All Posts in "Month: November 2020"

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The Federal Government will focus on the completion of ongoing road and bridge projects in the country rather than beginning new ones, in the implementation of the 2021 Budget, the Minister of Works and Housing, Mr. Babatunde Fashola, SAN, has said in Abuja.

Fashola, who spoke during the defense of his Ministry’s proposals in the 2021 Budget; listed roads whose completion would be prioritized during the budget year to include those categorized as A1-A9 adding that 18 of such road projects, which have reached appreciable level of completion have been identified across the country for completion within 12 to 15 months.

The roads and bridges, the Minister said, include those leading to the ports and major agricultural hubs across the six geopolitical zones of the country adding that the decision to prioritize those projects was in line with the mandate of President Muhammadu Buhari, whom, he recalled repeatedly emphasized the necessity to focus the Budget on completion of projects.

According to him, other categories of road and bridge projects on which the Ministry will focus for completion during the budget year also include those that have attained 70 per cent completion adding that subject to the availability of funds, such projects would be completed as early as possible.

The Minister, who was accompanied by the Minister of State, Engr. Abubakar Aliyu, the Permanent Secretary, Mr. Ernest Umakhihe, Directors and other top Ministry officials, said the Ministry would also focus on the maintenance of about 50 Bridges nationwide as a measure to avoid further deterioration of the structures, which he described as critical.

Pointing out that some bridges which connect several geopolitical zones and Federal roads had not been maintained for several years before this administration, Fashola added that some of the Bridges required replacement of expansion joints and hand rails while others required major underwater repairs of exposed piles, pile caps and piers.

“Bridges like the Third Mainland Bridge, the Koton Karfe Bridge and the Makurdi Bridge are part of about 50 bridges being rehabilitated simultaneously among others”, he said adding that the Ministry also had its focus on the completion of the construction of Chanchangi Bridge along Takum-Wukari Road in Taraba State and Ikom Bridge along Calabar-Ikom Road.

Expressing the need for the support of the National Assembly in realizing the stated objectives, Fashola, who put the estimated cost of rehabilitating all the bridges at N80.984 billion, however, pointed out that there was need, in the course of each year, to address washouts and erosion envisaged with the subsiding discharge of flood waters nationwide.

“We are mindful of the limitation of resources but the frequency of these natural disasters caused by Climate Change and aging infrastructure must compel us to think of making provisions for emergencies”, he said adding that the international Best Practice for such Emergencies was between 5 and 10 per cent of the Capital Budget.

Fashola, who said the Ministry has also selected two roads and a bridge in each of the six geopolitical zones for enhanced funding during the budget year, also listed for adequate funding the Federal Government of Nigeria’s Counterpart Fund for projects financed by the China Exim bank.

On the Ministry’s interventions on internal roads in Federal Tertiary institutions across the country, the Minister, who said out of the 43 such projects 18 had been completed, explained that inadequate budgetary provisions had stalled the projects which, according to him, the Ministry started since 2018/2019, adding that the 17.35 percent cut in the 2020 Budget made it impossible to pay Contractors who were being owed N3.31 billion while the money required to fix the remainder is N3.54 billion.

Reiterating that the major challenge of the Ministry in completing ongoing projects on time was inadequate budgetary provisions, the Minister explained further that aside the fact that the funds were inadequate, there was also the problem of timely release of funds to sustain annual cash flow requirement level adding that although funds from the Presidential Infrastructure Development Fund (PIDF) and SUKUK Bond had helped to bring some funding relief, the Ministry’s exposure had continued to expand due to annual addition of new projects.

He said although the sum provided for Highway projects in the 2021 Budget was an improvement over the 2020 Budget provision for the Sector, it was still inadequate to address the funding challenges of Highway projects pointing out that with about N1.2 Trillion as the Year 2021 projected cash flow requirement, funding for works planned to be executed on the projects in 2021 would have to be “efficiently optimized”.

