06 Oct

Daily Watch – Buhari proposes ₦6.9 trillion for Budget 2017, Erisco threatens to quit Nigeria

  • President Buhari has proposed ₦6.866 trillion for the 2017 fiscal year, pegging the Exchange Rate at ₦290 to $1, a 13.3 percent increase on the 2016 spending plan. In its bid to sustain its development projects, the FG also announced plans to set up a $25 billion Infrastructural Development Fund as a means of attracting non-budgetary resources. This is as the country’s debt stock hits ₦16.3 trillion ($61.45 billion) as of June 30. In adherence to the 3 percent threshold set out in the Fiscal Responsibility Act 2007, the 2017 fiscal deficit is projected at ₦2.7 trillion in nominal terms. This was contained in the 2017 to 2019 Medium Term Expenditure Framework and Fiscal Strategy Paper, sent to the National Assembly for approval. The government has projected $42.5 per barrel and 2.2 million barrels per day as crude production baselines, despite the volatility in global oil prices, as well as $45 bpd and $50 bpd respectively for 2018 and 2019 with oil production benchmark of 2.3 million and 2.4 million barrels per day for the same period.
  • Cross River governor, Ben Ayade has approved the release of ₦247 million in grants to 100 farmers trained under the World Bank supported Commercial Agriculture Development Project. According to the project coordinator, Ducham Amah, “each beneficiary gets between ₦2.4 million and ₦2.5 million and as I speak, all of them have received an alert of this money as paid into their account.” Amah said the money would be released to the farmers in tranches, adding that the government had also approved ₦85 million to train a further 600 people in Songhai demonstration farm. Amah said that the state would receive up to $26.34 million under the commercial agriculture programme.
  • Erisco Foods, a Nigerian tomato paste manufacturer, has said it may be forced to shut down production in the country due to its inability to access forex from the CBN for machinery procurement. The company’s CEO, Eric Umeofia said it would lay off 1,500 employees and quit Nigeria for a more favourable country if things do not change. This comes as some staffers held a protest over the retrenchment plans. Umeofia said, “It is difficult for indigenous manufacturers to access forex despite CBN’s promise to manufacturers that they will allocate 60 per cent of foreign exchange to them. It is unbelievable that for over two months, no forex has been allocated to Erisco Foods whereas the same forex is allocated daily for the importation of finished goods. “We will lay off 1,500 of our employees in the factory, replicate our $150m investment in another country and from there import tomato paste to Nigeria.” Erisco Foods produces about 450,000 metric tonnes of tomato paste annually for 22 brands and employs over 2,000 workers.
  • Air Business Express (ABX World), a Nigerian agro-allied solutions provider, has joined the Global Good Agricultural Practice, which sets worldwide standards for safe and sustainable agriculture, becoming the only Nigerian company to join the global body. Global G.A.P. members create private sector incentives for agricultural producers worldwide to adopt safe and sustainable practices to make the world a better place to live in for the global community. It connects farmers and brand owners, like notable supermarkets in Europe and North America, in the production and marketing of safe food to provide reassurance for consumers. Global G.A.P CEO, Kristian Moeller in a letter to the company said ABX World has become part of producers and suppliers members who “demonstrate their commitment to fully comply with the Global G.A.P. The company’s MD/CEO, John Okakpu expressed delight over the Global G.A.P membership status, adding that the feat would help place Nigeria on the global agricultural export map.
  • Hilton Worldwide says it has signed an agreement with a Nigerian company, Quality Inspection & Testing Services to open a 350-room hotel and suites around the Lagos Murtala Muhammed International Airport. This announcement was made at the African Hotel Investment Forum (AHIF 2016) in Kigali, Rwanda. This hotel, set to open in 2023, is part of Hilton’s Africa expansion plan which will see new hotels in Accra, Nairobi, Windhoek and the first Hilton in the DR Congo. “Strong growth is forecast for both domestic and international travellers using Murtala Muhammed International Airport, so this exemplary new hotel will be well placed to meet traveller’s needs,” said Patrick Fitzgibbon, Senior Vice-President, Development, EMEA, Hilton Worldwide. “The signing of the agreement to open Hilton Lagos Airport is a testament to a period of exciting growth and development for Lagos,” said Sam Iwuajoku, Chairman, and CEO of QUITS. This agreement is an extension to the recently signed Legend Curio at Lagos Airport, which is set to open in Q1 2017.