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Fuel Subsidy: Nigeria Faces Existential Threat- World bank

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Fuel Subsidy

Fuel Subsidy: Nigeria Faces Existential Threat- World bank

Fuel Subsidy

The World Bank on Wednesday raised the alarm that Nigeria might be facing an existential threat.

The warning comes in the wake of Nigeria’s dwindling revenue, the continued payment of trillions of naira on fuel subsidy by the government and the attendant economic challenges it has brought.

 

 

 

 

The international financial institution warned that if the country failed to optimise its tax system and focus on other areas to boost its revenue, the already low revenue would continue to drop. It noted that despite the rise in the price of oil in the international market, Nigeria had not reaped the benefits because of the huge amount spent on fuel subsidy.

The Senior Public Sector Specialist, Domestic Resource Mobilisation, at the World Bank, Mr Rajul Awasthi, said these at a virtual pre-summit, with the theme ‘Critical Tax Reforms for Shared Prosperity’, organised by the Nigerian Economic Summit Group on Wednesday. He insisted Nigeria would have to eliminate the subsidy regime eventually.

 

 

 

 

 

 

After the Federal Government earmarked about N4tn for subsidy payment in 2022, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, said recently that government might spend a whopping N6.72tn as fuel subsidy in 2023 or pay N3.36tn up to mid-2023 if the subsidy regime would was to end in May 2023.

Also, the minister had consistently said the nation was battling with revenue problems, which had compelled the government to keep borrowing. The debt stock had risen to N41.6tn in the first quarter of 2022 with projections that it could peak at N45tn by the end of the year. Nigeria is rated the fifth on the list of the World Bank’s debtors, with $11.7bn debt stock as of June 30, 2021.

 

 

 

 

 

 

 

 

The International Monetary Fund had in March projected that Nigeria might spend 93 per cent of its revenue on debt servicing in 2022, but the minister disclosed a few weeks ago that about 119 per cent of the country’s revenue was spent on debt servicing. This implied that government had to borrow to meet its debt financing obligations, a development many economists had described as disturbing and unsustainable.

The virtual event, anchored by the PwC’s Fiscal Policy Partner and Thematic Lead, NESG Fiscal Policy and Planning Thematic Group, Mr Taiwo Oyedele, was attended by several stakeholders, including the representative of the Manufacturers Association of Nigeria and the Executive Secretary of the Joint Tax Board, Mrs Nana-Aisha Obomeghie.

 

 

 

 

 

 

 

 

Meanwhile, in a slide he shared during his presentation, which showed Nigeria’s Development Update, Awasthi explained that between 2015 and 2019, Nigeria’s non-oil revenues were among the lowest in the world and as a result the second lowest in spending, and that oil revenues were also falling even when oil prices were higher.

He stated, “Nigeria has the largest economy in Africa and the largest country in Africa by population, so it is critical to Africa’s progress. There is no doubt about that. But the government of Nigeria, from the public finance perspective, is really facing an existential threat. Let’s not downplay the situation. That is the actual reality.

 

 

 

 

 

 

 

 

“Nigeria is 115th out of 115 countries in terms of the average revenue to Gross Domestic Product ratio. Despite the oil prices rising the way they have been, net oil and gas revenues have been coming down because of the tremendous impact of the subsidy.

“So, what is going to happen in 2022? The federation’s revenues are going to be significantly lower. They are already very low, and Nigeria is already the lowest in the world out of 115 large countries and this year, it’s really going to be lower than what it was in 2020 because of the debilitating impact of fuel subsidy.”

 

 

 

 

 

 

 

 

 

On the perennial low revenue from tax in Nigeria, a former Finance Minister and Ahmed’s predecessor, Mrs Kemi Adeosun, had in 2017 revealed that only 214 persons in Nigeria paid N20m and above as tax and that most active taxpayers in the country were people whose PAYE were deducted from source. She had also decried the low tax to GDP ratio at about six per cent, which she described as the lowest in the world and far below the 18 per cent average on the continent.

Speaking on how to get out of the woods, Awasthi stated that in the non-oil sector, Value Added Tax compliance gaps were immense and they needed to be breached as well as rationalise tax expenditures.

 

 

 

 

 

 

 

 

 

Citing the tax expenditure statement of the Budget Office in 2020, he said, “The VAT gap in 2019 was over N3.1tn whereas the collection was N1.2tn. Of that gap, about two-thirds, which is about N2tn, came from compliance gaps. That’s a serious issue that needs to be addressed. It’s because of this that we have a low tax base and a lot of people feel they are being overtaxed.”