Fashola said in order, therefore, for his Ministry to make significant impact in the improvement of the Federal road network and boost the nation’s economy, there was urgent need to enhance the release of funds for the projects under the Amended 2020 Budget to defray the outstanding payments; enhance Budget ceiling for Highway projects in the 2021 Budget proposal to cover the execution of works during the year and leverage on other alternative funding sources as well as make provision for emergencies to enable Government respond to damage and destruction caused by natural disasters, Climate Change and other unforeseen events.

The alternative funds, he explained include the Presidential Infrastructure Development Fund (PIDF), which is being used to rehabilitate, reconstruct and expand the Lagos-Shagamu-Ibadan Dual Carriage way, Construction of Second Niger Bridge and rehabilitation of Abuja-Kaduna-Zaria-Kano Dual Carriageway.

They also include the SUKUK BOND being used to fund a total of 44 road and bridge projects, which are mainly dual carriageways on major arterial routes A1-A9 on the Federal road network using the 2020 Sovereign SUKUK Issuance and Tax Credit Scheme being used in the construction of Bodo-Bonny Bridge across Opobo Channel in Rivers State and the construction/rehabilitation of Lokoja-Obajana-Kabba-Ilorin Road Section II in Kwara and Kogi States, among others.

On the issue of delay in project completion raised by Committee members during the interactive session, the Minister said aside the twin challenges of inadequate funding and delayed releases, there was also the fact that some of the roads carry heavy traffics which had to be managed while construction, reconstruction or rehabilitation was going on adding that it was necessary to put some measures in place for the safety of both the workers and commuters.

The Minister told them, “When we talk about delay of projects, I would have loved you to have specifics of what is considered as delays. It is important to understand what happens at the construction site, especially on highways where we are reconstructing and commuters still have traffic”, adding that ideally on a construction site traffic should be shut down.

He cited as examples the Third Mainland Bridge in Lagos with an average Daily Traffic (ADT) of 122,978 vehicles, the Koton Karfe Bridge with Average Daily Traffic of 11,942 vehicles and the Makurdi Bridge adding that the Lagos-Shagamu-Ibadan carries the heaviest daily traffic in the country followed by the Abuja-Kaduna-Kano Road.

On why the SUKUK could not be expanded to fund other road projects as a means of overcoming the problem of inadequate funding, he explained that at every issuance there was a specific amount which the Government could withdraw adding that no money would be left as reserve SUKUK fund.

In his contribution during the session, the Minister of State, Engr. Abubakar Aliyu, explained that the seeming delay in the completion of some of the road projects in the North East was as a result of security challenges citing the Yobe-Maiduguri Road where insurgents attacked the CCECC and burnt their equipment.

Patoma Admin by — November 8, 2020 in Others 0

 

By Favour Nnabugwu

Custodian Investment Plc has recorded 42 percent rise in its gross revenue which grew from N15.85 billion September 30, 2019 to N22.52 billion in the same period of 2020

The growth in revenue and profitability is attributable to an increase in financial and reinsurance assets which appreciated by 35.62 percent and 32.5 percent (Y-O-Y) respectively. An increase in investment and interest incomes were also very important in driving revenue.

The company’s Profit After Tax (PAT) of N1.5 billion in the third quarter of 2020, as against N1.37 billion posted the same period in 2019. Interest income advanced by 11.3 percent Year-on-Year.

Investment income gained 25.4 percent  from N5.61 billion to N7.03 billion. Earnings per share appreciated by 50 percent from N24 to N36 for the period under view. Other investments and operating income grew by approximately N6.40 billion.

Total assets also grew by 27 percent from N118.01 billion to N149.94 billion for the period under view. Profit before tax marginally grew by 2.8 percent from N1.69 billion to N1.73 billion.

On the contrary, despite recording increased gross revenue, the net profit margin decreased over time, from 23.91 percent recorded as of Q3 2019 to 5.8 percent in Q3 2020.

Thus, indicating a probability of weak cost control mechanism or that variable values are not well controlled. The Net profit margin indicates that the company earned N0.057K in profit for every N1 it received in revenue as of Q3, 2020. This is lower compared to N0.24k for every N1 it earned in revenue in Q3, 2019.

