Economy

FG, States Shared N2.3tr in Q3 2018—NEITI

Published

6 years ago

19/11/2018

By Modupe Gbadeyanka

The latest edition of the NEITI Quarterly Review released by the Nigeria Extractive Industries Transparency Initiative (NEITI) has revealed that a total of N2.28 trillion was shared among the three tiers of government comprising federal, state and local governments in the third quarter of 2018.

The disbursements were made by the Federation Account Allocation Committee (FAAC), with the federal government receiving the highest sum of N904.8 billion, followed by states, which received N718.5 billion and local governments receiving the lowest disbursements of N432.1 billion.

“Total FAAC disbursements in the third quarter of 2018 amounted to N2.28 trillion representing a 17.6 percent increase over the N1.938 trillion disbursed in the first quarter of 2018 and 13.5 percent higher than the N2.008 trillion disbursed in the second quarter,” a statement issued by NEITI’s Director of Communications & Advocacy, Mr Orji Ogbonnaya Orji, disclosed.

“It is interesting that with the exception of July, the lowest amount disbursed so far in 2018 is higher than disbursements in all other months in 2016 and 2017,” the statement added.

A breakdown of the disbursed sums for 2016, 2017 & 2018 shows that the disbursements in the third quarter of 2018 (N2.28 trillion) were 31 percent and 18 percent higher than disbursements in the third quarters of the last two years.

NEITI also reports that the last time total disbursements exceeded the N2.5 trillion mark was in the second quarter of 2014 (N2.510 trillion).

Further analysis of the increases as reported by the NEITI Quarterly Review shows that the federal government’s receipt of N904.8 billion in the third quarter of 2018, was 11.3 percent and 7.8 percent higher than the amounts received in the first (N812.8 billion) and second (N839.5 billion) quarters of 2018 respectively.

“The amount disbursed to states represented an increase of 5.1 percent over the N683.5 billion disbursed in the first quarter, and an increase of 3.8 percent over the N692.1 billion disbursed in the second quarter.

For local governments, the amount received was 9.8 percent and 7.5 percent higher than the respective amounts of N393.4 billion and N402.1 billion received in the first and second quarters,” the NEITI Quarterly Review disclosed.

On a year-by-year analysis, NEITI reveals that the increase to third quarter disbursements to states in 2018 were the highest when compared to 2016 and 2017 figures disbursed to other federating units.

A breakdown of the figures showing the level of growth indicates that, “Total disbursements to states in the third quarter of 2018 came to N718.5 billion, representing a growth of 40.1 percent and 22.5 percent over disbursements in the third quarters of 2016 (N512.7 billion) and 2017 (N586.6 billion) respectively” NEITI observes.

The NEITI Quarterly Review continues, “For the LGCs, disbursements in 2018 Q3 totalled N432.1 billion. This figure was 33.2 percent higher than the N324.3 billion disbursed in 2016 Q3, and 18.7 percent higher than the N324.3 billion disbursed in 2017 Q3.

“Total disbursements to the FGN in the third quarters of 2016, 2017 and 2018 were respectively, N697.9 billion, N752.7 billion, and N904.8 billion indicating that in 2018 Q3, the FGN received 29.7 percent higher disbursements than 2016 Q3, and 20.2 percent higher disbursements than 2017 Q3.”

The review further disclosed that total net FAAC disbursements to states in the first nine months of 2018 ranged between N16.41 and N150.59 billion, with Osun and Delta states receiving the lowest and highest amounts respectively.

A comparison of the state-by-state net disbursement shows a stark disparity in the amounts received.

For instance, the net disbursement received by Delta State in January alone sums up to the total net disbursements to Osun State from January to September 2018.

This clearly indicates that disbursements to Delta State were higher than the one to Osun by over 800 percent.

The NEITI Quarterly Review also shows that average monthly net disbursements to states in the first nine months of 2018 ranged between N1.82 billion and N16.73 billion with Osun receiving the least monthly sum and Delta, the highest.

As observed in previous reviews, states that received the highest allocations of N100 billion and above are all in the Niger Delta region and this is on account of the 13 percent derivation.

