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CBN’s Latest Action Reveals Just How Much Forex Deficit Nigerian Companies Have

It’s a whooping $815 million

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The Central Bank of Nigeria has evolved several policies regarding the forex exchange in the past few months that are becoming too many to list. However, many of these policies seem not to be having the desired effects, such as the satisfaction of forex demand for local companies.

In its latest action, the CBN was able to have a picture of just how large the unmet demand for forex is among Nigerian companies. The chief executives of deposit money banks (DMBs) were asked to sign undertakings to open new letters of credit (LCs) equivalent to the amount of forwards receive for each of the sectors and the results showed that a huge $815 million worth of forex was still unmet among Nigerian businesses.

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Demand from agriculture and agriculture-related companies was $31,941,640.73, while airlines demanded $216,738,717.57 which represented the highest proportion. $167,638,045.08 was demanded by machinery or manufacturing while demand for raw materials was $397,890,132.44.

This is coming on the back of complaints by manufacturers and other local companies that they lack the forex required to continue their operations profitably in the country. In order to block off some of this huge unmet demand, the CBN released $313,916,711.09 to Nigerian banks for onward sale to their customers through Special Secondary Market Intervention Retail Sales (SMIS), ThisDay reports.

It is now hoped that other players in the deal, i.e. would play their part and actually use the forex for what it is meant for. Accusations of banks refusing to allocate forex fairly, manufacturers round tripping the forex allocated to them and so on have been flying in the air recently. With this intervention, the CBN must carefully monitor other steps in the process to ensure that the funds are properly implemented.

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Patricia

Chacha Wabara-Ogbobine is a Legal practitioner with over 9years post call experience. A research Consultant, professional writer and a blogger at heart,owner of four thriving websites with well over 10years of experience. Totally in love with keeping fit and coaching weight loss enthusiasts. I love my quiet time, being with my kids, watching TV series for hours on end.

2 Comments

2 Comments

  1. Xanthos1

    October 20, 2016 at 5:09 pm

    economic equivalence of asymmetric warfare, every player for himself…

  2. Anonymous

    October 21, 2016 at 8:19 am

    God help Nigeeia

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Business

NDDC reveals more lists of contracts awarded to federal legislators

The Commission said it released the list to expose committee chairmen in the National Assembly.

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NDDC corruption probe: Commission denies spending N81.5 billion in 6 months 

The Niger Delta Development Commission (NDDC) said there is another list of emergency contracts that were awarded to National Assembly members in 2017 and 2019. This list was not submitted to National Assembly following the recent probe of the NDDC.

This disclosure was made in a press statement by the NDDC earlier today which was signed by the commission’s Director for Corporate Affairs, Charles Odili. According to the statement, the initial list that was submitted by the Minister for Niger Delta Affairs, Senator Godswill Akpabio, was actually compiled by the former management of the commission in 2018, not the minister himself.

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READ ALSO: Explained: CBN’s powers to seize bank account of criminals

The statement by the NDDC went further to note that the Interim Management Committee of the Commission stands by the list which came from the files already in the possession of the forensic auditors.

The Interim Management Committee (IMC) of the Commission stands by the list, which came from files already in the possession of the forensic auditors. It is not an Akpabio list but the NDDC’s list. The list is part of the volume of 8,000 documents already handed over to the forensic auditors,” the statement said in parts.

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READ MORE: 2021 Budget: FG projects spending plan of N11.86 trillion and deficit of N5.16 trillion

In the meantime, the NDDC has urged prominent indigenes of the Niger Delta, whose names appeared on that list, not to panic, because the NDDC is aware that their names were used to secure contracts. The ongoing forensic audit would help to unearth those behind those contracts, the NDDC said in the statement.

Furthermore, the commission disclosed that it released the list to expose committee chairmen in the National Assembly who used fronts to collect contracts from the NDDC, some of which were never executed. Interestingly, the list did not include the unique case of 250 contracts that were signed for and collected in one day by one person, ostensibly for members of the National Assembly.

While assuring that the forensic audit exercise is on course, the NDDC noted that the commission had positioned 185 media support specialists to identify the sites of every project captured in its books for verification by the forensic auditors.

READ MORE: NDDC Probe: Akpabio accuses NASS members of getting most of the commission’s contracts

The NDDC then enjoined members of the public not to be distracted or swayed by a lot of misinformation and falsehood that are being orchestrated by mischief makers, even as more of such will be expected by those opposed to the IMC.

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It can be recalled that Akpabio, while appearing before the members of the house of representatives ad-hoc committee probing the N40 billion corruption allegation against the IMC of NDDC, said that most of the contracts that are being awarded at the commission were given to members of the national assembly.

READ ALSO: Akpabio denies accusing Reps of receiving 60% of NDDC contracts

Not that likely, the Speaker of the House of Representatives, Femi Gbajabiamila, asked the minister to provide within 48 hours, the names of the legislators that benefitted from such contracts with full details or face legal action.

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Senator Akpabio, in response to the ultimatum, sent an official letter to the Speaker, providing the names of the national assembly members that benefitted from such contracts.

