BUSINESS
Going Forward with CBN, Emefiele’s 5-Year Roadmap

By Tony Obiechina, Abuja
The Governor of the Central Bank of Nigeria (CBN) Mr Godwin Emefiele, on Monday 24th July, 2019 unfolded the policy direction of his new five-year tenure which will terminate in 2024.
Addressing a World Press Conference at the CBN corporate headquarters in Abuja, the governor promised to facilitate access to financial services to 95 per cent eligible Nigerians as well as “continue to work to safeguard the stability of our financial system, while supporting the development of a payment system infrastructure that will improve access to credit for all eligible Nigerians”.
“Over the next five years, this will be the task for the Central Bank of Nigeria under my leadership, and we intend to do our very best to achieve these objectives”, he had assured.
Although Emefiele acknowledged that much was still left to be achieved from a similar agenda set in July 5, 2014, when he was first appointed, he said he was confident the bank will meet the expectations of Nigerians in the next five years.
Reviewing the achievements and challenges of the CBN in his first tenure, the governor pointed out that “with increased consultation and cooperation with the fiscal authorities and other interest groups, the agenda will be realised”.
In driving this vision, Emefiele expects that the bank under his management for the next five years, will work closely with the fiscal authorities to target a double digit growth; bring down inflation to single digit; and accelerate the rate of employment”.
“Put succinctly, our priorities at the CBN over the next five years are the following; First, preserve domestic macroeconomic and financial stability; Second, foster the development of a robust payments system infrastructure that will increase access to finance for all Nigerians thereby raising the financial inclusion rate in the country; Third, continue to work with the
Deposit Money Banks to improve access to credit for not only small holder farmers and MSMEs but also consumer credit and mortgage facilities for bank customers. Our intervention support shall also be extended to our youth population who possess entrepreneurship skills in the creative industry,” he had said.
Even as the governor promised to encourage the Deposit Money Banks to direct more focus in supporting the education sector, grow the country’s external reserves, and support efforts at diversifying the economy through CBN intervention programmes in the agriculture and manufacturing sectors, the apex bank may have concluded plans to raise the banks’ minimum capital base from the present N25 billion to over N200 billion.
“In the next five years, we intend to pursue a programme of recapitalising the banking Industry to position Nigerian banks among the top 500 in the world.
“Banks will therefore be required to maintain higher levels of capital, as well as liquid assets in order to reduce the impact of an economic crisis on the financial system,” he said.
On macro-economic stability, he said over the next five years, emphasis would be on supporting improved gross domestics product (GDP) growth and greater private sector investment.
According to him, the CBN intends to leverage monetary policy tools in supporting a low inflation environment, while seeking to maintain stability in our exchange rate.
He said decisions by the Monetary Policy Committee on inflation and interest rates will be dependent on insights generated from data on key economic variables.
He also said the CBN would also strive to continue to sustain a positive interest rate regime and that monetary policy measures, will be geared towards containing inflationary pressure and supporting improved productivity in the agricultural and manufacturing sectors.
To bring down the cost of food items, which have considerable weight in the Consumer Price Index basket, Mr Emefiele said the bank will work with other interest groups towards that objective.
“Our ultimate objective is to anchor the public’s inflation expectation at single digits in the medium to long run. We believe a low and stable inflationary environment is essential to the growth of our economy because it will help support long term planning by individuals and businesses,” he assured.
On Exchange Rate Stability, Mr Emefiele said the bank will continue to operate a managed float exchange rate regime, to reduce the impact the continuous volatility in the exchange rate could have on the country’s economy.
He the CBN will support measures to increase and diversify Nigeria’s exports base and ultimately help in shoring up the country’s foreign reserves.
Nigeria, he said, remains committed to a free trade regime that is mutually beneficial; but, particularly aimed at supporting our domestic industries and creating jobs on a mass scale for Nigerians.
Consequently, he said, the CBN intends to aggressively implement its N500 billion financial support facility to boost the growth of the non-oil exports and improve non-oil export earnings.
