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2022 budget: How FG can reduce borrowing – Lawan

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SENATE-PRESIDENT
President of the Senate Ahmad Lawan
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President of the Senate, Ahmad Lawan, has said that for the deficit in the country’s budget to be drastically reduced, concerted effort must be made by the Executive and Legislature to explore alternative sources of funding to reduce borrowing.

The Senate President explained that such sources of funding can come by way of Public-Private Partnerships on infrastructural projects, as well as compulsory remittances of generated revenues by Ministries, Departments and Agencies of Government.

Lawan made this known on Thursday in a speech delivered during the presentation of the 2022 budget to the National Assembly by President Muhammadu Buhari.

He, therefore, insisted that the policy of zero allocation for MDAs that fail to remit revenues for the 2022 Appropriation must be sustained for positive results to be achieved.

Lawan said, “Your Excellency, generating and collecting revenues have remained major challenges in our quest for development.

“The recent efforts by the National Assembly as well as the Executive to challenge the revenue generating agencies is a step in the right direction.

“Equally important is the recent position taken by the Legislature and the Executive to insist on zero allocation for Ministries, Departments and Agencies (MDAs) that fail to remit/upload their revenues for the 2022 Appropriation.

“This saw an increase in the contribution of the MDAs by over N400 Billion.

“It is my view that MDAs can contribute to the Federation account much more than that. This policy should be expanded and deepen to cover more MDAs.”

Speaking further, he said, “Mr President, the need to enhance revenue generation and collection cannot be overemphasized.

“The level of budget deficit is high, and both the Legislature and the Executive should work to reduce this deficit through the availability of more revenues.

“I must commend the Senate and House Committees on Finance and the Ministry of Finance, Budget and National Planning for working together to improve the level of revenues for the government.”

“Mr President, we understand that due to paucity of revenue, the Federal Government has to resort to raising funds from foreign and domestic sources to provide infrastructure across the country. That is why, the National Assembly approved the requests for borrowing.

“The Commitment of the Federal Government in providing infrastructure across the country means that the funds must be raised one way or the other.

“Government should also explore other sources of funding its projects in order to reduce borrowing”, the Senate President advised.

On the timely consideration of the 2022 budget, Lawan said that the Ninth Assembly remains committed to sustaining the January to December budget timeline hitherto reverted to after its inauguration.

He recalled that the early passage of the 2020 and 2021 budget helped Nigeria to deal with the economic recession it faced as a result of the COVID-19 pandemic.

Baring his thoughts on the security situation in the country, Lawan advocated for adequate funding of security agencies in the 2022 budget.

“Mr. President, the security of lives and property of Nigerians is still a challenge.

“The National Assembly is ever willing to work with the Executive arm of Government to continue to work for better security for our citizens.

“The recent changes in the leadership of the armed forces is a clear testimony of the collaboration between the Legislature and the Executive to overhaul the security architecture for better outcomes in our fight against the myriads of security challenges.

“Mr President, the recent passage of the supplementary budget 2021 that appropriated over eight hundred billion naira to our security agencies is a commendable step in the right direction.

“Federal Government should therefore continue to provide more resources to our security agencies to sustain the gains made so far.”

The Senate President assured that the National Assembly would pass the 2022 Appropriation Bill before the end of this year.

 

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Business & Economy

We Have No Magic Wand, Tackling Inflation Will Take Time — Cardoso

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Yemi Cardoso,CBN Governor
Yemi Cardoso,CBN Governor
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The Governor of Central Bank of Nigeria, Mr. Olayemi Cardoso has urged the citizens to be patient over the fight against current inflation and hike in food items in the country.

Cardoso disclosed this while briefing journalists at the end of the Monetary Policy Committee, MPC, meeting in Abuja.

The CBN governor mentioned that there was no magic needed to solve inflation in Nigeria but rather patience.

Also, Cardoso noted that despite pressure from food inflation, the general inflation rate was “moderating”, pointing out that “the tools the Central Bank is using are working”.

He stated, “I have several times and I will say again, there is no magic wand. These are things that need to take their time.

“I am pleased and confident that we are beginning to get some relief and in another couple of months we will see the more positive outcomes from the Central Bank have been doing.”

He added, “The committee thus reiterated several challenges confronting the effective moderation of food inflation to include rising costs of transportation of farm produce, infrastructure- related constraints along the line of distribution network, security challenges in some food producing areas, and exchange rate pass-through to domestic prices for imported food items.

“The MPC urged that more be done to address the security of farming communities to guarantee improved food production in these areas.