He also stressed the need for technology deployment in tax administration and data sharing between the Federal Inland Revenue Service and the states’ Internal revenue services to boost the revenue from personal income tax. He also called for an increase in the tax levied on certain goods, like wine, cigarettes and beer.

 

 

 

 

 

 

 

He added, “Property taxes at the state and local government levels are also critical. Nigeria has a tremendous potential, with about 50 million households, taxable properties and there are many rich people who need to be paying property taxes. There is a tremendous opportunity there.

“Also, I think there is a huge opportunity to raise excise on goods like beer, wine, spirit and cigarettes. There is a very tiny tax that has been introduced on them and this could be higher. These are the kinds of things that across the world there is a consensus that these rates should be higher because they are supposed to attack and address negative externalities of these products.

 

 

 

 

 

 

“There is also a need to reform the fuel subsidy regime, moving towards its full elimination at least by 2024. Nigeria needs to roll back the PMC subsidies and adopt the free market price. This is critical for this country. There is also the need to improve revenue from cross-border transactions and other international tax measures.”

While calling for increased enlightenment of the taxpayers, which he said the World Bank was collaborating with the World Bank to achieve, he noted that tax laws needed to be modernised and strengthened for a better outcome.

 

 

 

 

 

 

 

 

 

He added, “Going forward, the approach to revenue mobilisation has to be more strategic. We need to be more strategic and it’s not just about taxing more, Nigeria needs to tax better. We need to review the collection system and not just about what to collect and from who. There have been discussions about how the tax system has to be progressive and efficient in terms of compliance and making sure we are targeting the right tax bases.”

In his submission, the Director-General of MAN, Mr Segun Ajayi-Kadiri, represented by the Director of Mr Oluwasegun Osidipe, said there was no doubt that the country needed money but that the government must exercise caution in introducing more taxes.

 

 

 

 

 

 

 

 

He tasked the government to expand the tax base, ensure the inclusion of more people in the informal sector and make the tax system progressive such that the rich would pay more than the poor.

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Wonderland Lagos 2022: The Most Exciting Holiday Experience To Storm Lagos Nigeria Balmoral Group and Octoplus Marketing Group in partnership with CEC unveils

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Wonderland Lagos 2022

Wonderland Lagos 2022: The Most Exciting Holiday Experience To Storm Lagos Nigeria Balmoral Group and Octoplus Marketing Group in partnership with CEC unveils

Wonderland Lagos 2022

Wonderland Lagos is made up of four villages, all existing solely to deliver an overwhelming holiday experience of excitement and delight to guests. These villages include Qatar Live in Wonderland Lagos, Christmas in Wonderland, Wonder X and Wonderland Market all in one venue, Eko Energy City.

At the unveiling/launch of Wonderland, which took place at Eko Energy City, Lagos, Co-founder Wonderland and CEO Balmoral Group, Ezekiel Adamu explained that Wonderland Lagos is out to be an enchanting experience for guests during the fun-filled festive season. He also pointed that the four different villages otherwise known as ‘Four wonders’ delivers its own unique experience to every cadre of guests as it cuts across the different age, gender, and social group. “The different villages makes a wholesome experience for every individual; from the kids to the teens, young adults and even our mummies and daddies, everyone is definitely catered for in Wonderland Lagos”, he said.

Wonderland Lagos 2022
Also speaking at the launch event, Vinni, Co-founder Wonderland Lagos, expressed his excitement for the project as he noted that this is about to change the holiday experience in Lagos, Nigeria.

According to Vinni, Wonderland Lagos – the city that never sleeps would open doors to guests on 1st of December 2022 and run various activities across all four villages till January 2nd, 2023. “This is the biggest, never seen holiday experience coming to Lagos with this maiden edition and take on Africa at large”, he added.

The event which saw the attendance of HNIs and celebrities amongst which is Chimwemwe Chalemera, Country Director, Department for International Trade, British High Commission Lagos who showed her support and that of the commission towards Wonderland Lagos 2022. “The project is a really exciting one, as a Department for International Trade, one of our focus is to increase trade and investment between UK and Nigeria, and one of the sectors we are looking at is the creative sector and we have really done a lot in that sector, and we are really excited to see how we can get involved in this and support the success of Wonderland”, she said.

