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READ ALSO  Exit of multinationals has cost Nigeria N95 trillion in five years — Peter Obi

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Exit of multinationals has cost Nigeria N95 trillion in five years — Peter Obi

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The 2023 Labour Party presidential candidate, Peter Obi, has addressed the possibility of a merger between the LP and the Peoples Democratic

The 2023 Labour Party presidential candidate, Peter Obi said the exodus of multinational companies from Nigeria has cost our nation a staggering N95 trillion in the past five years.

Obi stated this in a statement via his X handle on Monday.

He expressed concern over the departure of over ten major companies in the last year alone, including GlaxoSmithKline, Equinor, Sanofi-Aventis, Bolt Food, Procter & Gamble, Jumia Food, PZ Cussons, Kimberly-Clark, and Diageo.

Obi stated, “I am compelled to address the alarming exodus of multinational companies from Nigeria, which has cost our nation a staggering N95 trillion in the past five years.

“According to The New Telegraph, in the last year alone, over ten multinational giants such as GlaxoSmithKline, Equinor, Sanofi-Aventis, Bolt Food, Procter & Gamble, Jumia Food, PZ Cussons, and Kimberly-Clark, Diageo and others, have exited Nigeria, citing eerily consistent reasons.”

Speaking on the nature of the issue, Obi said, “It is clear these issues are not coincidental but symptomatic of a larger governance problem.”

Meanwhile, Obi has called for action from the authorities, saying Nigerian leaders must address the trend of multinational companies leaving Nigeria.

He said, “The responsibility lies with our leadership, those we put in charge to urgently address these challenges.”

The former Anambra governor outlined areas for improvement, including creating a business-friendly environment, prioritising security, stabilising policies, and reducing energy costs.

He also stressed the importance of “cultivating a culture of transparency, accountability, and good governance.”

Obi further called for unity and transformation, saying, “Let us unite to transform Nigeria into a nation conducive to business, attractive to investment, safe and prosperous for all citizens.

READ ALSO  Shoprite to close Abuja branch June 30

Together, we can make Nigeria a beacon of hope and progress in Africa and the world.”

Recall that GlaxoSmithKline Consumer Nigeria Plc had announced plans to shut down its operations in the country.

The announcement was disclosed in a press statement and filed with the Nigerian Exchange Limited. It was signed by the Company Secretary, Frederick Ichekwai.

Similarly, Jumia Food, the food delivery service of the e-commerce company, Jumia Technologies, announced plans to shut down operations in Nigeria in December 2023.

Jumia said it will close its food delivery business in Nigeria and six other countries in which it operates by the end of the year to focus on growing its core online retail business.

Source: Vanguard

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Shoprite to close Abuja branch June 30

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Shoprite to close Abuja branch June 30

Shoprite Mall has announced its intention to cease operation in one of its Abuja branches from June 30, 2024.

The branch is situated at Novare Central Mall in Wuse Zone 5.

This was contained in a circular signed by the Chief Executive Officer, Dr Folakemi Fadahunsi, on behalf of the retail supermarket and obtained by our correspondent on Monday.

A staff at the store who pleaded anonymity also confirmed the report, saying “Yes, it is true, we just heard it here too.”

The popular mall attributed its decision to a thorough evaluation of the store’s financial situation and the current business climate.

It additionally notified vendors that their services would no longer be needed at the store.

The circular read, “We regret to inform you that as of June 30, 2024, Retail Supermarkets Nigeria Limited will be closing its Wuse Store located in Novare Wuse Central Mall, Abuja. This decision has been made after a thorough evaluation of the store’s financial situation and the current business climate. We believe this is the best course of action for our organization’s long-term growth.

“Effective June 30, 2024, our company will no longer operate in Wuse, Abuja, and we will no longer require your services for the Novare Wuse Central Mall Store. Please note that all existing service contracts will also terminate for the store.”

The circular added the company would be reviewing its accounting records in the next 60 days to settle outstanding balances.

