The Italian prosecutor involved in the trial of Shell, Eni and others, in the controversial Oil Prospecting Licence (OPL) 245 case, Fabio De Pasquale, has been demoted by the country’s Superior Council of the Judiciary (CSM) for his role in the proceedings.
An Italian newspaper, Ilgiorno, reported that De Pasquale was demoted for “lack of impartiality and fairness” in the way he handled the prosecution at the Court of Milan. Recall that in 2021, a former Minister of Justice and Attorney General of the Federation, Mohammed Adoke (SAN), had petitioned Italy’s Minister of Justice over the conduct of De Pasquale. Adoke, through his lawyers, accused the prosecutors of unlawful acts of intimidation/threat to life, forgery of documents/evidence intended for unlawful interference with the administration and perversion of the course of justice.
The Italian was also said to have hidden critical evidence that would have exonerated the defendants and is facing a separate hearing over the allegation. Adoke said the prosecutors acted “maliciously and unprofessionally” to his detriment despite the fact that he was not a direct party to the criminal prosecution and was not on trial before the Milanese court.
Eventually, the court discharged all persons and companies accused of fraud and bribery in the transaction. De Pasquale, who was assistant prosecutor at the Court of Milan with semi-managerial prosecuting functions, was rejected by 23 of the 27 members of the CSM, including its Vice President, Fabio Pinelli, while four members abstained from voting.
“It is therefore demonstrated that De Pasquale lacks the prerequisites of impartiality and balance, having repeatedly exercised jurisdiction in a manner that was neither objective nor fair with respect to the parties as well as without a sense of proportion and without moderation,” the CSM resolved.
Naira depreciation continued as US dollar transactions at the official foreign exchange market dropped to an all-time low of $84.38 million.
This is according to FMDQ data at the close of work on Thursday.
The day-to-day FX supply turnover dropped from $160.77 million on Tuesday to $84.38 million on Thursday.
Consequently, the Naira further dipped to N1459.73 per dollar on Thursday from N1416.57 on Wednesday.
This represents an N43.17 depreciation against the dollar at the official foreign exchange market.
Similarly, the Naira dropped to N1,450 per dollar on Thursday in the parallel market section, compared to N1,438 the previous day. This brings the gap between the official and parallel markets to N9.73.
Naira’s depreciation has been consistent for days now in the FX market.
The country’s forex instability has persisted despite the recent surge in foreign reserves by $262 million.
American Express Co. has launched its inaugural business credit card in Nigeria amid the foreign exchange crisis.
The international firm is partnering with a Nigerian firm, neobank O3 Capital Nigeria Limited, potentially enhancing access to dollar transactions in the West African country.
The unveiling happened in Lagos on Thursday.
The business card comes with a spending limit of $10,000 and offers a repayment window of up to 45 days for international transactions.
The President of Global Network Services, Amex, Mohammed Badi, said, “The first-ever American Express Business Card in the most populous African country will give us another way to support local businesses with their growth aspirations”.
Similarly, the Chief Executive Officer of O3 Capital, Abimbola Pinheiro, said the O3-Amex card “solves the problem of queuing at banks for business travel allowance and the personal travel allowance.
The development comes amid the continued foreign exchange crisis in Nigeria.
On Thursday, the Naira dipped to N1459.73 per dollar at the official exchange market.
FG’s cash transfer scheme increased household savings, but had little impact on employment — World Bank
AFOLABIThe World Bank says the conditional cash transfer (CCT) programme of the federal government has had a limited impact on household consumption and financial inclusion.
The Bretton Woods institution disclosed this in its latest report, titled, ‘Beta Don Come: Effects of Cash Transfers on Women and Households in Nigeria’.
According to the report, the intervention also had a limited impact on employment, especially for women.
The report cited the 2016 cash transfer programme when the federal government launched the National Social Safety Nets Project (NASSP).
At the launch of the programme, it said, the federal government had provided households a cash transfer of N 5,000, disbursed as a lump sum every two months.
Payments were given to each household’s primary caregiver — predominantly women — the report stated.
The World Bank, however, suggested that there is a need for a complementary livelihood to support the intervention to generate sustainable improvements in households’ self-sufficiency.
“Program participation improved several dimensions of households’ and women’s welfare over time,” the report reads.
“Households in communities that entered the program earlier experience larger increases in household savings and food security, along with increased access to farmland and livestock ownership, compared to similar households in communities that entered the program later.
