Economy
Senate Joins Reps to Pass 2024-26 Medium Term Expenditure Framework
By Adedapo Adesanya
The Senate has joined the House of Representatives to pass the 2024-2026 Medium Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP), with a borrowing plan of N7.8 trillion for 2024, N9 trillion deficit, and federal government total expenditure of N26 trillion.
The President of the Senate, Mr Godswill Akpabio, announced this on Wednesday, with an oil price benchmark of $73 per barrel of crude oil, 1.78 million barrels per day as contained in the MTEF/FSP documents, special intervention (recurrent) of N200 billion, special intervention(capital) of N7 billion and an exchange rate of N700/$1o.
This is coming a day after the House of Representatives on Tuesday approved and retained the parameters.
The Senate also resolved that all items locally produced should be banned from importation.
The joint committee chaired by Mr Musa Sani also observed that a significant number of the federal government’s revenue-generating agencies engaged in arbitrary, frivolous, and extra-budgetary expenditure and recommended that a review of the laws of all revenue-generating agencies be carried out.
Other recommendations are that the National Assembly begin the process of amending the Fiscal Responsibility Act (FRA, 2007) to enhance the agencies’ ability to enforce fiscal responsibility and impose sanctions on erring Corporations.
The recommendation that the subsidiaries of NIPOST are irregular and illegal and hence should be wound up and deregistered immediately equally drew an argument.
According to the chairman, the recommendation includes an investigation of the sum of N10 billion released by the Ministry of Finance for the proposed Nigeria Postal Service (NIPOST) restructuring and recapitalization, and the funds fully recovered if established to be injudiciously utilized by the relevant committee of the Assembly charge with the responsibility of fiscal prudence.
After the debate on it, the resolve was that further investigation be carried out before any cogent action is meted out.
Among the recommendations, is that all tax waivers not directly linked to non-governmental/non-profit organizations should not be granted and investigations conducted into all tax waivers from 2015 to date by the relevant committees of the senate.
Another recommendation that attracted debate was the recommendation that the Nigeria National Petroleum Corporation Limited (NNPCL) work towards reducing its production and operational costs to increase available government revenue. After the polarised arguments, the resolution was adopted unaltered.
Other recommendations are that Federal Government Agencies ensure the deployment of ICT in the collection of all revenues by MDAs including stamp duty collection activities to block leakages.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.22 per cent decline on Monday, January 20, with the market capitalisation shedding N2.35 billion to close at N1.073 trillion compared with the preceding session’s N1.075 trillion and the NASD Unlisted Security Index (NSI) going down by 6.79 points to wrap the session at 3,105.12 points compared with 3,111.91 points recorded in the previous session.
It was observed that the loss recorded on the first trading day of the week was triggered by UBN Property Plc, which crashed by 20 Kobo to trade at N2.00 per share versus last Friday’s N2.20 per share.
However, the share price of Industrial and General Insurance (IGI) Plc went up by 4 Kobo to 40 Kobo per unit from 36 Kobo per unit, it could not stop the bourse from going down at the close of transactions.
The activity chart showed that on Monday, the volume of securities traded by investors increased by 57.9 per cent to 767,610 units from the 486,215 units traded in the preceding session, while the value of shares traded yesterday slumped by 17.7 per cent to N2.3 million from the N2.8 million recorded in the preceding trading day, as the number of deals declined by 14.3 per cent to 12 deals from the 14 deals carried out in the previous trading day.
At the close of transactions, FrieslandCampina Wamco Nigeria Plc remained the most active stock by value on a year-to-date basis with the sale of 4.1 million units worth N162.9 million, followed by Geo-Fluids Plc with a turnover of 9.1 million units valued at N44.0 million, and 11 Plc with the sale of 55,358 for N14.5 million.
Also, Industrial and General Insurance (IGI) Plc closed the day as the most active stock by volume on a year-to-date basis with 25.3 million units sold for N5.9 million, Geo-Fluids Plc came next with 9.1 million units valued at N44.0 million, and FrieslandCampina Wamco Nigeria Plc with 4.1 million units worth N162.9 million.
By Adedapo Adesanya
The value of the Naira weakened against the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Monday, January 20 amid FX pressures associated with this period.