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Tech News

Plentywaka raises $300,000, seeks partners as it launches operations in Abuja

The company is in search of partners to join the Plentywaka Vehicle Partnership scheme

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Plentywaka records 100,000 rides as it compete with Danfo, OBus, Plentywaka raises $300,000, seeks partners as it launches operations in Abuja

Fast-growing transport/delivery startup, Plentywaka, has raised $300,000 pre-seed investment to facilitate its expansion plans.

According to a statement by the company which was sent to Nairametrics, the funding was led by EMFATO, Microtraction, and Niche Capital. It will help to facilitate that company’s planned expansion into the Federal Capital Territory Abuja and other Nigerian states.

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More details: The funding will also be used to transform the transport system in Nigeria. Plentywaka will improve its mapping technology, especially now that it is kicking off activities in other states and the FCT.

While commenting on the investment and launch, Co-Founder and Managing Director, Johnny Enagwolor, said that Plentywaka is out to transform transportation in Nigeria by taking it one state at a time.

“Securing investment and expanding into Abuja within our first year, in the midst of a pandemic speaks volumes of the demand for the service we provide. We are excited to have investment partners on board that see and believe in our vision.

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“An efficient transport system is fundamental to the prosperity of any city and we believe safe, convenient and comfortable travel should not just be for the few; but for everyone,” he said.

(READ MORE:Biggest oil trader, Vitol, in record compensation, pays over $6 million each to top employees)

Also commenting on the investment, Dayo Koleowo, a Partner at Microtraction, said:

“Plentywaka’s rapid growth since they launched Q3 last year has been tremendous so far. We are glad to be partnering with a very strong team that is passionate about providing convenience, safety, and comfort to everyday commuters. The distressful and uneasy experience by the majority of these commuters, especially in large cities is evident. We are backing the Plentywaka team to change that experience for commuters progressively by creating a transport system that is efficient.”

Plentywaka needs partners: In the meantime, Plentywaka said it is currently in search of partners who are willing to bring their vehicles on board by joining the Plentywaka Vehicle Partnership scheme.

The partnership involves Plentywaka working with individuals, corporates, and state governments to expand its technology and fleet in order to provide better transportation services.  Just like other cab-hailing services, registering a vehicle on the platform would provide the partners with an opportunity to earn extra income.

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In view of the pandemic, the company has assured that all vehicles in its scheme would be properly fumigated and equipped in line with government regulations and to keep commuters and drivers safe with the Wakapurse which allows electronic payment.

The Backstory:  The e-bus hailing company, which was launched in September 2019, was funded by Crowdyvest. Since then, the company has built a platform of over 40,000 customers and recorded its first 100,000 rides in six months.

They also recently announced the availability of same-day delivery service to small businesses, as well as the logistics by Plentywaka and its Staff Bus Solutions.

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The company first launched its services in Lagos and the success recorded so far has encouraged its decision to venture into other states. With the gaps seen in the country’s public transport system, the company is optimistic that it can provide a more reliable and efficient bus service.

 

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Business

Austin Avuru retires as CEO of Seplat petroleum, to receive huge benefits

According to the notice, Avuru will be considered a “good leaver” on his retirement.

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Austin Avuru retires as CEO of Seplat petroleum, to receive huge benefits, Seplat to acquire more oil & gas assets after Eland's acquisition

Co-founder and Chief Executive Officer of Seplat Petroleum Development Company Plc, Austin Avuru has retired as CEO of the company, but will remain on the board as a Non-Executive Director.

According to a notice sent to the Nigerian Stock Exchange and signed by the company secretary Mrs Edith Onwuchekwa, the resignation took effect on July 31, 2020.

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READ MORE: Seplat denies swindling FG of N600 billion despite co-conspirator’s guilty plea

What this means

According to the notice, Avuru will be considered a “good leaver” on his retirement and receive his remuneration and benefits as such.

The Remuneration Committee has confirmed that Avuru will receive “a lump sum payment in lieu of notice equal to his salary, benefits, and pension allowance until November 18, 2020” as well as other security and travel benefits.

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He would also receive a loss of office payment equal to 12 months’ salary, as compensation and in accordance with the Nigerian market practice.

READ ALSO: Seplat’s Austin Avuru no longer has direct shares in company 

In line with the provisions of the Directors’ Remuneration Policy approved by shareholders of the Company at its 2018 AGM, he will also receive a pro-rata bonus (in cash) to reflect his time as CEO during the financial year, and same “will be provided in the Company’s Directors Remuneration Report for 2020 and subsequent years”.

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Seplat will also vest awards made in form of deferred shares in 2019 and 2020 at the normal vesting dates, and subject to the achievement of the relevant performance conditions, and Avuru will be subject to the post-employment shareholding requirement for two years.

The company management and board appreciated Avuru for his ‘excellent leadership’ in growing the company to become a notable player in the Nigerian and wider African hydrocarbon industry.

READ: Okomu Oil Palm ‘s profit declines by 43.22% as at Q3 2019  

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Backstory

On November 18 2019, Seplat Petroleum Development Company Plc announced that Mr Austin Avuru will be retiring as CEO at the end of July 2020.

This is in line with Avuru’s earlier plans to retire sometime around his 62nd birthday.

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