“If your services are specifically tied to the Novare Wuse Central Mall Store and if there is an outstanding balance between our companies, we will carefully review our accounting records over the next 60 days (about 2 months). We will then promptly contact you to confirm the amount owed and discuss a suitable payment schedule.

READ ALSO  FBN Holdings records 126.8% rise in profit

“We would like to express our gratitude for your past business. It has been a pleasure working with you and your team. If you have any questions or concerns, or if there is anything we can do to assist you during this challenging transition, please do not hesitate to reach out to us, it added.

Multiple multinationals have left Nigeria by either scaling down operations, transferring ownership or selling their stakes, the most recent being the sale of beverage company Diageo’s 58.02 per cent shareholding in Guinness Nigeria to Tolaram Group on June 11, 2024.

The exodus of multinationals from the Nigerian economy has cost the country a N94tn loss of output in five years, according to an economist and former Director of Research and Advocacy at the Lagos Chamber of Commerce and Industry in Nigeria, Dr Vincent Nwani.

According to the analyst, for the first year, over 10 companies shut down operations in 2020, most notably Standard Biscuits Nigeria Ltd, NASCO Fiber Product Ltd, Union Trading Company Nigeria PLC, and Deli Foods Nigeria Ltd.

In 2021, he stated that more than 20 companies exited, including Tower Aluminium Nigeria PLC, Framan Industries Ltd, Stone Industries Ltd, Mufex Nigeria Company Ltd, and Surest Foam Ltd.

He stated that in 2022, over 15 known brands left Nigeria, including Universal Rubber Company Ltd, Mother’s Pride Ventures Ltd, Errand Products Nigeria Ltd, and Gorgeous Metal Makers Ltd.

More than 10 major companies left in 2023, notably Unilever Nigeria PLC, Procter & Gamble Nigeria, GlaxoSmithKline Consumer Nigeria Ltd, ShopRite Nigeria, Sanofi-Aventis Nigeria Ltd, Equinox Nigeria, and Bolt Food & Jumia Food Nigeria.

READ ALSO  Shoprite to close Abuja branch June 30

In the first six months of this year, five listed major companies had left Nigeria, including Microsoft Nigeria, Total Energies Nigeria (affected by its divestment), PZ Cussons Nigeria PLC, Kimberly-Clerk Nigeria, and Diageo PLC.

Source: The Punch

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FBN Holdings records 126.8% rise in profit

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FBN Holdings records 126.8% rise in profit

The FBN Holdings has further consolidated its top-tier ranking with strong performance in the 2023 financial year and the first quarter of 2024, Q1’24, reporting significant growth in gross earnings and pre-tax profit of 95.7 percent.

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The group recorded N1.6 trillion in gross earnings, about 95.7 percent above the 2022 figure while the profit before tax rose 126.86 percent to N350.59billion during the period.

The Q1’24 result shows even stronger growth performance with gross earning and profit before tax rising 181.43 percent and 325.15 percent respectively despite headwinds propelled by increasing operating costs and foreign exchange impairments.

Analysts believe the CBN’s payment of Heritage Bank’s debt not only signaled a positive outlook for its subsidiary, First Bank, with the reduction of the forbearance balances on FBN Holdings’ books but strengthened its position as a systemically important bank (SIB).

Insiders say that the bank’s performance is testament to the strong leadership provided by erstwhile Group Managing Director, Dr Adesola Adeduntan-led executive management team, who resigned his position in April after serving a record nine years at the helm.

A member of that team has since succeeded him, further affirming a transition that should lead to better outcomes.

Detailed analysis of the group’s results indicates a positive outlook overall as financial ratios continue to improve.

Interest income had a higher contribution at 60 percent relative to 40 percent from non-interest income, reflecting that core operation drove the income growth.

