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Economy & Politics

Nigerians knock Fashola over comments on “bad roads”  

Babatunde Fashola appeared to have angered many Nigerians with his latest comments on the state of the country’s roads.

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Uproar, as Nigerians knock Fashola over comments on “bad roads”  

Nigerian Minister of Works and Housing, Babatunde Fashola appeared to have angered many Nigerians with his latest comments on the state of the country’s roads.

On Wednesday, 6th August, the Minister, after the Federal Executive Council meeting, said that Nigerian roads were not as bad as people portrayed.

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What exactly did the Minister say?

The Minister, who is a former Governor of Lagos State, reportedly stated that the roads were not that bad while reiterating that the paucity of funds and bureaucratic bottlenecks were major setbacks that stalled the process of road construction in the country.

Federal Executive Council

Babatunde Fashola

The Minister’s statement reads: “The roads are not as bad as they are often portrayed. I know that this is going to be your headline, but the roads are not that bad.

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“When I come here to announce that a particular amount was approved for a contract that doesn’t mean the amount has been paid contrary to what you suggest.

“You are mindful also that minister of finance, different arms of government are escalating the fiscal challenges we face as a nation in trying to fund the budget.

“You are also mindful that the last few budgets in Nigeria for almost 20 years have been deficit budgets and these are terminologies that are realities and I think we should acquaint ourselves with if we are not just to report the news but also educate the public.

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“You must also be aware that between awarding a contract and also mobilizing to the site there is a distance. First of all, we have to have an agreement that is the relationship between the ministry of works or any other ministry and the ministry of justice, then there is a role that banks play, they have to give a guarantee.

“Building materials – rocks, laterite, quarry, iron rods have to be ordered, construction companies don’t keep them.

“The process of producing blasting rocks requires approval from the office of ministers of justice and even the office of the NSA to get approval to get dynamite. All of these are the things that go on. So the point that I am making to you is that there is a distance between approval, implementation, actual construction and the result.”

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[READ MORE: Fashola divulges FG’s plans to build affordable homes]

Meanwhile, Nigerians are not having it

Following the Minister’s comment on the state of Nigerian roads, Nigerians flooded to Twitter to express their displeasure. Here are some selected reactions.

Commenting on Nairametrics’ Twitter handle, popular Analyst and News Editor at Bloomberg, Paul Wallace, asked if the Minister had driven from Lagos to Seme.

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Also, a twitter user, Demola Og, described the painful experiences and ordeal Lagos road users witness in the process of manoeuvring on the bad roads, while also avoiding motorcycle and tricycle riders.

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Further reacting to the Minister’s statement, Steve Osaz, knocked Fashola, accusing the Minister of not plying the roads to have a glimpse of how bad they are.

According to Segun Oladejo, the Minister needs to ply one of Nigerian roads before making such a statement.

Another Twitter user wondered why the Minister would make such a statement when the deplorable state of Nigerian roads make road users spend more time than expected.

https://twitter.com/Pastor_CVB/status/1192355861672448000

A Twitter user, Mohammed. cited the deplorable major roads in the Northern part of Nigerian.

In a similar fashion, this user knocked Fashola, stating that the Minister and leaders are not living in the present-day realities. According to him, they fly jets and ride on big cars to notice the bad states of the roads.

Abiahama, who claimed to have travelled to over 28 states, was appalled by such a statement from the former Governor, stating that it’s a pure misrepresentation of the realities on ground.

 

Patricia

Samuel is an Analyst with over 5 years experience. Connect with him via his twitter handle

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Commodities

Nigeria’s excess crude account falls to $72 million

Nigeria’s excess crude account has now fallen by a whopping 98% in just 5 years.

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Capital market to get more tax incentives - FG , FEC reviews Ajaokuta-Kaduna-Kano gas project contract, approves $2.571 billion, FG to reduce N1.5 trillion from 2020 budget due to coronavirus

Nigeria’s Excess Crude Account (ECA) now stands at $72 million as the country continues to grapple with an unprecedented revenue crisis not seen since the early eighties. The ECA account has now fallen by about 98% within the last 5 years.