To achieve Financial System Stability, Mr Emefiele said a resilient and stable financial system was imperative for continued growth of the country’s economy given the intermediation role of financial institutions, to support the needs of individuals and businesses.
“In the next five years, we intend to pursue a programme of recapitalising the banking Industry to position Nigerian banks among the top 500 in the world.
“Banks will therefore be required to maintain higher levels of capital, as well as liquid assets in order to reduce the impact of an economic crisis on the financial system,” he said.
Reacting to the development. the Chairman, Charteted Institute of Bankers (CIBN), Abuja Chapter, Prof Uche Uwsleke said Ememefie’s five year policy thrust “is a good development with a lot of positive impact on the economy”.
In an interview with Daily Asset on Tuesday, Uwaleke, professor of Capital Market said, “The recapitalization of banks will strengthen financial system stability and put our banks in a stronger position to finance big projects needed for development as well as play in the global scene”.
“The planned introduction of a Trade monitoring system that reduces the length of time it takes to process export documents from one week to one day will surely boost exports.
“Also commendable is the plan to scale up the Anchor Borrower Programme and target for massive funding support 10 commodities that consume a lot of foreign exchange to import.
“This will help conserve Forex, grow external reserves, reduce food prices and possibly create job opportunities. The plan to build a robust payment infrastructure including through promoting payment service banks, shared agent networks, mobile money will go a long way in helping to achieve the target of 95 percent financial inclusion by the year 2024.
“Similarly, the boost in the Collateral Registry where over N400 billion worth of assets have been registered as well as the NISRAL microfinance bank will no doubt improve access to finance by micro and small businesses.
“The major risk I see in the pursuit of price and monetary stability which is the core function of the CBN is the volatility in crude oil price given our dependence on the sector. The CBN is therefore advised to have a plan B in its five year plan.
“It is also vital to get the cooperation of the fiscal authorities especially when it comes to the task of achieving double digit growth because on this very score, the CBN cannot clap with one hand”, he argued.
On capitalization, the university don’t however advised the CBN to raise the banks’ capital base to N100 billion, up from N25 billion.
“The N25 billion is already eroded when you look at our exchange rate. It is better to have 10 healthy banks than 20 that will be giving CBN headache. The tier two banks are also the most exposed banks to NPLs. The big five, are not giving CBN much problem like the others”, he argued.
“Bigger banks can easily bankroll larger businesses. So, if we are one of the 500 banks in the world, we can play comfortably in the international league. Bigger banks have better corporate governance and monitoring by CBN is much easier. Fewer stronger banks will invest in the right technology to deliver better services”, Uwaleke further pointed out.
In his reaction, CIBN President, Dr Uche Olowu, said there was no need for panic among bankers as the Nigeria financial system remains stable stressing that the whole idea of recapitalisation was to continue to sustain that stability in order to expand the scope of banks to do bigger businesses.
Olowu however advised the boards of the banks to go back to the drawing board and restrategise ahead of the CBN’s impending reapitalisation, assuring that the system will take care of itself with adequate planning.
Agriculture
VCDP Holds 3-Day Enterprise Training for Agri-businesses

From David Torough, Makurdi
In a bid to mainstream nutrition sensitive intervention and harness potentials along commodity value chain while empowering youth and women, the Federal Government, International Fund for Agricultural Development, Value Chain Development Programme (FG/IFAD-VCDP) held a 3-day youth enterprise training for Agri-businesses at the IFAD-VCDP premises, Makurdi, the Benue State Capital.
The six session training equipped participants with practical knowledge on how to process Vitamin A Cassava to snacks (Combo-bite, bread, chinchin, queens cake, Cassa-flakes), Processing of rice flour as substitute for baking flour, Processing of cassava peels to animal feeds as well as de-stoning and packaging of milled rice.
There was also an intense training for some youths on knapsack application and calibration as well as an entrepreneurship class for establishing a One-Stop Agro input shop.