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The 153.67 percent growth in non-interest income to N601.70bn was driven by net gains from financial instruments at FVTPL (N246.08bn), net gain on sale of investment securities (N34.85bn) and fee and commission income (N226.45bn). Proshare analysts noted that the commercial banking segment remained the lead gross earnings driver, contributing 94 percent, while merchant bank and asset management contributed six percent.

Macroeconomic factors, notably the persistence of naira depreciation and aggressive rate hikes impacted interest and non-interest growth in Q1 2024.

In addition, the group earned N66.34billion from digital banking in 2023, 20.41 percent higher than N55.10billion in 2022.

On the core operational side, the group’s customer deposits rose by 49.68 percent to N10.66trillion, and deposits from banks increased by 70.88 percent to N1.89trillion in 2023 over the previous year while shareholders’ funds improved by 75.45 percent to N1.75trillion, driven by a 48.09 percent rise in retained earnings, 531.43 percent growth in foreign currency translation reserve, and 35.38 percent in statutory reserve.

Overall the Group’s financial position improved in 2023 as total assets rose by 60.13 percent to N16.94trillion, up from N10.58trillion in 2022.

Improved gross earnings and profitability impacted key valuation metrics as return on average equity (ROAE) and average assets (ROAA) rose to 22.60 percent and 2.30 percent respectively in 2023, up from 14.50 percent and 1.40 percent respectively in 2022.

Similarly, Return on Equity (ROE) and Assets (ROA) grew to 45.40 percent and 4.30 percent, respectively, with the cost-to-income ratio (CIR) falling to 43.10 percent down from 60.40 cent in Q1 2023 implying better cost optimization.

READ ALSO  Exit of multinationals has cost Nigeria N95 trillion in five years — Peter Obi

Proshare analysts noted that the positive trend continued with the group’s loan-to-deposit ratio increasing to 62.20 percent above the 65 percent statutory limit, exempting it from discretionary CRR debits.

Source: Vanguard

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Textile industry faces total collapse as revival efforts fail

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Textile industry faces total collapse as revival efforts fail

Nigeria’s textile industry is now gasping for breath following the failure of revival measures, a sustained upsurge in the importation of textile products and a series of adverse monetary policy regimes.

Recall that Nigeria had a rich history of robust textile manufacturing with a large domestic market along with exports to the West Africa sub-region between 1970s up till 1990s, recording the highest contribution to Nigeria’s Gross Domestic Production (GDP) and employment in the manufacturing sector.

The sector had recorded about 180 textile mills employing over one million direct labourers at its peak around 1990. It also supported huge backward integration with the cotton production value chain during the period.

However, Financial Vanguard findings indicated that decline had set in around 2005 and it had struggled since then despite the growing market size due to the rising population.

Financial Vanguard also learnt that only about five textile mills are still operational today while the cotton production value chain has vanished. The labour force is also down to less than 2,000, both direct and indirect.

Industry stakeholders have attributed the collapse to challenges including large-scale smuggling and importation, little or no power supply to the industry that is power-intensive, inconsistent government policies on tariff, insecurity across cotton production regions, and foreign exchange crises and high cost of funding which made the products uncompetitive in the face of huge imports.

Failed revival efforts
Despite the federal government’s efforts to revive local production through protection policies, the country’s textile industry has continued to struggle, leading to an upsurge in textile imports over the years.

As part of the revival measures, the Central Bank of Nigeria (CBN) has implemented various intervention programmes, including financial support, training initiatives, and foreign exchange restrictions on textile imports at the official exchange market. But all these have not yielded the required boost in the sector.

Rising trend of imports

Data obtained from the National Bureau of Statistics (NBS) from 2019 to 2023 revealed a steady rise in textile imports.

Total textile trade within the period was N1.5 trillion, with imports totaling N1.4 trillion, representing 96.5 percent, while exports amounted to N50.7 billion (3.5 percent), indicating total textile trade deficit of N1.384 trillion and highlighting a significant reliance on imported textile products.

