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Nigeria, Others May Continue In High Debts – Report

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The economic outlook of Nigeria and some other countries of the world appears clouded with high inflation which has reduced private sector optimism and weakened consumer spending.
According to a report by  the Organisation of Petroleum Exporting Countries (OPEC), this is in spite of the improvements in fossil fuel prices in the short term so indicated in the economic outlook.
OPEC indicated that this could increase uncertainty and make high debt levels to persist in Nigeria, and across some other countries of the world next year.
In its newly released Monthly Oil Market Report for July 2022, OPEC indicated that in May 2022, Nigeria’s composite Consumer Price Index rose to 17.7 per cent year-on-year, from 16.8 per cent year-on-year in the prior month.
Responding to the elevated inflationary pressures, the Central Bank of Nigeria (CBN) raised its policy rate by 150 bps to 13 per cent, bringing borrowing costs to the highest since April 2020.
“It was the biggest rate hike since July of 2016 amid concerns that persistent inflationary pressures could weigh on the country’s fragile recovery”, the report said.
Nigeria has been unable to increase its crude revenue despite the rise in crude prices, and consistent increases in production quota by OPEC.
The country’s output recently dropped to about 1 million barrels per day, further worsening its chances of taking advantage of the Russian/Ukraine war to earn more revenue.
OPEC’s forecasts put world GDP growth in 2023 at 3.2 per cent, with the assumption that the ramifications of the pandemic, geo-political developments in Eastern Europe and global financial tightening amid rising inflation do not negatively impact the 2023 growth dynamic to a major degree.
It also assumed that major economies revert back towards their growth potential. However, OPEC said the downside risk exists.
“Global inflation continues to be a major concern, along with the consequence of further monetary tightening measures by key central banks.
“The continuation of the pandemic into 2023 is another risk that could curb growth depending on the extent of measures taken to reduce contagion.
“While labour markets are forecast to remain tight, supply chain bottlenecks may not be resolved in the short term and high debt levels across the globe may persist”, the report said.
Although OPEC said the above-average fossil fuel prices support a firmly positive outlook for the rest of the year, however, it said “concerns over soaring inflation would increase uncertainty next year.
Brent International rose to $100.32 at 1:15PM last Wednesday after declining and closing at $99.22 per barrel on Tuesday. However, as at 12:52P on Thursday, prices slide back to $99 per barrel
The OPEC warning comes on the heels of a warning by the country’s Debt Management Office, that Nigeria needs to generate significantly more revenue beyond current levels to avoid debt distress.
A report said Nigeria lost a total of N4.2tn in crude oil revenue in the first six months of 2022 due to its inability to meet the daily production by OPEC.
While the country’s oil revenue is on a downward trajectory due to low production, its GDP grew by 3.11 per cent year-on-year in the first quarter of the year in real terms, following a 3.98% growth recorded in the previous quarter (Q4 2021).
Again, while the economy seems to be moving on a positive trajectory after the recession recorded in 2020, recent economic reality seems to be putting the recorded growth in jeopardy.
For instance, rising cost of goods and services in the country has forced organisations to reduce working hours, even as much as laying off staff due to surging operating costs.

Experts say policy actions to curb the rising inflation rate, triggered by the energy crisis, fuel scarcity amongst others need to be put in place, in order to avert what would seem as the third economic recession in just seven years.

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Truckers Threaten Service Withdrawal Over Customs’ Haulage Truck Seizures 

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Truckers under the aegis of Association of Maritime Truck Owners (AMATO) have threatened to withdraw their services over incessant seizures of vehicles by operatives of the Nigeria Customs Service (NCS).
The truckers lamented that the seizure and possible auctioning of their trucks by the NCS has led to untold hardships for haulage operators in the maritime industry, describing the seizures as unjust.
A statement signed by  the President  and secretary of the body, Chief Yemi Ogungbemi and Alhaji Sanni Muhammed, respectively queried management of the Customs over failure to arrest  ships that import illicit goods to Nigeria for complicity.
”Does Customs seal the terminals that receive contraband and dangerous consignments in their yards for complicity in storing illicit consignments?”,
The truck owners said the Nigerian Customs at different fora made haulage operators to understand that the law stipulates they arrest the means of conveyance.
“If that is the reason, why not arrest ships that import containers with contraband goods to Nigeria. Are vessels no longer means of conveyance?”
AMATO described such laws  obsolete, saying that it has become injurious to truckers’ means of livelihood.
The AMATO executives further stated that truckers can no longer withstand what they call the unfortunate circumstances of being used as scapegoat for offenses perpetuated by unscrupulous importers.
“The seizure and possible auction of our trucks by the Nigerian Customs Service is causing us untold hardships as truckers, and for a very long time, we have been passing through this injustice in the hands of Nigerian Customs Service.
“Truckers are mere commercial transporters of goods. We are only invited by agents to come and carry goods to and from the ports after Customs might have examined and approved the release of goods in containers to Importers and agents.
“But unfortunately, after loading the containers that are duly examined and released by Customs on our trucks, they would waylay the trucks on the road, seize and detain our trucks in their yards together with containers with question marks”, they said.
Further questioning the rationale for the seizures, AMATO queried why they are the victims when they are not involved in physical examination of goods in the ports together with Customs, Police, Directorate of State Security (DSS), Nigeria Drug Law Enforecement Agency (NDLEA), etc. to see what they carry.