Most people who came into the country for Christmas and New Year holidays are already going back and are in need of forex, putting pressure on the local currency.
Also, the poor performance of the domestic currency could be attributed to end to the 42-day access granted by the Central Bank of Nigeria (CBN) to Bureaux de Change (BDC) operators to buy forex at official price.
According to data from the FMDQ Securities Exchange, the Nigerian Naira lost 0.16 per cent or N2.47 on the greeback yesterday to sell at N1,550.05/$1, in contrast to last Friday’s rate of N1,547.58/$1.
Similarly, the Naira slumped against the Pound Sterling in the spot market on Monday by N23.39 to trade at N1,906.98/£1 versus N1,883.59/£1 and depreciated against the Euro by N23.14 to sell for N1,613.48/€1 compared with last Friday’s N1,590.34/€1.
However, in the parallel market, the Nigerian currency improved its value against the Dollar during the session by N5 to quote at N1,665/$1 compared with the previous session’s N1,670/$1.
As for the cryptocurrency market, it turned red yesterday as the US President, Mr Donald Trump, didn’t bring up the much-expected subject of crypto in his inauguration speech on Monday afternoon.
Mr Trump had promised a far more friendly crypto policy stance than the previous administration but in the long speech that announced his plans in the coming days, he didn’t make mention of Bitcoin or crypto.
Just over the weekend, the President ignited a speculative frenzy with the Friday evening launch of the Trump meme coin, which was shortly followed by a meme coin associated with his wife, Melania.
Dogecoin (DOGE) crumbled yesterday by 6.3 per cent to $0.3419, Solana (SOL) slumped by 4.7 per cent to $235.32, Cardano (ADA) fell by 3.6 per cent to $0.9777, and Litecoin (LTC) moderated by 1.9 per cent to $114.98.
Further, Ethereum (ETH) went down by 1.7 per cent to $3,241.36, Binance Coin (BNB) retreated by 1.4 per cent to $693.30, Ripple (XRP) depreciated by 1.2 per cent to $3.06, and Bitcoin (BTC) tumbled by 0.8 per cent to $101,746.99, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
By Adedapo Adesanya
Oil prices settled lower on Monday after Mr Donald Trump was sworn in for a second time as President of the United States.
On assumption of office, Mr Trump declared a national energy emergency immediately, promising to replenish strategic reserves and export American energy worldwide.
Consequently, Brent crude futures went down by 64 cents or 0.8 per cent to settle at $80.15 per barrel and the US West Texas Intermediate crude futures depreciated by $1.30 or 1.7 per cent to trade at $76.58 per barrel.
Mr Trump and his allies have signalled they would use the authority to rapidly approve new oil, gas, and electricity projects that typically take years to permit, and during his speech said he plans to unleash new oil and gas development on federal lands while reversing the Biden-Harris administration’s de-growth climate regulations.
Market analysts noted that while many of the executive actions will simply kick off a lengthy regulatory process, they extend by a large degree to the US energy industry, from oil fields to car dealerships.
These also underscore Mr Trump’s determination to reorient federal government policy behind oil and gas production, a sharp pivot from Biden’s efforts to curb fossil fuels.
He also said in his inaugural speech that he would impose tariffs and tax countries and promised an overhaul of the trade system.
Last week, prices rose for a fourth-consecutive weekly gain after the Biden administration imposed sanctions on more than 100 tankers and two Russian oil producers. This led to a scramble by top buyers China and India for prompt oil cargoes and a rush for ship supply.
Meanwhile, dealers of Russian and Iranian oil sought tankers not under sanctions for oil shipment.
While the new sanctions could cut supply from Russia by nearly 1 million barrels per day, market analysts noted that recent price gains could be short-lived depending on Trump’s actions as the new American president promised to help end the Russia-Ukraine war quickly.
Russian President Vladimir Putin congratulated Mr Trump on taking office hours, saying he was open to dialogue with the new US administration on Ukraine and nuclear arms.
Pressure was reduced based on easing tension in the Middle East after Hamas and Israel exchanged hostages and prisoners on Sunday which marked the first day of a ceasefire after 15 months of war.
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