The Federal Government is still discussing with investors and stakeholders on the outright sale of the Omotosho and Olorounsogo Power Stations.
Mr Nuhu Wya, the Minister of State for Power, said this on Tuesday while speaking to journalists at the investors’ forum on the power sector organised by the Bureau of Public Enterprises (BPE) in Lagos.
He said the power stations were built by contractors through external loans.
The minister said that government was able to bring its equity participation in the companies to 35 per cent and needed to repay the 65 per cent that was pending.
He said that the Federal Government could not redeem the debt because of low output in the stations.
Wya said the stations, which have installed capacity of over 600 megawatts each when in full operation, would add value to the country’s power generation and distribution.
Our correspondents reports that the Federal Government is holding discussions with a consortium from Nigeria and China with a view to selling the two power stations under a buy-out deal.
The minister also said that the plants had been shut down several times because the operating manuals were written in Chinese, adding that PHCN workers had been encountering difficulties in running the plants.
“The government thinks it will be better to sell them to the Chinese contractors that installed the machines,” he said.
Wya said that the plants were already undergoing rehabilitation in preparation for their eventual sale to the consortium.
“Government wants to ensure that the nation gets optimum performance from the two power stations; that is why it is looking at the option of outright sale of both plants,” he said.
He said government also planned to sell its 51 per cent stake in the distribution companies to investors and grant concession to private companies to run the hydroelectric power stations. The minister said that the transmission grid would still belong to the government but would be managed by private sector operators.
Our source reports that Nigeria is targeting 14,000 megawatts in power generation by 2013 and 40,000 megawatts by 2020 under the power sector reforms.
Nigeria’s Revenue-To-GDP Ratio Lowest, Private Sector Choking – World Bank
Nigeria’s revenue-to-Gross Domestic Product ratio, which fell to between five and six per cent last year, is the lowest in the world, the World Bank said on Monday.
The Country Director for Nigeria, World Bank, Dr Shubham Chaudhuri, said this during a panel session at a virtual public sector seminar with the theme ‘Nigeria in challenging times: imperatives for a cohesive national development agenda’ organised by the Lagos Business School.
Chaudhuri, who stressed the need for private investment for the country to realise its potential, said the private sector in the country ‘is struggling to breathe’.
“In Nigeria, I think the basic economic agenda is about diversification away from oil because oil has really been like resource curse for Nigeria on multiple dimensions,” he said.
He noted the aspiration of the President, Major General Muhammadu Buhari (retd.), to lift 100 million Nigerians out of poverty by the end of the decade.
He said, “Nigeria is a country with tremendous potential. If you look at the synopsis for this panel, it suggests that Nigeria is at a critical juncture – almost at the moment of crisis.
“Despite all of that, Nigeria is still the largest economy in Africa. So, just think about the potential that Nigeria has because of its natural resources, but more than that, because of its dynamism and all of its population. Nigerians are more entrepreneurial by nature.
“No country has become prosperous and realised its potential, eliminated poverty without doing two simple things: investing in its people, and unleashing the power of the private sector in creating jobs by investing and growing business. And then, of course, the basic function of the state is to provide security and law and order.”
According to Chaudhuri, to invest in people entails basic services, basic education, primary healthcare and nutrition, among others.
He said, “On this, Nigeria at the moment ranks sixth from the bottom in terms of the human capital index that we produce every year.
“So, obviously, there is a huge agenda in terms of investing in human capital. Nigeria spends more on PMS (premium motor spirit) subsidy than it does on primary healthcare in a year, and we know who the PMS subsidy is benefitting.”
He indicated that despite the country’s huge potential to attract private capital, the non-oil part of the economy ‘is not growing that robustly and certainly not generating revenues that the government needs’.
Chaudhuri said, “So, we see as priorities investments in human capital. But for that, one needs revenues. And there again, Nigeria unfortunately has the distinction of having about the lowest revenue-to-GDP ratio in the world.
”The standard rule of thumb is that for government to provide the basic services and law and order, it needs between 15 to 20 per cent of GDP as being revenue, and this will be both at the federal and state levels combined.
