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FG to Borrow N4.89tn, Says Finance Minister

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FG to Borrow N4.89tn, Says Finance Minister

The Federal Government plans to borrow about N4.89tn from internal and external sources to finance the shortage in its proposed 2022 budget of N13.98trn due to declining revenue.

 

The Minister of Finance, Budget, and National Planning, Zainab Ahmed, made this known in Abuja on Monday at an interactive session organised by the House of Representatives’ Committee on Finance on the 2022-2024 Medium Term Expenditure Framework and Fiscal Strategy Paper.

She noted that perception of the naira as being overvalued over despite recent adjustment by the Central Bank of Nigeria has intensified Nigeria’s risk aversion in the global capital market, which she said would further put pressure on the foreign exchange market, stressing that foreign portfolio investors have yet to return to the Nigerian market.

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The minister stated that while the government plans to borrow to fund the N5.62tn deficits in 2022, it will reduce capital expenditure by N259.315bn, as the reduction would become necessary due to economic volatility occasioned by unstable global oil market as well as the effects of the COVID-19 pandemic.

Ahmed said for capital expenditure next year, ministries, departments and agencies would get N1.76tn as opposed to the N2.02tn spent in 2021.

She also the exchange rate has been pegged at N410.15 to a dollar per dollar and oil benchmark at $57 per barrel.

Other key macro-economic assumptions in the MTEF/FSP include a crude oil benchmark crude oil production of 1.88 million barrels per day, an inflation rate of 13 per cent, and a nominal GDP of 149.369tn.

The minister noted that non-oil GDP continues to grow at 169.69tn, compared to oil GDP of 14.68tn included in the nominal GDP. Nominal consumption is 130,49.36bn.

She said, “The budget deficit and the financing items for the expenditure projected for 2022 is N5.62tn, up from N5.60tn in 2021. The deficit is going to be financed by new foreign and domestic borrowings, both domestic and foreign, in the sum of N4.89tn, then privatisation proceeds of N90.73bn and drawdowns from project titles of N635bn. This amount represents 3.05 per cent of the estimated GDP, which is slightly above the 3 per cent threshold that is spent recommended in the Fiscal Responsibility Act. The revenue that we expect is N6.54tn, N2.62tn to accrue to the Federation Account and VAT, respectively.”

The minister further said the net oil and gas revenue, which would be available for the Federation Account for distribution, would be N6.151tn in 2022.

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Customs Corner

Customs Mourns Fallen Personnel in Katsina, Reaffirms Unwavering Commitment Towards Border Security

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Author: Muhammad Bashir.

The Nigeria Customs Service (NCS) on Wednesday, April 17, 2024, expressed deep sorrow in announcing the tragic passing of Customs Assistant II Auwal Haruna, who died in an unfortunate incident that occurred at the Gamji Makaho checkpoint in Dankama area of Katsina State.

According to a statement issued to newsmen and signed by the National Public Relations Officer, Chief Superintendent of Customs (CSC), Abdullahi Maiwada, said the sad incident was triggered when a team of Customs officers attached to Katsina Area Command attempted to intercept a convoy of over fifty vehicles transporting goods suspected to be smuggled outside the Country.

CSC Maiwada, in the statement, noted, “Haruna and his fellow officers exhibited remarkable courage in their duty to thwart these audacious economic saboteurs. Their actions sparked a confrontation with an enraged mob who viciously attacked and fatally assaulted CA II Auwal Haruna.”

He narrated that the late Customs Officer has since been laid to rest according to Islamic rites in his hometown, Kayawa, under the Dutsi Local Government Area of Katsina State.

The Comptroller-General of Customs, Bashir Adewale Adeniyi MFR, and the entire NCS management team extended heartfelt condolences to the family of CA II Auwal Haruna.

He also vehemently condemned the disheartening act of violence that led to his untimely demise and assures a comprehensive investigation into this tragic incident to ensure justice is served.

The CGC, who underscored the perilous challenges officers face in their daily mission to safeguard the nation’s borders under his stewardship, assured that the Service stands firmly united with the fallen officer’s family during this period of profound grief.

“The NCS remains steadfast in its efforts to combat illegal activities such as smuggling, prioritising Nigeria’s border integrity while ensuring the safety of citizens and dedicated customs personnel.” the statement said.

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Customs Corner

Customs TCIP Command Records 139% Target Surplus for 2024 1st Quarter

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Author: Vivian Daniel.

The Nigeria Customs Service Tincan Island Area Command, Lagos, has unveiled its extraordinary achievements, having recorded significant revenue generation for the 1st Quarter of 2024.

In a press statement signed on Monday, 15 April 2024, by Ngozi Okwara, the Command Public Relations Officer, on behalf of the Customs Area Controller, Comptroller Dera Nnadi, revealed that the command’s first-quarter revenue goal for 2024 increased by 139%, amounting to a difference of ₦177,079,358,035.36, compared to the same period in 2023.

According to the statement, the Command recorded a total collection of ₦303,937,547,265.47 in the first quarter of 2024, as opposed to ₦126,858,189,231.31 recorded in the same period of 2023.

