Data from the Ministry of Aviation has shown that the industry lost over ₦63 billion to the new coronavirus pandemic that is ravaging the economies of the world including Nigeria’s. According to the report, the air transport value chain, as the hardest hit to the deadly virus, has over 90 percent of operations and activities adversely affected resulting in monthly losses valued at ₦21 billion. The effects of the virus in the sector has forced the government to consider working out a recovery plan aimed at providing financial support where necessary to sustain air connectivity for passenger operations and cargo flights. The government is said to be rejigging plans to fast track the establishment of a private sector-driven national carrier, which is expected to generate significant revenue and GDP contributions and create activity in the wider economy for suppliers, importers, exporters and manufacturers. This is in addition to the financial support proposed for the industry. The government is working to ensure the removal of Value Added Tax from airline tickets as approved by the Federal Executive Council. It seeks the provision of COVID-19 tests for all passengers and crew, the report said, putting an estimated ₦27 billion as a bailout package for the sector, which should be delivered within 12 months.
Dividends accruable to cash-strapped Nigeria from Liquefied Natural Gas being under threat may affect the country’s Economic Sustainability Plan in improving the crumbling infrastructure and poor services in Africa’s largest economy. Nigeria’s gas sector is oriented towards the export market, which is determined by economic fundamentals as against a regulated domestic regime with the LNG being the major revenue earner for the country in the gas industry. The global LNG market, however, is under threat due to the coronavirus pandemic that has forced demand to collapse. Buyers who are obligated to take cargoes under long-term contracts, as part of the effect of the coronavirus pandemic, are postponing the delivery of the products they do not have an immediate need for. This is in addition to the extremely low prices which have forced traders to keep the LNG in terminal tanks, thereby creating the highest inventories at European import facilities. The fiscal crisis faced by Nigeria may further be worsened since the LNG has been a major source of revenue and foreign exchange earnings for the government. The FG earned $3.102 billion from its 49 percent stake in Nigeria LNG Limited between 2015 and 2018 – other shareholders of NLNG include Shell, 25.6 percent, Total 15 percent and Eni 10.4 percent. A breakdown of the dividend earnings showed that the FG got $904.498 million in 2018 compared to $798.140 million in 2017. It earned $356.126 million in 2016 compared to $1.043 billion in 2015. Overall, the FG has so far earned $17.407 billion as dividend from the company in the last 15 years beginning from 2004. The slump in demand for LNG is coming at a time Nigeria needs revenues to stimulate its struggling economy and increase its depleting foreign exchange reserves. Nigeria’s LNG exports around 300 cargoes of liquefied natural gas annually from the Bonny plant, representing about 40 percent of global LNG supplies. But NLNG said it cannot sell its LNG while commodity tracking firm, Kpler, has also said that about half of the world’s LNG vessels, currently deemed floating storage, are heavily loaded with Nigeria’s gas. Also, LNG prices at their lowest in years have forced traders to keep LNG on the tankers waiting for demand to improve. This, according to Nigeria’s Economic Sustainability Plan, indicates a stop in the flow of dividends from LNG as the country’s major sources of foreign exchange has dried up.
The West African regional bloc ECOWAS is supporting Nigeria’s candidate Ngozi Okonjo-Iweala to head the World Trade Organization and calls on other African countries to do the same. According to a document from the organisation on Monday, the support is a possible step towards uniting Africa behind Okonjo-Iweala, a former minister and World Bank managing director. The Niger’s President and ECOWAS chairman Mahamadou Issoufou’s signed document also called on other African countries as well as non-African countries to endorse her candidature. Brazil’s Roberto Azevedo is stepping down as WTO head a year early at the end of August so that his successor will need to steer reforms and negotiations in the face of rising protectionism, a deep recession caused by the COVID-19 pandemic and growing trade tensions, notably between the United States and China. There is broad support for an African candidate and a woman since neither have headed the Geneva-based body in the past, sources following the process said. Supporters of Okonjo-Iweala vaunt her negotiating skills, including clinching a multi-billion dollar debt relief package for Nigeria. Africa has previously struggled to unite behind one WTO candidate and this time has so far been no different. The African Union was due to officially endorse one of three pre-selected candidates from Benin, Egypt and Nigeria. But the process was disrupted by COVID-19 measures and Nigeria swapped its candidate this month, prompting Egypt to protest to the AU, sources said. The latter found that Nigeria had broken AU rules by changing its submission, according to the document, which Reuters said an AU official refused to comment on.
Nigerian doctors have decided to return to work after announcing the suspension of a countrywide strike to continue talks with the FG about a lack of protective equipment to treat COVID-19 patients and benefits including allowances. Following an intervention by government officials, the Nigerian Association of Resident Doctors said Monday that it will “continue negotiations with stakeholders and progress made shall be reviewed in four weeks.” The health workers at the front line including emergency response teams, investigators and sample collectors in infectious treatment centres across the country, are demanding payment of three months of outstanding allowances, the Punch newspaper reported. Nigeria’s minister of information and culture, Lai Mohammed, earlier said the government paid 55,031 health workers at 35 coronavirus-designated hospitals ₦4.6 billion ($11.8 million) in hazard allowances. Nigeria has recorded 20,244 coronavirus infections and 518 deaths since its first case on 27 February. Members of the National Association of Resident Doctors had last week embarked on an indefinite nationwide strike following the virtual extraordinary National Executive Council meeting of the association.