Economy
Lagos Seeks N100bn Yearly to Buy Paddy for Imota Rice Mill
By Modupe Gbadeyanka
The Lagos State government has said it would need about N100 billion annually to purchase paddy for the Imota Rice Mill in the Ikorodu area of the metropolis.
The Special Adviser to the Governor on Agriculture and Rice Mill Initiative, Mr Oluwarotimi Fashola, made this disclosure at an event held in Alausa, the state capital, recently.
He said this huge amount of money might not be taken from the government’s purse because of other items begging for attention, but the capital market would be a good avenue to source such funds.
According to him, this is why the state government has agreed to partner with the Lagos Commodities and Future Exchange (LCFE) and other key capital market operators to provide sustainable finance to the commodities ecosystem through the generation of tradable financial instruments.
“We are delighted with this partnership, and with this development, Lagos State has become the first sub-national that will have such an engagement with a commodities exchange.
“A lot has been said about the consumption of rice in Lagos, and I am sure everyone would have eaten rice at least once this week.
“Our per capita consumption of rice is the highest in Nigeria, and it is one of the highest in Africa. It is about 40 kilogram per person per year, and that is almost 50kg of rice per year, and if that is multiplied by our population of over 22 million, the demand for rice in Lagos will be better situated,” the aide to Governor Babajide Sanwo-Olu said.
Describing the Eko Rice as the best in Nigeria today, Mr Fashola said the Lagos rice mill in Imota has come to challenge the status quo about the quality of rice and that there was a need to ensure the ceaseless flow of raw material to make it function optimally.
“Imota mill will require over 200,000 tonnes of paddy annually. It is not cheap. In Nigeria, as of today, that is going into almost N100 billion, and N100 billion of taxpayers’ money being taken from the government will not be the easiest to do in any financial year but with the partnership with the commodities exchange, we can maintain the flow of paddy to the mill, the mill continues to run, we have a comparative advantage of having a good price, and at the same time, the finished rice becomes available in the market,” he noted.
In his remarks, the Managing Director of LCFE, Mr Akinsola Akeredolu-Ale, said, “At the commodities exchange, we understand the need to deepen the capital market and the commodities ecosystem concurrently.
“The capital market plays a critical role in providing sustainable finance to the ecosystem through the generation of tradeable financial instruments,” noting that the liquidity would be raised in batches, with N5 billion targeted for the first batch, N30 billion within six months, and the N100 billion annual target.
By Adedapo Adesanya
The Independent Petroleum Manufacturers Association of Nigeria (IPMAN) has advised Nigerians to begin to look into the direction of Compressed Natural Gas (CNG) as an alternative energy source to cushion the effect of subsidy removal.
The National President of IPMAN, Mr Chinedu Okorokwo, made this known in an interview with the News Agency of Nigeria (NAN) in Abuja on Wednesday, as the federal government continues its dialogue with the organised labour over the hike in the price of premium motor spirit (PMS), otherwise known as petrol.
On May 29, 2023, during his inaugural speech, President Bola Tinubu said the payment of subsidy for fuel had ended because there was no provision for it in the 2023 budget beyond June 30.
His announcement triggered the hoarding of fuel by marketers, and when the Nigerian National Petroleum Company (NNPC) Limited increased the price of the product across its retail outlets, prices of food, transportation and services went up, forcing the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) to threaten a nationwide strike, which was supposed to start today but was stopped by the National Industrial Court.
At a meeting on Monday night between the government and the labour unions, it was agreed that the adoption of CNG as an alternative fuel would be the best option, and it was agreed that the CNG conversion programme earlier planned in 2021 should be revived.
CNG, which is a gas mainly composed of methane and produces less emission, is the cleanest burning fuel operating today with less vehicle maintenance and longer engine life.
In the interview with NAN, Mr Okoronkwo said bringing CNG, which was cheaper than even firewood, as an alternative energy, would create relief for the government and its citizens.
