Aso Villa Reads for 22/1/2020

Every day, we bring you the best stories that the Media is reporting about the Government of Nigeria

The Petroleum Industry Governance Bill that could be passed before the end of this year will seek to create two regulators for Nigeria’s oil and gas sector, a move that could break apart the functions of the current regulator, Business Day reported. Timipre Sylva, in a recent press conference, said: “Special focus will be placed on the Midstream and Downstream sectors. Consequently, we are considering two regulators, one for the Upstream (the Commission) and another for the Midstream & Downstream (the Authority),” the minister said. Under the current system, the Department of Petroleum Resources enforces all the regulatory measures relating to the general control of the petroleum sector. It regulates critical sections including acreage management, petroleum products pricing, local content, technical and commercial regulation and environmental regulation through Environment Impact Assessments. However, the regulatory environment in Nigeria’s oil and gas sector is characterised by multiple regulators who duplicate functions. The different agencies carry out similar regulation as DPR and also the President and Ministers of Petroleum Resources and Environment, even the NNPC all carry out regulatory function. This leads to a crowded regulatory space raising cost for operators, delaying projects, slowing decision making, causing heavy political influence and regulatory arbitrage. In the previous PIGB, the eight assembly sought to create a single regulator, the Nigerian Petroleum Regulatory Commission (NPRC) merging the DPR with the Petroleum Products Pricing Regulatory Agency (PPPRA). It would have been the primary regulatory with board supervision and inbuilt accountability mechanism From the minister’s pronouncement, Nigeria will be moving away from a multiple regulator model to a value chain or product regulation model where two or three regulators exist focused on different elements of the value chain. This is similar to the system in the United Kingdom where the Oil & Gas Authority (OGA) is an independent regulator funded by levies from the private sector and is concerned with the upstream sector. Ofgem is a cross-sector regulator handling electricity and gas and the government issues specific regulators for environment, planning, health and safety.

Isa Ali Ibrahim Pantami, the minister of communications and digital economy says that it is necessary for the Nigerian Communications Commission (NCC) to strictly adhere to the provisions of executive order 003 and 005 as contained in the presidential directives of 1st May 2017 and 12th February 2018 respectively, before awarding any contracts in the telecommunications sector. In an effort to spur homegrown technology development, the Executive Orders 003 of 2017 and 005 of 2018, were specifically enacted to give impetus to the local content development and promotion drive of President Muhammadu Buhari’s administration as the telecommunications sub-sector is an important contributor to Nigeria’s economy. Executive Order 003, which is aimed at support for local content in public procurement by the federal government of Nigeria, expressly states that, all Ministries, Departments and Agencies (MDAs) shall grant preference to local manufacturers of goods and service providers, in their procurement of goods and services. Executive Order 005 which was signed by Muhammadu Buhari in February 2018, however, is even more specifically directed at the sector. The document titled Planning and Execution of Projects and Promotion of Nigerian Content in Contracts of Science, Engineering and Technology, directs all MDAs to engage indigenous professionals in the planning , design and execution of national security projects and maximize in-country capacity in all contracts and transactions with Science, Technology and Engineering components. In light of this, it is our obligation to entrench the rule of law and ensure as much as possible, National Security Infrastructure and information, is domiciled locally with local companies as a first choice, and indigenous innovation is developed by adhering to the tenets of the executive orders outlined above,” the ministry said in a statement signed by Uwa Suleiman, spokesperson to the minister of communications and digital economy. Having been notified that local tech manufacturers and developers have been somewhat sidelined when it comes to issuing of government contracts, Pantami has mandated the NCC to review telecoms sub-sector activities and give top priority and preference to Nigerian companies, with the requisite skills and qualifications. Business Day reports.

The International Monetary Fund, IMF, yesterday reiterated its forecast that Nigeria’s economy, as measured by the Gross Domestic Product (GDP), will grow by 2.5 percent in 2020. The IMF stated this in its January World Economic Outlook (WEO) released yesterday, titled, “Tentative Stabilization, Sluggish Recovery”. According to Vanguard, the IMF had earlier projected in its October 2019 WEO that Nigeria’s economy will grow by 2.5 percent in 2020. But, the IMF in the January 2020 WEO downgraded its growth forecast for Sub Saharan African region to 3.5 percent citing constrains and deteriorating public finance in South Africa. “In sub-Saharan Africa, growth is expected to strengthen to 3.5 percent in 2020–21 (from 3.3 percent in 2019). The projection is 0.1 percentage point lower than in the October WEO for 2020 and 0.2 percentage point weaker for 2021. This reflects downward revisions for South Africa (where structural constraints and deteriorating public finances are holding back business confidence and private investment) and for Ethiopia (where public sector consolidation, needed to contain debt vulnerabilities, is expected to weigh on growth the IMF said. Similarly, the IMF however downgraded its growth forecast for the global economy to 3.3 percent in 2020, representing a one percentage point decline from 3.4 percent forecast made in October last year. It stated: “Global growth, estimated at 2.9 percent in 2019, is projected to increase to 3.3 percent in 2020 and inch up further to 3.4 percent in 2021. Compared to the October WEO forecast, the estimate for 2019 and the projection for 2020 represent 0.1 percentage point reductions for each year while that for 2021 is 0.2 percentage point lower. A more subdued growth forecast for India (discussed below) accounts for the lion’s share of the downward revisions. “The global growth trajectory reflects a sharp decline followed by a return closer to historical norms for a group of underperforming and stressed emerging market and developing economies (including Brazil, India, Mexico, Russia, and Turkey). The growth profile also relies on relatively healthy emerging market economies maintaining their robust performance even as advanced economies and China continue to slow gradually toward their potential growth rates.

The President, Major General Muhammadu Buhari (retd.), has approved the appointment of Dr Bayero Salih-Farah as the substantive Director-General and Chief Executive Officer of the Nigerian Institute of Transport Technology, Zaria, for a four-year tenure. The Director of Public Affairs at the NITT, Mr Paul Mshelizah, disclosed this in a statement on Tuesday in Zaria. Mashliza said the appointment was communicated via a letter signed by the Permanent Secretary of the Federal Ministry of Transportation, Sabiu Zakari. He said the letter read in part, “I am pleased to inform you that the President of the Federal Republic of Nigeria, by a letter Ref. No. PRES/99/MT/26, dated January 13, 2020, has approved your appointment as the Director-General/Chief Executive Officer of the Nigerian Institute of Transport Technology, Zaria, Kaduna State. The appointment is for four years effective January 13, 2020, in accordance with Section 7 of the NITT Act Cap №116 LFN 2010.” Punch reported.