This is evident in the higher operating expenses recorded as of Q3 2020 which is up by 97.4 percent when compared with the figures obtained in the corresponding period last year (Q3 2019).

Patoma Admin by — November 7, 2020 in Insurance 0

The Nigerian Railway Corporation (NRC) has announced a revenue of N1.4 billion as at September 30, 2020  which is way less than it’s projected revenue of N4.4 billion for the same period.
The reduced revenue was due to the effects of the pandemic on the economy according to the NRC.

The Managing Director of NRC, Mr Fidets Okhiria, stated this during the 2021 Budget Defence to the Joint Committee of Land and Marine transport at the National Assembly in Abuja on Friday.

He added that the company remitted N245 Million to the TSA during the same period.

Despite reduced operations this year due to the pandemic. The NRC has acquired more trains for the Lagos-Ibadan railway project set to open soon. In August, The NRC announced the purchase of 24 coaches to operate the Lagos-Ibadan Railway..

The NRC MD  told the House Committee that the pandemic heavily affected operations, which caused a 32% performance of the company’s projections for the year so far.

The Joint Committee should  also note that for the year 2020, the Corporation presented a separate Internally Generated Revenue & Expenditure Budget.

He said, “The sum of N1.4billion has been generated as at Sept.  30 against the projection of N4.4billion from our core activities, representing 32% performance.

“It is necessary to mention that our train services were stopped and significantly reduced upon resumption due to the impact of COVID-19 Pandemic.

“The construction work within the Lagos corridor including access to Apapa Port also impacted on our ability to provide train services

“It is important to mention that during the period under review, the Corporation started making payments from its IGR into the Federal Government dedicated TSA as directed by the Federal Executive Council. A total sum of about N245.5million has so far been lodged into the account as at Oct. 31.

“The Railway Property Management Company Limited is a wholly owned subsidiary company of Nigerian Railway Corporation. As at Oct. 31, the Company has generated about N1.4 billion representing 91.5 per cent of N1.5 billion which was the revised approved revenue target for 2020.

He added that the NRC forecasts a revenue of N5.3 billion in 2021 as the company would have more coaches available for its operations deployed to operational routes across the country.

“For the year 2021, the Corporation plans to generate a total of N5.3billion as IGR. More coaches are expected to be deployed to Abuja-Kaduna Train Service, full commercial operation has commenced between Warri-Itakpe and the Lagos-Ibadan Train Service is expected to commence soon,” Okhiria added

He also added that 94% of the NRC’s Capital Appropriation for the year 2020 has been released so far, which has been used mainly for procurements.

“In the year 2021 Budget (Capital and Recurrent) of the Nigerian Railway Corporation for year 2020 budget, the sum of about N18 billion was appropriated for Capital Budge

“This amount was subsequently revised downwards to N16 billion due to the economic downturn as a result of the COVID-19 pandemic which led to shut down of economic activities as well as the dwindling revenue from crude oil.

“As at today, about N15 billion representing 94 per cent of 2020 Capital Appropriation has been released and procurement process is on-going,” he said.

Patoma Admin by — November 7, 2020 in Others 0

Low yield on securities, rising inflation, threat to pension funds Assets growth – LCCI DG

The Director General, Lagos Chambers of Commerce and Industry (LCCI), Dr. Muda Yusuf, has said that the 1-2 percent yield on Treasury Bills toppled with high inflation currently at 13.71 percent are threat to the real growth of pension funds assets in the medium term

Dr. Yusuf made the revelation while delivering the keynote lecture at the 2020 annual national conference of the National Association of Insurance and Pension Correspondents (NAIPCO) on the theme “Promoting Bankable Investments Portfolio for Insurance and Pension Sectors,” In Lagos recently.

According to him, this is so because Pencom guidelines, PFAs are mandated to invest pension funds in low-risk securities, adding that fund managers have little exposure to volatile investment vehicles and that six percent of pension funds assets are locked in equities.

Fund managers’ exposure to investment vehicles in the real sector, he said, is extremely low due to the high level of risk involved explaining that just 2% of pension assets is invested in real estate, and less than 1% in infrastructure fund. because fund managers often complain that projects in the real economy are non-bankable.