For the export activities of the Command, in terms of volume (MT) and value (FOB), export trade also witnessed exponential growth within the same period under review. Comparatively, the tonnage of goods exported via TCIP increased from 145,906.33 MT in 2023 to 251,679.89 MT in 2024, representing an increase of 95.3%.

Likewise, there was an over 300% increase in the FOB value of exports, rising from ₦80,993,580,710 to ₦287,792,767,415.00 between Q1 2023 and Q1 2024, respectively.

In his remarks, Comptroller Dera Nnadi congratulated officers, men, and stakeholders of the command for embracing service delivery and teamwork, surpassing the first-quarter revenue target of 2024. He acknowledged the efforts of all units within the Area Command in achieving these results.

“I challenge you to come up with modalities and new strategies to meet the revenue target for April and the months ahead despite the series of holidays the country has embarked upon,” the CAC emphasised.

“Stakeholders should be highly esteemed and treated with respect, but with due diligence to identify compliant and non-compliant traders,” he noted.

The Customs Area Controller emphasised that the Command’s enforcement and anti-smuggling unit has not relented in its effort to combat smuggling and all forms of criminality. According to him, the NCS, being the lead agency at the ports, has coordinated several 100% physical examinations under his supervision, ensuring compliance with international trade regulations.

“The anti-smuggling activities of the Command recorded a total seizure of 57 packets of heroin weighing 56.390kg with a street value of ₦902,240,000.00; 3,612 packets of Colorado Indica weighing 956.772kg with a street value of ₦4,055,400,000.00. All the seized illicit drugs have been handed over to the relevant sister agencies,” he added.

The statement also highlighted some stakeholders’ activities of the Area Command, including hosting various sessions of Stakeholders’ forums for Shipping Companies, Terminal Operators, Freight Forwarders, and Security Agencies, both physically and virtually, aimed at enhancing communication channels and minimising revenue loss.

The CAC equally notified stakeholders of the Command’s challenges and the efforts were put in place to overcome them, especially regarding goods released from terminals within the port premises.

“I have the honour to inform you that irrespective of the challenges observed, the Area Command has not relented in its efforts to achieve its aim. The Time Release Study (TRS) aims to enhance efficiency and effectiveness within Customs Operations by assessing the time it takes for goods to be released from terminals within the port premises. This will be unveiled with time, yet be assured that there is progress,” he stated.

In efforts to create a level playing field for importers and stakeholders by decongesting the ports, the Area Controller encouraged stakeholders to strategize for the formation of new terminals. He noted that activities have commenced at the terminals.

The CAC appreciated the support and leadership of the Comptroller-General of Customs, Bashir Adewale Adeniyi, towards consolidating the capacity of the Service through innovation and creativity.

“We continue to express our profound appreciation for the support and clear sense of direction from the Comptroller General of Customs, and his management team for their relentless efforts towards strengthening the Service’s capacity and introducing innovative methods to perform its statutory responsibilities in line with international best practices,” he extolled.

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Customs Corner

Federal Government Launches National Single Window Steering Committee to Enhance Trade Efficiency

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Author: Folusho Adeogun.

In a bid to enhance trade facilitation and efficiency within the nation’s import and export value chain, the Federal Government has inaugurated the National Single Window Steering Committee, with the Nigeria Customs Service (NCS) serving as a key member.

The launch took place at the Presidential Villa Abuja on Tuesday, with President Bola Tinubu presiding over the inauguration.

The Committee is composed of representatives from key federal ministries and agencies, including the Ministry of Finance, the Marine and Blue Economy, Transportation, Trade and Investment, as well as the Federal Inland Revenue Service. Other agencies involved are the Nigeria Sovereign Investment Authority (NSIA), the Central Bank of Nigeria, the National Agency for Food and Drug Administration and Control (NAFDAC), the Standards Organization of Nigeria, and the Nigerian Maritime Administration and Safety Agency (NIMASA).

The Nigerian Customs Service is playing a crucial role in the effort, given its direct involvement in trade facilitation and border security.

The newly established committee will oversee the implementation of the National Single Window project, a real-time digital trade compliance system aimed at modernising and streamlining trade processes.

The project is expected to facilitate paperless trade and provide an annual economic benefit of around $2.7 billion, contributing to national revenue and improving port efficiency.

President Tinubu emphasised the importance of the initiative. He said, “Nigeria cannot afford to lose an estimated $4 billion annually due to bureaucratic delays, red tape, and corruption at the nation’s ports. By embracing the single window system, Nigeria hopes to join countries like Singapore, Korea, Kenya, and Saudi Arabia that have already experienced significant improvements in trade efficiency,” he stated.

The Nigeria Customs Service supports the initiative as it aligns with the service’s goal of enhancing trade facilitation and national security.

NCS’s involvement will ensure the successful implementation of the project, helping to expedite cargo movement and optimise inter-African trade.

The initiative is seen as a bold statement of the government’s commitment to progress, prosperity, and the well-being of all Nigerians. It represents a significant step towards regional integration and collaboration, ultimately contributing to a better future for the country.

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