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Bizmen, Motorists Lament Diesel Price Hike

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Some small scale operators
and commercial motorists plying Lagos roads on Sunday lamented over the increasing price of diesel which now stands at N200 per litre in most of the filling stations in Lagos.
They told our correspondent in an interview that the increasing price had affected the profit margin of their businesses, thereby making them to run at a loss.
Mr Thompson Alo, General Manager, HTS Photo Laboratory, Agege said that the company spent N200, 000 monthly to buy diesel to power their generator.
Alo said that before, they used to spend just N100, 000 to buy the product because electricity supply was regular and the product was just at N130 per litre.
“With the price of diesel now at N200 per litre, the company is not making any profit, we had to send away two of our staff, last month.
“In June, the company made a profit of just N5, 000 for the entire month, we cannot afford to pay the salaries of workers.
“If diesel is N130 per litre, we will be saving N70 from each litre from the 1000 litres buy in a month, this is over N70,000,’’ he said.
Alo appealed to the Federal Government to wade into this problem and help in the importation of the product, adding that the cabal in the diesel business was making a lot of profit.
The general manager said that with the current world crude oil price that was less than 50 dollars, the product should not be more than N100 per litre.
Managing Director, Blue Sky Frozen Foods, Ijora Mrs Josephine Okoro, lamented the pain she was going through to sustain her business.
“Our business is finished without regular supply of public electricity, but now that there is no supply from the electricity distribution company, I rely on diesel to fuel my generator.
“This is really affecting our business because one cannot just increase the price because of the power challenges we are facing.
“All the profit now goes to buying diesel. I just keep coming to the shop because I don’t want the business to collapse.
“It is no longer business as usual now because all profit now goes into the purchase of diesel,” she said.
Okoro said she was spending close to N80, 000 monthly to keep her cold room alive.
Also, some commercial motorists in Lagos said that the increasing diesel price was affecting their take home.
Mr Morufu Salami, a commercial bus driver that plies the Sango/Oshodi axis said that the driving business was no longer as rosy as before.
Salami said he spent N8, 000 on diesel daily, only to discover that at the end of the day, there was nothing to take home.
“Apart from buying N8, 000 diesel, motor touts will collect almost N4, 800 daily, apart from Police settlement, then I will deliver N10, 000 to the owner.
“What is left will be shared by the conductor and myself. But recently, we are being left with little or nothing after the day’s work.
“The price of diesel is on the high side: from N130 in May to N200 in June. This is too much, our government should save us from the hardship.
“Drivers cannot boast of saving N2, 000 a day now, as everything is on the high side. Government should come to our rescue,” he said.
Another commercial bus driver, Mr George Okorie, said that he always checked filling stations along Abule-Egba/Iyana-Ipaja road to see those selling diesel below N200 per litre.
“The increasing price of diesel has taught me to check the prices of diesel on display before buying.
“I always buy my diesel at Danco filling station along Iyana-Ipaja because it is cheaper there.
“They sell diesel for N183 per litre and their petrol is N140 per litre.

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Lawmakers Want CBN To Halt Naira Devaluation

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The House of Representatives has asked the Central Bank of Nigeria (CBN), to urgently put in place a policy to check further devaluation of the naira to the United States dollar and other international legal tenders.
The House decried that while the Nigerian currency was losing value, others in Africa were appreciating.
At the plenary on Wednesday, the House unanimously adopted a motion moved by the Deputy Chairman of the Committee on Pensions, Mr Bamidele Salam, which warned the CBN of the implications of further devaluing the naira.
The motion was titled, ‘Matter of urgent public importance on the need for the Central Bank of Nigeria to urgently put in place monetary policies to stop the free fall of the naira against the dollar and other international legal tenders’.
Salam recalled that the CBN governor, Godwin Emefiele, while addressing the Bankers’ Committee at a summit on the economy in Lagos earlier in February, informed the committee about the naira devaluation against the dollar.
The lawmaker also quoted Emefiele as saying at the summit that the official exchange rate stood at N410 to the dollar.
“That is 7.6 per cent weaker than the rate of N379 published on the central bank’s website,” Salam noted.
According to the lawmaker, while the value of the naira relative to the dollar had declined by nine per cent in the last six months, the South African rand and Ghanaian cedi had appreciated by 11.4 per cent and one per cent, respectively.
Salam also recalled that the CBN adopted multiple exchange rates in 2020, in a bid to avoid an outright devaluation. 
He noted that the official rate used as a basis for budget preparation and other official transactions differed from a closely controlled exchange rate for investors and exporters known as the Nigerian Autonomous Foreign Exchange Rate Fixing Methodology.
He stressed that the naira had traded in a tight range between N400 and N410, while the NAFEX rate was different from the parallel market, considered illegal by the CBN, where the naira closed at 502.
Salam said, “The House is concerned that devaluation is likely to cause inflation because imports will be more expensive any imported goods or raw material will increase in price; aggregate demand increases, causing demand-pull inflation. Firms/exporters have less incentive to cut costs because they can rely on the devaluation to improve competitiveness.
 ”The concern is that the long-term devaluation may lead to lower productivity because of the decline in incentives.
 ”The House is further concerned that devaluation of the naira makes it more difficult for Nigerian youths especially in the IT sector, whose businesses are online and must necessarily transact businesses in the US dollars. 
“It also reduces real wages. In a period of low wage growth, a devaluation that causes rising import prices will make consumers feel worse off “.

