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FG’s 2019 Budget: Fears Heighten As OPEC Cuts Quota
Even before the combatant National Assembly (NASS) debates and passes the budget next year, the nation’s proposed estimates of income and expenditure for next year is enmeshed in fresh fears of misalignment following a cut in Nigeria’s oil production quota by the Organisation of Petroleum Exporting Countries (OPEC) by 3.04 percent to 1.685 million barrels per day for the first half of 2019.
The development is considered as part of efforts to reduce oversupply in the global crude oil market by the Organisation.
The production cut, which is to be implemented from 2019, has cast a shadow over the 2.3mbpd crude oil production assumption on which the 2019 budget is based. Nigeria expects 52.9 percent of its N8.83 trillion proposed budget to be funded by oil revenues.
Also the retention of $60 benchmark price is considered as over ambitious and unrealistic considering further sliding of the oil price at the international market, which is currently below the budget price.
President Muhammadu Buhari presented an N8.83 trillion ($28.80 billion) budget for 2019 last Wednesday, laying out plans to drive growth to a raucous parliament that highlighted divisions two months before the election.
The spending plan for Africa’s top oil producer assumes crude production of 2.3 million barrels a day, an oil price of $60 per barrel and an exchange rate of N305 to dollar.
Another disturbing signal is the Excess Crude Account (ECA), the only buffer for the country against oil revenue volatility, which fell seventy-six percent to just above $600 million in three weeks.
The Federal Government was said to have withdrawn $1.6 billion in three months, between November 25 and December 19, 2018, thereby shrinking ECA to $631 million.
Some analysts say at the weekend that these may be signs of taste of what to expect next year, even as Nigerians are experiencing low purchasing power in the midst of rising cost of food items.
OPEC and 10 non-OPEC countries agreed earlier this month to cut oil production by 1.2 million bpd effective from January for an initial period of six months to shore up what many expect to be weakening market fundamentals ahead.
Nigeria, which was exempted from the previous cuts since January 2017,was asked to join the deal during the OPEC meeting on December 7 in Vienna.
With a reference level of 1.738 million bpd, Nigeria’s oil production is to be cut by 53,000 barrels to arrive at the new quota of 1.685 million bpd, according to a breakdown of member quotas under OPEC’s supply accord released by S&P Global Platts last week.
Ibe Kachikwu, Nigeria’s junior petroleum minister, said on December 7 that it was very difficult for Nigeria to reduce its crude oil production.
Kachikwu, who spoke on ‘Bloomberg Daybreak: Europe’ ahead of the OPEC meeting in Vienna, stated that there was a need for an extension of production cuts to stabilise the global oil market.
Asked if Nigeria would be able to reduce production, he said, “It is very difficult to do that but where we are now, everybody must be seen to contribute. Obviously, the smaller it is, the more amenable we are to participate; the larger it is, the more we will struggle to participate.
“We have got exemption three times understandably. This time round, I think there is a decision that everybody should be seen to chip in.”
Friday Ameh, Lagos based energy analyst told our correspondent at the weekend that government will not be able to achieve the desired objective with the $60 per barrel benchmark.
“I consider the assumption as over ambitious and unrealistic since the sliding of the price is becoming uncontrollable,” Ameh said.
Muda Yusuf, director general of Lagos Chamber of Commerce and Industry, LCCI had last week described the budget as too small to create any meaningful impact compared with the size of the economy.
Yusuf, who spoke on Channels at 10 on Wednesday, said the budget is about five percent of the country’s Gross Domestic Product, (GDP), adding that the expected revenue is too small for investment in infrastructure.
Bismarck Rewane, Chief Executive of Financial Derivatives said that “At $60, the benchmark price could be ambitious.”
The Organised Labour yesterday, called on the Federal Government to ensure inclusiveness in policy making and guide against erosion of rights, such as free speech and association.
The President, Nigeria Labour Congress (NLC), Mr Joe Ajaero made the call at the 2025 Workers’ Day celebration held at the Eagle’s Square, Abuja.
The Tide source reports Ajaero and the President, Trade Union Congress, Mr Festus Osifo delivered a joint statement on behalf of the organised labour at the event.
Ajaero described May Day as, not only a moment to honour workers’ sacrifices, but also a platform to demand justice and accountability from those in public office.
He frowned at the alleged suppression of protests, and the erosion of rights of workers by some agents
According to him, workers have a duty to resist economic injustice, insecurity, and policies that undermine their dignity.
Speaking on the theme of the day, the NLC President underscored the need for Nigerian workers to reclaim the civic space and resist policies that contribute to worsening economic conditions.
“Our theme this year – “Reclaiming the Civic Space in the midst of Economic Hardship – reflects the urgent need for citizens to protect democracy and push back against repression.
