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FG to Borrow N1trn to Support Fuel Subsidy, States Face N1.5trn Revenue Loss

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.They’re Consequences of Petrol Subsidy Retention-Budget Office

By Joseph Amah, Abuja

The Federal Government will need to borrow an additional N1 trillion to offset the cost of fuel subsidy while states and local governments in the country would suffer an estimated loss of N1.

5 trillion in revenue.

These according to the Director General of the Budget Office of the Federation, Mr.

Ben Akabueze are the consequences of the government’s decision to retain fuel subsidies in the 2022 budget.

Akabueze also stated that the Federal Government was not excited about the rising prices of crude oil in the international market as long as fuel subsidies regime remained in Nigeria’s domestic market.

He was speaking, during a webinar that was organised by the Financial Institutions Training Centre (FITC), under its National Economic Development Outlook Series 2022 with the theme, “Rebooting the Economy: The Path to Sustainable Growth.”

He said: “Regrettably, for those of us on the fiscal side, the expectation of high oil price does not excite us as long as this subsidy regime remains because crude oil price is the biggest factor in the price of refined oil products. Above the price of $63 per barrel the impact on us fiscally will be negative with this subsidy regime. Higher dollar revenue will strengthen the external sector but the impact on government revenue is negative.”

He also explained that the net impact of the decision to retain fuel subsidy is that the federal government’s budget deficit will rise, “but by the way you need to understand that this subsidy cost is borne not just by the federal government but by all the tiers of government because it is charged at the Federation Account level.

“As you heard from the Minister of Finance, the Nigeria National Petroleum Corporation (NNPC) has indicated that it would require N3 trillion to cover this subsidy in 2022. Out of which we have (previously) provided N443 billion. So, we have to provide additional N2.5 trillion at the federation level.

“The federal government takes up N1 trillion of the sum and the deficit go up by that number. And because there is no corresponding revenue, debt borrowing will go up by N1 trillion. That is the cost of decision that it appears that the majority of Nigerians favoured. This is a democracy and government has to listen to the voice of the people.”

Akabueze also cleared the illusion in the minds of many Nigerians that high oil prices automatically translate to increased public revenue and savings in the Excess Crude Account.

He added, “The excess crude account does not receive accretion by just subtracting the price you get from the budget reference price. It is only when the revenue from oil exceeds what was projected in the budget that you have the excess. But the fact is that we haven’t had it for a long time. Last year oil price was in the high $60 but our revenue collection was N1 trillion less than what we projected even though oil price was significantly above the budget reference price simply because subsidy ate up a significant portion of it.”

He also argued that the country’s debt service to revenue ratio is high not because, “we are borrowing too much or that we are paying too much for our debt but because we are generating too little revenue. The other important ratio that we need to look at is the revenue to the GDP ratio compared to some African countries. Nigeria is at least one third of the average in terms of our revenue to GDP ratio. That is what needs to improve.”

He also blamed the structural imbalance in the country’s economy as one of the reasons why federal revenue ratio to the GDP has always remained very low.

“For instance, agriculture contributes close to a quarter of our GDP but yields less than one per cent to government revenue because of the structure of that sector that is largely informal and not taxable. These are the things we need to look into. Nigeria’s economic problem is largely structural. Even our high inflation is driven largely by structural factors.

“That is why reform is so critical. We need to reform this system. We need strong voices supporting agents of reforms in the government,” Akabueze said.

Speaking, the Chief Consultant of B. Adedipe Associates Limited, Dr. Biodun Adedipe, who made the key presentation during the webinar, said that Nigeria would snatch its economy from circles of recession by ending the era of depending on crude oil as its major source of public revenue, policy inconsistency, over dependence on import and low national productivity.

Adedipe projected that the manufacturing sector would be a major driver of the GDP in 2022.

“There are three reasons why I took the position that manufacturing will produce growth. The first reason is related to the intervention funds pumped by the Central Bank of Nigeria into the manufacturing sector. The second reason is the positive PMIs report that tells us what the future of that sector will be in terms of expansion. Third, is the steady inflow of FDIs and number four is the import data that showed that half of the country’s import in 2021 went to the manufacturing sector, ”he said.

The Managing Director/Chief Executive Officer of the FITC, Ms. Chizor Malize, also expected growth to come from the oil and gas sector and the financial sector of the nation’s economy.

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Airports Constructed by States  Not Commercially Viable, Says ICRC

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By Tony Obiechina, Abuja

Director-General Infrastructure Concession Regulatory Commission (ICRC) Dr Jobson Ewalefoh has said many airport projects undertaken by state governors lack commercial viability.

The ICRC boss stated this at the second Joint Public-Private Partnership Units’ Consultative Forum.

Over N160 billion has been channelled recently by Bayelsa, Nasarawa, Ekiti, Ebonyi, Yobe and Jigawa states for airport projects.

Ewalefoh described these allocations, which generate no revenue for the Federal Airports Authority of Nigeria (FAAN) as a misplaced economic priority.

He said, “When talking about infrastructure, it must be integrated, and we must speak with one voice.