The information on the excess crude account was revealed by the Minister of Finance, Zainab Ahmed in a National Economic Council Meeting during the week. The ECA is a savings account retained by the Federal Government and is funded by the difference between the market price of crude oil and the budgeted price of crude oil as contained in the appropriation bill.

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There were major concerns last November when it was reported that the ECA balances held just $324.5 million one of the lowest balances recorded at the time. At $72 million the ECA is in low territory highlighting the effect of the fall in crude oil prices this year. Crude oil prices have crashed to sub-zero in March and have risen back o just over $40/barrel in recent weeks. However, it still remains low from Nigeria’s previous budget benchmark.

ECA in the news

About a year ago Nairametrics reported Nigeria’s Excess Crude Account has dropped to $480 million. This is as controversy continues to trail the $1 billion military spendings which were withdrawn from Nigeria’s Excess Crude. According to the Central Bank of Nigeria’s annual report for 2018, Nigeria’s crude excess account fell from $2.45 billion in 2017 to $480 million as of December 2018.

(READ MORE: Rising COVID-19 cases in world’s biggest economy falter crude oil prices)

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Just 5 years ago (August 2015) the ECA stood at $2.2 billion. This was the early days of the Buhari administration. It was $3.6 billion in February 2014, one of the highest balances on record. That same month, at its monthly FAAC, the government agreed to remove fuel subsidy from its books. Fuel subsidy is currently being borne by the NNPC.

The Controversies: Last year, the federal government under President Muhammadu Buhari was accused of mismanaging the country’s Excess Crude Account especially the $1 billion reportedly spent on military equipment.

  • The National Security Adviser (NSA) retired Major General Babagana Monguno Gen. Babagana was quoted to have disclosed that he was not aware of the whereabouts or disbursement of the $1billion drawn from the ECA by the Buhari presidency in 2017 for security purposes.
  • While controversies trail the statement credited to the NSA, with many describing it as diversion of public funds, the Presidency provided some explanations.
  • Responding to the allegations, Senior Special Assistant on Media and Publicity, Garba Shehu, disclosed that various procurements had been made for the purchase of critical equipment for the Nigerian Army, the Nigerian Navy, and the Air Force, contrary to the allegations.

Nigeria’s ECA in retrospect: In Nigeria, there are two Sovereign Wealth Funds: the Excess Crude Account and the Nigeria Sovereign Investment Authority (NSIA). Note that these two are funded by the savings earned when oil prices are at peak.

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  • Hence, as a larger chunk of revenue is appropriated for ECA and NSIA, the country’s external reserves are likely to fall.
  • Note that the sovereign wealth fund was established to address the controversies surrounding the Excess Crude Account.
  • The fund is usually expected to generate revenue to meet budget shortfalls in the future, provide dedicated funding for the development of infrastructure and saves for future generations.

ECA depleted by 98% in 5 years: A closer look at the various annual reports of the Central Bank of Nigeria shows that Nigeria’s excess crude account has now fallen by a whopping 98% in just 5 years.

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Economy & Politics

Presidency dismisses allegation of Osinbajo receiving N4 billion from recovered loots

The accusation was described to be an obvious campaign of lies and calumny.

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Twitter deactivate Yemi Osinbajo's Twitter account, How Nigeria's LPG sector can create 2 million jobs -Osinbajo, budget support, NEC okays $250 million investment in NSIA , MSMEClinic gets 200,000 capacity yam storage facility in Benue, Accusations of Yemi Osinbajo receiving N4 Billion from recovered loots are baseless- Presidency

The office of the Vice President has reacted to a series of tweets accusing Professor Yemi Osinbajo of instructing the embattled acting Chairman of the EFCC, Ibrahim Magu, to release the sum of N4 billion out of N39 billion that was recovered from alleged looters. 

These allegations have been described as “false and baseless”. 

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READ ALSO: UPDATE: President Buhari appoints Prof. Gambari as new Chief of Staff

A statement that was signed by the Senior Special Assistant to the Vice President on Media and Publicity, Laolu Akande, said, with all emphasis at our disposal, let it be firmly stated that these are totally false and baseless fabrications purposing to reflect goings-on at the probe panel investigating Mr Ibrahim Magu”. 