“In Nigeria, it was eight per cent in 2019. In 2020, in the middle of the Covid-19 crisis and with the fall in oil prices, that went down to about between five and six per cent.
“So, domestic revenue mobilisation is huge. And then the third is enabling the space for private investment. You have to fix the power problem. Power is like the oxygen of an economy. In Nigeria, the private sector is struggling to breathe.”
CBN Stops Sale Of Forex To BDCs
The Central Bank of Nigeria (CBN) as announced immediate discontinuation of sale of Foreign Exchange (forex) to Bureau de Change (BDC) operators in the country.
Mr Godwin Emefiele, the CBN Governor , made this announcement yesterday, while presenting a communique from the apex bank’s Monetary Policy Committee (MPC) meeting in Abuja.
Emefiele said that the decision was informed by the unwholesome business practices of the BDCs, which he said had continued to put enormous pressure on the Naira.
He said , henceforth, the apex bank would sell forex to deserving Nigerians through the commercial banks.
“ The BDCs were regulated to sell a maximum of 5000 dollars per day, but CBN observed that they have since been flouting that regulation and selling millions of dollars per day.
“The CBN also observed that the BDCs aid illicit financial flows and other financial crimes. The bank has thus, decided to discontinue the sale of forex to the BDCs with immediate effect.
“We shall, henceforth, channel all forex allocation through the commercial banks,” he said.
He urged the commercial banks to ensure that every deserving customer got their forex demand, adding that any bank found circumventing the new system would be sanctioned.
“Once a customer presents all required documentation to purchase forex, the commercial banks should ensure they get the forex.
“Any customer that is denied should contact the CBN on 0700385526 or through the email- firstname.lastname@example.org “ he said.
The Tide source reports that stakeholders have been calling on the CBN and its MPC to take urgent steps to halt unending depreciation of the Naira.
Recently, a past President of the Chartered Institute of Bankers of Nigeria (CIBN), Mr Okechukwu Unegbu, urged the MPC to focus on policy decisions that would curb rising inflation and stabilise the Naira.
RSG To Privatise Songhai, Fish Farms
There are strong indications that the Rivers State Government has concluded plans to privatise the moribund Songhai Farm in Tai and Fish Farm in Buguma.
The State Chairman of the Peoples Democratic Party (PDP), Amb. Desmond Akawor, gave this indication while appearing in a phone-in radio programme organised by Silverbird Communications in Port Harcourt at the weekend.
He explained that the previous administration in the state failed to put in place a sustainability programme for these farms, hence they went moribund.
In order to reverse the situation, he said that the present administration was now contemplating a rehabilitation scheme to be driven by a privatisation policy to enable those investments come on stream.
He said the scheme had reached an advanced stage and is to executed by the State Ministry of Agriculture.
On the issue of job creation, Akawor said the administration of Chief Nyesom Wike was using the various construction projects around the state to empower the youths.
He explained that the government had floated a special scholarship scheme in Law and Medical Sciences to create opportunities for young people in various professions.
He called on the opposition to desist from de-marketing the state through propaganda as it’s capable of scaring investors away from the state.
Akawor insisted that the Wike led administration has provided an enabling environment for businesses to thrive through infrastructure and improved security.
By: Kevin Nengia
- Politics3 days ago
RSG To Seal Dirty Business Places, Illegal Motor Parks
- Politics3 days ago
Andoni Chairman Tasks Councillors On Capacity Dev
- Sports3 days ago
Coach Expresses Joy Over Players’ Performance
- Niger Delta3 days ago
Monarch Charges FG, Others On Abandoned Road Projects
- Politics3 days ago
Soludo: ‘INEC Must Redeem Self’
- Nation3 days ago
‘Media, Military Relations Can Be Enhanced In Conflict Reporting’
- Politics3 days ago
INEC Registers 9,261 Online In C’River
- News3 days ago
Cyber Crime: FBI Declares Six Nigerians Most Wanted