On insurance industry investment portfolio, he said there is need to maintain a balance between liquidity and returns on investment on bank placements, Treasury Bills, Commercial papers, Bonds, Equities and Real Estate.

On the trend in Nigerian pension fund assets, Dr. Yusuf said person fund assets have been on the upward trajectory in the last three years with assets under Management rosing by 42.9% from N7.94 trillion as of March 2018 to N11.35 trillion as of August 2020.

This year (2020), according to him, pension funds assets have appreciated by 8.8% to N11.35 trillion by end-August 2020 from N10.43 trillion by end-January 2020 amid very low return rates on government securities.

Patoma Admin by — November 7, 2020 in Others 0
Transportation Ministry proposes N205bn for 2021

The Ministry of Transportation has proposed a capital budget of N205 billion in 2021 to facilitate the completion of all its ongoing projects and fund related agencies.
This disclosure was made by the Minister, Rotimi Amaechi in a statement during his presentation before the Joint Committee of the Senate and House of Representatives on Land and Marine Transport in Abuja on Friday.

According to a report by News Agency of Nigeria, the Minister disclosed that out of the N205 billion, land transport had about N204 million, marine transport had N845 million, with an overhead cost of about N358 million for the year 2021.

Speaking of the agencies funded by the Ministry, he said that Nigerian Institute of Transport Technology (NITT) Zaria and Nigeria Railway Corporation (NRC) are fully funded from the national budget. Same with National Inland Waterway Authority (NIWA), Maritime Academy and Council for the Regulation of Freight Forwarding (CRFFN) derived their funding from both the national budget and the Internally Generated Revenues (IGR).

He said the major role of the Ministry in the marine transport sector was to oversee the monitoring of the implementation of government policies for the sub-sector, which were largely carried out by the agencies.

Amaechi said that the budget proposal had presented amounts required for completion of some of the projects by 2021, while others might extend to 2022. Some of these projects that are close to completion include National Freight Offices at Illela, Jibiya and Idiroko in addition to other land transport projects in 2021.

While presenting the budget, Rotimi Amaechi said: “The ministry is proposing a total capital budget of N205 billion with land transport estimates of N204 billion, marine transport estimates N845 million and overhead of N359 million in the 2021 budget, which is before you for consideration.

“The total capital appropriation of the ministry for 2020 is N70 billion, land has N69.6 billion, marine N698 million.

The aims and objectives of these proposals are to make significant progress on all ongoing projects, and to complete and deliver modern railway services that will provide an efficient and cost-effective alternative transport system for economic growth and job creation opportunities for the citizenry.”

Patoma Admin by — November 7, 2020 in Others 0
Lagos-Ibadan needs $656m for completion, Amaechi

By Favour Nnabugwu

The Minister of Transportation, Mr. Rotimi Amaechi, said that the Federal Government needs a total funding of $656 million to complete work on the Lagos-Ibadan railway project.
This disclosure was made by the Minister, during the 2021 budget defence of the Ministry before the Joint Committees of the Senate and House of Representatives in Abuja, on Friday,
He said that for the project to achieve practical completion for the intended purpose, some aspects of works involving construction of upgraded railway stations, signalling and telecommunication system, among others, have to be completed.
These additional works amount to a total cost of $656 million, which is to be financed 100% by the Federal Government, is needed.
During the budget presentation session today, the Minister said:
“For the project to achieve full loan drawn down from our co-financier, China EXIM Bank, and attain practical completion for intended purpose, some aspects of works involving construction of upgraded railway stations, signaling and telecommunication system among others have to be completed.
“These additional and extra works amounting to 656 million dollars which is to be financed 100 per cent by the Federal Government has been approved by the Federal Executive Council (FEC) for implementation.
“Therefore, in order not to forestall the progress of implementation, adequate fund needs to be provided in the 2021 budget proposal to facilitate the completion of the project.”
What you should know
During the budget presentation session today, before the Joint Committees of the Senate and House of Representatives, Mr. Amaechi proposed a total capital budget of N205,161,882,492 to cover: Land, N204,316,793,527; Marine, N845,088,965; and overhead of N358,799,999 in the 2021 budget for consideration.
The Minister said that the aims and objectives of the proposals were to make significant progress on all ongoing projects, as well as to complete and deliver modern railway services.
In his presentation, he disclosed that under the railway modernisation programme, the construction of Lagos – Ibadan Standard Gauge line had reached 92% completion, and funds were needed for the project to reach practical completion.