According to IFAD-VCDP Rural Institution, Gender and Youth Mainstreaming Officer (RIGYMO), Mrs Sandra Agber 41 male youths, 39 female youths and one adult female were beneficiaries of the training.
She revealed that, the need to engage and empower youths and women to be self-employed in a sustainable manner and to add value to agricultural produce was the primary justification for the training.
Mrs Agber disclosed that though the training is a youth empowerment programme, women were prioritized in line with VCDP’s gender mainstreaming initiative hence the high number of female participants particularly in the rice and cassava processing trainings.
In his remarks during the opening ceremony, VCDP State Programme Coordinator, Mr Emmanuel Igbaukum charged the participants to take the training serious as VCDP is poised to continually supporting its farmers to maximize output as well as harness all potentials along agriculture commodity value chain.
He disclosed that participants would be given start up kits to support their various enterprises.
Two participants, Babara Yaaya and Veronica Chigba, who were trained on rice processing and One-stop agro shop establishment respectively, in their separate remarks at the end of the training appreciated IFAD-VCDP for their unceasing support to farmers and agripreneurs in the state and prayed God to give them the strength and resources to upscale these interventions.
Oil & Gas
FG Awards Licences for 161 Marginal Fields as 13 Remain Dormant

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has awarded Petroleum Prospecting Licences (PPLs) to 161 successful 2020 marginal fields awardees.
The commission also officially unveiled the Host Communities Development Regulations and model Petroleum Prospecting Licences (PPLs).
Chief Timipre Sylva, the Minister of State Petroleum Resources, at the unveiling and licences presentation on Tuesday in Abuja said the maiden presentation of the PPL was part of the implementation of Petroleum Industry Act (PIA), 2021.
This is as the Federal Government revealed that 13 out of the 30 marginal fields awarded since 1999 were not producing crude oil, as only 17 of the fields were currently meeting the target of crude oil production, adding that a total of N202.91bn was raked in by the government from the just concluded 2020 marginal field bid round.
The award, the government said was pursuant to the provisions of the Petroleum Industry Act 2021.
This came as successful awardees, such as Matrix Energy Group, Petrogas Energy, among others, promised to begin oil search from the fields in earnest to boost the country’s crude oil production.
In his address at the event, the Chief Executive Officer, Nigerian Upstream Petroleum Regulatory Commission, Gbenga Komolafe, stated that one of the major tasks inherited by the NUPRC upon its inauguration last year, was the need to conclude the 2020 bid round.
“Consequently, we pursued the matter frontally and are delighted to inform you that the exercise which commenced in June 2020 is being concluded today,” he stated.
Komolafe explained that historically, the marginal fields award initiative began in 1999 and was borne out of the need to entrench the indigenisation policy of government in the upstream sector of the oil and gas industry and build local content capacity.
He said, “Besides, the initiative was also targeted at creating employment opportunities and encouraging increased capital inflow to the sector.
“Since its inception, a total of 30 fields have been awarded, with 17 currently producing. A breakdown of the allocation of the fields to indigenous operators is as follows: two fields awarded in 1999, 24 in 2003/2004, one each in 2006 and 2007, and two in 2010.
He added, “Ten years after, in 2020, 57 fields were put up for bidding. Again, it is noteworthy that the 2020 marginal field bid round exercise in respect of which PPLs are being issued today has attracted government revenue of about N200bn and $7m (N2.91bn at official exchange rate of N415.64/$) respectively.”
Speaking to journalists on the sidelines of the event, the Group Chief Executive Officer, Matrix Energy Group, Adisa Aliu, said successful investors in the bid round would commence oil search as fast as possible.
Aliu, who’s company emerged successful in the exercise, said the contributions of marginal field operators would help the country in meeting the monthly oil production quota approved for Nigeria by the Organisation of Petroleum Exporting Countries.
For several months running, Nigeria has been failing to meet its crude oil production quota approved by OPEC, a development that has further depleted the country’s revenue from oil.
“We are delighted at the conclusion of this exercise and we are ready to contribute our quota in assisting to meet the target approved for Nigeria and as well help in shoring up revenue for our county,” he stated.