“We also find improvements in caregivers’ self-reported happiness, decision-making autonomy over how to spend their own income, and freedom of movement.
“Positive impacts appear to primarily result from the saving mobilisation component of the program.
“Households are substantially more likely to save the longer they have been receiving cash transfers and to switch away from exclusively using the cash for household consumption.
“However, in contrast to these strong positive impacts, we do not find any statistically significant effects on overall household consumption or on caregivers’ employment and financial inclusion.”
The World Bank also said in spite of the efficacy of the CCT programme, there is no evidence to “the impacts of participating in the program at all”.
“We find positive effects on households’ saving, food security, and economic activity along with increased caregivers’ decision-making autonomy and physical mobility associated with participating in the project for longer periods of time,” the report added.
“Nonetheless, the limited impacts on household consumption and women’s employment suggest that there is remaining scope for a complementary livelihood support intervention to generate sustainable improvements in households’ self-sufficiency.”
Approved in 2016, the CCT programme was established to benefit poor and vulnerable Nigerians with a monthly stipend of N5,000.
On July 13, 2023, President Bola Tinubu asked the senate to approve the $800 million loan request.
The president had said the loan would be used to scale up the national social safety net programme and cushion the effect of the removal of petrol subsidy.
He said the federal government would transfer N8,000 monthly to 12 million poor and low-income households for six months.
But on July 18, 2023, Tinubu ordered the immediate review of the proposed N8,000 conditional cash transfer.
Experts have urged Nigeria to learn from the debt crisis of Egypt by embarking on spending that will make a positive impact on the nation’s economy.
According to experts, Egypt’s economic bold reforms were held up as a model country for Nigeria as the country became the darling of investors. However, the country later undone the gains of those reforms with huge spending of borrowed funds on megaprojects from a new capital city to presidential palaces that have not delivered economic gains.
An economist familiar with the matter said that the spending spree, financed mainly by foreign loans, has put Egypt at risk of a rare bond default. He said Egypt’s case shows reform is not enough, if it is not complemented by purposeful leadership.
A public finance expert, Musa Adekunle said Nigeria can learn from some mistakes made by Egypt such as failed industrial development due to poor planning and heavy bureaucracy, and export policies that created a persistent trade deficit.
He said, “A borrowing spree under President Abdel Fattah al-Sisi left Egypt with heavy foreign debt. Foreign creditors have been shying away, pushing the Cairo government to borrow domestically even as interest rates surge, spawning bigger deficits. This, and an expansion of the money supply, have fuelled currency depreciation and higher inflation.
Over the past two years, an acute dollar shortage suppressed imports and caused a backlog at ports, with a knock-on effect on local industry. Prices for many staple foods rose much faster than headline inflation, which accelerated to a record 38%. Economic growth has slowed, and many Egyptians say their standard of living has been eroded.”
Fresh data released by the Central Bank has shown that Egypt’s foreign debt increased by $3.5 billion in the last three months of 2023 which has deepened her debt crisis as the country’s foreign debt now amounted to 43 per cent of its Gross Domestic Product. According to Business Insider Africa, total foreign debt in the country climbed to $168.0 billion from $164.5 billion at the end of September and $162.9 billion at the end of December 2022.
Egypt has quadrupled its external debt since 2015, using it to finance various initiatives such as constructing new capital, developing infrastructure, procuring weaponry, and sustaining an overvalued currency, Reuters reported.
The central bank reported that the foreign debt, of which 82.5 per cent was long-term, amounted to 43 per cent of the gross domestic product.
Following the Ukraine crisis, which resulted in a chronic shortage of foreign currency and prompted an exodus of foreign investors, the government of Egypt sought assistance from the International Monetary Fund (IMF).
The country deliberately allowed its currency to weaken by over 35 per cent in a much-anticipated devaluation, potentially opening the door for additional loans from the IMF.
In March, the International Monetary Fund (IMF) approved a $5 billion augmentation to its loan programme for Egypt. The approval increased the Extended Fund Facility arrangement from the initially approved $3 billion in December 2022 to $8 billion.
The IMF has consistently advocated for Egypt to implement tighter monetary policies to address nearly 30% inflation and adopt a more flexible official exchange rate.