In 2019, NBS reported that N220.5 billion worth of textile products were imported into the country; N182.5 billion in 2020; N278.8 billion in 2021, and N365.5 billion in 2022.

Despite the foreign exchange crises the figure still went up further to N377.1 billion in 2023.
On the other hand, textile exports, mostly cotton and apparels, within the period was N3.3 billion in 2019; N6.0 billion in 2020; N12.3 billion in 2021; N10.3 billion in 2022; and N18.8 billion in 2023.

READ ALSO  Exit of multinationals has cost Nigeria N95 trillion in five years — Peter Obi

The rise was mainly in Naira terms following depreciation of the local currency year-on-year, as USDollar terms, the export value declined steadily.

In the first quarter of 2024 (Q1’24), NBS also reported that of the N186.94 billion total trade value of textile products, imports value stood at N178.45 billion (95.5 percent), while exports amounted to only N8.49 billion (4.5 percent), indicating a deficit of N169.96 billion.

The decline in import also marked a huge impact of exchange rate and the general economic downturn during the period, according to the industry stakeholders.

Underwhelming performance
Consequently, the sector’s contribution to real Gross Domestic Product (GDP) has been on consistent decline over the years.

Data from NBS shows that the sector’s contribution to GDP in 2019 was 2.02 percent (N1.442 trillion); 1.9 percent (N1.332 trillion) in 2020; 1.82 percent (N1.315 trillion) in 2021; 1.72 percent (N1.286 trillion) in 2022; and 1.63 percent (N1.247 trillion) in 2023.

In Q1’24, NBS noted that the sector contributed a negative 1.75 percent to GDP, making it one of the underperforming sectors in the country.

Chinese infiltration
Findings by Financial Vanguard show a huge Chinese infiltration into the Nigerian textile ecosystem, with importation of adulterated Adire (locally made tie and dye) fabrics, also known as “Adire Chinese”.

The Chinese counterfeit Adire products have become an attractive option because they are cheaper.
Folakemi (not real name), a customer who was in the market to buy Adire as “Aso Ebi”, said she was forced to go for the Chinese option because of the cheaper price, even though the quality is not the same as the original.

“It is not expensive. The ‘Adire Chinese’ costs N3,300, which is half the price of the locally produced fabric, hence I had to go for it,” she said.

Meanwhile, the Ogun State government said it has initiated moves to tackle the menace of imported adulterated Adire fabrics, which poses a major threat to the local Adire industry.

The State Commissioner for Culture and Tourism, Sesan Fagbayi, disclosed this at an Adire exhibition in Lagos.

He said: “The State House of Assembly has commenced steps to curb the excesses or inflow of Chinese adulterated fabric.

“We are also taking it up with the National Assembly; the Representative of Abeokuta South Federal Constituency has also raised a Bill at the National Assembly that has passed its second reading now. By the time that is done probably we will have the backing of the federal government in banning this adulterated fabric out rightly.”

READ ALSO  FBN Holdings records 126.8% rise in profit

Tight monetary policy worsening competitiveness
The Manufacturers Association of Nigeria (MAN) has faulted the continuous adoption of tight monetary policy by the Central Bank of Nigeria (CBN), saying it reduces the competitive capacity of Nigerian products in the global market.

Commenting, Director General of MAN, Segun Ajayi-Kadir, said: “The manufacturing export value of Nigeria has declined by 166 percent to N778.44 billion in 2023 from N2.07 trillion in 2019. And the exorbitant lending rate has also resulted into a 57.6 percent drop in the share of manufacturing export to non-oil export to 24.8 percent in 2023 from 82.4 percent in 2019.

“The incessant increase in monetary policy rate (MPR) has exacerbated the cost of doing business, thereby worsening competitiveness of Nigerian products in the global market, leading to dumping of cheaper goods in Nigeria,” he added.

Enforce Executive Order 003
As a way out, Ajayi-Kadir called for the enforcement of Executive Order 003.

