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Economy & Politics
The 5 states with the highest net statutory allocation in H1 2017
Published
3 years agoon

The first half of the year is gone and states, most of whom depend on statutory allocation from the top, had some form of relief following a horrendous 2016 which saw the amount available for sharing plummet rapidly due to concurrent issues surrounding foreign exchange, oil price slump and militancy in the Niger Delta. This year has seen slight to vast improvements on those fronts enabling states to access more money in H1 2017. Based on this, however, who got the highest net statuary allocation in H1 2017?
Lagos State
The commercial nerve point of the country got N39.61 billion following its inclusion among the oil-producing states, hence its entitlement to the 13% derivation allocation. Despite the fact that the state has the highest Internally Generated Revenue, it comes in at 5th on this list. It’s 13.71 billion (or 34.6% of its net allocation) deductions did not help matters as it followed the high level of deductions observed in the South Western states.
Delta State
With a little over than N2 billion on top of Lagos’ allocation, the oil production state also suffered from high deductions, shelling out N14.21 billion as deductions. This represents 34.6% of its N14.66 billion net statuary allocation in H1 2017
Bayelsa State
Home to former President Goodluck Jonathan, Bayelsa State continued the dominance of oil-producing states on this list by coming in third with N46.59 billion received as statuary allocation in H1 2017. This figure could have been as high as N55.6 billion if not for the N8.99 billion deductions made.
Rivers State
Governor Wike cannot say the APC dominated Federal Government has been unfair to his state in terms of statuary allocation in H1 2017 with the state raking in N53.5 billion or an average of about N9 billion Naira monthly for H1 2017. This excludes the about N10.35 billion removed as deductions.
Akwa Ibom
The South-South’s dominance is completed with Akwa Ibom’s clinching the top spot. Collecting about N68.9 billion as statuary allocations in H1 2017. Its case was certainly helped by having the least deductions among the top 5 with just N6.5 billion. However, not even with deductions added to their net allocations could any of the states match up with Akwa Ibom.
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.


Economy & Politics
Productivity-enhancing reforms are required for quick economic recovery – World Bank
Productivity-enhancing structural reforms key to quick economic recovery.

Published
13 hours agoon
January 19, 2021
The World Bank has revealed that a slow recovery of the global economy is not an inevitability and can be avoided through productivity-enhancing structural reforms.
This is contained in the Bank’s flagship report – Global Economic Prospects.
The Bank believes structural reforms are capable of offsetting the pandemic’s scarring effects and lay the foundations for higher long-run growth. It agrees that the global economy appears to be emerging from one of its deepest recessions and beginning a subdued recovery, beyond the short term economic outlook, following the devastating health and economic crisis caused by COVID-19.
According to the report, policymakers face formidable challenges — in public health, debt management, budget policies, central banking, and structural reforms, as they try to ensure that this still-fragile global recovery gains traction and sets a foundation for robust growth and development.
Highlights
- Growth in Nigeria is expected to resume at 1.1% in 2021 – markedly weaker than previous projections – and edge up to 1.8% in 2022, as the economy faces severe challenges.
- Investment is projected to shrink again this year in more than a quarter of economies – primarily in Sub-Saharan Africa (SSA), where investment gaps were already large prior to the pandemic.
- Growth in Sub-Saharan Africa is expected to rebound only moderately to 2.7% in 2021 – 0.4% point weaker than previously projected, before firming to 3.3% in 2022.
- Relative to advanced economies, disruptions to schooling have, on average, been more prolonged in emerging market and developing economies (EMDEs), including in low-income countries.
What the World Bank is saying
- “In the longer run, a concerted push toward productivity-enhancing structural reforms will be required to offset the pandemic’s scarring effects.
- “The intended productivity-enhancing structural reforms encompass promoting education, effective public investment, sectoral reallocation, and improved governance. Investment in green infrastructure projects can provide further support to sustainable long-run growth while also contributing to climate change mitigation.”
Are we ready to adjust structurally?
The World Bank has identified key areas that could trigger quick economic recovery. A close look at events in the country appears to suggest that we may be far from ready in terms of adjusting structurally.
A cursory look at the structural adjustment areas suggested by the Bank indicates that in Nigeria, for example, and maybe elsewhere, the single most important factor is improved governance.
All other factors appear to be contingent on this, as the Bank admits that improved governance and reduced corruption can lay the foundations for higher long-run growth. Policymakers and politicians in the country are therefore advised to pay close attention to activities geared towards reduced corruption and improved governance.
Another key area is public investment. Even though most public enterprises and related establishments are usually plagued with corporate governance problems, there are several ways by which the problems could be curtailed.
The issue of education, especially tertiary education, has been problematic with governments failing to meet the demands of university unions, resulting in strikes, almost on a yearly basis. It is hoped that a lasting solution to this springs forth soon.
Economy & Politics
Nigerian government spends equivalent of 83% of revenue to service debt in 2020
The Federal Government of Nigeria achieved a debt service to revenue ratio of 83% in 2020.

