Economy suffering from: 💰 🛢🌴✈️ 💡
Bank savings interest increase, NBC revokes 52 licenses, petrol subsidy removal, more
Hi!
In this edition:
NBC revokes over 50 news & media licenses
New petrol subsidy removal plans
Bank savings interest increase
Ministry of Agriculture under investigation for fund mismanagement
Nigeria Social Insurance Trust Fund says termite ate spending records
Nigeria withholding revenue of foreign airlines
ASUU still on strike
Some self-promo 🌚
NBC revokes media licenses
The National Broadcasting Commission (NBC) has revoked licenses of the African Independent Television (AIT), Silverbird Television (STV), Beat FM, Raypower FM, and over 40 other news and media stations because they owe the commission money.
According to the Director General of the Commission, Malam Balarabe Shehu Ilelah, the stations have owed their license renewal dues since 2015. The debt, he said, is now at N2.6 billion.
In May, the commission warned the stations to pay their dues or risk losing their license, he said. The media stations didn’t respond, so here we are.
The Nigerian Guild of Editors (NGE) says revoking the licenses is a little excessive considering that times are hard and the media is tasked with keeping the nation informed. Though they are not condoning or pardoning the debt, “the NGE is worried because media houses, which played and continue to play a key role in the nurturing and development of democracy, can’t just be off air no matter the reasons”.
The ban was to take effect on the 20th of August (today), 24 hours after the announcement. But as of the time of publishing this newsletter, the majority of the banned publications are still active
Petrol wahala
The Nigerian Federal Government is once again scheduled to end fuel subsidy. This time, in June 2023—one month after Buhari exits office.
The subsidy has been a topic of debate for a while. The government was scheduled to stop subsidising in June this year, but following protests from labour unions, they decided to pause petrol subsidy removal.
The subsidy helps keep the cost of car fuel at a “controlled” minimum. The government cushions some of the cost. Despite this, the price of petrol increased recently from N165 per litre to between N170-N190 per litre.
The FG says that the subsidy is taking a toll on Nigeria’s finances. Zainab Ahmed, Minister of Finance, Budget and National Planning, says Nigeria spends N18.39 billion daily on petrol subsidy payments via the NNPC.
Additionally, the Nigerian National Petroleum Corporation (NNPC), the agency in charge of petrol and subsidy, has not added any financial value to the Nigerian economy in 2022. So they have been spending more than they’ve been making.
Since oil is Nigeria’s main source of income, the economy has been badly hit by this lack of revenue.
But NNPC is now a private company with private stakeholders to answer to, so maybe some revenue is on the way?
On top of losing money, reports also indicate that Nigeria has been losing petrol. There have been rumours of a possible ongoing fuel heist via a Norwegian 3 million-barrel-capacity tanker named MT HEROIC.
The belief is that this tanker has been used to transport stolen petrol from Nigeria for a while.
However, the Nigerian Navy said this week that they intercepted and seized the ship with more stolen petrol in Equatorial Guinea.
Money
New attempts to curb inflation
Inflation hit another all-time high — from January’s 16.47% to 18% to 19.64% in July.
In July, in an attempt to control the relentless inflation, the CBN increased interest rates to 14%. This was majorly to address borrowing— people who borrowed from banks and other financial institutions would be charged this new rate (it was 11% at the start of the year and has increased twice since).
The CBN, possibly in an attempt to further reduce the amount of money in circulation (thus potentially slowing down the inflation rate), has directed banks to increase the minimum interest rate on savings deposits to 4.2% — formally 1.4%.
This new policy is said to have taken effect earlier this month.
It will hopefully encourage people to save more (and possibly spend less), slowing economic growth. A good thing if inflation is high and if done right. 🤞
Economy suffering from:
(1) Ministry of agric’s bush clearing expenses
There’s been circulating news that The Federal Ministry of Agriculture and Rural Development used N18.9 billion on bush clearing and land preparation during the COVID-19 lockdown. The ministry says it’s not true. They actually used N2.5 billion and it was used to clear 3,200 hectares of land.
The ministry said the media reports saying they’re being queried for spending N18.9 billion on bush clearing during the pandemic are misrepresented.
The ministry’s director of information, Dr Joel Oruche said the ministry had other projects during the peak of COVID— like construction of rural roads in the six geo-political, soil sampling and mapping, farmers registration as well as rehabilitation and the equipping of four national soil laboratories in Umudike (Abia State), Ibadan (Oyo State), Kaduna and Abuja— all of which added up to N18.9 billion.
Dr Oruche said all the projects were successfully executed and verified by relevant government agencies. He said they were part of the stimulus package under the Federal government's Agriculture for Food and Jobs programme to generate employment and grow the economy to mitigate the effect of the COVID-19 pandemic in 2020.
“To put the record straight the ministry never received any audit query to warrant summon by the House Public Account Committee”. If the statement that they spent N18.9 billion on clearing land was quoted from the committee, he said, “then it must have been taken out of context”.