“Members further observed the recent volatility in the foreign exchange market, attributing this to seasonal demand, a reflection of the interplay between demand and supply in a freely functioning market system.”

The Central Bank of Nigeria has also blamed the recent volatility of the country’s foreign exchange market on seasonal demand for dollars.

“Members further observed the recent volatility in the foreign exchange market, attributing this to seasonal demand, a reflection of the interplay between demand and supply in a freely functioning market system,” a communique issued by the committee on Tuesday stated.

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Port Harcourt Refinery Begins Full Operations Next Month

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Port Harcourt Refinery
Port Harcourt Refinery
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The 210,000-barrel-per-day Port Harcourt refinery is expected to commence operations by the end of July, following multiple delays.

National Public Relations Officer of the Independent Marketers Association of Nigeria, Chief Ukadike Chinedu, revealed this new timeline on Monday. He noted that the refinery’s operation would boost economic activities, reduce petroleum product prices, and ensure an adequate supply.

In December last year, Minister of State for Petroleum Resources, Heineken Lokpobiri, announced the mechanical completion and flare start-off of the Port Harcourt refinery, the largest in the region.

The refinery consists of two units: an older plant with a 60,000-barrel-per-day capacity and a newer plant with a 150,000-barrel-per-day capacity. The refinery was shut down in March 2019 for the first phase of repairs after the government enlisted Italy’s Maire Tecnimont as a technical adviser and appointed oil major Eni as a technical adviser.

On March 15, 2024, NNPC Limited’s Group Chief Executive Officer, Mele Kyari, announced that the Port Harcourt refinery would begin operations in about two weeks. He made this statement during a press briefing following his appearance before the Senate Ad hoc committee investigating the various turnaround maintenance projects of the country’s refineries.

“We achieved mechanical completion in December,” Kyari stated. “We now have crude oil stocked in the refinery and are conducting regulatory compliance tests. The Port Harcourt refinery will start within two weeks.”

However, two months later, the refinery had yet to commence operations.

In an interview, IPMAN’s Ukadike emphasized that the work done on the refinery represented a complete overhaul rather than mere rehabilitation. He assured that every effort was being made to meet the July deadline.

Ukadike said, “When we visited, the MD informed us that the refinery was nearly ready and would start production by the end of July. The overhaul is extensive, with all the armoured cables replaced and everything almost brand new. The maintenance turnaround is massive, with work being done day and night. All hands are on deck to meet the target. By the end of July, the refinery should be operational.”

When asked about the government’s previous unfulfilled promises to restart the refinery, Ukadike acknowledged the delays but noted that no reasons were given for missing the last deadline in April

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CBN Halts 0.5% Cybersecurity Levy

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CBN Headquarters Abuja
CBN Headquarters Abuja
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The Central Bank of Nigeria (CBN) has withdrawn the circular directing banks to implement a 0.5 per cent cybersecurity levy on electronic transactions in the country.

The CBN announced this in a revised circular dated May 17, 2024.

The circular was addressed to commercial banks, Payment Service Providers (PSPs), non-interest, and merchant banks, among others.

It was signed by the CBN Director of Payment Systems Management, Chibuzor Efobi, and the Director of Financial Policy and Regulation Department, Haruna Mustafa.

The circular read: “The Central Bank of Nigeria circular dated May 6, 2024 (Ref: PSMD/DIR/PUB/LAB/017/004) on the above subject refers.

“Further to this, please be advised that the above-referenced circular is hereby withdrawn.”The withdrawal of the circular on the cybersecurity levy followed its suspension by President Bola Tinubu.

it would be recalls that Tinubu suspended the controversial cybersecurity levy on electronic transfers on May 14.

Minister of Information and National Orientation Mohammed Idris, who made this known while speaking to journalists after the Federal Executive Council (FEC) meeting at the Presidential Villa in Abuja, disclosed that Tinubu directed the CBN to suspend the implementation and review the modalities for the implementation of the levy.

Idris added that the levy was thoroughly discussed at the FEC meeting, saying the president was not oblivious to the feelings of Nigerians.

It would be recalled that CBN, in a circular dated May 6, directed banks to start charging a 0.5 per cent cybersecurity levy on all electronic transfers.

The apex bank stated that the deduction and collection of the cybersecurity levy is a sequel to the enactment of the Cybercrime (prohibition, prevention etc) Amendment Act of 2024.

This was greeted with wide condemnations by Nigerians, with many groups and individuals calling for the immediate reversal of the levy.

The House of Representatives also asked the CBN to withdraw the directive.

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