Furthermore, a comparison of state-by-state debt deductions in the first nine months of 2018 revealed that Lagos State had the highest deduction of N26.84 billion while Yobe State had the lowest deduction of N1.12 billion (a percentage difference of 2,300 percent).

The state with the lowest ratio of deductions to net disbursements was Anambra with 2.85 percent, while Osun had the highest deduction to net disbursements ratio of 132.85 percent, signalling that deductions exceeded disbursements to Osun State.

The review however explained that the wide disparities in disbursements to states were as a result of differences in disbursements arising from the revenue sharing formula, deductions from states due to external debts, contractual obligations, among others.

The NEITI review advised that the increase in disbursements is a ground for cautious optimism in the fiscal positions of all tiers of government, noting that the upswings and downswings pattern is reflective of the volatile nature of revenue resulting from reliance on primary commodity exports The publication also observed that while increase in revenue will reflect positively on the fiscal situation of the federating units, states will still have to struggle to finance their budgets considering their poor Internally Generated Revenue (IGR).

“There is virtually none of the states that can adequately finance their budgets from IGR and FAAC disbursements. States will have to resort to different levels of borrowing”, the NEITI review noted.

The NEITI Quarterly Review, designed to provide timely information and data, is a tool to support citizens’ engagement, advocacy, constructive debate, information sharing and enlightenment in tracking the utilization of public funds for purposes of development.

NEITI’s interest in FAAC disbursements and the statutory recipients is in view of the fact that more than 50 percent of the funds are derived from the extractive industry. Net Disbursements and Total Deductions from States January to September 2018

Economy

NGX All-Share Index Jumps 0.17%

Published

15 hours ago

18/01/2025

Dipo Olowookere

By Dipo Olowookere

A 0.17 per cent growth was recorded by the Nigerian Exchange (NGX) Limited on Friday, extending the stay of the local bourse in the positive territory.

This uptrend was maintained despite profit-taking in the banking sector, which left its index down by 0.23 per cent at the close of trading activities.

Business Post reports that the insurance industry expanded by 4.04 per cent during the session, the energy counter improved by 1.05 per cent, and the consumer goods space gained 0.58 per cent, while the industrial goods sector closed flat.

Consequently, the All-Share Index (ASI) went up by 170.62 points to 102,353.68 points from 102,183.06 points and the market capitalisation grew by N541 billion to N62.851 trillion from N62.310 trillion.

There were 34 price gainers and 22 price losers yesterday, indicating a positive market breadth index and strong investor sentiment.

The trio of Caverton, Livestock Feeds and Sovereign Trust Insurance appreciated by 10.00 per cent each during the session to quote at N2.20, N5.94, and N1.10, respectively, as Neimeth jumped by 994 per cent to N3.43, and Royal Exchange increased by 9.88 per cent to 89 Kobo.

On its part, Academy Press lost 9.74 per cent to close at N3.15, PZ Cussons declined by 9.09 per cent to N25.00, DAAR Communications weakened by 8.64 per cent to 74 Kobo, Transcorp Power shed 5.91 per cent to settle at N46.95, and Dangote Sugar fell by 4.94 per cent to N38.50.

A total of 327.8 million shares valued at N11.8 billion were traded in 11,905 deals on Friday versus the 472.2 million shares worth N16.7 billion transacted in 12,336 deals on Thursday, representing a decline in the trading volume, value, and number of deals by 30.58 per cent, 29.34 per cent and 3.49 per cent apiece.

Access Holdings recorded the highest sales with 49.1 million stocks sold for N1.2 billion, Fidelity Bank exchanged 20.4 million shares valued at N359.0 million, UBA traded 20.1 million equities worth N681.0 million, Oando transacted 14.8 million shares for N998.1 million, and Universal Insurance traded 13.8 million stocks worth N8.7 million.

Economy

NASD OTC Exchange Gains 0.26%

Published

15 hours ago

18/01/2025

Adedapo Adesanya

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange extended its upward movement with a 0.26 per cent gain on Friday, January 17 amid renewed interest in unlisted stocks.

This raised the market capitalisation of the trading platform by N2.79 billion at the close of business to N1.075 trillion from the N1.072 trillion it closed in the preceding session.

