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Interbank lending rate drops to 20% amid cash squeeze

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Customers express disappointment over CBN’s directive on transaction charges

…As Pension fund assets rise by N862bn***

The nation’s overnight lending rate dropped to 20 per cent on Thursday on expectation that a cash squeeze will ease after money market rates more than doubled previous session.

The Central Bank of Nigeria has kept liquidity tight to support the currency, leaving its benchmark interest rate on hold at 14 per cent this year.

The CBN also aims to keep rates high to attract foreign inflows into its bond market to boost dollar liquidity.

“The market is a bit tight because of FX purchases which mopped up (naira) liquidity,” one trader was quoted by Reuters as saying.

The overnight rate closed at 44 per cent on Wednesday after banking system liquidity hit a debit of N265bn, traders said.

Tight liquidity continued on Thursday with the market in debit of N243bn, although the central bank repaid some treasury securities.

Traders said money market rates dropped on Thursday as lenders accessed the CBN window for naira at 16 per cent.

Though rates could go back up if a N60bn treasury security offered by the central bank on Thursday worsened the cash squeeze.

The CBN is selling $100m weekly to meet wholesale currency demand and also a separate amount twice weekly for retail needs to keep its multiple exchange rate system stable.

It injected a total of $195m into the interbank foreign exchange market on Monday, almost one week after it intervened in the market with the sale of $195m.

The naira has remained unchanged at 363 against the dollar in recent days.

Reuters quoted traders as saying that the local currency would likely hold ground across its multiple exchange rates next week following CBN’s intervention in the official market to boost dollar liquidity.

The local currency has traded at around 360 per dollar for investors with a volume of almost $600m this week.

On the official market, where the central bank has been selling $500,000 daily to lenders, the naira firmed slightly to 305.55 per dollar at 3:00pm on Thursday.

In the meantime, the latest report on the Nigerian pension fund administration, which was released on Thursday by the National Bureau of Statistics and the National Pension Commission, indicated that the country’s pension fund assets increased by N862bn to N6.164tn as of December 31, 2016.

According to the report, the N6.164tn pension fund assets represent six per cent of the country’s Gross Domestic Product, as the figure indicates an increase of N862bn when compared to the N5.302tn recorded in 2015.

It stated that a large percentage of the fund was invested in the domestic market, while the remaining part was invested abroad.

The report stated, “The Nigerian pension fund administration data for 2016 reflected that the pension fund asset under management as of December 31, 2016 stood at N6,164.76bn as against N5,302.82bn in 2015.

“The total asset as at the period under review represents six per cent of the GDP as against 5.57 per cent in 2015. 98.56 per cent of the funds were invested in domestic market while the remaining 1.44 per cent were invested in foreign market.”

The PenCom stated that the Federal Government of Nigeria debt securities had the highest weight percentage of 71.28 of the total pension fund assets.

This, it noted, was closely followed by ordinary shares, with 9.48 per cent weight; and money market securities, with 6.51 per cent weight; while infrastructure funds had the least with 0.03 per cent weight.

“Participants within the age distribution below 40 years have the highest percentage composition by sector and gender. These are closely followed by participants within the age brackets of 40 to 49 years and 50 to 59 years, respectively, while participants above 60 years have the least percentage composition by sector and gender,” the report stated.

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Economy

Nigeria Loses 50% Of Agricultural Produce Post-harvest – FAO

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Nigeria Loses 50% Of Agricultural Produce Post-harvest – FAO

Mr Ibrahim Ishaka, Food System/Nutrition Specialist at the Food and Agriculture Organisation (FAO) of the United Nations, revealed that Nigeria loses around 50% of its agricultural products along the food supply chain.

Ishaka disclosed this in an interview with the Newsmen on the sidelines of an FAO-organised training in Yola on Saturday.

He explained that food waste posed significant challenges to Nigeria’s agricultural sector, impacting food security, economic growth, and environmental sustainability.

“Some of these challenges include technological barriers, inefficient harvesting techniques, pest infestations, and lack of access to modern farming tools, all of which contribute to losses during harvest, largely influenced by consumer behaviour,” he said.

Ishaka further highlighted additional factors contributing to post-harvest losses, including inadequate storage facilities, poor handling practices and poor transportation infrastructure.

“These factors result in significant losses, especially for perishable goods such as fruits and vegetables.

He also noted that inefficient food processing methods, improper packaging, inadequate storage, and unhealthy consumption habits further exacerbate food waste.

“The nutrition expert highlighted several FAO initiatives promoting nutritious and sustainable practices within communities, focusing on reducing post-harvest losses, improving hygiene, and ensuring sanitation.

“These initiatives include investing in post-harvest infrastructure, building community capacity, training, and empowerment programmes, among others.

“I firmly believe that the key to empowering people, particularly in the northeast region, lies in giving them the power to make informed decisions and the power to educate others,” he said.

Ishaka mentioned the establishment of several FAO-supported centres that produce and distribute locally nutritious foods, such as ‘tom brown,’ to combat malnutrition and food insecurity in the region.

Ishaka mentioned the establishment of several FAO-supported centres that produce and distribute locally nutritious foods, such as ‘tom brown,’ to combat malnutrition and food insecurity in the region.

“These centres are run by local communities, promoting community-led initiatives to improve food security.”

He expressed optimism that the training would have a long-lasting impact on participants and their communities, enhancing overall well-being and food security through the adoption of best nutrition practices.

This initiative is part of the “Emergency Agriculture-Based Livelihoods Sustenance for Improved Food Security” programme, targeting Borno, Adamawa, and Yobe, with support from USAID. 