However, the House of Reps did ask the Corporate Affairs Commission to provide the details of the companies The Federal Ministry of Agriculture hired for all their activities and how it came to N18.9 billion. So maybe it’s not fishy in the way the misreporting represented it, but it’s still fishy. 🎣
(2) Termites eating documents on how NSITF spent N17bn:
According to the Nigeria Social Insurance Trust Fund (NSITF), termites ate vouchers containing details of how they spent N17.1 billion.
In 2018, the Auditor-General’s office queried NSITF on why N17.1bn was removed from NSITF Skye bank and First bank accounts from January to December 2013 and transferred to untraceable accounts.
Now, while facing the Senate committee, Dr Michael Akabogu, the current MD of NSITF, says that he is unaware of these vouchers, and if they exist, the containers where they are kept have been ravaged by termites.
He says he reached out to past managing directors who claim that they are not aware of the existence of these vouchers.
++ eNaira (launched last year) is getting a USSD code next week. CBN governor Godwin Emefiele announced that the eNaira project has concluded the first phase of the eNaira focusing on banks to users and progressed to the second phase of “financial inclusion”.
For the second phase, the CBN governor further said the eNaira wallet would be made available to the general public by next week simply by dialling USSD code *997#.
Nigeria owes foreign airlines $460m
Is Africa a country? People in Nigeria have to beg to get their foreign currency out. In Ghana, the Bank of Ghana has banned people from opening new dollar accounts.
Emirates Airlines announced that from September 1, 2022, they will no longer be operational in Nigeria.
Last month, the airline reduced the number of flights coming into Nigeria before ultimately suspending all flights.
The halt is because they have $85m in revenue stuck in the Nigerian banking system that they have been unable to withdraw.
The airline said the suspension is to “limit further losses and reduce the impact on its operational costs that continue to accumulate in the Nigerian market”
Emirates says if anything changes and they can take their money out, they will resume operations.
The International Air Transport Association (IATA) says Nigeria is withholding revenue worth over $460 million earned by foreign airlines operating in the country.
The trapped profits are likely due to Nigeria’s ongoing forex crisis.
“Education”
This week, the leadership of the Academic Staff Union of Universities (ASUU) and the Federal Government met to discuss the 6-month strike, but the meeting ended without an agreement.
A senior member of ASUU told Channels Television members of the renegotiation committee did not come up with any new offer on the table. Instead, they begged the teachers to resume teaching.
According to the source, the meeting lasted about three hours without any agreement.
ASUU’s demonstration is an industrial action against the government’s mistreatment of its staff. They are demanding improved welfare, revitalisation of public universities and academic autonomy and withholding staff salary of about N1.1 trillion.
But the Federal Government is saying it doesn’t have the money to pay such an amount, citing low oil prices during the Muhammadu Buhari administration. Hence, the academics have proposed an alternative payroll system, the University Transparency and Accountability Solution (UTAS), which the FG is also refusing.
ASUU has been on strike since February 14th.
Now, the minister of education, Adamu Adamu, is asking students to sue ASUU over the 6-month strike. The minister, when asked if the FG will compensate students for the half a year out of school this strike has caused, the minister said it is ASUU, not the FG, that owes the students compensation.
To get the teachers to stop the protest they started over not getting paid, the government said the teachers would not be paid for the days they don’t work.
Adamu said that even if there is reconciliation, the FG will stand by their conviction to withhold salaries for the six months they are absent from work.
“I think the stand that the government has taken now, not to pay no work done, I think that’s the only thing in the hand of the government to ensure that there’s a penalty for some behaviour like this,” he said.
“I believe teachers will think twice before they join [a] strike if they know that at the end, they are not going to be paid”.
All other University workers are set to resume. ASUU is still holding out.
Electricity this week
Another group protesting poor staff working conditions: The National Union of Electricity Employees (NUEE). On Wednesday, the Union shut down all power around the country and started a nation-wide strike.
In May, the union gave the government a 14-week ultimatum to meet their demands— mainly better welfare for staff— but they were met with silence.
However, soon after the strike was announced, the minister of labour and employment sat with senior union members. Following the meeting, they agreed to pause the strike for 2 weeks while the government arranges to meet their demands.
Other news
The Nasarawa State Commissioner for Information Culture and Tourism, Yakubu Lawal, has regained freedom after five days in the hands of kidnappers - AIT
Atiku’s resolve plan for Nigeria’s electricity problems - The Cable
Femi Fani-Kayode, former minister of aviation, says he has “prayed about” the Muslim-Muslim presidential ticket of the All Progressives Congress (APC). Fani-Kayode said it is not about the faith of the presidential candidates but their individual abilities - The Cable
Edo police discover a shrine with mummified bodies. They arrested three suspects and recovered 20 mummified bodies - Leadership
Higher cost of food, more fertiliser alternatives as the price of farming increases - Sun News online.
Some self-promo
Hi! Adetomiwa here.
I started a new series on Breach called Work in Progress. I’m writing about topics we’re often uncomfortable talking about. Things we go through, often on our own, because sharing feels like it’s not an option.
I published the first episode yesterday. It’s about the tough feelings that accompany watching all your friends migrate and feeling left behind. It’s called On migration and maintaining friendships.