As part of the agreement, Egypt committed to reducing spending on large government projects. Also, in March, Egypt raised the prices of various fuel products, fulfilling a commitment made to the IMF as part of the financial assistance agreement.
[Ledadership]
John Makina, the Country Director of Oxfam, has announced significant progress in fostering social cohesion among 16 wards and 80 communities in Michika Local Government Area, which suffered greatly during the insurgency in Adamawa State.
The initiative aims to foster unity and reduce crises in the region.
Addressing journalists at a close-out review and dissemination workshop in Yola, themed “Support to Improving Social Cohesion through Community Development Planning in 16 Wards of Michika LGA,” Makina outlined that the 11-month intervention was conducted in collaboration with CRUDAN, GIZ, and CEPAD.
Makina emphasised that the intervention focused on enhancing participatory engagement and planning among local communities, governmental bodies, and stakeholders. This collaborative effort is anticipated to yield better socio-economic outcomes for the affected communities.
“The aftermath of the insurgency in Michika LGA has led to widespread distrust among residents, internally displaced persons (IDPs), refugees, and returnees, underscoring the urgent need for social cohesion,” he said.
[DailyTrust]
Abia State Governor, Alex Otti, has said that it was not on the front burner of his administration to employ new people into the state’s civil service.
The governor made the disclosure during the monthly interactive session with the media on Thursday in Umuahia.
According to him, the issue of employment would arise when the government finished dealing with what it met in the civil service.
He added that there was an embargo that he made, stressing that it was still in place.
He complained that the number of persons in the civil service was still very high even after verification.
Otti decried the huge wage bill of about four billion naira for both local government and state on a monthly basis.
The governor, however, assured that the government was working assiduously on improving and enhancing the pay for the civil servants.
He said that government was aware that there were quite a lot of people in the service who might not be contributing at optimal levels and would need to do something about it.
He said: “So, it may not be a priority at this time to open up the doors to bring in new people, except if we have a way of exiting a few people.
“But you know with the civil service rules, it is not going to be very easy to exit people.
“What we are trying to do with the establishment of the Civil Service Commission and resumption of the new Head of Service and new Permanent Secretaries is to ensure that our people are adequately trained.
“This is to enable them operate their skills and perform better.”
[DailyPost]
A federal high court in Abuja has dismissed a suit seeking to restrain the federal government from securitising the N22.7 trillion Ways and Means loan received from the Central Bank of Nigeria (CBN).
Securitisation is the practice of pooling together various debt instruments and selling them as bonds to investors.
In a judgment delivered on Thursday, James Omotosho, the presiding judge, held that the plaintiffs lacked locus standi (legal right) to institute the case, noting that they failed to prove the case.
The suit, marked FHC/ABJ/CS/1286/2023, was filed by Justin Edim and Akinfewa Akinwunmi against President Bola Tinubu, the federal government of Nigeria, CBN, and the ministry of finance as first to fourth defendants.
Others in the suit are the debt management office (DMO), national assembly, and attorney-general of the federation (AGF) as fifth to seventh defendants, respectively.
The plaintiffs, through their counsel, Victor Opatola, claimed they initiated the legal action on behalf of themselves and other Nigerian citizens.
They asked the court to stop the conversion of the debt to a promissory note or any other promise to pay at a future date or securitisation through the issuance of treasury bills, bonds, or other forms of security.
In December 2022, the federal government requested the 9th national assembly for permission to securitise the debts it incurred from the CBN over the years.
The plaintiffs claimed that the series of loans secured by the government from the CBN had amounted to N23.7 trillion.
They added that the federal government was planning to restructure the loans to something that could be traded.
They further stated that the federal government had over the years secured various loans from the CBN under the Ways and Means provision of section 38 of the CBN Act in contravention of relevant laws.
They argued that the laws stipulate that the total amount the government could borrow shall not exceed five percent of the previous year’s revenue.
Recently, according to the plaintiffs, the Ways and Means debt of N22.7 trillion was decided to be converted into bonds (promissory note) contrary to section 38(3)(b) of the CBN Act.
The plaintiffs wanted the court to declare that the effect of securitising the ways and means debt would adversely affect millions of Nigerians, as well as rob them of the true worth of their savings and further drive Nigerians below the poverty line.
Delivering the judgment, Omotosho struck out the name of the national assembly from the suit, noting that the plaintiffs had breached the condition precedence of filing a pre-action notice on the legislature three months before filing the case.