Published
3 days agoon
January 17, 2021
The Federal Government of Nigeria achieved a debt service to revenue ratio of 83% in 2020. This is according to the information contained in the budget implementation report of the government for the year ended December 2020.
According to the data seen by Nairametrics, total revenue earned in 2020 was N3.93 trillion representing a 27% drop from the target revenues of N5.365 trillion. However, debt service for the year was a sum of N3.26 trillion or 82.9% of revenue.
READ: FG posts 27% revenue shortfall in 2020 as budget deficit hit N6.1 trillion
Nigeria’s debt service cost of N3.26 trillion has now dwarfed the N1.7 trillion spent on capital expenditure of N1.7 trillion incurred in 2020. This is also the highest debt service paid by the Federal Government since we started tracking this data in 2009.
The total public debt (External and Domestic) balance carried by Nigeria as of September 2020 stood at N32.22 trillion ($84.57 billion). Included in the total debt is a domestic debt of about N15.8 trillion.
READ: Nigeria’s high recurrent costs, low revenue and escalating debt numbers
READ: Customs revenue rises by N200 billion to hit N1.5 trillion in 2020
What this means: Nigeria’s debt to GDP ratio is estimated at about 22%, one of the lowest in the world and much below what is obtainable in most emerging markets.
- However, the challenge has always been the debt service to revenue ratio, a metric that reveals whether the government is generating enough revenues to pay down its debts as they mature.
- Since the first recession experienced in 2016, Nigeria has struggled with a higher debt service to revenue ratio as revenues slid in direct correlation with the fall in oil prices.
- Nigeria’s government spent about N2.45 trillion in debt service in 2019 out of total revenue of N4.1 trillion or 59.6% debt service to revenue ratio.
- At 83%, 2020 ranks as the highest debt service to revenue ratio we have incurred. Before now it was 2017 with 61.6%.
READ: PayVIS: New Lagos State platform to use traffic cameras to fine traffic offenders
Breakdown of what debts were serviced
The following amount was spent on debt service during the year
- To service domestic debt, the government spent N1.755 trillion in 2020 as against a budget of N1.87 trillion.
- For foreign debts, a sum of N553 billion was spent against a target budget of N805.47 billion. The drop here is likely a result of lower interest rates on foreign borrowing as well as very limited borrowing from the foreign debt market during the year.
- The government only contributed N4.58 billion into its sinking fund instead of the budgeted N272.9 billion.
- The sinking fund is required to set aside funds that will be used to pay down on other loans such as bonds when they mature in the future.
- Finally, a sum of N912.57 trillion was spent on servicing CBN’s loans, granted via its Ways and Means provisions.
- Nairametrics reported last week that a total sum of N2.8 trillion was extended by the CBN to the FG as Ways and Means.
READ: World Bank hopes to cut down debts of poor countries rather than delay payments
What happens next: In 2021, the government projects a debt service of N3.1 trillion against revenue of N6.6 trillion or debt service to revenue ratio of 46.9%.
- The government plans to spend N4.3 trillion on capital expenditure during the year.
Economy & Politics
FG receives N144 billion in dividends from NLNG in 2020
NLNG, paid the Federal Government a dividend of N188 billion in the fiscal year ended December 2020.

Published
3 days agoon
January 17, 2021
Nigeria Liquified Natural Gas Company, NLNG, paid the Federal Government a dividend of N144 billion in the fiscal year ended December 2020.
This is according to the information contained in the Ministry of Finance Budget implementation report for the period of January 2020 to December 2020 and presented by the Minister for Finance Dr. Zainab Ahmed.
During the year, the Federal Government budgeted a sum of N80.3 billion as its share of dividends from NLNG, however, the actual sum received as its share was N144 billion, N63.2 billion more or 79% higher than projected.
The year 2020 was a difficult year for the government as the fall in crude oil prices and the economic shutdown that was triggered by the Covid-19 Pandemic dented projections and ravaged revenues.
READ: NLNG says Train 7 project will surge production capacity to 30 million MPTA
NLNG Dividend Bliss
The dividend received from NLNG was a major bright spot in the government’s revenue performance for the year.
- During the year, the government projected revenue of N5.36 trillion but only received N3.9 trillion in revenues representing a shortfall of N1.4 trillion or 27% for the year.
- The huge dividend windfall received in 2020 is a stark contrast from 2017 when Nigeria just exited a recession triggered by falling oil prices and a sharp exchange rate devaluation.
- In that year, the Federal Government’s share of dividends from Nigeria Liquefied Natural Gas (NLNG) dropped by as much as $687 million, from $1.04 billion in 2015 to $365 million in 2016, a 65% drop.
- The N144 billion received in 2020 topped the amount received from signature bonuses only N78.2 billion and complimented the N192 billion received by VAT.
- It is the most effective form of revenue generation for the government.
READ: NLNG signs 10 year sales deal with Eni
NLNG Controversies
Back in July Nairametrics reported that the House of Representatives planned to investigate the alleged illegal withdrawal of $1.05 billion from the NLNG account by NNPC without its knowledge and appropriation.
- They had accused the NNPC of illegally tampering with the funds at the NLNG dividends account to the tune of 1.05 billion dollars thereby violating the nation’s appropriation law.
- NLNG is a company jointly owned by Nigerian owned NNPC(49%), Shell (25.6%), Total (15%), and ENI (10.4%).
- The company is located in Bonny Island and has six trains with a total capacity to process 22 million tonnes of LNG a year and as much as 5 million tonnes of natural gas liquids.
- NLNG currently accounts for about 7% of the total LNG supply in the world. Nigeria is ranked as the 4th exporter of Natural Gas in the world.
READ: NLNG signs supply agreement with Galp Trading SA
Upshots: The FG is targeting a revenue of N208 billion from NLNG as dividends in 2021. If this materializes, it will be a significant payout in dividend (in naira terms) competing with the N238.4 billion expected from VAT.
- Important to note that the recent devaluation of the naira will increase the naira value of dividends and other government revenue, as it did in 2020.
- The government also targets N6.6 trillion in revenue for the period under review.
Updated: An earlier version of this article captured the dividend as N188 billion instead of N144 billion. It has now been corrected.
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