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Budget: FG to spend N1.16tn more in 2018

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…As Jonathan accuses APC of lying, non-performance***

The country’s national budget will rise by N1.16tn in 2018, according to projections contained in the 2018-2020 Medium Term Expenditure Framework and Fiscal Strategy submitted to the National Assembly by President Muhammadu Buhari.

The President forwarded the MTEF/FSP to the National Assembly on Tuesday, with a covering letter read to members of the House of Representatives by the Speaker, Mr. Yakubu Dogara.

Details of the MTEF, which The PUNCH obtained in Abuja on Thursday showed that the Federal Government would spend N8.60tn next year, up from the N7.44tn appropriated in 2017.

The difference of N1.16tn represents a “15.5 per cent” increase over the budget of the current year.

This will also mean additional deficit in the 2018 budget size of up to N592.75bn or “25.0 per cent” over the N2.36tn deficit contained in the 2017 budget.

In 2016, the country’s budget was N6.06tn.

The details of the MTEF reveal that the anticipated aggregate revenue to fund the 2018 budget will be N5.65tn “or 11.0 per cent or N562.50b over the 2017 estimate of N5.08tn.”

Major expenditure heads include N12.12tn for recurrent and N2.03tn for capital expenditure.

The government projects the country’s Gross Domestic Product to grow by 3.5 per cent in 2018, but inflation will “moderate to 12.42 per cent.”

The government arrived at this, using a crude oil production projection of 2.3 million barrels per day in 2018, with a benchmark price of $45 “and an average exchange rate of N305/$1.”

Daily oil production is expected to be 2.4mbpd in 2019 and 2.5mbpd in 2020.

In 2017, oil production suffered setbacks before it later climbed to 2.2mbpd. The benchmark for 2017 was $44, while the exchange rate was also N305/$1.

Generally, the government hopes that oil production will rise, owing to improved security and consultations with groups in the Niger Delta region.

For instance, it said pipeline vandalism dropped to 94 points in April 2017, compared to 214 vandalised points in the same period in 2016.

The document added, “The nominal GDP is expected to increase from N104.79bn in 2017 to N134.7bn in 2020.

“Similarly, consumption expenditure is projected to grow from N83.66 in 2018 to N107.77bn in 2020. These are reflective of a gradual recovery of the economy.”

The MTEF merely gives a general outlook of the government’s plans for 2018-2020.

Specific details, particularly in respect of the 2018 budget, are expected to be contained in the estimates of the budget that will soon be presented to the National Assembly by Buhari.

By the provisions of the Fiscal Responsibility Act, 2007, the National Assembly is to first consider and approve the MTEF/FSP before the estimates of the budget will be presented to lawmakers.

Meanwhile, the House in plenary asked the government to recover the $14.29bn gas flare fines owed the country by International Oil Companies from 2008 to 2016.

The House also called for a status report on the damage caused by gas flaring in affected communities.

The resolution was passed following a motion moved by a member from Edo State, Mr. Johnson Agbonayinma, and six other lawmakers.

The motion read partly, “The House is aware that the Federal Government, in a bid to discourage gas flaring and encourage the redirection of gas flared from waste to wealth, and to save the environment and the lives of the people living in the gas flared environment, imposed a penalty of $3.5 per 1000 SCF of gas flared by oil companies.

“(The House is) also aware that the Deputy Director and Head, Upstream of the Department of Petroleum Resources, while speaking at a conference in Houston, Texas, USA, recently, said that the country had lost $14,298bn between April 2008 and October 2016 in form of penalties for gas flaring, which the IOCs failed to pay.

“In a similar vein, the Nigeria Extractive Industries Transparency Initiative, in its latest Oil and Gas Audit Report, noted that firms operating in the country had failed to abide by the regulating penalty of $3.5 for every 1000 SCF of gas flared by oil companies.

“(The House is) concerned that multinational oil companies, which adhere strictly to internationally acceptable environmental best practices in their countries and other parts of the globe, have refused to pay the agreed penalties on gas flared in Nigeria.”

In the meantime, former President Goodluck Jonathan has accused the All Progressives Congress (APC)-led administration of running a government of lies and propaganda.

Jonathan spoke in Abuja yesterday while receiving one of the chairmanship aspirants of the Peoples Democratic Party (PDP), Prof Tunde Adeniran, at his residence.

The former President insisted that the PDP, which controlled the federal government from 1999 to 2015 did well for the country but that the APC had failed the country and its people.

He said the APC administration has nothing to show as achievement.

?Challenging the APC leadership to public debate on its performance, Jonathan said, “The PDP administration for 16 did well and will continue to do well. But this administration has done nothing, the administration is full lies and propaganda

“In the power sector, we did well to revive it, a certain state governor criticised our government, saying that any serious government should be able to fix the power sector within six months. But today, the APC has been in power for how many years? Fortunately, the then governor is in the APC Government as a Minister”.

