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Nigeria’s Economy Will Grow in 2017 – Udo Udoma

The federal government has given assurance that the Nigerian economy is expected to experience growth next year despite the fact that it is tilting towards a recession at the moment, Leadership reports.

Speaking to State House correspondents after the National Economic Council (NEC) meeting, presided over by Vice President Yemi Osinbajo, the minister of Budget and National Planning, Udo Udoma, was accompanied by the Niger State governor, Abubakar Bello, and his Taraba State counterpart, Darius Ishaku, said Nigeria could only be said to be in recession if it records two quarters of negative growth.

Udoma noted that since the country had experienced negative growth in the first quarter, the country will be said to be in technical recession if the second quarter – which is still being expected – is also negative.

The minister admitted that this year had been a difficult year for the country, and while some of it was expected, the disruptions caused in the Niger Delta which led to a significant reduction in crude oil output was unexpected.

He said,” Recession is basically when you have two quarters of negative growth. We had a first quarter of negative growth and we are still waiting to get all the figures for the second quarter which has just ended in June.

“The National Bureau of Statistics (NBS) will be giving us all the figures, but if, as we suspect, the second quarter is also negative, then, of course, technically, you could say that we are in recession if those figures turned out to be so. But even if we are not, the situation in the economy right now is one that, of course, we are addressing.”

“Some of it was expected some of it was not. We did expect the low oil price but we did not to expect the level of disruption that we got in the Niger Delta, such that oil production went down and we are not likely to achieve the 2.2 million barrel per day because it went down to 1.2 million barrel per day, a little over about 1.3 million barrel per day, which also affected power supply because a lot of our power is supplied by gas. So you can imagine the impact. But measures are being taken to address those issues.”

He, however, added that there is hope that the economy will begin to recover by the third quarter.

“We expect that by the third quarter we will start to pick up and we expect to finish the year in positive territory. That is what we are expecting. We expect to be marginally positive by the end of this year. But by next year we will now start to pick up and we will have much more growth next year,” the minister said.

According to him, the government is focusing on non-oil revenue. “We are focusing agriculture, solid minerals and manufacturing. So basically, we see what we are going through as an opportunity, in some ways, to finally move away from total dependence on the single commodity, crude oil.”

On his part, Governor Bello said the economic council also approved a proposed new self-funded JVC Cash Calls, i.e. Incorporated JVCs or IJVC, which was presented by the minister of state of petroleum, Dr Ibe Kachikwu.

He said the new system will improve accountability within the governing structure of the JVs, ensure less political interference and enhance commercial decision making.

Governor Ishaku disclosed that the Central Bank Of Nigeria (CBN) has lifted the restrictions on deposit of forex into domiciliary accounts.

He said, “The Council was informed by the Central Bank governor that all bank customers that operate Domiciliary Accounts are permitted to lodge dollar cash into their non-export Dom accounts subject to the provisions of the Money Laundering Act.”

It was also disclosed that the minister of finance reported to the Council that the balance in the excess crude account (ECA) by July 20, 2016, stood at $3.93 billion.

The council also stated that seven states are yet to meet the criteria for the budget support facility.

According g to him, 35 States applied for the facility, 28 states met the requirements while seven states sent their required documentations late and theirs are being processed.

Federal Allocation Rises To N599.03bn in June

The total allocation distributed among the three tiers of government increased to N599.03 billion in June, raising hopes that cash trapped states will now have money to pay salaries.

The allocation for June indicates an increase of N253.9 billion over the N305.128 distributed for the month of May.

Minister of finance, Mrs Kemi Adeosun, said the improvement was largely due to increased non-oil revenue collections from the Federal Inland Revenue Service (FIRS) and the Nigerian Customs Service.

Speaking after the Federal Account Allocation Committee (FAAC) meeting in Abuja, yesterday, Adeosun stated that the improvement in non-oil revenues was an indication that some of the reforms introduced by the current administration were beginning to yield positive results,

A breakdown shows that the federal government received a total of N209.4 billion, while the states and local governments got N133.67 billion and N100.75 billion respectively. Saving into the Excess Crude Account increased to $3.09 billion compared to $2.9 billion in the previous month.

Further breakdown indicates that gross revenues received for the month was N538.788 billion compared to N237.466 billion received in the previous month.

There was an outstanding increase in the companies’ income tax and petroleum profit tax with complementary increases in import duty and royalties.

According to her, N9.923 billion, being revenues from solid minerals, and N79.272 billion, being exchange rate gain, were also distributed during the month.

 

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Copyright 2015 SIGNAL. Permission to use portions of this article is granted provided appropriate credits are given to www.signalng.com and other relevant sources.

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