Economy
FG Projects 4.2% GDP Growth, 13% Inflation Rate in 2022
By Adedapo Adesanya
The federal government has projected a rise of 4.2 per cent in the country’s Gross Domestic Product (GDP) in 2022 and a decline in the inflation rate to 13 per cent.
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, gave these projections at the public consultation on the Draft 2022 to 2024 Medium Term Fiscal Framework and Fiscal Strategy Paper (MTFF/FSP) on Thursday.
Mrs Ahmed said the GDP projected in 2021, to close at three per cent, had been adjusted downwards to close at 2.5 per cent.
“In 2022, we are expecting an uptake to 4.2 per cent, then a dip to 2.3 per cent in 2023 and up to 3.3 per cent in 2024,” she said.
The Minister further said the nominal GDP projected for 2022 is N184.38 trillion, up from N168.6 trillion in 2021, and then to N201 trillion in 2023 and N222 trillion in 2024.
She also said the inflation rate is expected to drop slightly to 13 per cent in 2022 from 15 per cent in 2021, noting that the increase in inflation was due to the exchange rate.
“Inflation rate, which was planned for 11.95 per cent in 2021, has been reflected in reality because the exchange rate is high. The average we have so far is 15 per cent.
“We are expecting 2022 to go down slightly to 13 per cent, then 11 per cent in 2023 and 10 per cent in 2024,” Mrs Ahmed stated.
She, however, said the federal government has put the Nigerian Autonomous Foreign Exchange Rate Fixing (NAFEX) rate of N410.15 to one US dollar for 2022 to 2024.
“The exchange rate of the Naira to the dollar, which was N379 in the 2021 budget, has been adjusted to the NAFEX rate of N410.15 to one US dollar.
“We are assuming, for now, the same rate for 2022, 2023 and 2024,” the Minister added.
Furthermore, the Finance Minister took an overview of the federation and fiscal outcomes for the Federation and Value Added Tax (VAT) Pool Accounts Distributable for January to May.
She said the amount available for distribution from the Federation Account was N2.78 trillion.
“Of this amount, the federal government received N998.57 billion, while the states and local governments received N506.59 billion and N390.48 billion respectively from the main pool account.
“Federal, state and local governments received N132.70 billion, N442.33 billion and N309.63 billion respectively from the VAT pool account,” Mrs Ahmed disclosed.
Also, the Minister said the gross oil and gas revenue was projected at N5.19 trillion for January to May.
“As of May, N1.49 trillion was realised out of the prorated sum of N2.16 trillion. This represents 69 per cent performance.
“Oil and gas deductions were N194.31 billion (or 45.8 per cent) more than the budget.
“This is mainly attributable to petroleum subsidy costs which were not provided for in the 2021 budget.
“After netting out deductions (including 13 per cent derivation) net oil and gas revenue inflows to the Federation Account amounted to N872.16 billion,” she said.
The Minister noted that the inflow was N864.20 billion or 49.8 per cent less than the projection as of May.
Giving an update on the revenue performance of 2021 budget implementation for January to May, Mrs Ahmed said the federal government’s retained revenue was N1.84 trillion, 67 per cent of the pro-rata target.
She said the share of oil revenues was N289.61 billion, which represented 50 per cent performance, adding that non-oil tax revenues totalled N618.76 trillion, 99.7 per cent of pro-rata.
“Companies Income Tax (CIT) and VAT collections were ahead of the budget targets with N290.90 billion and N123.85 billion, representing 102 per cent and 125 per cent respectively of the pro-rata targets for the period.
“Customs collections was N204.0 billion (86 per cent of target),” she said, noting that other revenues amounted to N762.70 billion, of which independent revenues were N487.01 billion.
On the expenditure side, the Minister said N4.86 trillion, representing 92.7 per cent of the prorated budget had been spent, stating that, “This excludes GOEs’ and project-tied debt expenditures.”
She noted that out of the expenditure, N1.80 trillion was for debt service representing 37 per cent of the federal government’s expenditure and N1.50 trillion for personnel costs, including Pensions, representing 31 per cent of the federal government’s revenues.
The Minister further said that as of May, N973.13 billion had been released for capital expenditure.
By Modupe Gbadeyanka
The federal government, the 36 states of the federation and the 774 local government areas have received N1.727 trillion from the Federal Accounts Allocation Committee (FAAC) for December 2024.
The funds were disbursed to the three tiers of government from the revenue generated by the nation in November 2024.
At the December meeting of FAAC held in Abuja, it was stated that the amount distributed comprised distributable statutory revenue of N455.354 billion, distributable Value Added Tax (VAT) revenue of N585.700 billion, Electronic Money Transfer Levy (EMTL) revenue of N15.046 billion and Exchange Difference revenue of N671.392 billion.
According to a statement signed on Friday by the Director of Press and Public Relations for FAAC, Mr Bawa Mokwa, the money generated last month was about N3.143 trillion, with N103.307 billion used for cost of collection and N1.312 trillion for transfers, interventions and refunds.
