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Business News
Why government, not Discos is behind Nigeria’s poor power supply
Power distribution operators (Discos) are of the opinion that government could be behind the troubles faced in the industry, which is resulting in poor power supply in the country. Captain Hosa Okunbo, one of the investors that acquired the Yola Distribution Company (DISCO) in an interview with Osasu Igbinedion of The Osasu Show,disclosed some of the burdens his company and other Discos are currently facing.
Broadly speaking, according to Okunbo,the Federal Government has not met most of the conditions under which they should operate as a distribution company (DISCO). Okunbo said:“the best thing that can happen today to us or to me is for government to take back the assets and pay us back our money”.
Why such a conclusion?
One of the reasons for this is that government has refused to raise tariffs to allow discos recuperate their costs.
However, government may have been unable to meet this condition due to circumstances beyond its control. A proposed increase in electricity tariffs, has been put on hold due to a court case. Furthermore, the National Assembly is very strongly opposed to the move, due to concerns over the inability of a vast majority of Nigerians to afford high electricity tariffs. While the level of poverty is already high, purchasing power is being battered by high inflation, which is making basic commodities like food, expensive.
Another reason that Okunbo points out as a debilitating factor is the fact that the Federal Government sold distribution assets to Nigerian investors in dollars, when it knew that the assets would generate revenue in Naira. To finance the acquisition of the assets, Nigerian investors took Dollar loans from Nigerian banks, and are still struggling with repaying both the interest and principal in Dollars. To worsen the situation, the CBN doesn’t recognize this loan repayment as an eligible transaction under its forex rules, making it extremely expensive for discos to repay their debts.
Okunbo opines that government should have sold the assets for cheap, so that investors could then gradually invest in them and improve them. But government, in its cash-strapped state, opted for revenues rather than making it easier for the problems to be solved.
Mr Dallas Peavey, MD of Egbin Power Plc had also recently complained of the company’s inability to function effectively due to the failure of the Federal Government to settle its debts.
The inability of the DISCOs to generate adequate revenue, has led to difficulties in paying back loans for some of the investors. Banks, that lent the funds are also unwilling to make provisions for them, so as not to fall below regulatory limits set by the Central Bank of Nigeria (CBN).
Why a refund may not be possible
As reasonable as Captain Okunbor’s argument is, the possibility of government refunding the firm is quite slim. The funds generated from the privatization exercise have already been spent. Government itself is constrained by funds, and has had to borrow massively to meet budgetary obligations.
Government may also be unwilling to reverse the exercise as that would leave it saddled with the responsibility of generating, transmitting and distributing power in the country.
Coronavirus
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Coronavirus
COVID-19 Update in Nigeria
On the 18th of January 2021, 1,617 new confirmed cases and 14 deaths were recorded in Nigeria
The spread of novel Corona Virus Disease (COVID-19) in Nigeria continues to record significant increases as the latest statistics provided by the Nigeria Centre for Disease Control reveal Nigeria now has 112,004 confirmed cases.
On the 18th of January 2021, 1,617 new confirmed cases and 14 deaths were recorded in Nigeria.
To date, 112,004 cases have been confirmed, 89,939 cases have been discharged and 1,449 deaths have been recorded in 36 states and the Federal Capital Territory. A total of 1.17 million tests have been carried out as of January 17th, 2021 compared to 1.15 million tests a day earlier.
COVID-19 Case Updates- 18th January 2021,
- Total Number of Cases – 112,004
- Total Number Discharged – 89,939
- Total Deaths – 1,449
- Total Tests Carried out – 1,172,234
According to the NCDC, the 1,617 new cases were reported from 18 states- Lagos (776), Kaduna (147) Kwara (131), FCT (102), Plateau (78), Edo (59), Ogun (53), Osun (45), Rivers (37), Taraba (36), Nasarawa (34), Adamawa (33), Kano (26), Delta (20), Ebonyi (16), Bayelsa (11), Gombe(11) and Borno (2).
