A former Attorney General of the Federation (AGF), Kanu Agabi, has said that politicians who rigged elections have no moral justification to call on God for help when they run into roadblocks.

Agabi stated this during an appearance on Channels Television on Sunday.

He asserted that those who nurse suspicion against elections in Nigeria have justifiable grounds to seek redress in court.

Agabi noted that the problem with Nigeria is not the 1999 constitution but those who are enforcing the laws.

“So, the problem is not with the laws but with “good people to enforce them. We need to reform ourselves as a nation,” he said.

Speaking further, the ex-justice minister said the courts are burdened with electoral cases because Nigeria’s elections come under “justifiable suspicions”.

He said, “We keep talking of reforming the judiciary. We keep attacking the judges, we stigmatise them, we abuse them, we insult but the truth is this: we have very good judges.

“The judiciary is not perfect but it is the best arm of government. The problem is this: On the judges’ lists, there may be 30, or 40 cases a day. How can he cope? As long as they go on struggling with that system, they cannot cope.

“The problem of the judiciary arises from the fact that the judges are overworked.

“Take the elections for instance. Do you know how many percentages of elections are challenged? Why? Because the elections come under justifiable suspicions. Those who suspect the elections are justified but if we reach a point where the elections are not opened to the kind of criticisms and suspicions that they have been suspected, then they can free up the courts.

“Primaries are rigged at the party levels. Giving a spiritual dimension, when you have stolen the office that you are holding, do you expect God to partner with you? Can you pray over that office? Can you use it to do any good? That’s the problem.

“St Paul said I am an Apostle of Jesus Christ by the grace of God. Whatever office you hold, you must be able to say the same thing. You must be able to say, ‘I am a governor by the grace of God’, ‘I am a senator by the grace of God’. If you can’t say that, your prayer in calling upon the name of the Lord in that office is an abomination.”

[NaijaNews]

Nigeria’s foreign exchange (FX) unification policy, implemented by the Central Bank of Nigeria (CBN) in June 2023, aimed to simplify the country’s multiple exchange rate system by consolidating it into a single market-driven rate.

The policy was designed to boost investor confidence, eliminate arbitrage opportunities, and address chronic FX shortages that plagued the economy.

However, one year after the policy’s implementation, the impact on tax revenues reveals an unexpected consequence.

While foreign companies have seen their tax contributions skyrocket, local firms have struggled to keep pace, revealing the deeper challenges facing Nigeria’s domestic economy.

Growth in Foreign CIT 

According to data from the National Bureau of Statistics (NBS), the one-year period following FX unification (Q3 2023 to Q2 2024) saw a rise in foreign Corporate Income Tax (CIT) contributions.

Foreign CIT increased by 140.5%, rising from N1.42 trillion in the pre-unification year (Q3 2022 to Q2 2023) to N3.41 trillion in the year post-unification.

In contrast, local CIT only grew by 35.1%, moving from N2.16 trillion to N2.92 trillion over the same period.

This disparity in growth suggests that naira devaluation has contributed significantly to taxes the Federal Inland Revenue Service (FIRS) gets from foreign firms.

The total CIT collected in the year following FX unification reached N6.33 trillion, a significant increase from the N3.58 trillion collected in the year before the policy change.

However, foreign CIT accounted for 53.8% of this total, up from 39.6% in the pre-unification period.

This indicates that foreign firms are increasingly driving Nigeria’s tax revenue, masking the sluggish growth in local firm contributions.

Local firms struggle under FX Pressures 

While foreign companies have benefited from FX unification, local businesses have faced more challenges.

In February, Nairametrics reported that the naira had lost about 68% of its value, marking a profound downturn since the implementation of the foreign exchange unification policy.

In the first six months of this year, Nigerians and businesses faced prolonged periods of exchange rate volatility, as the naira crashed by 40% between the end of December 2023 and June-ending.

• The devaluation of the naira by as much as 70% following the unification policy resulted in higher costs for local firms, particularly those reliant on imports for raw materials and goods.
• These rising costs have eroded profit margins, making it difficult for domestic businesses to match the growth seen by their foreign counterparts.
• Nairametrics earlier reported some of Nigeria’s leading companies incurred a combined forex loss of N1.7 trillion in the financial year 2023. The size and magnitude of the loss were so significant that it effectively wiped out the shareholder funds of some companies, forcing mega restructuring for others.
• Also, the NBS data shows that local CIT collections, while growing, have been inconsistent.
• After hitting N1.02 trillion in Q2 2023, local CIT dropped to N651.63 billion in Q3 2023 and further to N533.93 billion in Q4 2023.
• By Q1 2024, local CIT had fallen to N386.49 billion, before rebounding to N1.35 trillion in Q2 2024.

This volatility emphasizes the uncertain economic conditions facing local firms, who continue to grapple with inflation, supply chain disruptions, and the increased cost of doing business post-unification.

The Director-General of the Manufacturers Association of Nigeria (MAN), Mr. Segun Ajayi-Kadir, recently noted that the challenges facing the manufacturing sector, particularly due to the current macroeconomic conditions, are exacerbated by the ongoing foreign exchange volatility and high electricity tariffs.