“We have also discovered that bringing an alternative that is cheaper than even firewood which is CNG, will not only create relief for the government and its citizens but it is environmentally friendly.
“The CNG is abundantly available in Nigeria than anywhere in Africa.
“In the Niger Delta region, you see billions of tonnes of gas flare being wasted daily, these are huge amounts that should be accruing to our GDP, but we are wasting it because there is no market for it.
“So, we are asking the government to create the market. How do you create the market?
“What Egypt and India did was to give soft loans to be paid back within stipulated periods; from there, you can get vehicles to use gas instead of fuel,” he said.
“There’s a franchise for the bottling of CNG so that an average woman in the kitchen can use it,’’ he added, noting that the introduction of CNG would cushion the effect occasioned by the high price of fuel currently as a litre of CNG would not cost more than N130.
He advised that repairing the local refineries as well would reduce the impact of the removal as it would eliminate the cost of importation and exportation.
By Modupe Gbadeyanka
The National Bureau of Statistics (NBS) has disclosed that Nigeria’s tax to Gross Domestic Product (GDP) ratio has been upwardly reviewed to 10.86 per cent from the 6 per cent earlier reported to reflect better data sources and improved estimation using the Organisation for Economic Co-operation and Development (OECD) manual.
The OECD manual is an improvement over the System of National Accounts (SNA 2008) classification of taxes.
Although the System of National Accounts conceptual framework and its definitions of the various sectors of the economy are reflected in the OECD’s classification of taxes, the OECD classifications provide the maximum disaggregation of statistical data on what is generally regarded as taxes by tax administrations.
In a disclosure, the statistics office said the country’s total tax revenue compared with its GDP was at that level in 2021, higher than 8.40 per cent in 2020, which was impacted by the COVID-19 pandemic.
In the previous year, the ratio was 10.20 per cent, marginally lower than the 10.36 per cent recorded in 2018 but higher than the 9.02 per cent in 2017.
The NBS said the revised computation considered more comprehensive coverage of data at the federal, state, and local government levels and revenue items not previously included in the computations, particularly relevant revenue collected by other government agencies.
The review of the tax-to-GDP ratio was initiated by the Federal Inland Revenue Service, which collaborated with the Federal Ministry of Finance and the NBS for better measurement of the ratio.
The data used were sourced from the Office of the Accountant General of the Federation (OAGF), FIRS, NBS, the Nigeria Customs Service (NCS), the Joint Tax Board (JTB), and other relevant agencies of government that collect revenue.
By Adedapo Adesanya
VFD Group Plc has announced its intention to list its shares on the Nigerian Exchange Group (NGX) after leaving the NASD Over-the-Counter Securities Exchange, where it has been trading its stocks for the past three years.
This development, according to analysts, is a strategic move that would allow the company to gain access to public equity markets, increase its visibility, and strengthen its financial position.
VFD Group Plc is a leading proprietary investment company with a proven track record of generating attractive returns for its investors through a variety of investment strategies.
The company has a diverse portfolio of investments in various sectors, including banking, technology, media, energy, and real estate. The group has been listed on the NASD OTC Securities Exchange since 2020.
Speaking on this big step, Mr Nonso Okpala, Group Managing Director of VFD Group, stated, “We are excited to take this next step in the evolution of our company.”
“Listing on a major stock exchange will give us access to a larger pool of investors, enhance our profile, and provide superior returns to our investors,” he added.
With the intention of listing on the NGX, the company will delist from the NASD and is subject to regulatory approvals and market conditions.
VFD Group noted that it would provide additional updates as the listing process progresses.
At the close of business on Tuesday, the securities of the organisation closed on the NASD OTC exchange at N244.88 per unit, the same rate they finished in the preceding trading session.
Business Post reports that the NASD was created to provide an avenue for public companies to transition smoothly into the country’s main stock exchange.
However, it has witnessed the movement of firms from the NGX to the NASD, especially due to the very strict regulatory requirements by the former.
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