Meanwhile, the latest numbers bring Lagos state total confirmed cases to 41,400, followed by Abuja (14,700), Plateau (6,831), Kaduna (6,325), Oyo (4,695), Rivers (4,429), Edo (3,320), Ogun (2,912), Kano (2,617), Delta (2,122), Ondo (2,070), Katsina (1,723), Kwara (1,697), Enugu (1,583), Gombe (1,500), Nasarawa (1,335), Ebonyi (1,275), Osun (1,260), Abia (1,134), and Bauchi (1,107).
Borno State has recorded 867 cases, Imo (857), Sokoto (677), Akwa Ibom (667), Benue (657), Bayelsa (619), Adamawa (573), Niger (547), Anambra (515), Ekiti (473), Jigawa (425), Taraba (294), Kebbi (251), Yobe (211), Cross River (169), Zamfara (162), while Kogi state has recorded 5 cases only.
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Lock Down and Curfew
In a move to combat the spread of the pandemic disease, President Muhammadu Buhari directed the cessation of all movements in Lagos and the FCT for an initial period of 14 days, which took effect from 11 pm on Monday, 30th March 2020.
The movement restriction, which was extended by another two weeks period, has been partially put on hold with some businesses commencing operations from May 4. On April 27th, 2020, Nigeria’s President, Muhammadu Buhari declared an overnight curfew from 8 pm to 6 am across the country, as part of new measures to contain the spread of the COVID-19. This comes along with the phased and gradual easing of lockdown measures in FCT, Lagos, and Ogun States, which took effect from Saturday, 2nd May 2020, at 9 am.
On Monday, 29th June 2020 the federal government extended the second phase of the eased lockdown by 4 weeks and approved interstate movement outside curfew hours with effect from July 1, 2020. Also, on Monday 27th July 2020, the federal government extended the second phase of eased lockdown by an additional one week.
On Thursday, 6th August 2020 the federal government through the secretary to the Government of the Federation (SGF) and Chairman of the Presidential Task Force (PTF) on COVID-19 announced the extension of the second phase of eased lockdown by another four (4) weeks.
Governor Babajide Sanwo-Olu of Lagos State announced the closed down of the Eti-Osa Isolation Centre, with effect from Friday, 31st July 2020. He also mentioned that the Agidingbi Isolation Centre would also be closed and the patients relocated to a large capacity centre.
Due to the increased number of covid-19 cases in Nigeria, the Nigerian government ordered the reopening of Isolation and treatment centres in the country on Thursday, 10th December 2020.
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Around the World
US Capitol complex temporarily shut down
The US Capitol complex was shut down temporarily on Monday as a precautionary measure after a small fire broke out nearby.
The US Capitol complex was shut down temporarily for about an hour on Monday as a precautionary measure after a small fire broke out nearby, highlighting the security concerns that are being raised days before the inauguration of President-elect Joe Biden.
The security concerns and the lockdown follows the January 6 attack on the US Capital by supporters of the outgoing US President, Donald Trump, after his encouragement and inciting comments, calling the Presidential election a fraud without any proof of evidence.
READ: President Trump says he won’t attend Joe Biden’s inauguration
Some of them even called for the death of the US Vice President, Mike Pence for presiding over the certification of Joe Biden’s November election victory.
While making the disclosure in a statement, the Capitol Police said that the lockdown has been lifted and the nearby fire contained.
The Acting Chief of the Capitol Police had said that the complex which comprises of the Capitol, its grounds and several buildings were shut down as a precautionary measure.
READ: US Supreme court dismisses Texas bid to overturn presidential election results
The US Secret Service in a tweet post on its official Twitter handle said, “Out of an abundance of caution the U.S. Capitol complex was temporarily shutdown. There is no threat to the public.’’
The city’s fire department in its tweet post said that firefighters put out a fire outside near the Capitol complex.
The fire department said, “There were no injuries. This accounts for smoke that many have seen.”
READ: Huawei accuses the United States of hacking
What you should know
- President-elect, Joe Biden is expected to be sworn in at the US Capitol on Wednesday amid an unprecedented cordon of security, with strict physical distancing measures in place due to threats of violent attacks in Washington and the rising cases of coronavirus infections.
- Donald Trump, who is just fresh from a historic second impeachment from the congress had said he would not attend, although his deputy, Vice President Mike Pence, had given an indication that he would attend.