He, however, noted that security should be improved in the Niger Delta, as this had been a challenge to not just the production of crude oil, but to the meaningful progress of the sector.
Meanwhile, the NUPRC in its presentation at the event, stated that the passage of the Petroleum Industry Act had brought an end to the era of marginal field awards.
Section 94(9) of the Act stated that “No new marginal field shall be declared under this Act”.
The agency stated that the Minister of Petroleum Resources shall now award PPL on undeveloped fields following an open, fair, transparent, competitive, and non-discriminatory bidding process in line with Sections 73 and 74 of the Act.
It urged the new investors to hit the ground running in developing their awarded assets in line with industry best practices.
“Also, we shall continue to provide a predictable and enabling regulatory environment to operators in line with our technical and commercial statutory
mandates with a view to optimising the development and exploitation of the nation’s hydrocarbon resources,” it stated.
It said it was worthy of note that the average price of crude oil in recent months had been above $100/barrel, adding that investors in the fields should take advantage of this upward swing in market fundamentals, caused by the Russian/Ukraine conflict.
NEWS
Breaking: Reps Raise Crack Team to Probe Oil Subsidy Regime Under Buhari

By Ubong Ukpong, Abuja
The House of Representatives yesterday, raised a crack adhoc committee, to Probe the petroleum Products subsidy Regime in the last five years, from 2017 to 2021
The committee was given eight weeks to carryout this investigation and report back to the House for further legislative action.
The decision was sequel to a motion on the “Need to Investigate the Petroleum Products Subsidy Regime in Nigeria from 2017 to 2021”, brought before the Honda by Hon.
Sergius Ose Ogun.The lawmaker had said that his motion was informed by section 88 (1) and (2) of the Constitution of the Federal Republic of Nigeria (As Amended) , which empowered the National Assembly to conduct investigations into the activities of any authority executing
or administering laws made by the National Assembly;.
He also noted that Section 32 of the Petroleum Industry Act, 2021 saddled the Petroleum Midstream and
Downstream Regulatory Authority with the task of regulating and monitoring technical and commercial
midstream and downstream petroleum operations in Nigeria.
Ogun informed the House that as of 2002, the NNPC’s purchase of crude oil at international market prices stood at 445,000 barrels per day in order to enable it to provide petroleum products for local consumption.
He was concerned that as at 2002, the installed capacity of Nigeria’s local refineries stood at 445,000 barrels per
day, however, their capacity utilization began to nosedive and eventually fell completely to zero due to the
ineffectiveness and alleged corruption of critical stakeholders in the value chain.
The lawmaker said he was aware that due to the decline in the production capacity of the refineries, NNPC found it more convenient to export domestic crude in exchange for petroleum products on trade by barter basis described as Direct Sales Direct Purchase (DSDP) arrangement.
He said he was further aware that component costs in the petroleum products subsidy value chain claimed by the NNPC was highly over-bloated while the transfer pump price per litre used by the NNPC in relation to PPMC was
underquoted as N123-N128 instead of N162-N165 and this fraudulent under-reporting of N37-N39 per
litre translates into over 70 billion naira a month or 840 billion naira a year.
The legislator worried that the consumption rate of Premium Motor Spirit (PMS) was 40million to 45million litres per day, however, the NNPC used 65 million to 100 million litres per day to determine subsidy as discoverable
from NNPC’s monthly reports to the Federal Allocation Committee (FAAC).
He also worried that the subsidy regime has been unscrupulously used by the NNPC and other critical
stakeholders to subvert the nation’s crude oil revenue to the tune of over 10 billion US dollars, with records
showing that as at 2021, over 7 billion US dollars in over 120 million barrels have been so diverted.
The lawmaker was disturbed that “there exists evidence that subsidy amounts are being duplicated, thus subsidy is charged against petroleum products sales in the books of NNPC as well as against crude oil revenue in the books
of NAPIMS to the tune of over N2 trillion.”