Also, speaking to Nairametrics on the challenges of firms operating in Nigeria face, Olufemi Oyinsan, General Partner at The Continent Venture Partners (TCVP), said: “Companies in Nigeria struggle with dropping consumer purchasing power and the high cost of doing business, especially with energy and logistics. On top of that, they face challenges in repatriating profits due to currency devaluation. This makes it unsustainable for them to operate.” 

He further stressed the need for businesses to be creative and more capital-efficient, cutting unnecessary costs and focusing on optimizing resources.

Ike Ibeabuchi, Chief Executive Officer, MD Services, earlier told Nairametrics that foreign exchange stability could steer firms’ rebound and boost their capacity to create value.

More Insights 

The standard CIT rate in Nigeria is 30% of a company’s taxable profits for large companies (those with annual gross turnover of more than N100 million).

• Medium-sized companies (with turnover between N25 million and N100 million) are charged a CIT rate of 20%. Small companies (those with an annual turnover of less than N25 million) are exempt from CIT.
• The growing disparity between foreign and local CIT contributions raises concerns about the long-term sustainability of Nigeria’s tax base.
• While foreign firms have become the dominant source of CIT revenue, the slower growth of local firms highlights the vulnerabilities within the domestic economy.
• If local businesses continue to struggle under the weight of rising costs and inflation, their ability to contribute meaningfully to tax revenue may be further weakened, placing more pressure on foreign firms to sustain government revenues.
• Also, the reliance on foreign CIT could make Nigeria’s tax base more vulnerable to external shocks.
• Should global economic conditions deteriorate, or should foreign firms reduce their operations in Nigeria, the country’s tax revenues could take a significant hit.
• This highlights the need for policies that support local business growth and enhance the competitiveness of domestic firms in the post-unification economy.

[Nairametrics]

Borno State Governor, Prof Babagana Zulum, has decried the influx of unaffected persons to the camps of the real victims of the last Tuesday’s flood that devastated the state.

The Governor stated this on Monday while flagging off the distribution of relief materials to victims of the Maiduguri flooding who are taking refuge in about 36 internally displaced persons camps.

The flood which shattered Maiduguri following the overflowing of the Alau Dam, displaced nearly 2 million people within Maiduguri metropolis and environs.

The flag-off ceremony took place on Monday at Bakasi Camp along Damboa Road in Maiduguri.

Relief materials distributed to each victim include a bag of 25kg of rice, a carton of pasta and N10,000 cash.

Speaking to journalists, Governor Zulum decried the influx of people who were not affected by the flood to the IDP camps, thereby making it difficult for smooth operations.

He said, “We observed that it is no more sustainable to continue receiving people in the camps because many people that were not affected are tripping to the camps.”

In addition to distributing relief materials, the governor also announced plans to comprehensively assess the affected areas, which will inform future interventions.

He stated, “So we decided to mobilise the resources and ensure that each affected victim had the relief items.”

“We have also concluded arrangements that we shall do the assessment at the communities to verify the actual number of those that were affected.”

The Director-General of the National Emergency Management Agency (NEMA), Zubaida Umar, highlighted her agency’s interventions for victims of the flood disaster.

She noted that the agency has been providing shelters and mobile water purifiers to provide clean drinking water to those affected since the flooding began.

Meanwhile, Governor Zulum has acknowledged receiving food donation from the Federal Ministry of Agriculture, NEMA, and Nigerian National Petroleum Company Limited (NNPCL) to support the victims of the disaster.

[Leadership]

The Nigerian National Petroleum Company (NNPC) Limited has released an updated breakdown of the estimated price of petrol purchased from the Dangote Refinery.

On Monday morning, the NNPC provided a chart detailing the refined petrol it acquired from the refinery on Sunday.

Payments for the September 2024 petrol supply, according to NNPC, are being made to Dangote Refinery in US dollars, with Naira transactions scheduled to begin on October 1, 2024.

“NNPC Ltd. has released the estimated prices of Premium Motor Spirit (PMS), also known as petrol, sourced from the Dangote Refinery, for distribution at its retail outlets nationwide.

“These prices are based on negotiated terms between NNPC Ltd. and Dangote Refinery, taking into account current international gasoline prices and the prevailing foreign exchange rate, in accordance with the Petroleum Industry Act (PIA) 2021.

“NNPC Ltd. confirms that it is making payments in USD for the September 2024 PMS supply, with Naira payments starting on October 1, 2024.

“We assure Nigerians that any discounts received from Dangote Refinery will be fully passed on to the public,” the statement from NNPC reads.

While the data of the estimated price to be sold around the country remains the same, the analysis of the transaction it had with Dangote Refinery was modified.

In the initial statement released on Monday, a Nigerian Midstream and Downstream Petroleum Regulatory Authority fee of N8.99 was listed, while the revised version showed a fee of N4.495.

The first breakdown included an inspection fee of N0.97, a margin fee of N26.48, and a distribution fee of N15.

However, in the updated release, the inspection and margin fees were removed, and the distribution fee was adjusted to N42.45.

In addition, the second statement introduced a Midstream and Gas Infrastructure Fund fee of N4.495.

[DailyTrust]