Connect with us


FG, Agro Dealers Quarrel over N66b Debt



FG, Agro Dealers Quarrel over N66b Debt

FG, Agro Dealers Quarrel over N66b Debt

There is a misunderstanding between the Federal Government and agro dealers and suppliers that participated in the Growth Enhancement Scheme (GES).

This is because the Ministry of Agriculture claimed it has paid over N20 billion of the N66 billion debt to the agro dealers and suppliers.

However, the Nigeria Renascent Group, representing the agro dealers, disagreed with the government, saying it has refused to pay what is owed the suppliers and agro dealers, resulting in progressive collapse of their businesses and death of some participants of the GES Programme.

Speaking with Sunday Telegraph in a telephone interview, the Director of Agribusiness, Ministry of Agriculture and Rural Development, Engineer Ohiari Badmus Jatto, said that all the documents and information relating to the non-payment of the outstanding debt owed to the agro dealers have been made available to the Federal Ministry of Finance, and they have made part payment to the suppliers. He also added that there are plans to settle the balance soon.

The debt was accumulated through GES programme, as part of the Agricultural Transformation Agenda, which encouraged firms to supply fertilizers and seeds to agro dealers for delivery to farmers.

Coordinator of Nigeria Renascent Group, Mr Abdulrasaq Lawal, some participants in the scheme have lost their lives due to the non-payment of their money by the Federal Government, even as many can no longer pay their children’s school fees.

“Participants are dying by the day. Instances will be given. Musa Baba, the Managing Director/Chief Executive Officer of Diamond Fertilizer based in Kano, died in December 2016 from complications not unrelated to his inability to meet his obligation to creditors,” he claimed.

Preliminary investigation revealed that the federal government is owing his company over N1 billion. “Also the story of Gali Gali in Kaduna is not different from that of Musa Baba. ‘Gali Gali’ as he is fondly referred to by all, was a well-known force in the fertilizer market. His company, Gali Global, was at the forefront in championing the GES cause; he took it personal as a way to get his people to enjoy direct interventions from government.

“He went all out to mobilize farmers to register. His personal input and resources were put in ensuring the GES was a success.

“The result, over N1 billion, the chunk of which is a bank loan, is trapped. He died in the late 2015 of heart and blood related issues,” he said.

He urged the Federal Government to pay the debt to the participants in order to bring an end to the death of participants of the GES programme and ensure that all hands will be on deck in ensuring that there is food for all and eradicate famine in the country, which according to him, is imminent with the present situation of things.

Also speaking recently, a participant who pleaded anonymity, said that he has closed his company because banks were after him, adding that he is hiding in shame because he cannot face the people who had assisted him financially to make supplies to the Ministry of Agriculture.

On the claim by the Ministry that it has made part payment to the suppliers, he urged the Ministry to desist from playing politics with the debt owed agro dealers in the country.

He lamented that the Minister of Agriculture and Rural Development, Mr Audu Ogbeh, has been silent over the debt, saying that this is the worst situation they have ever experienced with any government in the country.

He urged the Minister to make public who got the purported N20 billion part payment from the N66 billion accumulated debt.

He further urged the Presidency, senators and House of Representatives members to intervene in the situation, adding that some of them collected loan from banks when the United States American dollars was lower than what is obtainable now.

“That is another challenge we will face in repaying the loan to the banks whenever the Federal Government decides to settle the debt,” he said.

Director of a Non-governmental organisation, Agricultural Development Watch Initiative, Dr Mark Adebisi, lamented that a situation where people will make financial commitment to support a government project and they are then treated as if they are no longer important is a bad omen.

He lamented that efforts by the group to get the Chairman, Senate Committee on Agriculture, Mr Abdullahi Adamu; Minister of Finance, Mrs Kemi Adeosun and Minister of State for Agriculture and Rural Development, Mr Heineken Lokpobiri, to assist them ensure that the suppliers are paid their money did not bear fruit.

A highly placed official of the Agriculture and Rural Development Ministry, who spoke with Sunday Telegraph on condition of anonymity, said there are a lot about the debts which Nigerians don’t know about.

According to him, the debt was not N66 billion but N47 billion. He added that the agro dealers over inflated the money owed them by the Ministry, thinking that it would be easy for them to get the money from government.

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

Click to comment

Leave a Reply


SEC to Step up Investor Education



investor education

By Aduragbemi Omiyale

The Head of the Office of the Chief Economist of the Securities and Exchange Commission (SEC), Mr Okey Umeano, disclosed that the commission would intensify its commitment to continue educating and enlightening investors to ensure they make informed investment decisions.

In an interview in Abuja, Mr Umeano stated that the recent upsurge in the activities of illegal fund managers has been a source of worry to the agency and assured investors that the SEC was working hard along with other government officials agencies to reduce their activities to the barest minimum.

“This is an area that we are doing a lot and still have a lot to do. If you look at the Capital Market Master Plan, you will see that a lot of the things we want to do revolves around investor education. In investor education, we tell investors how to know who is genuine, and it is very simple.

“Just go to the; on the search portal, you can type CMO. The search portal comes out, and you type the name of the firm marketing to you; if it is not there, then it is not registered with SEC, which means you are not protected. You are not covered by that investor protection that I am talking about. Those who are marketing financial products, investment-related financial products must come to SEC and be registered,” he stated.