In the same vein, the NASD Unlisted Security Index (NSI) went up by 8.08 points at the close of transactions to 3,111.91 points from the 3,103.83 points recorded at the previous session.

Yesterday, the volume of securities traded by investors went down by 606 per cent to 486,215 units from 1.2 million units, the value of shares shrank by 84.7 per cent to N2.8 million from N18.0 million, and the number of deals decreased by 65 per cent to 14 deals from the 33 deals carried out a day earlier.

In the final trading day of the week, there were three price gainers and one price loser, Geo-Fluids Plc, which lost 9 Kobo to finish at N4.70 per unit versus the preceding session’s price of N4.79 per unit.

On the flip side, Okitipupa Plc gained N3.60 to settle at N39.59 per share compared with the previous day’s N35.99 per share, Industrial and General Insurance (IGI) Plc added 3 Kobo to wrap at 36 Kobo per unit compared with the preceding session’s 33 Kobo per share, as FrieslandCampina Wamco Nigeria Plc improved its value by 49 Kobo to N39.65 per unit from N39.16 per unit.

At the close of business, FrieslandCampina Wamco Nigeria Plc remained the most active stock by value (year-to-date) with 3.4 million units worth N134.9 million, trailed by Geo-Fluids Plc with 8.9 million units valued at N43.0 million, and Afriland Properties Plc with 690,825 sold for N11.1 million.

The most active stock by volume (year-to-date) remained IGI Plc with 23.5 million units worth N5.3 million, followed by Geo-Fluids Plc with 8.9 million units valued at N43.0 million, and FrieslandCampina Wamco Nigeria Plc with 3.4 million units sold for N134.9 million.

Economy

Naira Rallies by 0.06% to N,1547/$1 at NAFEM

Published

15 hours ago

18/01/2025

Adedapo Adesanya

By Adedapo Adesanya

The Naira extended its appreciation against the US Dollar by 0.06 per cent or N89 Kobo on the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Friday, January 17, trading at N1,547.58/$1 compared with the previous day’s value of N1,548.47/$1.

Market analysts expect that the Naira will appreciate in the first quarter of the year, backed by continued policy support by the Central Bank of Nigeria (CBN).

Vestance Nigeria, an agribusiness advisory firm, projects that the exchange rate will trade between N1,650/$1 and N1,750/$1 this year in its Resilience and Recovery for Agribusiness in 2025 outlook report.

“The Central Bank of Nigeria (CBN) will continue implementing reforms to enhance exchange rate market transparency while maintaining higher interest rates to curb inflationary pressures and attract foreign portfolio management,” it said.

Also, the Nigerian currency improved its value against the Pound Sterling by N20.84 to wrap the session at N1,883.59/£1 versus the preceding day’s N1,904.43/£1 and against the Euro, the Nigerian currency gained N10.45 to settle at N1,590.34/€1, in contrast to Thursday’s closing price of N1,600.79/€1.

In the parallel market, the domestic currency appreciated against the greenback by N5 yesterday to sell for N1,675/$1 compared with the N1,675/$1 it was traded a day earlier.

As for the cryptocurrency market, there was profit-taking amid excitement for a new era of crypto-friendly US government mounts ahead of Donald Trump’s inauguration next week.

Crypto investors expect a change from Mr Trump who promised on the campaign trail to position the US as a leader in the crypto space including creating a national stockpile of Bitcoin, in stark contrast to past years’ regulatory crackdowns and enforcements.

Litecoin (LTC) fell by 9.9 per cent to trade at $124.56, Ripple (XRP) slumped by 6.2 per cent to $3.10, Cardano (ADA) dipped by 4.9 per cent to $1.06, Ethereum (ETH) dropped 3.1 per cent to finish at $3,270.61, Binance Coin (BNB) went down by 2.3 per cent to $698.57 and Dogecoin (DOGE) depreciated by 2.2 per cent to $0.3927.

However, Solana (SOL) rose by 8.8 per cent to end at $235.12, Bitcoin (BTC) expanded by 0.8 per cent to $102,494.03, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) sold flat at $1.00 each.