Daily Watch – Cocoa exports suffer, FAAC expects no more than ₦2.4 trillion in 2020

The federal, states and local governments have received a total of ₦606.196 billion from the Federation Accounts Allocation Committee for the April 2020 revenue. The amount comprised Value Added Tax, exchange gain, solid mineral revenue, excess bank charges and excess oil revenue was announced Friday after a virtual FAAC meeting. The FG received ₦169.831 billion; the states got ₦86.140 billion; while the local governments collected ₦66.411 billion out of the amount. The oil-producing states received ₦32.895 billion as 13 percent derivation from mineral revenue. The cost of collection/Federal Inland Revenue Service refund/allocation to North-East Development Commission and transfer to excess oil revenue was ₦15.134 billion according to the communique. It said that the gross revenue available from VAT for April 2020 was ₦94.495 billion as against the ₦120.268 billion distributed in March 2020, amounting to a decrease of ₦25.772 billion. From the VAT revenue, the Federal Government got ₦13.182 billion; the states received ₦43.941 billion; while the local governments got ₦30.758 billion. The distributed statutory revenue of ₦370.411 billion received for April was lower than the ₦597.676 billion received for the previous month by ₦227.265 billion. Revenue from Petroleum Profit Tax, Companies Income Tax, import and export duties, oil sales and VAT all declined during the month, the communique showed. The allocation collected for the month declined due to drop in crude oil price as a result of the COVID-19 pandemic. This was against the projected revenue. The Minister of Finance, Zainab Ahmed, had said that while the states were expecting to share ₦3.3 trillion from the Federation Account during the year, they would not be able to get more than ₦₦2.1 trillion. The FG’s share from the Federation Account initially projected to be N4.8 trillion will decline to ₦2.4 trillion. The share of the LGs, expected to be ₦2.5 trillion at the beginning of the year, will decrease to ₦1.5 trillion. While ₦8.6 trillion was projected as the total inflow into the Federation Account in 2020, it is now expected that only ₦3.3 trillion will accrue to the account.

The Nigerian government-owned refineries recorded a total loss of ₦18.96 billion in the first two months of 2020, data from the Nigerian National Petroleum Corporation has shown. The refineries managed by the NNPC lost ₦9.60 billion in January and ₦9.36 billion in February. The refineries located in Port Harcourt, Kaduna and Warri, have a combined installed capacity of 445,000 barrels per day but have continued to operate far below the installed capacity. The refineries have remained in a state of disrepair for many years despite several reported repairs. The corporation said in April that it had secured funding for the rehabilitation of the ailing refineries. According to the Group Managing Director, NNPC, Mele Kyari, the corporation was pursuing “a different model” for the refineries, including the type used by the Nigeria LNG Limited. The NLNG is jointly owned by the FG, represented by the NNPC, 49 percent, and three international oil companies; Shell, 25.6 percent, Total 15 percent and Eni 10.4 percent. Kyari said the corporation would no longer be involved in running the refineries after their rehabilitation. Upon completion of the ongoing rehabilitation, the services of a company would be procured to manage the plants on an operations and maintenance basis, he added. The NNPC had planned to rehabilitate the refineries to attain a minimum of 90 percent capacity utilisation during president Buhari’s first term. The plan was to use third-party financiers and the original refinery builders to provide the requisite funding and technical support. However, after over one and a half years, negotiations with financiers were stalled in December 2018 due to varying positions on key commercial terms. Kyari, who took over the NNPC leadership in July 2019, had reiterated his plan to revamp the refineries and end fuel importation by 2023.

Nigeria’s cocoa mid-crop output is expected to be very low as measures to curb the spread of the coronavirus hindered farmers and exporters. The president of the cocoa association, Mufutau Abolarinwa said the measures have created a backlog of unshipped beans as some of April’s orders still being exported were disrupted by the lockdowns and restrictions on transport and port activities. Around 5,000 to 6,000 tonnes of beans were stuck at Lagos port and warehouses in the country, Abolarinwa told Reuters. Nigeria, the world’s fifth-biggest cocoa grower, in its mid-crop, harvested between May and September, comes in at between 50,000 and 60,000 tonnes when weather conditions are good and chemicals readily available to spray diseased trees. The FG had last week eased month-long lockdowns in commercial hub Lagos state, neighbouring cocoa producing state Ogun and the capital Abuja. But interstate movement has been banned, creating a headache for cocoa delivery. Ships are being quarantined at the port, creating extra storage costs. Trading houses are anxious to receive their shipments, Abolarinwa said, noting that delays could affect demand for further beans from farmers, especially as the mid-crop harvest is about to start. One local buying agent echoed Abolarinwa’s concern and said the export delays have also slowed domestic demand because buyers were struggling to resell beans stuck in their warehouses to exporters. Some farmers told the agency that this year’s mid-crop could begin in the southwest region a month later than usual, in June, due to late rains, and output could be hit by a lack of chemicals. This could see the main crop extend to November.

French gendarmes have arrested Rwandan genocide suspect Felicien Kabuga, who is accused of funding militias that massacred about 800,000 people in Rwanda. The 84-year-old who is Rwanda’s most-wanted man was arrested on Saturday near Paris after 26 years on the run, the French justice ministry said. Kabuga who had a $5 million U.S. bounty on his head, was living under a false identity in a flat in Asnieres-Sur-Seine, according to the ministry. He was indicted in 1997 on seven criminal counts including genocide, complicity in genocide and incitement to commit genocide, all in relation to the 1994 Rwanda genocide, according to the UN-established International Residual Mechanism for Criminal Tribunals. The Hutu businessman, Kabuga is accused of funding the militias that massacred some 800,000 Tutsis and their moderate Hutu allies over a span of 100 days in 1994. Rwanda’s two main ethnic groups, Hutus and Tutsis, have historically had an antagonistic relationship and fought a civil war in the early 1990s. According to the French ministry, Felicien Kabuga, since 1994, known to have been the financier of Rwanda genocide, had with impunity stayed in Germany, Belgium, Congo-Kinshasa, Kenya, or Switzerland. His arrest paves the way for the fugitive to come before the Paris Appeal Court and later be transferred to the custody of the international court based in the Hague, Netherlands and Arusha, Tanzania. Kabuga, who controlled many of Rwanda’s tea and coffee plantations and factories, was part-owner of Radio Television Milles Collines which ran a radio station that fanned ethnic hatred against Rwanda’s Tutsis, told Hutus where Tutsis were to be found and offered advice on how to kill them. He is accused of being a main financier of the genocide, paying for the militias that carried out the massacres.