The Federation Account Allocation Committee (FAAC) disbursed the sum of N762.597 billion from the Federation Account to the three tiers of government in June 2019. This is according to the latest FAAC report released by the National Bureau of Statistics (NBS).
This was reportedly disclosed in a communique issued by the Technical sub-Committee of FAAC and signed by the Accountant-General of the Federation at the end of the meeting held in Abuja on Thursday.
The breakdown: The gross statutory revenue of N652.949 billion received for June is higher than the N571.731 billion received in the previous month. This means the gross statutory allocation received rose by N81.218 billion.
- The amount disbursed comprises of N652.949 billion from the Statutory Account, N108.631 billion from Value-Added Tax (VAT), as against N106.826 billion distributed in the preceding month, resulting in an increase of N1.805 billion.
- Also, the total revenue distributable for the month of June included the Value-Added Tax which stood at N762.597 billion.
FG received the lion share: Further breakdown shows that from the net statutory revenue, the Federal Government got N309.433 billion, representing 52.68% the total gross allocation in June.
- States governments received N201.157 billion or 26.72%.
- Local governments got N151.384 billion and this represents 20.60% of the total.
- The oil-producing states received N38.705 billion or 35% of total gross allocation as a 13% derivation revenue.
- From the revenue available from the VAT, the Federal Government received N15.643 billion (15%), states got N52.143 billion (50%) and the local government councils received N36.500 billion (35%).
Slight relief for states? The slight increase in disbursement from the Federation Account will directly affect economic activities in most states, albeit in different magnitudes. The slight increase in allocation for the month under review is also expected to improve economic activities.
Meanwhile, as earlier reported, there are concerns as the rise in debts accruable to some states is seriously eating up into the allocation to the affected states. While debt is building up, only a few states in Nigeria have sufficient Internal Generated Revenue (IGR) enough to spur economic activities without the Federal Government’s monthly allocation.
According to the NBS report, state governments paid the sum of N3.14 billion debt in just one month. Also, the recent debt report released by the Debt Management Office (DMO) shows that all the 36 States accrued domestic debt of N3.97 trillion or US$12.9 billion as of the end of March 2019.
Guinea Insurance Plc gives optimistic Q3 earnings forecast in spite of COVID-19
Note that some companies have had to revise their earnings estimates due to pandemic.
Guinea Insurance Plc is being very optimistic, having projected a 78.6% rise in gross premium written to N1.8 in Q3 2020, up from N1 billion during the comparable period in 2019. The insurer also forecasted a profit after tax of N185.8 million for the period, indicating an expected better performance compared to N735 million loss recorded in Q3 2019.
The earnings forecast, which was sent to the Nigerian Stock Exchange earlier today, also estimated that reinsurance expense for Q3 will be at N337.5 million. Claims expenses, underwriting expenses, and other operating experiences were equally put at N331.3 million, N292.6 million, and N692.2 million, respectively.
Note that this forecast is coming amid the negative economic impacts wrought by the Coronavirus pandemic. But while a growing list of companies (including Guinness Nigeria Plc) has downgraded their 2020 earnings and profitability forecasts, Guinea Insurance is expecting growth and that is good.
In Q1 2020, Guinea Insurance Plc reported gross premium written OF N207 million and a profit after tax of N12.6 million. The company’s consolidated half-year 2020 financial has not been released and is expected sometime between this month and next month.
The company’s share price ended today’s trading on the Nigerian Stock Exchange at N0.20. Year to date, this stock has not recorded any price movement.
CBN unification of exchange rate a welcome development – MAN
Ahmed urged the CBN to tackle activities that made speculators manipulate the multiple exchange rates.
The President of the Manufacturers Association of Nigeria (MAN), Mr Mansur Ahmed, announced on Friday that the recent CBN unification of Nigeria’s exchange rate is a welcome development that will boost investor confidence in Nigeria.
He said the exchange rate unification will enable stable planned production for manufacturers in Nigeria leading to economic growth, adding that the Manufacturers Association had urged for an exchange rate unification to enable a market-friendly business environment in Nigeria.
“Clearly, this is a welcome development and a laudable initiative that has come at the right time.”
“This is more so, particularly, now that the economic outlook is gloomy in light of the impact of the ravaging COVID-19 pandemic that has culminated in uninspiring macroeconomic situations,” he said.
He revealed that the World Bank had attributed Nigeria’s falling Foreign Direct Investment (FDI) to the multiple exchange rates as investors felt a “manipulation of the foreign exchange market.”
“The unification will also boost investors’ confidence, control rising inflation, and promote transparency, entrench better exchange rate management and eradicate distortions to the barest minimum,” he added.
He urged the CBN to tackle activities that made speculators manipulate the multiple exchange rates like “round-tripping” which he says expand the inflows of foreign investment into the economy.
He called on the Central Bank to implement 2 strategies to ensure a smooth transition into a unified exchange rate system.
“The first is to limit the short-term pains until efficiency gains materialize by responding swiftly with an inward-oriented rescue guideline while the second should seek to boost the pace at which such efficiency gains materialize,” he said.
He advised, it’s necessary the CBN “submit all the instruments of exchange rate determination” towards a free-market approach.
Buhari appoints new Ag. Chairman of EFCC, gives reason for Magu’s suspension
The statement revealed why Ibrahim Magu, was suspended by the President.
President Muhammadu Buhari has approved the appointment of Mohammed Umar as the new acting Chairman of the Economic and Financial Crime Commission (EFCC).
Umar who is EFCC’s Director of Operations was asked to take charge and oversee the operations and activities of the anti-corruption agency pending the conclusion of the ongoing investigation on the allegations against Ibrahim Magu and further directives in that regards.
This was disclosed by the Special Assistant Media and Public Relations to the Attorney General of the Federation and Minister for Justice, Dr Umar Gwandu, in a press statement on Friday, July 10, 2020, in Abuja.
The statement revealed that the former acting Chairman for EFCC, Ibrahim Magu, was suspended by the President in order to allow for an unhindered probe by the Presidential Investigation Panel which is headed by Rtd Justice Ayo Salami under the Tribunal of Inquiry Act and other relevant laws.
The presidential panel was set up to investigate various cases of official misconduct and financial irregularities against Ibrahim Magu, who has been in detention since Monday, July 6, following his invitation for questioning by the panel.
The allegations were made by the Attorney General and Minister for Justice, Abubakar Malami, who demanded for his removal as the acting Chairman of the EFFC in a memo to President Muhammadu Buhari.