He said: “Importation is presently discouraging local production and putting a strain on foreign reserves as well as weakening the economy.

“Structural constraints should be addressed to reduce cost of local production, which remains significantly high.

“Whilst the structural challenges may require a long-term approach to resolve, the government could focus on the low-hanging fruits.

“It could deliberately facilitate backward integration and ensure a friendlier operating environment that will encourage expansion and inflow of fresh investments.

“There is a need to implement the new cluster industrial framework that allows manufacturers to produce efficiently for domestic consumption and export.

“The advocacy of MAN in 2016 to promote the consumption of locally made products yielded desired results as the Federal Government also formally launched the “Buy Naija Campaign”, signed Executive Orders 003 and 005 that seek to promote improved patronage and local content.

“However, there appears not to be a well-structured platform for monitoring, evaluation, control and objective interrogation of the effectiveness of these orders.”

Also reviewing the plight of the sector, the immediate past President of the National Union of Textile Garment and Tailoring Workers of Nigeria (NUTGTWN), John Adaji, also called for the enforcement of Executive Order 003, adding that the textile industry is capable of creating 2 million jobs.

“The government should revive and invest in the textile industry to create 2 million jobs in the country and as well reduce over $4 billion import bill incurred on textile and apparel annually,” he stated at the union’s annual conference recently.

Adahi said revival of the sector requires deliberate efforts by the government, referencing South Africa’s clothing and textile sector which experienced a lull due to a lack of local patronage and dumping of imported textile materials.

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According to him, because of conscious efforts on the part of the South Africa government through the “Buy South Africa” Campaign, the textile and clothing sector has been revived with many jobs created.
He maintained that Executive Order 003 which mandates Ministries, Departments and Agencies (MDAs) of government to spend more of their budgets on locally produced goods was a bold and courageous move to enhance the growth of the nation’s manufacturing sector and economy that if fully implemented.

FG moves to revamp the sector
In the meantime, the Federal Government has commenced moves aimed at revamping the cotton, textile and apparel industry in Nigeria in collaboration with development partners and the private sector.

Minister of Industry, Trade and Investment, Doris Uzoka-Anite, disclosed this at two recent events.

While reviewing the activities of the ministry in the last year, she said that about $3.5 billion in investments were secured within the period to rejuvenate the moribund sector.

Uzoka-Anite stated: “The ministry is developing a resurgence plan for the Nigeria cotton, textile and apparel industry in partnership with development partners and private sector players. We have attracted $3.5 billion to unlock the textile, cotton and apparel industry.

“As you know, Nigeria’s textile and apparel industry covers the entire clothing value chain and has a strong potential for growth due to the availability of cotton and the country’s market size.

“This industry is one of the top contributors to the manufacturing sector of the economy with huge potential for employment for both skilled and unskilled labour with extensive capacity for generating export earnings and attracting foreign direct investment, therefore reducing poverty.”

Also, at the signing of a Memorandum of Understanding (MoU) with Afreximbank to establish a $3.3 billion Nigeria Industrialisation Financing Facility on the sidelines of the 2024 Afreximbank Annual Meetings (AAM) in Nassau, Bahamas, the minister said the agreement signified the partnership between the ministry, Arise Integrated Industrial Platforms (Arise IIP) and Afreximbank to revamp the cotton, apparel and textile value chain in Nigeria, adding that the financing support would further create 20,000 jobs for the country.

“This is going to cut across the cotton belt in Nigeria and also create a lot of jobs in Nigeria’s core strength in terms of cotton and textile production which used to be the pride of the country in the 1980s and 1990s.

“In partnership with Arise IIP, we are aiming to create up to $3.3 billion in project capital expenditure and generate jobs for our youth,” she added.

Source: Vanguard

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Crude price hike: Dangote alleges IOCs frustrating refinery

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Dangote Petroleum Refinery on Tuesday announced a further reduction in the prices of both diesel and aviation fuel to N940, and N980 per

Vice President of Oil and Gas at Dangote Industries Limited, Devakumar Edwin, has accused International Oil Companies in Nigeria of plans to frustrate the survival of the new Dangote Oil Refinery and Petrochemicals.