Mr Umeano disclosed that in an effort to protect investors further, the commission has been carrying out enforcement exercises against these illegal fund managers and would continue to do so.

“We have been going around closing Ponzi schemes and all those illegal fund managers, and you know we have been on different stations. I personally have been on several TV stations, radios, and newspapers talking about this. We are about to launch a few billboards around the country saying these same things. Nigerians must understand that the money that they are giving people it is difficult to get.

“It is difficult to raise capital, and before you give it to someone, it is important to know that person is the right person. This they can easily ascertain by going on our website. That is the message,” he said.

He stated that SEC has a police Unit that assists in investigating these entities and carrying out enforcement actions when the need arises while also collaborating with relevant government agencies like the Nigeria Financial Intelligence Unit and the Economic and Financial Crimes Commission.

“The problem with Ponzi schemes is they use the money from Mr A to pay Mr B and use Mr B’s own to pay Mr C, and while they are paying all that, they are taking their own, so by the time we close them, there’s not enough money again to return to the people whose money they took. You also know they promise outrageous returns, and these returns are paid to the first people.

“We have a few now that we are trying to resolve, but I must tell you that it is difficult for anyone who has put money in a Ponzi scheme to recover much. Nigerians must understand this. If anyone promises you a return too good to be true, then it is probably not true,” he said.

Mr Umeano, therefore, urged Nigerians to be vigilant and carry out their due diligence by visiting the commission’s website to ascertain the registration status of the entities before investing, adding that there is also a need for them to understand the products they are investing in to obtain desired returns on their investments.

Continue Reading


Dangote Cement N50bn Commercial Paper Sales Close



Dangote Cement commercial paper sales

By Dipo Olowookere

The N50 billion commercial paper sales of Dangote Cement Plc are closing today, Thursday, February 2, 2023.

The exercise commenced on Monday, January 30, 2023, under its N150 billion commercial paper issuance programme.

According to details of the commercial paper sales, the cement firm is issuing the debt instruments in two maturities, with the Series 4 at a 183-day tenor and the Series 5 at a 267-day tenor.

Dangote Cement is offering the 183-day paper at a discount rate of 12.21 per cent with an implied yield of 13.00 per cent, while the 267-day paper is offered at a discount rate of 12.70 per cent with an implied yield of 14.00 per cent.

The publicly-quoted company is raising this money to fund its working capital requirements and for general corporate purposes.

Dangote Cement is a leading player in the cement industry in Nigeria, controlling more than half of the market share despite competing with big boys like Lafarge Africa, BUA Cement and others.

The firm has a combined capacity of 51.55Mta (35.25Mta in Nigeria) across its operations in 10 African countries. It operates a fully integrated “quarry-to-customer” business with activities covering manufacturing, sales and distribution of cement.

Through its investments, the organisation eliminated Nigeria’s dependence on imported cement and transformed the nation into an exporter of cement, serving neighbouring countries.

Dangote Cement has relied on debts, especially from the capital market, to carry out its operations, especially as funds from commercial banks come with higher interest rates.

Continue Reading


Moody’s Downgrades Seplat Energy



Seplat Energy

By Dipo Olowookere

The ratings of Seplat Energy Plc and Dangote Cement Plc have been downgraded by Moody’s Investors Service to Caa1 from B3.

In a statement on Wednesday, the rating agency said the action followed the “downgrade of Nigeria’s long-term issuer rating to Caa1 from B3.”

While Moody’s noted that the two firms, listed on the Nigerian Exchange (NGX) Limited, “have relatively prudent financial policies, adequate liquidity, moderate to low leverage and strong business profiles, generally supported by market-leading positions,” their operating environment poses risks which could affect their operations.

According to the statement, Dangote Cement’s high proportion of dollar debt in the capital structure exposes the company to currency convertibility risk.

“While Dangote continues to grow its dollar revenue through exports and repatriations of dollar cash flow from its other African operations, it is still reliant on the Central Bank of Nigeria for dollars, which remains restricted.

“The company’s liquidity profile is adequate but is exposed to ongoing refinancing risks because of the large portion of short-term debt equal to N383 billion, representing 55 per cent of total Moody’s adjusted debt as of 30 September 2022.

“Dangote Cement benefits from strong cash flow generation with cash balances of N217 billion as of 30 September 2022,” Moody’s said.

However, the rating company noted that Seplat is less exposed to convertibility risk, given most of its revenue is paid in dollars.

It was stressed that the export dollar oil revenue of the energy firm is required to be repatriated back into Nigeria within 90 days of receipt, after which Seplat can transfer these US dollars funds back into offshore bank accounts.

“To date, Seplat has had no restrictions imposed by the Central Bank of Nigeria and the company targets to have 70 per cent of total cash balances in USD and 70 per cent of that in offshore accounts.

“Seplat’s $650 million senior unsecured notes are due in 2026, and the company has a good liquidity profile supported by $305 million of cash on the balance sheet and full access to the $350 million undrawn revolving credit facility as of September 2022,” it stated, adding that their ratings are only “constrained by the foreign currency country ceiling.”

Continue Reading
%d bloggers like this: