The charismatic Central Bank Governor and now Emir of Kano appeared on CNN yesterday taking questions from Christiane Amanpour. She grilled him on a wide range of issues to which he responded in his typical no holds barred fashion. One of the major talking points was the $20 billion oil money that he claimed was missing (or is it unreconciled) and his response to the PWC report that now said only $1.48 billion needs to be refunded by NNPC. His response drew our attention to one major issue 1. Effects of missing funds on government revenue and Its impact on the stock market “collapse”.
“My position in the Central Bank was that there was always this gap of $20bn after reconciliation between what the NNPC exported and what it deposited into the Federation Account. I raised a number of issues that I think have not yet been discussed and addressed sufficiently.
One of them is the billions of dollars being paid in kerosene subsidies without appropriation by the National Assembly and against a presidential order and we don’t know who authorised those payments and yet no one has owned up to say I authorised the payments, I made a mistake. It must stop. I think those issues need to be addressed and until we address them and begin to close all the loopholes in government revenues, we are going to continue to create opportunity for the destruction of the economy.
“It could be $20bn at the end of the day. After reconciliation it could amount to $14(bn) or $12(bn) and I think these issues reflect unconstitutional and illegal withholding of revenues from the Federation Account.
“The country is paying the price today; oil prices have crashed, the currency has been devalued, the stock market has collapsed, government revenues are in a very bad shape. Whoever wins, whether this government or the opposition, will have to deal with these issues. The petroleum sector is a major drain on the resources of the country and this has to be looked at.”
Based on the above can we partly blame the stock market collapse on activities of the NNPC? Is there a direct connection or a missing link we are not seeing? We have always felt the elections and the fall in oil prices are the major culprits for the stock market faltering in recent months. But introducing NNPC now makes us ponder if really there is a direct connection, because if there really is one, then we are in for a really bad run.