Edwin said the IOCs were “deliberately and willfully frustrating” the refinery’s efforts to buy local crude by hiking the cost above the market price, thereby forcing the refinery to import crude from countries as far as the United States, with its attendant high costs.

Speaking to journalists at a one-day training programme organised by the Dangote Group on Friday, Edwin also accused the Nigerian Midstream and Downstream Petroleum Regulatory Authority of granting licences indiscriminately to marketers to import dirty refined products into the country.

According to Edwin, the Federal Government issued 25 licences for the construction of refineries in Nigeria, but only the Dangote Group delivered on its promise.

While calling for the government’s support, the vice president noted that more than 3.5 billion litres of diesel and aviation fuel had been exported to Europe by the refinery in the past few months.

The exported fuel, it was said, represented about 90 per cent of its production.

“The Federal Government issued 25 licences to build refineries and we are the only one that delivered on our promise. In effect, we deserve every support from the government. It is good to note that from the start of production, more than 3.5 billion litres, which represents 90 per cent of our production, have been exported. We are calling on the Federal Government and regulators to give us the necessary support to create jobs and prosperity for the nation,” Edwin stated.

He added that though the Nigerian Upstream Petroleum Regulatory Commission was trying its best to allocate crude oil for the 650,000-capacity refinery, “the IOCs are deliberately and willfully frustrating our efforts to buy the local crude.”

The Dangote official said the IOCs sometimes made the refinery pay $6 over and above the market price, saying this has forced the company to reduce its output as well as import crude from countries like the United States at a higher cost.

He said, “Recall that the NUPRC recently met with crude oil producers as well as refineries’ owners in Nigeria, in a bid to ensure full adherence to Domestic Crude Oil Supply Obligations as enunciated under section 109(2) of the Petroleum Industry Act. It seems that the IOCs’ objective is to ensure that our petroleum refinery fails. It is either they are deliberately asking for a ridiculous/humongous premium or they simply state that crude is not available. At some point, we paid $6 over and above the market price. This has forced us to reduce our output as well as import crude from countries as far as the US, increasing our cost of production.

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“It appears that the objective of the IOCs is to ensure that Nigeria remains a country which exports crude oil and imports refined petroleum products. They (IOCs) are keen on exporting the raw materials to their home countries, creating employment and wealth for their countries, adding to their Gross Domestic Product, and dumping the expensive refined products into Nigeria – thus making us to be dependent on imported products. It is the same strategy the multinationals have been adopting in every commodity, making Nigeria and Sub-Saharan Africa to be facing unemployment and poverty, while they create wealth for themselves at our expense.”

“This is exploitation – pure and simple. Unfortunately, the country is also playing into their hands by continuing to issue import licences at the expense of our economy and at the cost of the health of the Nigerians who are exposed to carcinogenic products.”

It was said that even though Dangote is producing and bringing diesel into the market, complying with the regulations of the Economic Community of West African States, “licences are being issued, in large quantities, to traders who are buying the extremely high sulphur diesel from Russia and dumping it in the Nigerian market.”

Edwin explained, “Since the US, European Union and the United Kingdom imposed a price cap scheme from February 5, 2023, on Russian petroleum products, a large number of vessels are waiting near Togo with Russian ultra-high sulphur diesel and they are being purchased and dumped into the Nigerian market.

“Some of the European countries were so alarmed about the carcinogenic effect of the extra high sulphur diesel being dumped into the Nigerian market that countries like Belgium and the Netherlands imposed a ban on such fuel being exported from its country, into West Africa recently. Sadly, the country is giving import licences for such dirty diesel to be imported into Nigeria when we have more than adequate petroleum refining capacity locally.”