Patoma Admin by — November 7, 2020 in Others 0

Three experts has proper solution to for real sector to attract adequate quantum of private capital from Pension Fund Administrators (PFAs), insurance firms, and foreign investors.

The three of them, the Director General, Lagos Chambers of Commerce and Industry (LCCI) Dr. Muda Yusuf; the Chairman of the occasion, who is also the Chairman. Nigeria Social Insurance Trust Fund, (NSITF), Mr Austin Enajemo-Isire and the Chief Launcher of NAIPCO website, Chairman, Mutual Benefits Assurance Plc, Dr. Akin Ogunbiyi spoke at the 2020 Annual National Conference of the National Association of Insurance and Pension Correspondents (NAIPCO)

They called for business-friendly environment, institutional reforms, better regulation and effective synchronization of fiscal and monetary policies.

Speaking on the theme of the conference, “Promoting Bankable Investments Portfolio for Insurance and Pension Sectors,” Dr Yusuf, stressed the need to de-risk the real sector to boost investor confidence and fund managers’ participation in the real sector.

He said de-risking the real sector will attract more private sector insvestment into the sector, generate more employment opportunities, foster industrialization and economic diversification agenda as well as unlock more investment opportunities in the real sector.

Proffering solution on how to de-risk the real sector, he advocated for policy and institutional reforms, better regulatory environmental and effective synchronization of fiscal and monetary policies.

He said the low yields on government securities ought to have spurred fund managers to explore viable investment opportunities in the real sector, noting that many fund managers are ignoring the real sector due to elevated risk despite quite a number of attractive opportunities.

“Investor’s participation has been weak in the real economy in recent years. About 5% of foreign capital flows to Nigeria went into the real sector between January and June 2020, indicating poor investment sentiment towards the sector. The real sector needs to be totally de-risked to be able to attract adequate quantum of private capital from PFAs, insurance firms, foreign investors,” he advocated.

On investment of pension assets in the real sector, Dr. Yusuf stated that fund managers’ exposure to investment vehicles in the real sector is extremely low due to the high level of risk involved, saying that just 2% of pension assets is invested in real estate, and less than 1% in infrastructure fund.

He said this is because “fund managers often complain that projects in the real economy are non-bankable, hence, the low.”

On Investment Prospects of Nigerian Real Sector, LCCI boss said the Deposit Money Banks (DMBs), just like fund managers, are very cautious in channeling funds to the real economy, particularly this time when risks are elevated in the macroeconomic and business environment.

This, he said, “validates the reason for high borrowing costs on bank facilities to the real economy. Just a few high-profile corporates enjoy lower interest rate (prime rate), while small and medium outfits suffer tight access to funds.”

Major factors dampening the investment prospects of the real sector, Dr Yusuf noted, include vulnerability to external shocks, Foreign Exchange volatility, infrastructure deficit, tough operating environment, regulatory challenges, policy uncertainty, low purchasing power and weak economic growth.

The Chairman of the occasion, who is also the Chairman. Nigeria Social Insurance Trust Fund, (NSITF), Mr Austin Enajemo-Isire, advocated for a deliberate policy by the authorities, in addition to what is currently obtainable, directly or through moral suasion to invest Insurance and Pension Fund in sectors such as Manufacturing, Agriculture and Aviation, etc with an inbuilt safety net.

He said the current restrictive nature of insurance and Pension Funds investment outlets calls for review of the legislations guiding investment of Insurance and Pension Fund, noting that the yelling and plea from the Organised Private sector of Nigeria (OPSN) to create more access to investible funds deserves attention.