Wonderland Lagos 2022
In the spirit of giving a unique experience to its guests, Wonderland Lagos would be using its own currency- Flakes. Each flake is equivalent to the naira value, and this would be the currency for every activity/payment in the Wonderland. Also, in contributing to the hospitality for visitors, particularly tourist and travellers from other states to the city, a tower of 110 fully furnished apartments of different specifications is ready and available to receive guests.

Wonderland Lagos 2022
Wonderland Lagos is brought together by Balmoral Group, Octoplus Marketing Group, in partnership with Creative Economic Catalysts (CEC), Magic Moments Entertainment and MTV Base and Nickelodeon. With, Soundcity, TVC, Arise News, Max FM, Beat FM, Cool FM as official media partners and supported by Lagos State Government.
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DANGOTE WINS ECOWAS’ MANUFACTURING BRAND OF THE YEAR AWARD

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Dangote

DANGOTE WINS ECOWAS’ MANUFACTURING BRAND OF THE YEAR AWARD

…Cement, Sugar win Brands of the Decade

Dangote

Africa’s largest business conglomerate, Dangote Industries Limited has been adjudged the Outstanding Indigenous Conglomerate of the Decade, carting home eight different Economic Community of West African States Manufacturing Excellence Awards (EMEA) in the process.

In the same vein, two subsidiaries of the Conglomerate, Dangote Cement Plc and Dangote Sugar Refinery Plc also received awards of the renowned Marketing Edge magazine’s Brands of the Decade.

 

 

While the EMEA awards were given by the Nigeria’s Daily Independent Newspaper and its BusinessDay Ghana counterpart, the Brand of the Decade for Dangote Group subsidiaries were received at the 10th edition of the leading brand magazine, Marketing Edge’s 2022 Summit and Award Night themed “Technological explosion in the digital Age – Imperatives for the marketing communications industry”, which held in Lagos.

It was a gale of accolades as the Dangote brand was named number one brand by all standards with its Sugar and Cement brands as the two brands, which company has contributed tremendously to the infrastructure development not only in Nigeria but Africa in the last 10 years.

 

 

 

Speaking at the event, Mr. John Ajayi, Publisher/CEO of Marketing Edge Publications described this year’s awards as one with a special attraction and uniqueness, designed to reboot, restart and re-energise the social, intellectual and entrepreneurial landscape of the Nigerian Integrated Marketing Communication (IMC).
While eulogising the management of Dangote Group for the business strategy that has helped in positioning the brand well ahead of others in the industry, he explained that the award event was organised to “celebrate the best and brightest brands”

According to him, the award to Dangote brands are in recognition of its leadership and domination in the various market segments and categories, adding that the recognised brands are brands that “continue to make the Nigerian consumers happy and satisfied”.

 

 

The Marketing Edge publisher, while giving the business trajectory of the past 19 years, saluted the various winners and their managements for their roles in making Nigeria proud, citing an instance of how Dangote Cement and Dangote Sugar have made Nigeria self-sufficient in cement and sugar production.

In his response to the new awards, Mr. Anthony Chiejina, Group Chief, Branding & Communications Officer, Dangote Industries Limited (DIL), said the Group’s brand remains at the forefront of African enterprise and that the brand, since inception, has touched the lives of many by providing their basic needs.

 

 

Expressing gratitude to the management of Marketing Edge publications for the recognition, Mr. Chiejina explained that consumers are loyal to brands that are purposeful and that is “why we have designed a strategy that creates that purpose.” “Because we understand the power of brands, we have positioned all our businesses to be consumer-centric so that it can inspire millions of people behind it”, Mr. Chiejina stated.

The ECOWAS awards won by the company included ECOWAS Manufacturing Company of the Year; ECOWAS Manufacturing Company CEO of the Year; ECOWAS Manufacturing CSR Company of the Year; ECOWAS Cement Manufacturing Company of the Year; ECOWAS Sugar Manufacturing Company of the Year; ECOWAS Salt Manufacturing Company of the Year and ECOWAS Fertiliser Manufacturing Company of the Year.

 

 

 

The awards won during the Marketing Edge Magazine’ 2022 summit included Outstanding Indigenous Conglomerate won by the Dangote Industries Limited, and Cement Brand of the Decade and Sugar Brand of the Decade.

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DANGOTE BOOSTS ABUJA TRADE FAIR

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DANGOTE BOOSTS ABUJA TRADE FAIR

Dangote

The Dangote Group has been described as a significant premium player as over 300 corporate exhibitors are participating in the 17th Abuja International Trade Fair (AITF) that is expected to be declared open by President Muhammadu Buhari on Friday.