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Four West African Countries To Buy Nigeria’s Unutilised Electricity

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Four West African countries, Niger, Togo, Benin and Burkina Faso, are collaborating to buy the unutilised power produced in Nigeria. 
The Chairman of the Executive Board of the West African Power Pool (WAPP), Sule Abdulaziz, disclosed this at the WAPP meeting on the North core project in Abuja, on Wednesday. 
Abdulaziz, who is also the acting Managing Director of the Transmission Company of Nigeria (TCN), said the four countries were collaborating to make the power purchase from Nigeria through the North core Power Transmission Line currently being built.
He explained, “The power we will be selling is the power that is not needed in Nigeria.
“The electricity generators that are going to supply power to this transmission line are going to generate that power specifically for this project. So, it is unutilised power”.
He said Nigeria was expecting new generators to participate in the energy export for the 875km 330KV Northcore transmission line from Nigeria through Niger, Togo, Benin to Burkina Faso.
Abdulaziz said, “In addition, there are some communities that are under the line route, about 611 of them, which will be getting power so that there won’t be just a transmission line passing without impact”.
The WAPP chairman noted that the project, funded by World Bank, French Development Council and the African Development Bank, had recorded progress, adding that the energy ministers would be addressing security issues for the project at another meeting in Abuja.
He said, “Nigeria has the greatest advantage among these countries because the electricity is going to be exported from Nigerian Gencos (generation companies). 
“So, from that, the revenue is going to be enhanced and a lot of people will be employed in Nigeria”.
The Secretary-General, WAPP, Siengui Appolinaire-Ki, said the cost of the project was about $570 million, adding that part of the investment in each country would be funded by that particular nation.
According to him, the countries in the partnership, including Nigeria, are also being supported by donors.
He said the funding agreement was ready as partner countries were awaiting the disbursements.
Appolinaire-Ki, however, said the donor agencies had said they needed a Power Purchase Agreement between the buying and the selling countries to be executed before releasing the fund.

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Reps Probe N275bn Agric Loans Under Yar’Adua, Jonathan, Buhari

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The House of Representatives has resolved to investigate the disbursement of loans and credit facilities by the Federal Government in the agriculture sector since 2009.
The period under review covers the administrations of the late Umaru Yar’Adua, Goodluck Jonathan as well as the present President, Muhammadu Buhari.
The resolution was sequel to the unanimous adoption of a motion moved by Hon. Chike Okafor at the plenary last Wednesday, titled ‘Need to investigate disbursements of all agricultural loans/credit facilities to farmers from 2009 to date to enhance national food security’. 
Okafor said, from 2009 to date, the Federal Government had approved the disbursement of funds to farmers in various schemes to the tune of over N275billion, ranging from Commercial Agricultural Credit Scheme to the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending, to help farmers improve agricultural production and guarantee food security in Nigeria.
The lawmaker also noted that apart from increasing food supply, the schemes were to grant agricultural loans to large and small-scale commercial farmers to lower the prices of agricultural produce, generate employment and increase foreign exchange earnings.
He said, “The House is aware that since the approval, most farmers have not been able to access the loans due to stringent requirements being demanded by banks from prospective borrowers and the alleged siphoning of over N105billion meant for farmers by management of NIRSAL.
“The House is concerned that food production has not attained the expected level, despite the approval of over N275billion facilities to farmers. 
“The House is worried that the projected diversification of the economy from oil production to agricultural production and increase in agricultural output, food supply and promoting low food inflation will not be achieved if farmers are unable to access loans meant to increase agricultural production”.
Adopting the motion, the House resolved to mandate the Committee on Banking and Currency to “investigate disbursements and compliance of all agricultural loans/credit facilities to farmers from 2009 to date to enhance national food security in the country”.

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