The judge said though the plaintiffs claimed they filed the matter on behalf of the masses, the instant case was not a fundamental enforcement rights suit.
He said the claim that the suit was brought on behalf of the public was incomprehensible.
The judge added that the plaintiffs failed to show how the actions of the defendants affected them personally.
The Aare Onakakanfo of Yorubaland, Gani Adams, has asked the Federal Government to address Nigerians’ sufferings caused by the fuel subsidy removal and increased electricity tariffs.
Adams disclosed this while speaking during the 2024 edition of the Oke Ibadan festival, organised by the Olokun Festival Foundation, which was held in Ibadan, the Oyo State capital, on Thursday.
He noted that Nigerians are concerned about the present situation in the country.
He also pointed out that the idea of states having independent power supply was one of the policies of this administration that he had applauded, adding that there are a lot of advantages the states can get from this initiative.
He said, “One of the major policies of this administration that I applauded at the onset was the idea of having an imdependent power supply in the states.
“There are a lot of advantages the states can get from this initiative.
“Nigerians have continued to raise their voices against the policy, even as power outages persist in the country. The new tariffs have become a big problem for Nigerians.
“The increase in electricity tariffs had taken a huge toll on the entire system. It has affected all the sectors of the Nigerian economy.
“Like the growing pain experienced through the hike in the electricity tariffs, the fuel subsidy removal has continued to bring more hardship to Nigerians. It has also affected the Nigerian economy, drifting the country to further inflation.”
Adams has always pledged his support for President Bola Tinubu’s administration, saying his Presidency represents a new chapter for Nigeria.
He stated this in a congratulatory letter to the President on his recent victory at the Supreme Court.
Noting that “Nigeria is going through a lot at the moment,” Adams said Tinubu’s “victory has given rise to a leadership that this time demands. And we must agree with the fact that this is truly a new chapter in the political trajectory of Nigeria.”
He, however, urged Tinubu to make the best of his Presidency to, especially, heed the widespread yearning for the restructuring of the country.
[Punch]
Bandits on Thursday night invaded the Confluence University of Science and Technology, Osara, Okene in Kogi State and abducted some students.
An eyewitness account indicated that the bandits swooped on the university around 9pm while the students were reading for their upcoming exams.
The source said that the bandits came in through the bush, went into three lecture halls and began to shoot into the air to scare the students.
“They trapped the students inside the halls and started taking them; the school was thrown into total confusion as fear-stricken students in other halls scurried to safety, scampering in various directions.
“By the time local security guards and the conventional security men at the gate engaged the bandits, they had already succeeded in abducting some students.
“But the efforts minimised the damage as the attackers didn’t go beyond the first three halls,” the source said.
According to the source, the students were preparing for their first-semester examination expected to commence on Monday, May 13, when the bandits struck.
A student, who craved anonymity, said that he and some colleagues ran to the bush and hid there for “more than an hour”.
“We only ventured out when everywhere became quiet,” he said.
Contacted, CUSTEC Vice Chancellor, Prof. Abdulraman Asipita, confirmed the incident but refused to give details of the number of students abducted.
“I don’t talk to journalists on incidents like this, but I want you to know that we are on top of the situation,” he said.
Efforts to reach the Commissioner of Police in Kogi, Mr Bethrand Onuoha, were not successful.
Retired Cdre Jerry Omodara, State Security Adviser, could equally not be reached for comments as calls to his line were not picked up nor returned.
Like in several parts of the country, abduction for ransom is the new normal. In February, gunmen reportedly kidnapped nine travellers in Oshokoshoko, along the Kabba/Obajana/Lokoja Road in Kogi State.
(NAN)
More...
Organised Labour has justified its proposed N615,000 minimum wage demand.
The request is based on a conservative analysis of what an average Nigerian family needs to survive.
Nigeria Labour Congress (NLC) President Joe Ajaero stated this yesterday during his visit to the headquarters of The Nation in Lagos.
He was accompanied by some national officers and officials of the Lagos State council of the union.
Some of these are the National President, Nigeria Union of Local Government Employees (NULGE), Ambali Akeem Olatunji; NLC Lagos State Chairman Funmi Sessi and NLC National Trustee, Akporeha Williams.
The delegation was received by senior editorial figures led by Managing Director/Editor-in-Chief Victor Ifijeh.