He recalled that in May, Belgium and the Netherlands adopted new quality standards to halt the export of cheap, low-quality fuels to West Africa, harmonising its standards with those of the European Union.

These measures, according to Edwin, synchronised fuel export standards with the European domestic market, specifically targeting diesel and petrol with high sulphur and chemical content.

Historically, he recounted that these fuels with sulphur content reaching up to 10,000 ppm, were exported at reduced rates to countries like Nigeria and other West African consumers.

He mentioned that Belgium’s Minister of Environment, Zakia Khattabi, announced that his country followed the Netherlands, which in April 2023 also prohibited the export of low-quality petrol and diesel to West Africa via the ports of Amsterdam and Rotterdam.

He quoted Khattabi as saying, “For far too long toxic fuels have been departing from Belgium to destinations including Africa. They cause extremely poor air quality in countries such as Ghana, Nigeria, and Cameroon and are even carcinogenic.”

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Edwin narrated that a September 2017 investigation by an international organisation, Public Eye, revealed that polluted and toxic fuels were being exported on a large scale from the ports of Rotterdam and Amsterdam for export to African markets.

He reiterated that as much as a quarter of the petrol and diesel available in West Africa originated from the ports of Amsterdam, Rotterdam, and Antwerp, stressing that these fuels contain sulphur and other pollutants, such as cancer-causing benzene, in quantities up to 400 times the limits permitted in Europe.

Edwin fumed, “The decision of the Nigerian Midstream and Downstream Petroleum Regulatory Authority in granting licenses indiscriminately for the importation of dirty diesel and aviation fuel has made the Dangote refinery expand into foreign markets. The refinery has recently exported diesel and aviation fuel to Europe and other parts of the world. The same industry players fought us for crashing the price of diesel and aviation fuel, but our aim, as I have said earlier, is to grow our economy.”

He noted that because the refinery meets the international standard as well as complies with stringent guidelines and regulations to protect the local environment, it has been able to export its products to Europe and other parts of the world.

While appealing to the Federal Government and the National Assembly to urgently intervene for speedy implementation of the PIA and to ensure the interest of Nigeria and Nigerians are protected, he remarked, “Recently, the government of Ghana, through legislation has banned the importation of highly contaminated diesel and PMS into their county.

“It is regrettable that in Nigeria, import licences are granted despite knowing that we can produce nearly double the amount of products needed in Nigeria and even export the surplus. Since January 2021, ECOWAS regulations have prohibited the import of highly contaminated diesel into the region.”

The PUNCH reports that the President of the Dangote Group, Aliko Dangote, had recently accused some powerful individuals of frustrating his refinery, adding that the IOCs were denying him access to crude oil.

“In a system where, for 35 years, people are used to counting good money, and all of a sudden, they see that the days of counting that money have come to an end, you don’t expect them to pray for you. Of course, you expect them to fight back.

“And I think that is the process that we’re now really going through. But the truth is that, yes, the country, the sub-region, and also the continent, of sub-Saharan Africa, need this refinery. So, you expect them to fight through non-supply of crude, non-purchase of the product, but I think it’s all temporary. We’ll get there,” Aliko added.

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Dangote recalled that he was once persuaded by a former Minister of Energy in Saudi Arabia, Khalid Al-Falih, to shelve the idea of building a refinery. However, he said he told the former minister that he did not need his advice.

“Four years ago, I was in Saudi Arabia during the fasting period, and I was invited for the breaking of the fast, Dr Falih, who used to be the Minister of Energy invited me to come and break the fast with him and I went there. He just said, ‘Aliko, I heard that you’re planning on building a refinery, what capacity?’ I said 650,000. He kept quiet for a while and said, ‘You know just about 120km from Mecca, we are building one and I think I would like you to go and have a look. We as Saudi Aramco, are facing a lot of challenges and, we are proceeding with it, but my advice to you is not to do it because normally, refineries are built by major oil corporations or sovereign countries.’

