Economy
Paris Club Debt: States Warn FG Against Deduction
By Adedapo Adesanya
The 36 states of the federation have written to the federal government, warning it not to tamper with funds accruing to them and the 774 local government councils under the guise of satisfying an alleged $418 million London/Paris Club Loan refund-related judgment debts.
According to Channels Television, the states in a letter dated April 4 said they were not parties to any suit on the refund on the Paris Club debt and as such were not liable to any person or entity in any judgment debt being relied on by the central government.
Speaking through the Body of Attorneys-General of the Federation, the states warned further that should the national government proceed to make any such deduction, it would be acting illegally and in contempt of their appeal challenging the judgment.
The notice is part of their response to a November 11, 2021, letter from the Minister of Finance, Budget, and National Planning, Mrs Zainab Ahmed, advertising the commencement of the deduction for the liquidation of the alleged judgment debts.
The reply of the states was signed by the Body of Attorneys-General of the Federation Interim Chairman, Mr Moyosore Onigbanjo (SAN) of Lagos State and the Interim Secretary, Mr Abdulkarim Abubakar Kana of Nasarawa State as well as the Attorneys-Generals of Rivers, Abia, Taraba, Benue, and Zamfara states, for and on behalf of all the state Attorneys-General.
“Their excellencies have drawn our attention to your letter referenced above, which the various states of the federation received at about the end of March 2022.
“The letter notifies the States of your intention to commence deduction from allocations due to the states from the federation account for the liquidation of the London/Paris Club Loan refund-related judgment debts on behalf of the 36 states of the federation and the 774 local government councils.
“Please note that the states of the federation were not parties to any contract or suits concerning the London/Paris Club refund, from which the said judgment debts arose.
“Consequently, the 36 states of the federation are not liable to any person or entity in any judgment debt,” the letter said.
It noted that the deduction of the allocations due to the 36 states of the federation from the federation account to liquidate the London/Paris Club Loan refund-related judgment debts is the subject of an appeal filed by the 36 states at the Court of Appeal, Abuja.
It explained that: “The appeal challenges the Federal High Court’s (per Honourable Justice Inyang Ekwo) judgment delivered on 25th March 2022 between A.G Abia State v. President, Federal Republic of Nigeria & 42 Ors. and, therefore, the issue is sub judice.”
In addition, it noted that the states have also filed a Motion on Notice for an Order of Injunction pending appeal.
The letter added that the body’s legal representatives had published a public caveat in national dailies notifying the public of the pending appeal, which also advised concerned parties “to desist from dealing with the subject matter thereof pending the hearing and determination of the Appeal and the application for Injunction pending appeal”.
It said that given the above, “The law requires you to restrain from taking any step whatsoever that is capable of interfering with the rest of the suit, which is now a subject of an appeal.
“Accordingly, Nigerian case law enjoins you to refrain from effecting any deduction whatsoever from the allocations due to the 36 States from the Federation Account for the liquidation of the London/Paris Club Loan refund-related judgment debts purportedly on behalf of the 36 States of the Federation and the 774 local government councils, pending the hearing and determination of the appeal by the states of the federation. Doing otherwise in the face of the pending Appeal and Motion on Notice for Injunction pending appeal shall be at your peril.”
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange weakened by 0.22 per cent on Tuesday, April 28, with the market capitalisation down by N4.8 billion to N2.420 trillion from N2.425 trillion, and the NASD Unlisted Security Index (NSI) down by 9.01 points to 4,044.96 points from 4,053.97 points.
During the session, the price of Central Securities Clearing System (CSCS) Plc went down by N1.82 to N767.05 per share from N78.87 per share, while FrieslandCampina Wamco Nigeria Plc appreciated by N1.90 to N100.00 per unit from N98.10 per unit.
According to data, the value of trades increased by 265.7 per cent to N27.1 million from N7.4 million units, and the volume of transactions surged by 305.2 per cent to 1.3 million units from 319,831 units, while the number of deals decreased by 6.9 per cent to 27 deals from 29 deals.
Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date basis, with the sale of 3.4 billion units valued at N8.4 billion, followed by CSCS Plc with 59.8 million units exchanged for N4.0 billion, and Okitipupa Plc with 27.8 million units traded for N1.9 billion.
GNI Plc also finished as the most traded stock by volume on a year-to-date basis, with a turnover of 3.4 billion units worth N8.4 billion, trailed by Resourcery Plc with 1.1 billion units transacted for N415.7 million, and Infrastructure Guarantee Credit Plc with 400 million units sold for N1.2 billion.
