The World Bank has asserted that investing in the digital economy and infrastructure will be crucial to mitigate the impact of the COVID-19 pandemic and foster a sustained recovery and foster a sustained recovery in Sub-Saharan Africa.

This is according to the World Bank In Africa report – #AFRICAN CAN.

The report noted that in a time of Covid-19, dominated by lockdowns and social distancing, investing in the digital economy and infrastructure will be crucial to mitigate the impact of the COVID-19 pandemic and foster a sustained recovery.

It argued that the adoption of digital technologies by governments, households and firms in Sub-Saharan Africa still lags behind that of other regions in the world.

The report, therefore, maintains that government intervenes to reduce the cost of devices and services, avoid disconnections for lack of payment, and increase bandwidth will be key, considering that the road to economic recovery is projected to be long and arduous.

What they are saying

The report states that:

“The road to recovery will be long and arduous and will require policies and investments that focus on connecting people to job opportunities, which can help end extreme poverty, particularly post-COVID-19.”

What you should know

Even though the World Bank did not suggest the form that the policies and investments would take in the report, the Bank, in a separate report — flagship report – Global Economic Prospects – as reported by Nairametrics on the 19^th of January, 2021, has argued that productivity-enhancing structural reforms are required for quick economic recovery.

The Bank suggests these productivity-enhancing 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.

According to the report:

• Sub-Saharan Africa is home to more than 1 billion people, half of whom will be under 25 years old by 2050.
• It is a diverse continent offering human and natural resources that have the potential to yield inclusive growth and wipe out poverty in the region, enabling Africans across the continent to live healthier and more prosperous lives.
• With the world’s largest free trade area and a 1.2 billion-person market, the continent is creating an entirely new development path, harnessing the potential of its resources and people.
• Knowledge is essential for governments to make better policies and institutions to make more effective decisions, thus, governments should pay attention to research and analysis.

According to World Bank’s Flagship report – Global Economic Prospects.

• 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.

The President of the Senate, Ahmad Lawan, has said that the Petroleum Industry Bill (PIB) which is presently before the National Assembly for consideration and passage will ensure that Nigerians benefit optimally from crude oil production and sale of fossil fuel reserves.

According to a statement that was issued by the Special Assistant, Press to the Senate President, Tabiowo Ezrel, this disclosure was made by Lawan, while declaring open a 2-day public hearing on the bill by the National Assembly on Monday, January 25, 2021.

The Senate President pointed out that the National Assembly in its consideration of the piece of legislation would ensure that the bill when passed into law, guarantees improved revenue earnings for the country.

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What the Senate President is saying

Lawan in his statement said, ‘’Let me say this, we (National Assembly) will pass this bill not without ensuring that it is a bill that satisfies certain conditions. Nigeria is blessed with these resources, we want Nigeria to benefit optimally from them. In fact, we are in a hurry because we have lost so many years of benefits that we could have had.’’

He, however, noted that the non-passage of the PIB had been a major drag on the industry over the years, significantly limiting its ability to attract both local and foreign capital at a time when many other countries are scrambling to exploit their oil and gas resources.

READ: FG to begin online registration, monitoring of petrol stations, depots

Going further, Lawan said, ‘’The mere knowledge that the nation’s oil industry is still being governed by laws enacted more than 50 years ago is ludicrous and extremely disappointing.

‘’As legislators, we will strive to deliver a Bill that will enhance the growth of our oil and gas industry, modernize our fiscal system and enhance competitiveness, while creating harmony for all stakeholders. This is a promise we have made and that we shall achieve.’’

READ: FG assures oil companies of lower taxes in new PIB

‘’Nigeria must have an oil and gas industry that benefits its people. Equally, our oil and gas industry must be competitive. We must create a sustainable investment climate, where business in the sector will flourish,’’ he said.

He also added that the determination by the legislature to pass the Bill is driven by the need to overhaul a system that has refused to operate optimally in line with global standards, resulting in loss of continental competitiveness, transparency, accountability, good governance and economic loss for the petroleum industry and the country.

The Different chapters of the PIB

The Senate President revealed that the PIB comprises of 4 chapters that outline;

• How to create efficient and effective governing institutions with clear and separate roles for the petroleum industry,
• Establish a framework for the creation of a commercially oriented and profit-driven National Petroleum Company,
• Promote transparency, good governance and accountability in the administration of the petroleum resources of Nigeria among others.

READ: Buhari directs FIRS, others to ensure strict compliance of tax payment by foreign firms

Other benefits of the PIB

He also noted that the PIB upon passage and assent into law by the President;

• Would foster sustainable prosperity within host communities, provide direct social and economic benefits from petroleum operations to host communities,
• Create a framework to support the development of host communities among others
• Establish a progressive fiscal framework that encourages investment in the Nigerian Petroleum Industry,
• Balancing rewards with risk and enhancing revenues to the Federal Government of Nigeria,
• Provide a forward-looking fiscal framework that is based on core principles of clarity, dynamism and fiscal rules of general applications,
• Establish a fiscal framework that expands the revenue base of the Federal Government while ensuring a fair return to investors.

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Lawan assured that the National Assembly during the public hearing would deal with all issues relating to the oil and gas industry with thoroughness and effectiveness so as to avert colossal losses to the nation’s economy.

Lawan: PIB will ensure Nigerians benefit optimally from resources

***As Senate begins public hearing on bill pic.twitter.com/nSycKWW4lH

— President of the Senate (@SPNigeria) January 25, 2021

The Federal Government has announced that Nigeria’s Excess Crude Account (ECA) balance as at 20th January 2021 is $72,411,197.80.

This was disclosed by the Minister of Finance, Budget and National Planning, Zainab Ahmed at the first National Economic Council meeting of the year presided over by Vice President Yemi Osinbajo, SAN, with State Governors, Federal Capital Territory Minister, Central Bank Governor and other senior government officials in attendance.

READ: Nigeria’s growing current account deficit fans devaluation flames 

The FG said, “the ECA balance as at 20th January, 2021, $72,411,197.80; Stabilization Account, balance as at 19th January, 2021, N28, 800, 711,295.37; Natural Resources Development Fund Account, balance as at 19th January 2021, N95, 830,729,470.82.”

READ: Nigerians spend $9.01 billion on foreign travels in 2019 

What you should know

• In August 2015, during the early days of the Buhari administration, the ECA stood at $2.2 billion. It was $3.6 billion in February 2014, one of the highest balances on record.
• According to the Central Bank of Nigeria’s annual report for 2018, Nigeria’s excess crude account fell from $2.45 billion in 2017 to $480 million as of December 2018.
• In 2019, Nairametrics reported Nigeria’s Excess Crude Account had dropped to $480 million. This is as controversy continued to trail the $1 billion military spendings which was withdrawn from Nigeria’s Excess Crude Account.
• Nairametrics reported in July 2020 that the  ECA had fallen by about 98% within the last 5 years to $72 million.
• Nigeria has 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 their peak.