“The civic space, where Nigerians express their concerns and challenge injustices is shrinking.
“If we fail to reclaim this space, the foundation of our democracy risks collapse,” he said
Ajaero, therefore, urged workers to unite and resist division, fear, and despair.
He also urged them to mobilise and organise for change, declaring that the right to demand better conditions is non-negotiable.
“Without workers, there is no society; without labour, there is no development. We must take our place in the fight for economic justice and democratic governance.”
Speaking in the same veins, Osifo said workers are the backbone of the nation—the educators, healthcare providers, builders, farmers, and innovators who sustain its economy -.
He stressed the need for the labour to reclaim the civic space even in the midst of economic hardship.
The Joint Admissions and Matriculation Board (JAMB) has disassociated itself from a fraudulent site requesting payments from candidates who missed the ongoing 2025 Unified Tertiary Matriculation Examination (UTME).
The board said that the site, “Copyrightwriter Personal J Rescheduling Flw” and account number 8520641017 at Sterling Bank, associated with it, are scam.
The disclaimer is contained in a statement made available to newsmen in Abuja on Thursday by the Board’s Public Communication Advisor, Dr Fabian Benjamin.
Benjamin said the account is being exploited to defraud unsuspecting candidates who missed their UTME.
“We issue this urgent notice to inform the public about this nefarious scheme targeting candidates who were unable to participate in the UTME.
“Some unscrupulous individuals are deceitfully soliciting payments of N15,700 under the false pretence of offering rescheduling services for the examination.
“Let us be unequivocal: this, it is a blatant scam, and we are confident that the public will not fall prey to such cheap and regressive tactics.
” The individuals behind this scam have no affiliation with JAMB or any legitimate government agency.
“The account details provided in these communications are entirely fictitious and bear no connection to any official processes; they exist solely for the purpose of perpetrating fraud,” he said.
Benjamin called on Sterling bank to take immediate and decisive action against this criminal activity.
According to him, JAMB has reported the matter to the relevant security agencies and actively pursuing those responsible for this deceitful act.
He further said that “JAMB does not reschedule examinations for candidates who miss their scheduled tests due to reasons unrelated to the Board’s actions”.
He, however, said that the Board is conducting a thorough investigation for candidates whose biometrics failed during verification and were thus unable to sit for the examination.
He said those without discrepancies would be invited to retake the examination at no cost , stressing that “no cost is required”
“It is imperative to understand that JAMB does not charge any fees for examinations after a candidate has completed their registration.
“We strongly urge all candidates to remain vigilant and not to succumb to these fraudulent schemes.
“Protect yourselves and report any suspicious activity immediately,” he explained.
The Niger Delta Development Commission (NDDC) has expressed its willingness to partner with the United Nations (UN) to accelerate the development of the Niger Delta region.
Dr Samual Ogbuku, Managing Director of the NDDC, made the appeal in a statement issued by the commission’s Director of Corporate Affairs, Mrs Seledi Thompson-Wakama, in Port Harcourt on yesterday.
According to the statement, Ogbuku sought the UN’s support during his visit to the UN Resident and Humanitarian Coordinator (UNRHC), Mr Mohammed Fall, at the UN regional office in Abuja.
He called on the global body to provide the NDDC with technical assistance and expert services to support the region’s development.
“We are eager to collaborate with the UN, recognising that the state governments in the region and the NDDC alone cannot achieve the level of regional development required,” he said.
Ogbuku identified key areas where support would be needed, including the provision of portable and affordable drinking water powered by high-tech solar energy sources.
He also highlighted the importance of reforesting the mangrove swamps, which have been severely damaged by decades of environmental degradation caused by oil exploration in the Niger Delta.
“Although the NDDC has made progress in providing solar-powered streetlights across the region, we still require UN support in delivering solar energy solutions for residential buildings.
“We also wish to explore the possibility of installing solar mini-grids in homes across communities, which would boost local commerce and trade,” he added.
The NDDC managing director further appealed for increased UN involvement in areas such as healthcare, education, youth training, gender development, and food security.
Ogunku stated that such interventions would significantly enhance the standard of living in the region.
In response, Fall affirmed the UN’s readiness to collaborate with the NDDC to fast track development in the Niger Delta.
He assured that the UN would support initiatives in food security, job creation, education, and renewable energy, among other areas.
“We aim to approach development in the Niger Delta holistically, rather than focusing solely on environmental pollution.
“This is merely an entry point; however, the UN’s development vision aligns with the Sustainable Development Goals (SDGs), which are designed to positively impact various aspects of people’s lives,” Fall stated.
He assured the NDDC of continued and fruitful engagements to drive the region’s development.