The movement for the sale of government assets in order to shore up the foreign reserves of the country began with the Central Bank of Nigeria’ CBN’s governor, Godwin Emefiele, just like several other controversial economic ideas. The movement soon garnered momentum and just like that, it became the FG’s next move. However, public furor and labor union threats quickly made the proposal die off in the National Assembly.
Not satisfied however, another movement has begun. This movement is the ‘concession’ movement which is advocating that the Federal Government (FG) reduces its shares in the nation’s crown jewels. Once again, several Nigerians are left confused as to the FG’s motive especially with regard to the Nigerian Liquefied Natural Gas company and the 4 major international airports.
For the NLNG, it has consistently remained the nation’s top performing public company, paying out billions to the FG annually. It was the NLNG, for instance, that paid $2.1 billion dividend with which the Federal Government bailed out states and local governments having financial challenges to enable pay workers’ wages.
The NLNG in its 2016 Facts and Figures said the company had paid $65 billion in dividends, taxes and gas purchase levies to its shareholders from inception and 61% of the money went to the coffers of governments at different levels between 1999 and 2015.
The former NLNG Managing Director, Mr. Babs Omotowa , said in April that $39.56 billion (N7.793 trillion) in dividends, taxes, levies and other remittances were paid to the governments at different levels in Nigeria in 17 years. NLNG raked in $90.370 billion (N17.802 trillion) during the period under review, and according to Omotowa about 44.44 per cent of these revenues were ploughed back to Nigeria through dividends and gas purchase to the NNPC, Company Income Tax (CIT) and Education Tax (ET) to the Federal Inlands Revenues Services (FIRS), Pay As You Earn (PAYE), Withholding Tax, Value Added Tax (VAT), state and local government taxes, regulatory fees and levies, and local contractors for goods and services in addition to over 18,000 jobs created. Why even think of selling that, when there are other deadwood public companies that need resuscitation?
The airports also present a baffling choice. With the FG deciding to start off with the four most profitable airlines, it makes one wonder while there are several non-functioning airlines that can be concessioned. The Minister of Aviation is arguing that government lacks the funds to continue to pump into the upgrade, expansion and maintenance of these airports and that if privatization was opposed by the majority of stakeholders, at least, they should see the concession deal as a better alternative.
However, the Honorable Minister seems to have forgotten that just about 3 years ago, the Chinese Export-import Bank had granted Nigeria a $500million loan to build new airport terminals at the Lagos, Enugu, Abuja and Kano International airports, but with a caveat that included a 22-year Build Operate and Transfer (BOT) concession deal that allows China to first manage and recoup its investments before transferring the assets back to Nigeria. The project has just about finished the Build phase and is about entering the Operate phase. What happens to that deal when a new concessionaire is in place? Another legal war just like the Bi-Courtney case still in court?
The innocent well-meaning Nigerian keeps getting more and more confused about the real motive of all these moves, especially at a time as delicate as this one. However, it is hoped that public outcry and labor involvement will continue to override any ulterior motives.