Economy
FAAC Allocation to FG, States, LGs in March Shrinks to N722.7bn
By Aduragbemi Omiyale
The amount shared to the three tiers of government, the federal government, state governments, and local governments, by the Federation Account Allocation Committee (FAAC), decreased in March 2023 from the money distributed in February.
A communique issued on Wednesday after the FAAC meeting in Abuja disclosed that N722.7 billion was disbursed from the revenue generated by the country last month compared with the N750.2 billion shared in February.
A breakdown showed that the total distributable revenue of N722.677 billion comprised distributable statutory revenue of N366.800 billion, distributable Value Added Tax (VAT) revenue of N224.232 billion, Electronic Money Transfer Levy (EMTL) of N11.645 billion and N120.000 billion Augmentation from Forex Equalisation Account.
In the disclosure signed by the Director of Press and Public Relations of the Office of the Account-General of the Federation (OAGF), Mr Bawa Mokwa, it was disclosed that in February, Petroleum Profit Tax (PPT), Companies Income Tax (CIT), Oil and Gas Royalties, Import and Excise Duties all decreased significantly while Value Added Tax (VAT) and Electronic Money Transfer Levy (EMTL) decreased marginally.
Explaining how the money was disbursed, FAAC said from the N722.677 billion, the federal government received N269.063 billion, the state governments got N236.464 billion, and the local councils were given N173.936 billion, while N43.214 billion was shared to the oil-producing states as 13 per cent derivation revenue.
Further, from the N366.800 billion distributable statutory revenue, the federal government received N178.683 billion, the state governments received N90.630 billion, and the local government councils received N69.872 billion, with relevant states getting N27.614 billion as 13 per cent derivation revenue.
In addition, from the distributable N224.232 billion from VAT, the federal government received N33.635 billion, the state governments received N112.116 billion, and the local councils received N78.481 billion.
The statement also said N11.645 billion Electronic Money Transfer Levy (EMTL) was distributed as follows: the Federal Government received N1.747 billion, the State Governments received N5.822 billion, and the Local Government Councils received N4.076 billion.
From the N120.000 billion Augmentation, the Federal Government received N54.998 billion, the State Governments received N27.896 billion, the Local Government Councils received N21.506 billion, and a total sum of N15.600 billion was shared to the relevant States as 13 per cent of mineral revenue.
In February 2023, the total deductions for the cost of the collection were N27.449 billion, and total deductions for transfers, savings, recoveries and refunds were N109.909 billion, while the balance in the Excess Crude Account (ECA) was $473,754.57, the same amount it had remained since December 2022.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange rose by 0.40 per cent on Monday, July 13, buoyed by buying interest in 11 Plc, Central Securities Clearing System (CSCS) Plc and UBN Property Plc, which offset the profit-taking in Food Concepts Plc, the parent company of Chicken Republic.
11 Plc gained N20.69 to end at N227.64 per share compared with last Friday’s price of N206.95 per share, CSCS Plc grew by N1.83 to N91.48 per unit from N89.65 per unit, and UBN Property Plc added 1 Kobo to sell at N1.81 per share versus N1.80 per share.
On the flip side, Food Concepts Plc depreciated by 24 Kobo to close at N2.45 per unit, in contrast to the preceding session’s N2.69 per unit.
As a result, the market capitalisation increased by N9.2 billion to N2.587 trillion from N2.578 trillion, and the NASD Security Index (NSI) improved by 15.33 points to 4,311.67 points from 4,296.34 points.
Yesterday, the volume of securities traded by investors surged by 615.9 per cent to 9.1 million units from the previous 1.3 million units, and the value of securities rose by 997.1 per cent to N320.4 million from the preceding session’s N29.2 million, while the number of deals decreased by 12.5 per cent to 28 deals from last Friday’s 32 deals.
At the close of trades, Great Nigeria Insurance (GNI) Plc remained the most active stock by value on a year-to-date basis, with 3.4 billion units valued at N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units worth N6.5 billion, and CSCS Plc with 73.9 million units exchanged for N5.2 billion.
GNI Plc also closed the session as the most traded stock by volume on a year-to-date basis, with 3.4 billion units sold for N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.
By Adedapo Adesanya
The Naira maintained stability against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Monday, July 13, at N1,379.65/$1.
However, it appreciated against the Pound Sterling in the official market by N2.44 to exchange at N1,848.18/£1 compared with the previous rate of N1,850.62/£1, and lost 73 Kobo against the Euro to sell at N1,576.39/€1 versus last Friday’s N1,575.66/€1.