“Does it sound just for Customs officers and other government agencies that jointly examined and approved the exit of contraband and other dangerous goods in the ports to be holding the trucker responsible for their fault and negligence?

“Is it the commercial trucker that is short-paying government’s import duty on goods or the Importers and their Agents?

“If the answer to the above questions are ‘No’, we are calling on Nigerian Customs Service to release all our trucks detained in their yards or we withdraw our services nationwide in protest against the unjust seizure of our trucks.

“Our members are facing agonizing economic hardships. Their means of livelihood are being seized by the Nigerian Customs for the offense committed by Importers and their dubious collaborating Agents.

“Nigerian Customs should please release our trucks and stop using the truckers as scapegoat.

“Recently, some containers were found to contain tramadol, arms and ammunition. If the trucker knows that he is to carry container loaded with explosives that can destroy him and the truck, or the contraband drug that would equally put him in trouble, he will not carry it.

“Thus, where is the justification for seizing our truck?

“We appreciate the previous Management of Customs authority, in that they reasoned with complaints and issued out circular that enables us to retrieve our seized trucks through application.

“But the present Management of Customs wrote against the Circular. All our efforts and entreaties to the present management of the Customs to revalidate the circular to enable us secure the release of our trucks have proved abortive.

“Hence our plan to settle out grievance with the customs authority through the eloquence of withdrawal of services if our trucks are not released by the Customs”, AMATO concluded.

By: Nkpemenyie Mcdominic, Lagos

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Electronic Auction Platform, Most Authentic For Goods -NCS

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The Nigeria Customs Service (NCS) has restated that electronic auction (e-auction) platform of the Service at https://app.trade.gov.ng/eauction/ is functional and remains the only authentic means of auctioning goods to members of the public.
The Service in a statement issued in Abuja by its Public Relations Officer, Deputy Comptroller Timi Bomodi, noted that this clarification became necessary following rumours that a special auction of over 7000 cars would soon be held by the Service.
It reiterated that auctions are periodic and advertised in advance on the Service’s website to avail members of the public the opportunity of selecting and bidding for items of their choice.
NCS recalled that the Service deployed the e-auction platform in July 2017 specifically to improve efficiency in revenue generation to the Federal Government and also provide equal opportunities to all Nigerians in the seamless disposal of seized/condemned and overtime/abandoned cargoes.
“Since its implementation, the e-auction has lived up to expectations by guaranteeing transparency and integrity in the auctioning process.
“Requirements to take part in the e-auction bidding process by interested public/bidders include:
“Applicant must have a valid tax identification number (TIN) issued by Federal Inland Revenue Service (FIRS) with an active e-mail account for the issued TIN.
“Conditions and Terms of this auction are to be carefully considered by an interested person before acceptance.
“Applicant must ensure he/she has an authentic and nationally accepted means of identification, i.e. international passport, driver’s license, national identity card or voters card.
“Other guidelines can be found on the e-auction portal at https://app.trade.gov.ng/eauction/.”
The statement, however, advised owners of uncleared vehicles at the ports to avail themselves of the VIN-Valuation protocols which it said had simplified, automated and made user-friendly the clearance procedure.

By: Nkpemenyie Mcdominic, Lagos

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Subsidy: Reps Summon Finance Minister, Query NNPC

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The House of Representatives’ Ad Hoc Committee that is Investigating the Petroleum Products Subsidy regime from 2013 to 2022 has summoned the Minister of Finance, Budget and National Planning, Zainab Ahmed, to appear before it on Tuesday next week for questioning.
Ahmed is to appear before the committee with all the documents demanded by the lawmakers relating to subsidy claims and payments in the period under review.
Chairman of the committee, Ibrahim Aliyu, issued the summons at the continued investigative hearing of the panel in Abuja on Tuesday.
Members of the committee had faulted the appearance of the ministry’s Director of Home Finance, Stephen Okon, without a letter from Ahmed authorising him to represent her.
The Chairman decried the non-appearance of several invited agencies, such as the Nigeria Police Force, Department of State Services, Office of the Accountant-General of the Federation, and Shell Petroleum Development Company.
After Okon was eventually allowed to speak, the Director said he only appeared before the lawmakers to seek more time for the Ministry to collate and present the required documents.
The committee consequently gave the Minister one week to do so.
“This committee requested from you to know the total amount released from the Consolidated Revenue Account as subsidy payments from January 2013 to date; the total amount released from other accounts other than the Consolidated Revenue Account to subsidy payments from January 2013 to date; breakdown of beneficiaries; companies that enjoyed releases from the Consolidated Revenue Account and other revenue accounts as subsidy payments.
“Identify each beneficiary with the amount sent to them, month by month, covering the period from January 2013 to date; all correspondences between the Federal Ministry of Finance and the Central Bank of Nigeria regarding subsidy payments from January 2013 to date; evidence of lodgement of forex into Consolidated Revenue Account by the Nigerian National Petroleum Corporation now (Nigerian National Petroleum Company) Limited as revenue from January 2013 to date”, the Chairman stated.

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