Ajaero, a former Labour reporter, who is one year old in office, described the visit as “home-coming”.
He said he would have visited media houses before now but for the pressure of office.
Although Labour was not opposed to a negotiated wage for workers, Ajaero said the prevailing economic realities informed its decision to put forward for negotiation the proposed N615,000 wage demand to the Federal Government’s Tripartite Committee on Minimum Wage.
Labour made public the amount on May Day, saying it had tabled it before the Tripartite Committee, whose meetings are ongoing to reach an agreement on the minimum wage.
Ajaero said there were misconceptions about the proposal, but the NLC was left with no other choice than to arrive at the figure based on prevailing economic indices and realities to make life better for Nigerian workers.
“We presented N615,000 as minimum wage to the Federal Government. But if you ask us to present again today, it is going to increase because when we were presenting that figure, things like electricity tariff had not increased. And there was no cybersecurity levy,” he said, asking: “Where are we going to get money to pay for these?”
Ajaero said this was why the NLC gave the Federal Government, through the Tripartite Committee, a proviso that “If the indices remain the way they are, this N615,000 demand stands, but if they come down as we are negotiating, we will look at it.”
Explaining how NLC arrived at the N615,000 minimum wage, Ajaero said: “We looked at accommodation, food, medicals, education, and other utilities. We didn’t make provisions for communication, offerings, tithes and the like. Those are some of the things we took into cognisance before we arrived at N615,000.”
On accommodation, for instance, Ajaero said the NLC pegged it at N40,000 for a room and parlour apartment for a family of husband and wife and four children.
“This means that if you have a grandmother or mother-in-law, you are on your own because we did not calculate those,” he said.
NLC calculated feeding based on N500 per person per meal for a family of six.
“So, N500 per person is N1,500 per person in a day. For six tables in a month, we are going to have N270,000 for feeding,” he said, adding that N50,000 is for education and medicals each, assuming a worker does not go for surgery or send his or her children to private school, for instance.
For utilities like electricity bills and gas, Ajaero said while N20,000 was allocated to the former, even before the tariff increased, about N16,000 or N17,000 was for gas, which does not last for more than two weeks.
This, he said, means that in a month, some families buy gas at least twice, spending between N30,000 and N35,000.
“Based on our calculation, a worker is not supposed to own a car, not even a motorcycle, because he or she can’t fill a car tank with N30,000; he can’t service a vehicle,” Ajaero said.
He noted that these are some of the things the NLC took into consideration before coming up with N615,000.
“We have placed it (N615,000) wage demand before the government for negotiation because when there is an offer there is usually a counter-offer to say no, this one you are asking is out of it,” the labour leader said.
He pointed out that while inflation remained high, wages have also remained constant and all other costs are going up, whether it’s housing, transportation or school fees.
“So, should wage remain constant and still take care of other variables?” Ajaero asked.
“If all these factors are checked, we will be arriving at another figure.”
The NLC boss also said the removal of petrol subsidy pushed up prices of goods and services across the country.
He said if the fuel subsidy was not removed, “probably we would have suggested N80,000 minimum wage.”
Asked about state governments not even paying the current N30,000 wage, and whether the Federal Government can afford the proposed N615,000, Ajaero was emphatic.
“States can pay if they get their priorities right,” he said, noting that it’s only a few state governments that are not paying the N30,000.
He said: “I think a few state governments are not paying; just very few or some are paying in breaches.
“But on the issue of whether the states can pay, yes, they can if they get their priorities right.
“In fact, National Assembly’s wages have almost tripled. If you come to an economy and we are having this argument of affordability, everybody must be disciplined.”
Besides, he argued that the issue of minimum wage is a benchmark and a product of legislation such that if left open, some states will not even pay N10,000.
“If this N30,000 was not a product of legislation, the state governments that have been kicking that minimum wage be sent into the concurrent list so that they can decide whether to pay N5,000 or not would have succeeded,” he said.
Ajaero, however, said all over the world, it is called minimum.
In other words, states are supposed to pay beyond the minimum.
“If you check states like Edo, while some are paying N30,000, they are paying N40,000; some others are paying N35,000. Most states are paying more than N30,000,” he said.
He also pointed out that when this same complaint about the payment of 30,000 came up during former President Muhammadu Buhari’s era and he released money from the Sovereign Wealth Fund for state governors to pay salaries, they did not use it for the purpose but diverted it.