The former President said that all hope was not lost, adding that the PDP would go all out and put its house in order for it to return to power in 2019.

Jonathan said that Nigerians have been able to see the difference between the PDP and the APC in terms of performance.

“With the rate at which people are coming around to associate with a party that lost elections, it shows that the people still believe in the PDP. With the number and calibre of the people coming out to vie for the seat of the national chairman and other offices of our party, it shows that our party still has another chance”, the ex- President added.

But APC Deputy National Chairman (North) Senator Lawal Shuaibu, rejected the ex-president’s comment.

Shuaibu said: “In the history of governance in this country, there is no government that deceived Nigerians like that of Goodluck Jonathan.

“I have never seen where a government was being run on the basis of speculation rather than realities like that of Goodluck Jonathan.

“I am not even talking about the PDP government. I am talking particularly about Goodluck Jonathan’s government. They were so deceptive that Nigerians actually realised their act of deception and decided not to trust them again and that was why they lost the (2015) election.”

Speaking on his expectations, Jonathan said the PDP needed “a national chairman who will rule the party democratically and carry others along. In fact, the national chairman is the leader of the party. It is not the other way round”.

He said judging by his long interaction with Prof Adeniran, coupled with testimonies of other party leaders, Adeniran possessed what it takes to lead the party at this critical point in time.

The ex-President warned the party leaders and the aspirants against turning the convention into a battle field.

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Economy

NGX Market Capitalisation Gains N836bn

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Stock Market Gains N18bn; FTN Cocoa Processors, Prestige Assurance lead Losers’ Chart 

…Tantalizers, NASCON lead the losers’ chart 

The Nigerian Exchange Ltd.(NGX) market capitalisation, which opened at N57.697 trillion on Tuesday, gained N836 billion or 1.45 percent closing at N58.533 trillion.

Also, the All-Share Index rose by 1.45 percent or 1,480 points to close at 103,524.44, as against 102,044.84 recorded on Monday.

As a result, the Year-To-Date (YTD) return rose to 38.45 percent.

Interest in Telco heavyweight and Tier-one banks such as MTN Nigeria, UBA, Access Corporation, Guaranty Trust Holding Company(GTCO), and sustained interest in Transcorp Power(TransPower) kept the market in the green.

Market breadth closed positive with 35 gainers and 14 losers.

On the gainer’s chart, UBA led in percentage terms of 10 to close at N25.30, followed by MTN by 9.98 percent to close at N243.50 per share.

Julius Berger also gained 9.71 percent to close at N61, While Access Corporation rose by 9.51 percent to close at N22.45 per share.

Veritas Kapital Assurance went up by 9.38 percent to close at 70k per share.

Conversely, Tantalizers led the loser’s chart by 7.89 percent to close at 35k, and National Salt Company of Nigeria(NASCON) trailed by 6.77 percent to close at N53.70.

Morison Industries Plc shed 6.62 percent to close at N1.41, C&I Leasing lost 6.45 percent to close at N3.48, while Cutix Plc dropped 6.30 percent to close at N2.53 per share.

However, analysis of the market activities showed trade turnover settled lower, relative to the previous session.

The value of transactions was also down by 16.76 percent.

A total of 565.79 million shares valued at N14.23 billion were exchanged in 11,519 deals,  compared to 436.90 million shares valued at N17.09 billion exchanged in 11,344 deals traded on Monday.

On the activity chart, Transcorp led in volume with 170.72 million shares traded at a value of N3.13 billion, Access Corporation followed by 48.57 million shares valued at N1.06 billion.

GTCO sold 39.04 million shares worth N165.80 million, Jaiz Bank traded 36.78 million shares valued at N72.51 million and UBA transacted 31.96 million shares valued at N796.24 million

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Economy

SIFAX Group Appoints Basil Agboarumi As Executive Director

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SIFAX Group, one of the leading business conglomerates in Nigeria with investment in Maritime, Aviation, Oil & Gas, Haulage & Logistics, Financial Services, and Hospitality, has appointed Basil Agboarumi as its new Executive Director of corporate and Intergovernmental Affairs.

Agboarumi recently completed his term as the Managing Director/CEO of the Skyway Aviation Handling Company Plc. (SAHCO Plc.), one of the subsidiaries of SIFAX Group.

Agboarumi holds a National Diploma (OND) in Mass Communication from the Federal Polytechnic, Auchi and a Higher National Diploma (HND) in Mass Communication from the Federal Polytechnic, Oko, a Master in Communications (MSc) from the Lagos State University and a Certificate in Creative Design & Digital Communications from the School of Media & Communications of the Pan-Atlantic University, Lagos. He also holds a Management Certificate in Civil Aviation from Concordia University, Montreal, Canada.

