Business News
Lawmakers tackle Finance Minister over failed CCTV project worth $460 million
Members of the House of Representatives have commenced an investigation into the failed Abuja CCTV project funded with a $460 million loan.
Members of the House of Representatives have commenced investigation into the failed Abuja CCTV project which was funded with a $460 million loan obtained from China.
The Details: The lawmakers, who were unhappy that the project was funded with a loan and left uncompleted, probed the Ministry of Finance for answers. This occurred at a budget defence session with the finance committee of the house of representative led by its Chairman, Hon. James Faleke.
“Before this administration, we collected some loans and the one that strikes me the most is the $460 million for CCTV installation in Abuja.
“I want to know the position of this loan. I am sure we are paying back, but the CCTV is not working. Any time we take loan from China, the Chinese will come and do the job, they will bring all their equipment, the personnel and the goods and yet we do not have value for the money, especially that of the CCTV.
“Where are we? I need you to look into it and send us a memo on this particular project,” he demanded.
[READ MORE: Finance Minister, Zainab Ahmed says Nigeria’s VAT collection rate is low]
Unfortunately, the Finance Minister, Zainab Ahmed could not provide details on the status of the project even though she acknowledged that Nigeria is currently servicing the loan to the Chinese.
Ahmed’s response: “We are servicing the loan, but on the project, we will have to ask the Federal Capital Territory Authority because the project was deployed in the FCT. I have no information on the status of the CCTV.
“The conditions of the loans that we take from China always will be that a Chinese company will provide the infrastructure services. These are loans that are of 3%, the rail lines are being rolled out, the Abuja-Kaduna, Lagos-Ibadan rails are all loans from China and are being executed by Chinese companies.”
Backstory: The project, which was called the National Public Security Communication System, (NPSCS), was conceived by late President Umaru Yar’Adua to help security agencies in the Federal Capital Territory check the growing insecurity in the federal capital.
Findings show that late President Umaru Yar’Adua was persuaded by some of his powerful aides to award the $470 million project to the Chinese firm, ZTE Corporation, in August 2010 without proper monitoring.
The project was funded through a $600 million credit facility obtained from the Chinese EXIMBANK and scheduled for completion in May 2011.
[READ ALSO: Nigeria needs $100 billion annually to fix infrastructural deficit – Finance Minister]
In 2015, the House of Representatives directed an ad-hoc committee to probe the uncompleted projects awarded to the Chinese firm, ZTE Corporation.
The cameras were to be accompanied with 37 switch rooms, MW backbone, 37 coalition emergency response systems, 38 video conference sub-systems, 37 e-police systems, six emergency communication vehicles and 1.5 million lines for subscription.
Energy
FG to begin online registration, monitoring of petrol stations, depots
The DPR has stated that it will commence the remote monitoring, registration, and accreditation of all petroleum products depots.
The Department of Petroleum Resources (DPR) has revealed that it plans to automate and begin remote monitoring, registration, and accreditation of petroleum products depots, retail outlets, and the entire downstream oil and gas industry, with the launch of the newly established Downstream Remote Monitoring Systems (DRMS).
While disclosing a statement in Abuja, the Head, Public Affairs of the DPR, Paul Osu, pointed out that the newly established Downstream Remote Monitoring Systems is expected to take off on December 1, 2020, after the launch in Abuja.
According to a report by Vanguard, Osu explained that the DRMS is a web-based solution designed to provide intelligent regulatory and inventory management system for petroleum products supply and distribution from depot to retail outlets and also as a regulatory tool to monitor retail outlets and depot activities.
He said, “Other features of the application include retail outlets accreditation and re-registration, nationwide automated product inventory management, retail outlets coordinate recording for mapping purposes and transactions management and report generation of dealers nationwide.
“The establishment of DRMS is another strategic initiative of DPR to continue to create opportunities and enable business in the oil and gas industry in Nigeria.”