“I said, ‘But Your Excellency, unfortunately, we have already started, so I’m not looking for advice.’ That was really how we continued,” he recounted.

Dangote revealed that both local and international cartels, which he described as “mafia”, made repeated attempts to sabotage the $19bn refinery project located in Lagos.

“Well, I knew that there would be a fight. But I didn’t know that the mafia in oil, they are stronger than the mafia in drugs. I can tell you that. Yes, it’s a fact,” he said.

Dangote, who described himself as a fighter, said they tried all sorts to stop him.

“As a matter of fact, during the COVID period, some of the international banks were looking forward to making sure that they push us into default of our loans so that the project would just be dead. And that didn’t happen with the help of banks like Afreximbank,” it was stated.

The PUNCH reports that despite its huge crude oil reserves, Nigeria still depends heavily on imported refined fuel.

But Dangote recently said Nigeria would no longer import any fuel by the time he begins the sale of PMS in the third week of July.

Efforts to get the IOCs to react to the development through the Oil Producers Trade Section of the Lagos Chamber of Commerce and Industry were unsuccessful.

The Director-General, LCCI, Chinyere Almona, had yet to respond to a text sent to her on the matter up till when this report was filed after her phone number remained unreachable.

Also, the spokesperson of NMDPRA, George Ene-Ita, requested details about the claims of the Dangote official when contacted. This was sent to him, but he had yet to send a response up till when this report was filed.

Source: The Punch

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Alake presents gold bars to Tinubu, says sector will boost Naira value

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Alake presents gold bars to Tinubu, says sector will boost Naira value

The Minister of Solid Minerals Development, Dele Alake, has praised President Bola Tinubu for backing reforms in the solid minerals sector.

He assured that the National Gold Purchase Programme would enhance the country’s reserves and strengthen the value of the naira.

The minister’s assurance was contained in a statement issued by his special assistant on media, Segun Tomori.

During the presentation of the latest gold bar sourced from artisanal and small-scale gold miners, refined by an agency under the ministry called the Solid Minerals Development Fund, Alake highlighted that the refined gold would be sold to the Central Bank of Nigeria (CBN) to bolster foreign reserves.

Alake explained to President Tinubu the significance of the occasion, noting that it marked the inaugural commercial transaction under the National Gold Purchase Program (NGPP).

This programme features a centralized offtake scheme supported by a decentralized aggregation and production network involving artisanal miners and cooperatives.

He said: “The successful completion of the first commercial transaction clearly demonstrates the National Gold Purchase Program’s effectiveness. It has increased the nation’s foreign
reserves assets and shown that using the Nigerian Naira to purchase a liquid asset traded in United States Dollars, such as gold, is a viable strategy. This transaction has also underscored the potential of the National Gold Purchase Program to enhance fiscal and
monetary stability.”

Alake said the first commercial transaction has delivered +US$5 million increase in Nigerian’s foreign reserves assets, 70+ kilograms of gold refined to the London Bullion Market Good Delivery Standard and successful aggregation of locally mined gold thereby injecting about NGN6 billion into the rural economy.

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Receiving and displaying a symbolic bar, President Tinubu commended the ministry for achieving a major milestone in the administration’s drive to diversify the economy.

“This is another concrete step towards the diversification process under the Renewed Hope Agenda” the President said.

In her presentation, the Executive Secretary of the Solid Minerals Development Fund, Fatimah Shinkafi said the London Bullion Market Good Delivery Standard is the globally recognised stringent and trusted standard that enables the global trade in gold and silver bars.

“Only gold and silver bars that meet our Good Delivery standards are acceptable in the settlement of a Loco London contract – where the bullion traded is physically held in London” she said.

Shinkafi said, through the efforts of the National Gold Purchase Program under the Ministry of Solid
Minerals Development, Nigeria has joined a select group of countries bolstering their gold reserves by purchasing gold in local currency to foster economic confidence, enhance currency stability, and create a more attractive environment for foreign investment.

Source: The Nation

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