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Oil, Gas Industry Owes FG $6bn, N66bn – NEITI Report

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Oil, Gas Industry Owes FG $6bn, N66bn – NEITI Report

The Nigeria Extractive Industries Transparency Initiative (NEITI), says outstanding collectable revenues due to the Federal Government in the oil and gas industry have risen to 6.071 billion dollars and N66.4 billion as of June 2024, respectively.

NEITI disclosed this on Thursday in Abuja at the public presentation of its 2022 and 2023 Independent Oil and Gas Industry Reports.

It was reported that the report is being prepared by the NEITI Board and National Stakeholders Working Group (NSWG).

The report was unveiled by Mr Ola Olukoyede, Chairman, Economic and Financial Crimes Commission (EFCC), alongside Sen. George Akume, Secretary to the Government of the Federation and Chairman, NSWG, NEITI and other dignitaries.

The breakdown of the report showed that outstanding liabilities were 6.049 billion dollars and N65.9 billion in unpaid royalties and gas flare penalties, due to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) as collectable revenues by Aug. 31, 2024.

It also provided a detailed analysis of the information and data regarding who owes what in outstanding revenues due to the government.

Oil, Gas Industry Owes FG $6bn, N66bn – NEITI Report
(L-R) Mr Ola Olukoyede, Chairman, Economic and Financial Crimes Commission (EFCC), with Sen. George Akume, Secretary to the Government of the Federation and Chairman, NSWG, NEITI and Mr Ikenga Ugochinyere, Chairman. House Committee on Downstream Petroleum

A further breakdown showed outstanding petroleum profit taxes, company income taxes, withholding taxes, and Value Added Tax  (VAT), due to the Federal Inland Revenue Service (FIRS), amounting to 21.926 million dollars and N492.8 million as of June 2024.

On fuel importation, the latest NEITI report disclosed that a total of 23.54 billion litres of Premium Motor Spirit (PMS) were imported into the country in 2022, while 20.28 billion litres were imported in 2023.

This represented a reduction of 3.25 billion litres, or a 14 per cent decline, following the removal of the fuel subsidy.

A detailed 10-year trend analysis (2014–2023) in the NEITI report showed that the highest annual PMS importation into the country, 23.54 billion litres, was recorded in 2022, while the lowest, 16.88 billion litres recorded in 2017.

The NEITI report also disclosed that a total of N15.87 trillion was claimed as under-recovery/price differentials between 2006 and 2023, with the highest amount, N4.714 trillion, recorded in 2022.

On crude production, fiscalised crude production in 2022 stood at 490.945 million barrels, compared to 556.130 million barrels produced in 2021, representing an 11 per cent decline.

However, in 2023, NEITI’s independent report revealed total fiscalised production of 537.571 million barrels, and 46.626 million barrels or a 9.5 per cent increase from total production recorded in 2022.

A 10-year trend (2014–2023) of fiscalised crude oil production in Nigeria showed the highest production volume of 798.542 million barrels was recorded in 2014, while the lowest, 490.945 million barrels, was recorded in 2022.

The NEITI report further provided detailed information and data on crude lifting, disclosing that in 2022, total crude lifting was 482.074 million barrels compared to 551.006 million barrels lifted in 2021.

“In 2023, total crude lifting stood at 534.159 million barrels, representing an 11 per cent increase of 58.08 million barrels,” the report stated.

On oil theft and crude losses, a total of 7.68 million barrels of crude were either stolen or lost in 2023, representing a significant drop of 79 per cent (29.02 million barrels) compared to 36.69 million barrels either stolen or lost in 2022.

NEITI’s independent industry report carefully reviewed all aspects of the regulatory framework for the oil and gas industry.

This included the legal framework, fiscal regime, roles of government entities and reforms, as well as laws, Petroleum Industry Act (PIA 2021) and regulations relating to addressing corruption risks in the oil and gas sector.

The event was supported by the European Union and the Rule of Law and Anti-Corruprion (RoLAC) programme being implemented by the International Institute for Democracy and Electoral Assistance (IIDEA). 

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Economy

EKO BRIDGE REPAIRS: LASG Rolls Out Diversion Plan Beginning Monday

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EKO BRIDGE REPAIRS; LASG Rolls Out Diversion Plan Beginning Monday

The Lagos State Government on Friday announced that traffic will be diverted away from Eko Bridge to facilitate emergency repairs by the Federal Ministry of Works. 

The diversion, according to the Commissioner for Transportation, Mr Oluwaseun Osiyemi, will commence on Monday, 16th September 2024, and will last for 8 weeks.

“The repairs will be carried out in four phases, during which the bridge will be intermittently fully or partially closed, depending on the work schedule”, Osiyemi stated, advising Motorists to use the following alternative routes during the repairs:

*Motorists heading to the Island from Funsho Williams Avenue can make use of the service lane at Alaka to connect to Costain and access Eko Bridge to continue their journeys.

*Alternatively, Motorists heading to the Island can access Costain to connect Eko Bridge to link Apongbon for their destinations.

*Motorists can also connect Apongbon inwards Eko Bridge to link Costain to access Funsho Williams Avenue.

*Motorists can also make use of Costain inwards Alaka/Funsho Williams Avenue or alternately go through Apapa Road from Costain and link Oyingbo to access Adekunle to link Third Mainland Bridge for their desired destinations.

*In the same vein Motorists heading to Surulere are advised to use Costain to link Breweries inward to Abebe Village to connect Eric Moore/Bode Thomas to get to their destinations.

The Commissioner for Transportation, Mr Oluwaseun Osiyemi, assures that Lagos State Traffic Management Authority officers will be deployed to the rehabilitation areas and alternative routes to minimize travel delays and inconvenience.

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