It can be recalled that the DPR had a few months ago, launched the National Production Monitoring System (NPMS), another online platform to assist the oil and gas regulator accurately monitor national crude oil production and exports, through the provision of a system for direct and independent acquisition of production data from oil and gas facilities in Nigeria
This is to ensure timely and accurate reporting of production figures and export data. This is also expected to guard against the crude oil theft that is prevalent in Nigeria’s upstream oil sector or reported cases of crude oil that is sold but unaccounted for.
The NPMS is an initiative that is developed as a replacement for the current paper-based report and ensures ready production reporting to the Federal Inland Revenue Service (FIRS) and the Nigeria Extractive Industries Transparency Initiative (NEITI) and other agencies.
Financial Services
Era of backlog of unsettled claims is over – NAICOM boss
NAICOM has stated that it will monitor and sanction insurance companies who fail to settle claims as at when due.
The National Insurance Commission (NAICOM) is out to seriously sanction any insurance companies with huge unsettled claims.
This disclosure was made by the Commissioner for Insurance, Mr. Sunday Thomas, at the on-going 2020 Insurance Directors’ Conference, jointly organized by NAICOM and the College of Insurance & Financial Management (CIFM), held at the Oriental Hotel in Lagos.
Mr. Thomas reiterated the need for the operators, post-pandemic, to appropriately strengthen their human and financial capital for effective participation in big-ticket risks to take advantage of the obvious gains of the domestication policy in the Nigeria Content Development Act 2010.
In his words, Mr. Thomas stated, “More businesses especially in the oil and gas and the Aviation sectors are now being reinsured abroad. Of more concern is the declining participation of life companies in the annuity business, which is the emerging business for our industry.
“These are the areas where the industry can impose itself on the economy through the control of funds for national development. The industry must invest handsomely in technology, one of our key drivers for developing the market.
“The Institutions should be prepared to digitalize their processes, procedures, and systems, in order to make their operations seamless and real-time. The Commission is investing heavily in automating its processes and expects nothing less from the insurance institutions. An industry Information Technology Guideline has been issued for the operators and the Commission requires your support and cooperation for effective compliance.”
(READ MORE: FG seeking FDI to develop Special Economic Zones – Trade Minister)
Why this matters
Prompt settlement of claims should be a top priority for the insurance operators in achieving an excellent and responsive customer service experience. Settlement of claims has been a serious nightmare for quite a number of customers, resulting to the abysmally low insurance culture in Nigeria.
Customers are more likely to patronize the insurance companies that are prompt in claims settlement and by extension improve the industry penetration in the market.
Financial Services
Total credit to the economy rose to N19.54trillion – CBN Governor
The CBN revealed during the MPC meeting that the total credit to the economy rose to N19.54tn as of the end of November 13.
The CBN Governor, Godwin Emefiele, has disclosed during the Monetary Policy Committee meeting that the total credit to the economy rose to N19.54tn as of the end of November 13.
According to him, the aggregate domestic credit grew by 7.6% in October 2020 compared with 7.35% Month-on-Month in September.
In his words, “Total gross credit by the banking industry stood at N19.54tn as at 13th November 2020 compared with N19.33tn at end-August 2020, an increase of N290.13bn. When compared with N15.56tn at the commencement of the LDR policy in May 2019, total gross credit increased by N3.97tn.”
According to Emefiele, the composition of the loans are N738bn to Manufacturing, General commerce N874bn, Agric and forestry N301bn, Construction N291bn, ICT (N231bn), etc.
In the month of October 2020, he stated that 86.23% of the total loans granted to over one million customers by banks were at interest rates considerably below 20% per annum.
(READ MORE: N200 billion Unclaimed Dividend: Securities dealers reject FG’s plan to manage fund)
Bottom line
The MPC was quite optimistic and favorably disposed about the future impact of the disbursements from agri-business/Small and Medium Enterprise Investment Scheme of the sum of N92.90bn to 24,702 beneficiaries; Anchor Borrowers Program – N164.91bn disbursed to 954,279 beneficiaries; and COVID-19 Targeted Credit Facility to household and SMEs, with the sum of N149.21bn to 316,869 beneficiaries.
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