Also speaking, Chairman, Mutual Benefits Assurance Plc, Dr. Akin Ogunbiyi, who was the Chief Launcher of NAIPCO website at the occasion, called for government support and patronage for insurance industry.

He said the industry can achieve adequate return on investment and capital adequacy ratio through support and patronage of the Nigerian Insurance industry by government at all levels and also by ensuring reduction of sharp practices to its barest minimum.

Patoma Admin by — November 7, 2020 in Insurance 0

  The Gabonese Federation of Insurance Companies, FEGASA, and the Africa Insurance Organisation, AIO are jointly organising the 27th African Reinsurance Forum will be held in 2023
More than 500 professionals from the sector are expected to discuss topics specific to reinsurance.

It should be recalled that the 44th General Assembly of the Federation of African National Insurance Companies (FANAF) was also held in Libreville, Gabon.

Patoma Admin by — November 6, 2020 in Insurance 0

Martin Ziguelé, 63 years old, is running for the 2020 Central African Republic presidential election planned for 27 December 2020. A graduate of the International Insurance Institute of Yaoundé (IIA) Ziguelé is an insurance expert.

During his professional career, he has held various management positions in several groups, among which CICA-Re, SONAR and ACAM Vie.

In April 2001, M.Ziguelé was appointed Prime Minister by President Ange-Félix Patassé. In 2006 he was provisionally elected president of the Central African People’s Liberation Movement (MLPC) as a replacement of Ange-Félix Patassé.

Mr. Ziguelé also ran for presidency in the elections of 13 March 2005, 23 January 2011, and 30 December 2015. None of these candidacies were validated.

Patoma Admin by — November 6, 2020 in Insurance 0

China has barred non-Chinese travellers from Nigeria, the United Kingdom, Belgium and others from entry their country over the resurgence of Covid-19
The country imposed new border restrictions in response to the worsening Covid-19 pandemic across Europe.
The Chinese embassy in the UK said Beijing had “decided to temporarily suspend entry into China by non-Chinese nationals.”
“The suspension is a temporary response necessitated by the current situation of COVID-19,” it said .
The Chinese Embassy in Nigeria also said it will no longer issue certified health declaration form for non-Chinese nationals in the country.
The notices said the new restrictions would not affect those with diplomatic, official or courtesy visas or crew members of international flights, trains or other vessels.
The embassy in a statement said “Due to the COVID-19 pandemic, China has decided to temporarily suspend entry into China by non-Chinese nationals in Nigeria holding visas or residence permits still valid at the time of this announcement.
“The Chinese Embassy and Consulate in Nigeria will no longer issue a certified health declaration form for the above-mentioned personnel. Entry by holders of diplomatic service, courtesy or C visas will not be affected.
It is not very clear why Nigeria was included in the travel ban having recorded fever cases compared to what the World Health Organization (WHO) called a “critical moment of action” in Europe.
According to the Nigerian Centre for Disease Control (NCDC) Nigeria now has 63,325 confirmed cases of the coronavirus since the first reported case in March.
“To date, 63,328 cases have been confirmed, 59,675 cases have been discharged and 1,155 deaths have been recorded in 36 states and the Federal Capital Territory. A total of 668,729 tests have been carried out as of November 4th, 2020 compared to 635,410 tests a day earlier,” the NCDC said on its website.
The Chinese embassy website in Belgium announced a similar ban on travelers as a “last resort in response to the current pandemic.”
The UK, one of the world’s hardest hit countries with nearly 48,000 deaths linked to the virus and more than one million cases, has entered a new nationwide lockdown to curb the spread of the pandemic.
Belgium, which has the most COVID-19 cases per capita in the world, has been in lockdown since last week.
Beijing has recently tightened requirements for travelers from several countries, making entry much more difficult.
These requirements include the presentation of a health certificate from the local Chinese embassy showing the results of a nucleic acid test and an antibody test – within 48 hours of travel.
The new rules apply to travelers from countries including France, India, Singapore, Canada, Germany, Pakistan, South Africa and the U.S..
Patoma Admin by — November 6, 2020 in Others 0