.
U.S. West Texas Intermediate (WTI) crude CLc1 was down 45 cents at $55.52.
“Oil may now be off its lows, but gains are very gradual and downward pressures, most notably as a result of the subdued global outlook, persist,” said Craig Erlam, analyst at broker OANDA.
Crude’s gains on Wednesday were supported by an unexpected drop in U.S. inventories.
U.S. crude inventories fell 1.7 million barrels in the week ended Oct. 18, against analyst expectations of a 2.2 million barrel increase, data from the Energy Information Administration showed.
Brent prices have risen 13 per cent this year, supported by a supply pact among the Organization of the Petroleum Exporting Countries (OPEC) and its allies.
Since January OPEC, Russia and other producers have implemented a deal to cut oil output by 1.2 million barrels per day (bpd) until March 2020 to support the market. The producers meet over Dec. 5-6 to review the policy.
Adding further price support, officials have said that extended supply curbs are an option to offset the weaker demand outlook for OPEC crude in 2020.
Additional reports from Reuters