“For instance, you have airport infrastructure projects going on in almost all the 36 states of the federation. With proper planning, that scenario can be avoided.

“I am from Edo State. There is an airport in the state and another one in Warri, Asaba and Anambra.

“Driving through those states with good roads is not up to one hour. So that’s why I think we all need to put our heads together and think of a national planning approach.

“Though we have a document, we can sit down and decide on priority projects to know which is best for one to do.

“Edo can build one project, Delta another one, Warri a different one but with integrated planning, such things can be avoided. We need to discuss at the national and sub-national level because Nigeria is sovereign, and we are one.”

Through integrated projects and collaboration with sub-national bodies, Ewalegoh said the frequency of unfeasible economic ventures would be addressed.

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Anguish as Bandits Embark on Killing Spree in Benue, Plateau

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From Attah Ede, Makurdi & Jude Dangwam, Jos

There seems to be no respite for many local communities in Benue and Plateau States as bandit attacks have continued to escalate by the day.

According to multiple local sources, the incessant attacks by gunmen, suspected to be Fulani herders, have left hundreds dead while many others are either displaced or missing.

Amid the growing tension, community leaders and other stakeholders have called on the federal government and the security agencies to secure the lives and property of the terror stricken communities.

In a passionate appeal yesterday, a group of academics and opinion leaders from Tyoshin, in Gwer-West local government area of Benue State bemoaned the fate of residents in their communities in the hands of the armed invaders.

Coming under the aegis of the Forum of Tyoshin Academics (FoTA), the forum said more than 500 persons had been killed by the armed invaders within a period of six months.

A statement jointly signed by the forum’s National President and the National Publicity Secretary, Professors Patrick Ukase and John Anja said five persons were killed in a fresh attack on Saturday.

The forum noted that the attacks, which it said dated back to 2011 claimed about 192 innocent lives by the end of 2017, while 302 were killed between 2018 and 2023.

According to the forum, more than 17  persons had been killed this year, bringing the figures to 511.

The statement said in part, “Today marks another day of mourning, another black day etched in the hearts of our community.

“The relentless wave of violence continues as suspected Fulani armed herders have, once again, unleashed terror on our people—this time along the Naka-Makurdi Road.

“The lives of five innocent souls who were rushed to the clinic for treatment following the attack, tragically slipped away, their cries unheard. Others lie in agony, fighting for their lives, yet the true number of those attacked remains unknown.

“Since 2011, the toll of this violence has been staggering. Between 2011 and 2017, 192 sons and daughters of Tyoshin were gruesomely murdered by herders. From 2018 to 2023, the numbers escalated, with 302 more lives lost in the area.

“This year alone, 17 individuals have been mercilessly hacked down by these herders. These figures do not include those who have disappeared and have not been seen since 2011. In all, we have lost over 511 lives to this relentless onslaught.

“Tyoshin land is bleeding, its cries drowned in the deafening silence of indifference. Our villages, our homes, and our very existence have come under siege for too long. Nine council wards of the Gwer-West local government area have already fallen into the hands of these ruthless attackers.

“Today’s tragedy is but a grim continuation of a war that has ravaged our land, leaving us shattered and broken. Just days ago, the blood of our brothers and sisters was spilled in Camp-Nagi, Mbachohon, where three more were brutally murdered.

“Yet, in the face of this terror, the silence from those sworn to protect us is deafening. The Tyoshin people are abandoned and forsaken by the very government that should shield them.

“The Federal Government and the Benue State Government remain disturbingly quiet, their inaction a haunting reminder of how alone we truly are.”

The community leaders lamented that the attacks were being carried out by the invaders despite the presence of soldiers drafted in the community for the purpose of protecting lives and property.

“Even the military presence, meant to offer protection, stands idle as the bloodbath continues. Our people fall; one by one, as these attackers roam freely, unchallenged and unafraid”, the group said.

The leaders appealed to President Bola Tinubu and the Governor of Benue State, Hyacinth Alia, to come to come to the community’s rescue.

In a related development, troops on Sunday rescued eight travellers along the Akaa-Akundo community in Zaki Biam, Ukum local Government Area of Benue State.

The troops were attached to 401 Special Forces Brigade/Sector 1, with the code named “Operation Whirl Stroke (OPWS).

The names of the rescued travelers were given as Oliver Enze, 40, who was the driver of the bus; Obi Valentine, 32; Nasuru Abubarka,18; Evangelist John Udhemuburu, 64; Bulus Bukar, 23; Samuel Chukwudi, 18; Joseph Ejeh, 37; and Alex Okafor, 42.

Some of the victims who spoke to journalists in Makurdi, thanked the troops for their prompt intervention.

The driver of the bus said they were attacked at 7:30pm when the vehicle ran into a barricade mounted by the bandits.

“They stopped us along Zaki- Biam-Wukari road at a check point that was mounted by the armed men wearing army uniforms and we mistook them to be soldiers.

“Several other vehicles were also parked by the roadside, and I was asked to park and ordered down with the passengers and forced to lie face down.

