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World Bank Supports Nigeria’s Petrol Subsidy Removal

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The World Bank has thrown its weight behind the removal of petrol subsidy in Nigeria, saying it was an important step amid the COVID -19 crisis.
The bank , in its ‘Africa’s Pulse’ report entitled ‘Charting the road to recovery ’ , said countries in sub -Saharan Africa were seizing the opportunity created by the crisis to accelerate the structural reform agenda .
“ The COVID – 19 crisis is not being wasted among countries in the region… In Nigeria , the government has taken important steps to reform its subsidy regime ,” it said.
The World Bank noted that the Nigerian government had eliminated petrol subsidy and established a market -based pricing mechanism with no price ceilings .
It said “ The gasoline (petrol) price is set monthly by the Petroleum Products Pricing Regulatory Agency from market -based costs .
“ When international petroleum product prices start to recover, the PPPRA will allow price increases accordingly .”
In a report on August 17 , Reuters quoted sources as saying that the World Bank was unlikely to approve a much -needed $ 1 .5 bn for Nigeria in August as planned due to concerns over desired reforms.
Reuters said fuel subsidies and electricity tariffs were also being discussed , adding that a banking source said the loan could not be approved until October .
The World Bank projected on Thursday that sub -Sahara Africa ’s real GDP would contract by 3. 3 per cent this year , after expanding by 2 . 4 per cent in 2019 .
It said , “ In Nigeria , after expanding 1 .9 per cent year -on -year in 2020 Q 1 , real GDP contracted by 6. 1 year – on- year in 2020 Q2 , with growth in the oil and non -oil sectors falling .
“ The near -term outlook is subject to considerable uncertainty as the economy continues to grapple with the effects of the pandemic. ”
The report said activity data suggested that the rebound in activity that started in Q3 2020 might have stalled .
“ Investment remains weak amid high uncertainty . Growth is projected to fall by 4 .1 per cent in 2020 and remain subdued at 0 .3 per cent in 2021 ,” it added.

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Banks’ CEOs Hold Emergency Meeting Over BDCs’ Forex Ban 

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Bank Chief Executive Officers on Thursday, held an emergency meeting on how to ensure compliance with the new forex directive of the Central Bank of Nigeria.

After the meeting, they spoke during a webinar organised to give an update on the banks’ preparedness to be the main channel of forex distribution, following the recent discontinuity of forex supply to the BDC operators by the CBN.

The executives assured the public that banks would make forex available to customers in accordance with the CBN’s directives.

After the last Monetary Policy Committee meeting, the Central Bank Governor, Godwin Emefiele, had ordered all Deposit Money Banks to set up teller points at designated branches across the country to fulfil legitimate FX request for personal travel allowance, business travel allowance, tuition fees, medical payments and SMEs transactions, among others.

Speaking at the webinar, the Group Managing Director/Chief Executive Officer, Access Bank Plc, Herbert Wigwe, said, “The banking industry as a whole was willing and ready to carry out this function. The banks have very strict compliance measures, in terms of verification and making sure that people who do apply are eligible.

“All Nigerian banks will be able to meet these requirements. If you look at all the branches nationwide, you will know that the banks have more than enough capacity to do this.”

He said if the banks saw any compliance issues, or people attempting to do things cunning, they would be reported to the CBN because the banks would ensure full compliance with the order.

The Group Chief Executive Officer, Guaranty Trust Holding Company Plc, Mr Segun Agbaje, while speaking on the capacity of the banks to meet the customers demand, said, “It is not only the CBN that has the ability to fund the market; the banks also have the resources to meet the demand, and we have agreed collectively that it will start immediately.”

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NERC: Over 1m Electricity Consumers Have Received Prepaid Meters

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Labour Warns FG Against Electricity Tariff Hike 

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The Nigeria Labour Congress faulted plans to allegedly sell the Transmission Company of Nigeria, saying it will lead to an increase in electricity tariff.

The NLC President, Mr Ayuba Wabba, said this in a statement titled, “This Kite will not Fly’’ on Friday.

Wabba explained that instead of allegedly planning to sell the transmission company, FG should focus on improving the electricity supply.

He described the attempt to hand over the TCN to a few ‘privileged’ Nigerians as self-serving, obtuse, odious, morally reprehensible and criminal.

The NLC president said, “The TCN is a strategic economic asset of immense national security implications. This is because the TCN traverses all nooks and crannies of Nigeria.

“It will be wrong that our country will be deliberately exposed to an avoidable vulnerability and thus, provide an opportunity to others to restrain the Nigerian state.

“We apprehend that the planned sale of the TCN is only an attempt to further confound the people and concurrently raise electricity tariff. Unfortunately, this time around, Nigerians have had enough.

“The government cannot promise improved power supply to consumers by the planned sale of TCN. The under-the-table scheming as transparent privatisation cannot pass muster.

“It is an unsavoury narrative for our country, that even the privatised assets, which have survived the rapacity of the new owners, have been turned into unrealisable collaterals for unpayable loans.

“This constitutes a bone stuck in the throat of financial institutions and sundry creditors.”

Wabba explained that the plan would “fundamentally weaken the security of the nation and above all, deprive the people of their age-old investments in the commanding heights of the Nigerian economy”.

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