Basil Agboarumi, Executive Director, Corporate and Intergovernmental Affairs

After the privatization and subsequent takeover of SAHCOL by SIFAX Group in 2009, Agboarumi was appointed the Head of Corporate Communications to spearhead the re-branding of the new company. He was subsequently appointed the company’s Managing Director in 2018. Under his leadership, SAHCO Plc was listed on the Nigeria Stock Exchange while many airlines, both local and foreign, signed business deals with the company due to its excellent and cutting-edge services which include passenger handling, ramp handling, and cargo handling.

Agboarumi has over 25 years of professional in public relations, reputation management, brand development, media relations, business development, and government relations.

Speaking on the new appointment, Dr. Taiwo Afolabi, Chairman, SIFAX Group, said Agboarumi brings vast experience and records of achievements to his new role, adding that these qualities will help him succeed in the new role.

He said: “He demonstrated the capacity and ability to navigate different terrains as a leader during his time as the Managing Director of SAHCO. The COVID-19 pandemic hit shortly after he took over the reins at SAHCO, but he was able to steer the ship of the company to profitability despite the uncertainties that characterised the global aviation business at the time. I am convinced the Group will benefit tremendously from his wealth of experience as he assumes this new role.”

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Economy

NGX All-Share Index Crosses 100,000 Mark

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Stock Market Gains N18bn; FTN Cocoa Processors, Prestige Assurance lead Losers’ Chart 

…Guinness Nigeria and FTN Cocoa Processors lead the losers’ table

The All-Share Index, one of the performance indices of the Nigerian Exchange Ltd.(NGX), on Thursday, crossed a 100,000 mark for the second time in the year.

Having crossed the mark on Jan. 24, and later dropped, the All-Share Index specifically added 0.75 percent or 744 points to settle at 100,335.3, compared to 99,591.64 posted on Wednesday.

Consequently, investors gained N420 billion or 0.75 percent, as the market capitalisation which opened at N56.310 trillion, closed at N56.730 trillion.

Also, the Year-To-Date (YTD)return rose to 33.19 percent.

Improved buy interest in the shares of Dangote Sugar, MTN Nigeria, Transcorp Power, Oando Plc, and Cornerstone, alongside other top gainers drove the equity market to a positive terrain.

Analysis of the market activities showed trade turnover settled lower relative to the previous session, with the value of transactions down by 9.11 percent.

However, market breadth closed negative with 33 losers and 25 gainers.

On the gainers table, Dangote Sugar and MTN led in percentage terms of 10 percent each to close at N50.60 and N201.30 per share, respectively.

Transcorp Power followed closely by 9.99 percent to close at N351.30, while Juli Plc added 9.96 percent to close at N4.97 per share.

National Salt Company of Nigeria (NSCN) rose by 9.92 percent to close at N47.65 per share.

On the other hand, Guinness Nigeria and FTN Cocoa Processors led the losers’ table by 10 percent each to close at N45.90 and N1.53 per share, respectively.

Transcorp also lost 9.95 percent to close at N17.10, Ikeja Hotel shed 9.93 percent to close at N6.08, while Redstarex declined by 9.87 percent to close at N3.38 per share.

Stock Market Gains N18bn; FTN Cocoa Processors, Prestige Assurance lead Losers’ Chart 

A total of 554.72 million shares valued at N17.73 billion were exchanged in 9,708 deals, compared to 416.48 million shares valued at N19.51 billion exchanged in 9,338 deals.

On the activity table, Transnational Corporation (Transcorp) led both in volume and value with 301.36 million shares traded in value of  N5.65 billion.

Sterling Nigeria sold 33.32 million shares worth N150.78 million, while FBN Holdings traded 23.21 million shares valued at N773.91 million.

Also, United Bank of Africa (UBA) transacted 18.38 million shares worth N400.29 million and Zenith Bank sold 17.08 million shares valued at N583.93 million.

Reacting, a stockbroker with Premium Capital, Mr Victor Ibrahim, said that the improved performance of the equity market was due to renewed investors’ expectations from the current government’s policies.

Ibrahim stated in Lagos that investors were keying into the future benefits of the economy by boosting their investment in the equity market.

He said, “The stock market is a leading indicator of the Nigerian economy and as such, with government policies such as the free-flow economy, investors confidence in our market has been boosted.

“The artificial scarcity of dollars in order to underprice or devalue the Naira is also another indicator.

“This is because the price of stocks in the Nigerian equity market is cheaper for foreign investors and those local investors who have dollars in reserve.

“While the Nigerian economy may presently appear tough, investors are keying into the future opportunities in the current government’s policies with the belief in the capacity of President Bola Tinubu.”

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