“Two of the passengers were taken away from the vehicle by the gunmen into the bush and cash worth millions of naira was collected from them, including travel bags, phones and other  valuables.

“In the process of their operations, they spotted the vehicle of the Joint Military Operations Team from a distance and took to their heels. That was when we got to know that they were kidnappers.”

When contacted, Brigadier General A. Rabiu, Commander 401 Special Forces Brigade/Sector 1, confirmed the incident and assured Benue State residents of total fight against criminality in the state.

It would be recalled that last week, the military troops also rescued six persons including a serving youth corps member who were traveling from Taraba to the Southeast.

The situation is not too different in neighbouring Plateau where armed herders have been terrorising agrarian communities in the state.

The Minister of Defence, Mohammed Badaru Abubakar who visited the state at the weekend, condemned the renewed bloodshed across some local government areas and called for an immediate end to the senseless killings.

He said peace loving people in the affected areas must avoid farm destruction, cattle rustling, poisoning of animals, night grazing, underage grazing and avoid ethnic profiling.

Abubakar stated this yesterday during a stakeholders engagement with community, religious and youth leaders from Barkin-Ladi, Riyom, Bokkos, Mangu and Wase local government areas of Plateau State.

He noted that the essence of the stakeholders engagement was to come up with workable solutions and tasked them to identify criminals in their respective communities and treat them as criminals rather than promoting ethnic profiling.

In his words, “Firstly, I must express my displeasure over the current attacks and reprisals that have resulted in the loss of lives and property.

“This is happening despite the best efforts of our security agencies, particularly the 3rd Division Operation Safe Haven, in ensuring a peaceful settlement to these early attacks that have affected both farmers and cattle breeders.

“I am particularly saddened by the actions of certain elements in some communities who continue to destroy farms and disrupt peace efforts despite ongoing dialogue aimed at resolving the issues diplomatically.

“These security challenges are not isolated to Plateau State, but are widespread across other parts of the country,” Badaru said.

This minister said the stakeholders’ meeting was intended to de-escalate tension and prevent a spillover of the situation in parts of Mangu into other areas of the state.Earlier, the General Officer Commanding 3 Armour Division, Maxwell Khobe Cantonment Rukuba Barracks, Major General Abdusalam Abubakar had given a commitment to ensure peace in the area

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Army Dispels Rumour of Lagbaja’s Death

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By David Torough, Abuja

Nigerian Army last night dismissed speculations that the Chief of Army Staff (COAS), Lt. Gen. Taoreed Lagbaja is dead, describing the reports as fake news.

The headquarters via its official X handle, @HQNigerianArmy dismissed an online report that circulated yesterday with the headline “Chief of Army Staff dies of cancer”.

The report claimed that Lt.

Gen.
Lagbaja passed away in an undisclosed hospital overseas nearly 48 hours due to stage three cancer. It quoted a senior government official.

The report claimed that the news of the COAS’s death had been kept secret due to intense lobbying by some Army Generals seeking to assume his position.

However, sources at the Army Headquarters confirmed that the Army Chief was critically ill.

One of the sources said, “COAS is not dead. He is only critically ill at the moment. We should be praying for him at this critical time and not spreading rumours that he died.”

Another source said he was out of the country to treat himself.

“He is out of the country for treatment. And I have not heard of his death from anyone around him. There is no way such information could be hidden.”

The phone number of the director, Army Public Relations, Maj. Gen. Onyema Nwachukwu indicated it was switched off. He was yet to respond to a message sent to him on the matter.

Lt. Gen. Lagbaja, born on Feb. 28, 1968 in Ilobu, Osun State was appointed by President Bola Tinubu in June 2023 as the 27th COAS.

The Army Headquarters asserted the importance of accurate information and urged the public to disregard any unverified reports regarding the health or status of its leadership.

Presidency reacts

Also reacting to the rumours, Special Adviser Information and Strategy to President Tinubu, Bayo Onanuga via his X Platform dismissed the report on death of Lagbaja.

He said, “Director of Army Public Relations, Major General Onyema Nwachukwu has dismissed fake reports about the Chief of Army Staff, Lt. General Taoreed Lagbaja.

“To be very clear, the Nigerian Army is a highly structured establishment with well-laid-out procedures and processes for dealing with different circumstances.

“Before proceeding on leave, necessary protocols were put in place for the Chief of Policy and Plans (Army), Major General Abdulsalami Bagudu Ibrahim to act on behalf of the COAS while he is away.”

In another development, the army pulled out of service 15 Generals from the Artillery Corps.

The army in a post on X yesterday said, “The Nigerian Army formally pulled out 15 retired generals from the Artillery Corps on Saturday, October 19, 2024 during a ceremony at the Nigerian Army School of Artillery in Kachia, Kaduna State.

“The group of retirees included 11 Major Generals and 4 Brigadier Generals.”

Maj. Gen. James Myam who spoke on behalf of the retired officers reflected on their long military career, expressing fulfilment and gratitude.He extended appreciation to President Bola Tinubu for the opportunity to serve and thanked the COAS for his leadership.

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