Ibrahim Magu was relieved of his duties this week, after a probe was conducted on his activities as Acting Chairman of the nation’s anti-graft agency. He has since been replaced with Mohammed Umar. 

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READ MORE: Just In: DSS invites EFCC’s Acting Chairman, Ibrahim Magu for questioning)

Meanwhile, the statement by the Presidency also complained about the recent rise in people being paid to “peddle blatant falsehoods” against the Vice President and says Mr Osinbajo “will not be distracted by these obvious campaigns of lies and calumny”. 

The statement added that the online publications “being criminally defamatory in nature”  have been referred to law enforcement agencies for investigation. 

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Explore economic research data from Nairametrics on Nairalytics

 

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Economy & Politics

Minister of Petroleum explains reasons for subsidy removal

The Minister said it was unrealistic for the government to continue with the subsidy regime.

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IOCs, Nigeria, Timipre Sylva, crude oil, Minister proposes 2020 timeline for rehabilitation of Warri, Kaduna refineries , FG to cut huge energy cost through gas commercialisation initiative, FG discloses plan to sell fuel at N97 per litre , FG give reasons why it won’t allow marketers determine petrol price despite deregulation, FG explains reasons for deregulating downstream oil sector

The Federal Government has explained the reason for the deregulation of the downstream sector of the oil industry. The government said that this was to ensure economic growth and development of the country.

This was disclosed by the Minister of State for Petroleum Resources, Timipre Sylva, in a press statement on Thursday, July 9, 2020, in Abuja.

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Sylva said that it was unrealistic for the government to still continue with the subsidy regime, especially with the Premium Motor Spirit (PMS) otherwise known as petrol, as it had no economic value.

He asked Nigerians to ignore the misinformation and misguided comments that have been in the public space on the issue.

According to the Minster, ‘’It has become expedient for the Ministry of Petroleum to explain misconceptions around the issue of Petroleum Products Deregulation. After a thorough examination of the economics of subsidizing PMS for domestic consumption, the government concluded that it was unrealistic to continue with the burden of subsidizing PMS to the tune of trillions of Naira every year.’’

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“More so, when the subsidy was benefiting in large part the rich rather than the poor and ordinary Nigerians. Deregulation means that the Government will no longer continue to be the main supplier of Petroleum Products, but will encourage private sector to take over the role of supplying Petroleum Products.

READ MORE: DPR allays fears of possible looming fuel scarcity, says it has enough stock

He pointed out that in line with global best practices, the price of petroleum products will be determined by market forces. He, however, added that the government will continue to play its traditional role of regulation and ensure that it was not priced arbitrarily by private sector suppliers.

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Sylva said that the regulatory function will be similar to that played by the Central Bank of Nigeria in the banking sector where they try to make sure that deposit money banks do not charge arbitrary interest rates on its customers.

The minister noted that the government has earlier revealed that an increase in crude oil prices would also reflect at the pump price of petroleum products.

Going further Sylva said, ‘’Indeed, one of the reasons we have been unable to attract the level of investments we desire into the refining sector has been the burden of fuel subsidy. We need to free up that investment space so that what happened in the Banking Sector, Aviation Sector and other Sectors can happen in the Midstream and Downstream Oil Sector.’’

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” We can no longer avoid the inevitable and expect the impossible to continue. There was no time government promised to reduce Pump Price and keep it permanently low. Let us, therefore, ignore the antics of unscrupulous middlemen who would want status quo ante to remain at the expense of the generality of Nigerians.,” he added.

READ MORE: NNPC releases audited financial statements, refineries record losses of N154 billion

He disclosed that the deregulation policy will attract more investments into the oil sector, create more jobs and opportunities and free up trillions of naira to develop infrastructure instead of enriching a few Nigerians.

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The minister noted that government who is mindful of the impact of higher PMS prices on Nigerians is working to roll out the auto gas scheme which will provide citizens with alternative sources of fuel at lower cost.

 

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