Speaking to newsmen, the Director-General of the Abuja Chamber of Commerce and Industry (ACCI), Ms. Victoria Akai said: “As a member of ACCI, the Dangote Group further strengthens the position of ACCI in implementing business activities and advocating for business-friendly policies.

 

 

”The DG said the Dangote-ACCI partnership is strategic and geared towards showcasing made-in-Nigeria products, which will help inform prospective exporters about the available opportunities and processes.

Ms. Akai said the company had been a significant sponsor of the Abuja International Trade Fair, including this year’s Trade Fair. In the same vein, the President of ACCI, Dr. Al-Mujtaba Abubakar, told newsmen that the theme for this year’s exhibition: “Creating an Export Ready Market through SMEs Digitization,” offers a wide range of opportunities for Small and Medium Enterprises to ginger their performance, and especially in relation to the non-oil sector.

 

 

 

He said: “The Abuja International Trade Fair, since its inception, has served Nigeria as a trusted global trade destination and a potential market for over 50,000 consumers.”

The 17th AITF is scheduled to hold between Friday, September 30 and Sunday, October 9, 2022, at ACCI Abuja International Trade Fair Complex.

 

 

 

The Dangote Group’s Executive Director of Government and Strategic Relations Engr Mansur Ahmed said the partnership with ACCI offers the company the opportunity to display its numerous innovative products while contributing its quota to the Nigerian economy through Trade Fairs and expos.

He said the President of the Group Alhaji Aliko Dangote is passionate about developing the Nigerian economy, exporting made-in-Nigerian goods, earning foreign exchange, and creating jobs for the populace. Engr Ahmed said the company is desirous of entering into any strategic partnership that will set the country on the path of rapid growth and development.

 

 

 

Aside government, the Dangote Group is the second biggest employer of labour in Nigeria.

A statement by the Corporate Communications Department of the company said a special help desk has been set up at the company’s pavilion to respond to queries while urging participants to leverage the numerous innovative products which include the: Dangote Fertiliser, Dangote Sugar, Dangote Cement, Dangote Salt, and lots more.

 

 

AFCFTA: DANGOTE TO BOLSTER AFRICA’S EARNINGS
As the African Continental Free Trade Area (AFCFTA) implementation commences, experts say the continent is in a privileged position considering the Dangote Group’s huge international investment portfolio.

Pundits say Dangote Group has positioned its subsidiaries as multinational conglomerates which have continued to play a pivotal role in the industrialization of Africa.

 

 

The multi-billion naira Dangote Cement Plc, for instance, has a presence in over ten African countries, while the newly incorporated Dangote Fertiliser and oil refinery are capable of mitigating the continent’s shortfall in foreign earnings.
The Director-General of the Abuja Chamber of Commerce and Industry (ACCI), Ms. Victoria Akai said the Dangote Group has been a pacesetter in manufacturing while boosting Nigeria and Africa’s earnings.

She said: “The founder Alhaji Aliko Dangote is a visionary leader and has led the Group to become one of the leading brands in Africa and the world, which is a pride to every Nigerian.”

 

 

 

According to her, the company is one of the biggest and most strategic partners of the Abuja Chamber of Commerce and Industry (ACCI).
The 17th Abuja International Trade Fair is scheduled to hold between Friday, September 30, and Sunday, October 9, 2022, at the ACCI Abuja International Trade Fair Complex. Dangote Group is the major sponsor of the 17th edition of the Abuja International Trade Fair, which seeks to deepen trade across Africa.

Speaking on the role of small-scale industries, the DG of ACCI said with the heightened interest in the African market, coupled with the implementation of the AfCFTA, Nigeria is in a privileged position given the role of the Dangote Group and many other big companies.

 

 

 

 

 

She added that Nigeria has enormous potential for export considering the number of SMEs.

According to her: “SMEs represent about 96% of the business fabric and generate over 70%of employment while contributing to about 48% of Nigeria’s GDP, making them the engine of Nigeria’s economy and playing a vital role in the economic recovery.”

 

 

 

 

The AFCFTA, established in 2018, is a free trade area comprising of most African countries as signatories, making it the largest free trade area by number and second only to the World Trade Organization (WTO). Under the agreement, parties are committed to eliminating tariffs on most goods and services, as well as eliminating other impediments to free trade.

 

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