14 Jul

Daily Watch – Nigeria can’t fund budget, Naira dips at parallel market

  • The FG has said the ₦6.06 trillion budget for the fiscal year 2016 will only be partially implemented, citing the drastic fall in oil prices, as well as the persistent attacks on oil installations in the Niger Delta which has cut government earnings by 40 percent. Appearing before the joint Senate Committee on Ethics, Privileges and Public Petitions, and Appropriation and Finance, the SGF, Babachir David Lawal, blamed the decline on the activities of the Niger Delta Avengers, which has claimed responsibility for a wave of attacks on oil installations in the oil-rich region. Lawal explained that there is a fall in oil production 800,000 bpd – compared to the budgeted 2.3 mbpd. The SGF had been summoned by the Senate on Tuesday to appear before the committee over a comment credited to him that the FG would not implement constituency projects as provided in the budget.
  • The naira on Wednesday dipped further against the American dollar at the parallel market. It slid to ₦357 to the dollar, from ₦353 which it traded on Monday. The Nigerian currency also weakened further against the pound and the euro as it exchanged at ₦462 and ₦385 respectively, from Monday’s ₦460 and ₦383. At the official interbank window, the naira closed at ₦283.42 to a dollar. Traders at the market cited a scarcity of dollars as the reason for the extension of losses of the naira.
  • Militants have blown up a gas pipeline in PZ Estate in the Ogijo area of Ogun state. Members of the community told Channels Television that the incident occurred late Tuesday. Apart from Imo state in the south-east, where a Shell pipeline was blown last month, all other attacks in recent times have happened in the south-south, mainly in Delta state. The attackers in Ogun carried out their bombing after posing as officials of the NNPC on maintenance patrol. The affected pipeline serves an 11.4 distribution line for some companies in Ikorodu, Lagos state.
  • President Buhari has forwarded budgets of agencies and corporations not captured in the 2016 budget to the House of Representatives for consideration in line with the 2007 Fiscal Responsibility Act. In a June 30 letter to Speaker of the House of Representatives, Yakubu Dogara, the President submitted the budgets of 38 agencies and corporations, including those of the CBN, FIRS, NNPC, NPA, SEC, NAFDAC, BPE, NMA, FAAN, NCC, NDIC, NIS, FHA, FMB and the CAC, among others.
  • The Shiroro Hydro Power station says it has incurred about ₦2.4 billion in repair costs in order to get four turbine generators running to bring the plant to its installed capacity of 600 megawatts. Olubunmi Peters, SHPS Executive Vice Chairman, blamed the inability of the station to operate at full capacity since the signing of a 30-year concession agreement with the federal government in 2013 on damage to the water intake of Unit 4, a situation which has reduced SHPS’s output from 600MW to 450MW.