It was disclosed that gross statutory revenue of N1.827 trillion was received compared with the N1.336 trillion recorded a month earlier.
The statement said gross revenue of N628.972 billion was available from VAT versus N668.291 billion in the preceding month.
The organisation stated that last month, oil and gas royalty and CET levies recorded significant increases, while excise duty, VAT, import duty, Petroleum Profit Tax (PPT), Companies Income Tax (CIT) and EMTL decreased considerably.
As for the sharing, FAAC disclosed that from the N1.727 trillion, the central government got N581.856 billion, the states received N549.792 billion, the councils took N402.553 billion, while the benefiting states got N193.291 billion as 13 per cent derivation revenue.
From the N585.700 billion VAT earnings, the national government got N87.855 billion, the states received N292.850 billion and the local councils were given N204.995 billion.
Also, from the N455.354 billion distributable statutory revenue, the federal government was given N175.690 billion, the states got N89.113 billion, the local governments had N68.702 billion, and the benefiting states received N121.849 billion as 13 per cent derivation revenue.
In addition, from the N15.046 billion EMTL revenue, FAAC shared N2.257 billion to the federal government, disbursed N7.523 billion to the states and transferred N5.266 billion to the local councils.
Further, from the N671.392 billion Exchange Difference earnings, it gave central government N316.054 billion, the states N160.306 billion, the local government areas N123.590 billion, and the oil-producing states N71.442 billion as 13 per cent derivation revenue.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.65 per cent gain on Friday, December 13, boosted by three equities admitted on the trading platform.
On the last trading session of the week, Okitipupa Plc appreciated by N2.70 to settle at N29.74 per share versus Thursday’s closing price of N27.04 per share, FrieslandCampina Wamco Nigeria Plc added N2.49 to end the session at N42.85 per unit compared with the previous day’s N40.36 per unit, and Afriland Properties Plc gained 50 Kobo to close at N16.30 per share, in contrast to the preceding session’s N15.80 per share.
Consequently, the market capitalisation added N6.89 billion to settle at N1.062 trillion compared with the preceding day’s N1.055 trillion and the NASD Unlisted Security Index (NSI) gained 19.66 points to wrap the session at 3,032.16 points compared with 3,012.50 points recorded in the previous session.
Yesterday, the volume of securities traded by investors increased by 171.6 per cent to 1.2 million units from the 447,905 units recorded a day earlier, but the value of shares traded by the market participants declined by 19.3 per cent to N2.4 million from the N3.02 million achieved a day earlier, and the number of deals went down by 14.3 per cent to 18 deals from 21 deals.
At the close of business, Geo-Fluids Plc was the most active stock by volume on a year-to-date basis with a turnover of 1.7 billion units worth N3.9 billion, followed by Okitipupa Plc with the sale of 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.3 million units sold for N5.3 million.
In the same vein, Aradel Holdings Plc remained the most active stock by value on a year-to-date basis with the sale of 108.7 million units for N89.2 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with a turnover of 297.3 million units worth N5.3 billion.
By Adedapo Adesanya
The Naira appreciated further against the United States Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by N1.50 or 0.09 per cent to close at N1,533.00/$1 on Friday, December 13 versus the N1,534.50/$1 it was transacted on Thursday.
The local currency has continued to benefit from the Electronic Foreign Exchange Matching System (EFEMS) introduced by the Central Bank of Nigeria (CBN) this month.
The implementation of the forex system comes with diverse implications for all segments of the financial markets that deal with FX, including the rebound in the value of the Naira across markets.
The system instantly reflects data on all FX transactions conducted in the interbank market and approved by the CBN.
Market analysts say the publication of real-time prices and buy-sell orders data from this system has lent support to the Naira in the official market and tackled speculation.
In the official market yesterday, the domestic currency improved its value against the Pound Sterling by N12.58 to wrap the session at N1,942.19/£1 compared with the previous day’s N1,954.77/£1 and against the Euro, it gained N2.44 to close at N1,612.85/€1 versus Thursday’s closing price of N1,610.41/€1.
At the black market, the Nigerian Naira appreciated against the greenback on Friday by N30 to sell for N1,650/$1 compared with the preceding session’s value of N1,680/$1.
Meanwhile, the cryptocurrency market was largely positive as investors banked on recent signals, including fresh support from US President-elect, Mr Donald Trump, as well as interest rate cuts by the European Central Bank (ECB).
Ripple (XRP) added 7.3 per cent to sell at $2.49, Binance Coin (BNB) rose by 3.5 per cent to $728.28, Cardano (ADA) expanded by 2.4 per cent to trade at $1.11, Litecoin (LTC) increased by 2.3 per cent to $122.56, Bitcoin (BTC) gained 1.9 per cent to settle at $101,766.17, Dogecoin (DOGE) jumped by 1.2 per cent to $0.4064, Solana (SOL) soared by 0.7 per cent to $226.15 and Ethereum (ETH) advanced by 0.6 per cent to $3,925.35, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
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