On the ongoing negotiations at the Tripartite Committee, made up of Federal/state government officials, labour unions and the organised private sector, Ajaero said the labour centres were asked to harmonise their positions, which he said had been done.
He said another meeting of the committee had been fixed for May 15. It will be held via Zoom.
He expressed reservations about using Zoom for such a serious negotiation, saying many factors could make it inappropriate.
He also said if the Federal Government makes good its promise to provide Compressed Natural Gas (CNG) buses, which, according to him, is not rocket science as it only requires a conversion kit to switch over to PMS, transportation costs will significantly reduce.
“If we had achieved that, you don’t need to tell anybody and you will see that transportation will just crash. Transportation is central to our demand.
“If CNG buses are put in place, we won’t be talking about this. We are looking at it holistically. If all this is done, Nigerians will live happily,” Ajaero said.
[TheNation]
FBN Holdings Plc, has announced the exit of Mr Tunde Hassan-Odukale as Chairman of its subsidiary, First Bank of Nigeria Ltd., following the completion of his tenure.
The Board of First Bank appointed Mr Ebenezer Olufowose, a Non-Executive Director, as the new Chairman of the Board of Directors of the Bank.
Company Secretary, FBN Holdings, Adewale Arogundade, said this in a notification sent to the Nigerian Exchange Ltd.(NGX) on Thursday in Lagos.
Arogundade explained that Hassan-Odukale completed the cumulative number of years, which is 12 years for a Non-Executive Director, in line with the Central Bank of Nigeria’s (CBNs) corporate governance guidelines.
He said Olufowose was appointed to the Board of Directors of First Bank on April 29, 2021.
Olufowose is the Group Managing Director of First Ally Capital Ltd., an investment banking firm based in Lagos.
With over 35 years of working in the financial services industry, Olufowose brings skills from corporate finance, project finance and investment banking to the board.
Before joining the First Bank Board, he was Executive Director at Access Bank Plc and Citibank Nigeria, where he led Citigroup’s origination, structuring and execution of corporate finance and investment banking transactions in Nigeria.
He started his banking career in 1985 at NAL Merchant Bank Plc (NAL), working in the Corporate Planning and Finance Departments.
A first-dass honours degree holder in Economics from the University of Lagos, Olufowose holds an MA in International Economics from the University of Sussex, England.
He has attended several management and leadership training programmes at leading institutions, including the Institute of Management Development, Switzerland, Harvard Business School, Boston, U.S., and INSEAD Singapore.
He is an alumnus of the Harvard Business School and the Lagos Business School and an Honourary Senior member of the Chartered Institute of Bankers of Nigeria.
Olufowose is also a Fellow of the Institute of Credit Administration and a Fellow of the Association of Investment Advisers and Portfolio Managers.
(NAN)
The House of Representatives said yesterday the controversial Lagos-Calabar coastal highway had no National Assembly’s approval.
It also resolved to investigate the procurement process of the coastal highway.
The House also called on the Minister of Works, Minister of Finance and the Attorney-General of the Federation and Minister of Justice to ensure that all project guarantees and credit enhancement instruments are sent to the National Assembly for approval.
The Green Chamber equally mandated its committees on Procurement and Works to investigate the procurement process of the contract for the project.
Recall that the project has generated a lot of controversies, with former Vice President, Atiku Abubakar, and Presidential Candidate of Labour Party, LP, in the 2023 election, Mr Peter Obi, asking the Federal Government to come clean on the project.
The motion, titled “Urgent need to investigate the procurement process and award of contract for the Lagos-Calabar Coastal Highway’’, was moved by Austin Achado(APC-Benue) at plenary in Abuja.
Moving the motion, Achado said award of the contract did not follow due process, adding that it also did not get the approval of the National Assembly, hence the need to thoroughly investigate the procurement process of the contract.
Achado said: “The House is disturbed that the contingent liabilities accruing to the Federal Government of Nigeria on this project violate the Debt Management Office (Establishment) Act of 2023, as Section 22(3) states that the minister shall not guarantee an external loan unless the terms and conditions of the loan shall have been laid before the National Assembly and approved by its resolution.
‘No NASS approval for debt guarantees’
“The guarantees issued to cover the debt financing component of this project do not have the approval of this National Assembly.”
Speaking further, he noted that the Federal Ministry of Works had executed an Engineering Procurement Construction and Finance (EPC+F) contract, in favour of Hitech Construction Company Nigeria Limited, for the delivery of the 700km Lagos to Calabar Coastal Road and Rail Project estimated at a rate of N4.329 billion per kilometre, using reinforced concrete technology for a carriage width of 59.7metres to include 10 lanes, shoulders and rail with additional designs of service ducts, street lights, drainages and shore protection.
He further noted that the project, with the prospect of providing easy access for the movement of goods and services across the nation, has a financing structure, as announced by the Minister of Works, which required the Federal Government to provide 15 to 30% co-financing, while the private sector counterpart will provide the balance, and toll the road when completed for a minimum period of 15 years, to ensure full recovery of all debts and equity applied for the delivery of the project.
The lawmaker expressed concerns that the procurement strategy might have violated the Public Procurement Act 2007, Section 40(2) which required that where a procuring authority adopts to use Restrictive Tendering Approach, it should be on the basis that the said goods and services are available only from a limited number of suppliers and contractors and as such, tenders shall be invited from all such contractors who could provide such goods and services.
According to him, the procurement strategy adopted by the Federal Ministry of Works for the award of the contract violates the Infrastructure Concession and Regulatory Commission Act 2905, as Section 4 of the Act outlines that all approved infrastructure projects and contracts for financing, construction and maintenance must be advertised for open competitive public bid, in at least three national dailies and Section 5 of the Act further clarifies that any direct negotiations with only one contractor could be allowed, only after exhausting the provisions of section 4 .
He expressed concern that the Federal Ministry of Works, in promoting the project, has provided a rate per kilometre for the planned works, but has not provided the private partner’s financing sources, structure and competitiveness, as this was likely to create contingent liabilities to the Nigerian government.
The House, therefore, asked it’s committees to report back within four weeks.
[Vanguard]
A federal high court in Abuja has dismissed a suit seeking to restrain the federal government from securitising the N22.7 trillion Ways and Means loan received from the Central Bank of Nigeria (CBN).
Securitisation is the practice of pooling together various debt instruments and selling them as bonds to investors.
In a judgment delivered on Thursday, James Omotosho, the presiding judge, held that the plaintiffs lacked locus standi (legal right) to institute the case, noting that they failed to prove the case.
The suit, marked FHC/ABJ/CS/1286/2023, was filed by Justin Edim and Akinfewa Akinwunmi against President Bola Tinubu, the federal government of Nigeria, CBN, and the ministry of finance as first to fourth defendants.
Others in the suit are the debt management office (DMO), national assembly, and attorney-general of the federation (AGF) as fifth to seventh defendants, respectively.
The plaintiffs, through their counsel, Victor Opatola, claimed they initiated the legal action on behalf of themselves and other Nigerian citizens.
They asked the court to stop the conversion of the debt to a promissory note or any other promise to pay at a future date or securitisation through the issuance of treasury bills, bonds, or other forms of security.
In December 2022, the federal government requested the 9th national assembly for permission to securitise the debts it incurred from the CBN over the years.
The plaintiffs claimed that the series of loans secured by the government from the CBN had amounted to N23.7 trillion.
They added that the federal government was planning to restructure the loans to something that could be traded.
They further stated that the federal government had over the years secured various loans from the CBN under the Ways and Means provision of section 38 of the CBN Act in contravention of relevant laws.
They argued that the laws stipulate that the total amount the government could borrow shall not exceed five percent of the previous year’s revenue.
Recently, according to the plaintiffs, the Ways and Means debt of N22.7 trillion was decided to be converted into bonds (promissory note) contrary to section 38(3)(b) of the CBN Act.
The plaintiffs wanted the court to declare that the effect of securitising the ways and means debt would adversely affect millions of Nigerians, as well as rob them of the true worth of their savings and further drive Nigerians below the poverty line.
Delivering the judgment, Omotosho struck out the name of the national assembly from the suit, noting that the plaintiffs had breached the condition precedence of filing a pre-action notice on the legislature three months before filing the case.
The judge said though the plaintiffs claimed they filed the matter on behalf of the masses, the instant case was not a fundamental enforcement rights suit.
He said the claim that the suit was brought on behalf of the public was incomprehensible.
The judge added that the plaintiffs failed to show how the actions of the defendants affected them personally.
[TheCable]