By Adedapo Adesanya
Pressure is beginning to mount on the Nigerian Naira in the different segments of the foreign exchange (FX) market despite an oil windfall triggered by the Middle East crisis.
On Monday, April 27, the domestic currency further weakened against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) by N16.47 or 1.2 per cent to N1,380.71/$1 from the previous day’s N1,364.24/$1.
It was not different against the Pound Sterling in the same market window, as it lost N16.04 to trade at N1,863.76/£1 versus Monday’s closing rate of N1,847.72/£1, and against the Euro, it slipped by N12.72 to close at N1,615.01/€1 versus N1,602.29/€1.
The Naira also depreciated against the Dollar at the black market yesterday by N5 to quote at N1,390/$1 compared with the previous price of N1,385, and at the GTBank forex counter, it further crashed by N9 to settle at N1,379/$1 compared with the preceding session’s N1,370/$1.
The continued decline of the Naira comes as traders increasingly seek other safe-haven currencies amid continued global disruptions.
The benefit awash in the global market is making foreign portfolio investors stay short in Nigerian markets. Despite this, the daily FX publication released showed that interbank turnover rose to $98.829 million across 78 deals, up from $76.65 million.
Meanwhile, the cryptocurrency market remained cautious, with Bitcoin (BTC) trading at $77,216.66 despite surging oil prices and geopolitical tensions over a potential extended US naval blockade of the Strait of Hormuz.
Analysts say the supply overhang has finally dried up, and the sellers who were spooked by macro shifts or quantum fears have already exited, leaving the market much thinner on the sell-side.
Investors will await decisions made by central banks this week. The US Federal Reserve will announce its rate decision later on Wednesday, while the European Central Bank (ECB) follows on Thursday.
Ethereum (ETH) gained 1.5 per cent to trade at $2,324.59, Dogecoin (DOGE) chalked up 1.4 per cent to sell for $0.1016, Solana (SOL) appreciated by 0.6 per cent to $84.85, Cardano (ADA) grew by 0.5 per cent to $0.2483, and Binance Coin (BNB) advanced by 0.2 per cent to $627.15.
However, TRON (TRX) depreciated by 0.6 per cent to $0.3224, and Ripple (XRP) lost 0.03 per cent to sell at $1.39, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) were unchanged at $1.00 each.
By Adedapo Adesanya
Oil was up by nearly 3 per cent on Tuesday as persistent worries about supply constraints from the closed Strait of Hormuz continued, with Brent futures for June rising by $3.03 or 2.8 per cent to $111.26 a barrel, and the US West Texas Intermediate (WTI) crude futures growing by $3.56 or 3.7 per cent to $99.93 a barrel.
An earlier round of negotiations between the United States and Iran collapsed last week after face-to-face talks failed.
Ship-tracking data showed significant disruptions in the region, with six Iranian oil tankers forced to turn back due to the US blockade, but some traffic is still moving.
Prices trimmed some of the advances after the United Arab Emirates (UAE), the fourth-largest producer in the Organisation of the Petroleum Exporting Countries (OPEC), said on Tuesday it would exit the group on this Friday, May 1, 2026.
This dealt a blow to the oil-exporting group and its de facto leader, Saudi Arabia.
The UAE could quickly add between 1 million and 1.5 million barrels per day of output. However, with the Strait of Hormuz effectively closed, analysts said that there’s nowhere for that supply to go.
The UAE joined OPEC in 1967, but tension with Saudi Arabia over production quotas has been building for years.
Under the OPEC+ deal, the country has been held to roughly 3 million barrels per day while sitting on capacity above 4 million. It has been pushing toward 5 million barrels per day by 2027, and that target is hard to achieve with quotas built around someone else’s view of the market.
The war in Yemen broke whatever was left of diplomatic patience.
President Donald Trump said he was unhappy with the latest Iranian proposal to end the war. The proposal would avoid addressing the nuclear programme until hostilities cease and Gulf shipping disputes are resolved.
The Idemitsu Maru, a Panama-flagged tanker carrying 2 million barrels of Saudi oil, and an LNG tanker managed by the Abu Dhabi National Oil Company (ADNOC) crossed the Strait on Tuesday, shipping data showed.
Vortexa data showed that the amount of crude oil held around the world on tankers that have been stationary for at least seven days rose to 153.11 million barrels as of April 24.
The American Petroleum Institute (API) estimated that crude oil inventories in the United States fell by 1.79 million barrels in the week ending April 24. The official data from the US Energy Information Administration (EIA) will be released later on Wednesday.
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