Economy
Economist Says Govt Policy to Reduce Cooking Gas Price Yet to be Felt
In spite of the Federal Government’s policy aimed at reducing the price of Liquified Petroleum Gas (LPG) also known as cooking gas, the price has continued to increase.
However, an Economist, Dr Ayo Anthony said this in Abuja on Sunday that it takes time for the impact of government policies to be felt on the economy.
NAN reports that the Federal Government announced the removal of customs duty and Value-Added Tax (VAT) on the importation of LPG and its associated equipment.
This is contained in a letter dated November 28, 2023, signed by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy.
NAN also recalls that earlier, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, had waded into the challenges of constant price increment of cooking gas in the country’s domestic market.
The minister had constituted a committee and mandated them to recommend the best way to boost supplies and crash LPG prices, following the rise in prices in recent months, from about N700 per kg to above N900 per keg in parts of the country.
NAN reports that 5kg cooking gas is currently being sold at N4,750 to N4,900 and 12.5kg is sold at N11,875 to N12,300 in the Federal Capital Territory (FCT).
Anthony said the delay in seeing government policies materialise was caused by what was referred to as inside and outside lag.
“In economics, we have what we call lag. Lag is the time it takes for government policy to materialise, and we have inside lag and outside lag.
“Inside lag is the time it takes the government to make a decision when there is a problem. It is not immediately when a problem emanates that the government takes a decision on it.
“So the time it takes the government or policymakers to make decisions to address a problem or shock to the economy is called inside lag.
“While outside lag is the time it takes for the decision to be implemented.
“Decisions made by the government are not implemented immediately, bureaucratic processes will come in, that will cause another delay in implementation.”
Anthony said a contributing factor to the high cost of cooking gas in spite of the government’s policy to remove VAT from its importation was the issue of old gas stock.
He said that cooking gas that had been stocked by marketers before the policy pronouncement would still be sold at the old price to cover the cost of importation.
“The seller will sell it at the price that covers the cost of importation of the gas.
“So until this stock finishes and they buy at the prevailing price that reflects the new government policy, that is when they will sell at the price that will show a reduction of VAT.”
NAN reports that recent data from the National Bureau of Statistics (NBS) states that the average price of 5kg of cooking gas increased from N4,562.51 in October 2023 to N4,828.18 in November 2023.
The average cost of refilling a 12.5kg cooking gas increased by 5.78 per cent on a month-on-month basis from N10,545.87 in October 2023 to N11,155.15 in November 2023.(NAN)
The Nigerian Exchange Ltd. (NGX) continued its bullish trend on Wednesday, gaining N183 billion.
Accordingly, the market capitalisation, which opened at N59.532 trillion, gained N184 billion or 0.31 per cent to close at N59.715 trillion.
The All-Share Index also added 0.31 per cent or 303 points, to settle at 98,509.
68, against 98,206. 97 recorded on Tuesday.Consequently, the Year-To-Date (YTD) return increased to 31.
74 per cent.Gains in Aradel Holdings, Zenith Bank, United Bank For Africa(UBA), Oando Plc, Nigerian Breweries among other advanced equities drove the market performance up.
Market breadth closed positive with 34 gainers and 17 losers.
On the gainers’ chart, Africa Prudential, Conoil and RT Briscoe led by 10 per cent each to close at N14.30, N352 and N2.42 per share, respectively.
Golden Guinea Breweries followed by 9.95 per cent to close at N7.18, while NEM Insurance rose by 9.74 per cent to close at N10.70 per share.
On the other hand, Julius Berger led the losers’ chart by 10 per cent to close at N155.25, Secure Electronic Technology Plc trailed by 9.52 per cent to close at 57k per share.
Multiverse lost 7.63 per cent to close at N5.45, Haldane McCall dropped 6.07 per cent to close at N4.95 and Honeywell Flour shed 5.62 per cent to close at N4.70 per share.
Analysis of the market activities showed trade turnover settled lower relative to the previous session, with the value of transactions down by 49.44 per cent.
A total of 320.10 million shares valued at N6.48 billion were exchanged in 7,943 deals, compared with 939.41 million shares valued at N12.81billion traded in 9,098 deals posted in the previous session.
Meanwhile, ETranzact led the activity chart in volume with 70.27 million shares, while Aradel led in value of deals worth N1.22 billion.(NAN)
The central parity rate of the Chinese currency renminbi, or the Yuan, weakened 22 pips to 7.1870 against the dollar on Monday.This is according to the China Foreign Exchange Trade System.In China’s spot foreign exchange market, the Yuan is allowed to rise or fall by two per cent from the central parity rate each trading day.
The central parity rate of the Yuan against the dollar is based on a weighted average of prices offered by market makers before the opening of the interbank market each business day. (Xinhua/NAN)
Arewa Youths Initiative for Energy Reforms (AYIFER), has urged Nigeria National Petroleum Corporation Limited (NNPCL) to do everything possible to bring Kaduna Refinery back into operation.
National Coordinator of the group, Mr Bashir Al’Amin, stated this in a statement issued on Friday in Abuja.
Al’Amin specifically called on the Chief Executive Officer of NNPCL, Mallam Mele Kyari, to do all within his powers to rejuvenate the refinery and bring it up to global standard.
He said that having delivered the Port Harcourt refinery, coupled with the establishment of Dangote Refinery in Lagos, attention should be shifted to Kaduna refinery for easy spread of petroleum products.
“We are calling on Malam Mele Kyari to expedite action on Kaduna refinery so we can be at par with other regions in the country.
“We equally beg the NNPCL to do professional work in rehabilitating the old refinery and deliver a standard and functional petrochemical refinery and not a blending plant.
“Kyari should resist any temptation that could make him do something that can jeopardise his good image,” he said.
Al’Amin said that since the extinction of groundnut pyramid and textiles in Kano State as well as PAN in Kaduna State and with the Kaduna refinery getting moribund, a lot of youths had lost their jobs.
According to him, all their hopes in the north are tied to the legacy refinery, expressing the hope that God would use Kyari to deliver it well and on time.
He said that the group was solidly behind NNPCL in prayer and would be ready to celebrate the company if its expectations were met. (NAN)
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