The report that the Governor of the Central Bank of Nigeria, Olayemi Cardoso, has said that the huge purchase of foodstuffs by the government as palliatives is contributing to the galloping food inflation in the country is one of the trending stories in Nigerian newspapers on Friday.
The Punch reports that the Governor of the Central Bank of Nigeria, Olayemi Cardoso, has said that the huge purchase of foodstuffs by the government as palliatives is contributing to the galloping food inflation in the country.
He stated this in his contributions during the March Monetary Policy Committee, which was published on the website of the CBN.
The MPC increased the benchmark interest rate to 24.75 per cent, from 22.75 per cent.
The committee had said that its hawkish stance was to tackle inflation.
However, the country’s inflation rate accelerated to 33.2 per cent in March, with the food inflation rate reaching 40.01 per cent, a year-on-year increase of 15.56 percentage points from 24.45 per cent in March 2023.
In his comments, the CBN governor noted that inflationary pressure had failed to abate despite the hike in the interest rate in February.
He said, “Despite notable stability in the foreign exchange market resulting from decisions taken at that 293rd MPC meeting, inflationary pressure remains unabated. While there is the argument that the significant tightening since the last MPC meeting is yet to fully permeate the system and yield its expected impact, the risk of galloping inflation persists. If such a hyperinflationary scenario is to become reality, available options to control inflation could be severely constrained. From the facts presented to the MPC, there is a clear indication that the monetary factors contributing to inflation are diminishing in their significance.
The newspaper says that the Federal Government has said that Nigeria’s electricity generation has risen to 4,800 megawatts up from around 3500 in March.
This is as the government accused some “cartels and cabals” as those who did not want the power sector to function because of their selfish business interests.
The Minister of Power, Adebayo Adelabu, disclosed this on Thursday when he was in Ajah, Lagos State to launch a 63MVA, 132/33kV mobile substation installed under Phase 1 of the Presidential Power Initiative by the FGN Power Company in collaboration with Siemens Energy.
Speaking at the event, Adelabu disclosed that the power generation increased from 4,200MW in the past few days following the operation of the Zungeru hydroelectric power plant.
The PUNCH reports that the Zungeru power plant is a major infrastructure project with the capacity to generate 700MW, making it the second-largest hydroelectric plant in Nigeria, behind the Kainji Dam.
Located in the Kaduna River, near the town of Zungeru in Niger State, the plant is to generate 2.64 billion kilowatt-hours of electricity annually, meeting nearly 10 per cent of Nigeria’s domestic energy needs.
“Let me mention that we have started seeing improvements in our generation output. In the past few days, the output has increased from 4,200MW to 4,800MW. What we experienced in February and some parts of March is not desirable when we had very low generation.
“I just came back from a meeting this morning, where how to make efforts to pay down on our debts to the gencos and the gas companies was discussed.
“We have made significant progress which I believe will encourage generating companies to ramp up their outputs as we are targeting 6,000MW before the end of the year.
“What led to the increase in the past few days was the commencement of the operation of Zungeru hydroelectric power plant that just added 625MW to the national grid,” he said.
Speaking on the cartels preventing power growth, Adelabu asked them to stop being shortsighted, saying there are enough opportunities in the sector.
The Vanguard newspaper reports that the Dangote Sugar Plc has expressed commitment to investing over $700 million to Backward Integration Program, BIP, in the sugar sub-sector of Nigeria’s economy.
The Chairman of the company, Aliko Dangote, who disclosed this at the company’s 18th Annual General Meeting (AGM) in Lagos, stated that achievement of the goals of the Sugar Backward Integration Master Plan remains the company’s focus.
He said this will go a long way in delivering the anticipated benefits, especially in foreign exchange (FX) savings and cushioning its impact on operations amongst other benefits to the company, all stakeholders, and the nation.
He stated: “Despite the adverse impact of FX on the business environment by the continuous increase in the inflationary trend, lack of liquidity and FX to fund the company’s equipment import, among others, for the backward integration projects, concerted efforts are ongoing to secure the needed funds for the development of the Nasarawa Sugar Company Limited project at Tunga in Awe Local Government Area of the state.”
The newspaper says that the President of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Mr Dele Oye, has called for a review of the barely three years old Petroleum Industry Act, 2021 citing its inherent operational complexities, duplications and ambiguous delineation of roles which could impede efficiency.
Speaking at the National Assembly retreat themed, “Navigating Change: Legislative Strategies for Economic Transformation”, earlier in the week, the NACCIMA boss highlighted areas of the challenges with the PIA including regulation and administrative bottlenecks; security concerns; economic stability; cost recovery and fiscal regimens; incentivizing gas utilization; encouragement investments; environmental considerations; community engagement and development; as well as transparency and accountability:
According to him, it is now time to consider a review that brings about streamlined operations, reducing redundancy, and fostering a clear regulatory path.
He stated: “We must consider a review that brings about streamlined operations, reducing redundancy, and fostering a clear regulatory path.
“The issue of general insecurity remains a significant impediment to growth. Legislative attention must focus on crafting policies that bolster security frameworks, ensuring the safety of investments and personnel in the sector.
“The PIA must be revisited to address the challenges of unstable customs duties and exchange rate volatility that have engendered an uncertain investment climate. We recommend a review of the relevant provisions to promote economic stability, which is crucial for the predictability needed by investors.
“The current cost recovery mechanisms under the PIA need to be reassessed to ensure they are aligned with best practices and supportive of long-term investment.”
He further noted, “While the Act imposes penalties for gas flaring, there is a significant opportunity for legislative review that shifts the focus towards incentivizing investments in gas capture and utilization.
“The PIA, in its current form, does not sufficiently incentivize investment in the oil and gas sector. We propose a legislative review that considers tax breaks, grants, and other incentives for investors, particularly in the exploration and development of new frontiers.
GIK/APA