At the GTBank fore counter, the Naira declined by N2 to settle at N1,388/$1, in contrast to the previous session’s rate of N1,386/$1, and at the black market, it traded flat at N1,400/$1.
Market analysts expect the Naira to trade within a relatively stable range, supported by sustained FX inflows and a continued market intervention by the Central Bank of Nigeria (CBN), although persistent underlying FX demand is likely to keep depreciation pressures elevated.
According to Monday’s trading data, interbank FX turnover surged by 21.14 per cent to $86.136 million from $71.044 million at the previous trading session on Friday.
However, interbank deal counts declined to 85 from 87 on Monday, reflecting the absence of pressure from US Dollar payments against local units. Last week, total foreign exchange inflows amounted to $0.97 billion, according to a Coronation Merchant Bank research report.
Analysts reported that foreign portfolio investors (FPIs) remained the largest source of inflows, contributing 30.29% or $0.29 billion, closely followed by Exporters and Importers at 30.14 per cent.
Non-bank corporates accounted for 26.49 per cent or $0.26 billion, while the CBN contributed 6.93 per cent or $0.07 billion. Other sources made up the remaining 5.4 per cent of total inflows.
In the cryptocurrency market, major coins came under pressure following heightened expectations for a Federal Reserve interest-rate increase as soon as July, just ahead of key US inflation data and congressional testimony from Chairman Kevin Warsh came into focus.
Bitcoin (BTC) fell by 0.2 per cent to $62,627.03, Solana (SOL) dipped by 1.5 per cent to $75.18, TRON (TRX) depreciated by 0.2 per cent to $0.3248, Ripple (XRP) slumped by 0.6 per cent to $1.06, and Cardano (ADA) lost 0.6 per cent to close at $0.1589.
On the flip side, Ethereum (ETH) appreciated by 0.5 per cent to $1,784.26, Dogecoin (DOGE) grew by 0.2 per cent to $0.073, and Binance Coin (BNB) jumped by 0.2 per cent to $569.23, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 apiece.
By Adedapo Adesanya
Brent jumped to $83 per barrel on Monday after the United States announced a fresh blockade that reignited concerns over energy shipments through the Strait of Hormuz.
The international crude benchmark soared by $7.29 or 9.59 per cent to $83.30 per barrel, while the US West Texas Intermediate (WTI) crude gained $6.73 or 9.42 per cent to trade at $78.14 a barrel.
US President Donald Trump announced that he would reinstate a blockade on Iran, forcing traders to once again price in the risk of prolonged disruption to energy flows through the Strait of Hormuz. The blockade, due to begin on Tuesday, will cover Iran’s entire coastline, ports and oil terminals, as well as all vessels regardless of flag.
The US President also said vessels receiving protection while transiting Hormuz would reimburse the country through a 20 per cent charge on cargoes, Reuters reported.
President Trump’s idea would mean that a 20 per cent fee on a supertanker that carries about 2 million barrels of crude at $80 per barrel would be equivalent to around $32 million, or an additional cost of $16 per barrel.
“This is significantly higher than the $1/bbl toll for which Iran has been pushing,” ING’s strategists said.
The proposal was also criticised by the International Maritime Organisation (IMO) because international law does not provide for mandatory transit fees through straits used for international navigation. Energy companies have also rejected similar proposals previously advanced by Tehran, arguing that freedom of navigation remains a cornerstone of global maritime trade.
Iran’s top joint military command had earlier said it would not allow the US to intervene in the management of the strait, and any attempt by the US to transit without its authorisation would be confronted.
Analysts now expect countries to work on ways to permanently bypass the Strait of Hormuz. Goldman Sachs estimated that expanding pipeline capacity in the Middle East could shield more than 60 per cent of pre-war Gulf oil exports from any future Hormuz disruptions by the end of 2028.
The bank’s base-case forecast assumes pipeline capacity bypassing Hormuz will rise by 3.8 million barrels per day by end-2027 and 7.3 million barrels per day cumulatively by end-2028, taking total effective bypass capacity to more than 14 million barrels per day by end-2028.
The Organisation of the Petroleum Exporting Countries (OPEC) has trimmed its 2026 global oil demand growth forecast for the third straight month, even as crude production rebounds across the Gulf and tanker traffic slowly returns to the Strait of Hormuz.
In its monthly oil market report released Monday, OPEC lowered expected oil demand growth this year to 780,000 barrels per day, down another 190,000 barrels per day from last month’s forecast. The producer group still expects stronger consumption than many other forecasters, including the International Energy Agency, and even raised its demand growth estimate for 2027 by 210,000 barrels per day to 1.94 million barrels per day.
