Nigeria defends fuel-price increase amid strike threat

Nigeria’s Minister of State for Petroleum Emmanuel Kachikwu defended the government’s decision to increase the price of gasoline as averting an even larger fuel shortage and financial crisis, as the country’s main unions threatened indefinite strikes over the increase.

“If we did not do what we are doing now, the queues will be back in very full force, there’ll be complete social disruption,” Kachikwu told lawmakers in the capital, Abuja, on Monday. “Governors will not pay salaries, the federal government in fact will not pay salaries, probably members of this honorable house” will be affected also, he said. “That’s simply the reality.”

Last week Kachikwu increased the cap on the gasoline price last week by 67 percent to 145 naira ($0.73) per liter (0.26 gallon). The move was necessary to attract private importers, who will be able to recover their costs and help end fuel shortages that have persisted for months in the OPEC-member country, he said during the announcement.

Nigeria’s two main union federations have threatened an indefinite strike to shut down offices and businesses by May 18 if previous gasoline prices aren’t restored. The unions accused President Muhammadu Buhari, who won elections last year pledging not to increase the price of fuel, of betraying his promises.

Militant Attacks

When Buhari’s predecessor, Goodluck Jonathan, attempted to raise fuel prices and end subsidies in 2012, he was faced with a crippling national strike by the unions and civic groups until he partially reinstated them.

A major oil-exporter, Nigeria relies on fuel imports to meet more than 70 percent of national supply as the four state-owned refineries with a capacity for 445,000 barrels of crude per day produce only a fraction of that because of poor maintenance and mismanagement.

Kachikwu told Parliament the cap only applies to fuel supplied by the National Nigerian Petroleum Corporation, which he also heads, while other retailers can sell fuel for higher.

A resurgence in militant attacks in Nigeria’s oil-producing Niger River delta region has cut output by as much as 600,000 barrels a day to 1.4 million a day, Kachikwu said. The nation’s output hasn’t fallen this low on a monthly-average basis since 1989, according to data compiled by Bloomberg.

“Our budget is based on 2.2. million barrels a day,” he said. “It’s critical for this government that we get back to these numbers as fast as we can.”

Bloomberg

Inflation hits six-year high in Nigeria

Annual inflation in Nigeria quickened to a near six-year high of 13.7 percent in April, in part due to rising petrol and electricity prices, the National Bureau of Statistics said on Monday, stoking expectations of another rate hike.

Nigeria’s worst economic crisis in decades has been driven by a sharp drop in oil prices that has slashed government revenues since the country relies on crude sales for around 70 percent of national income.

Gross domestic product growth was just 2.8 percent last year, its lowest rate since 1999, and speculation of a devaluation of the naira currency is growing. March inflation was 12.8 percent.

The statistics bureau (NBS) said the higher inflation rate in April, the highest level since August 2010, according to Thomson Reuters data, reflected increases across all sectors.

In March, Nigeria’s central bank tightened monetary policy, raising the benchmark interest rate to 12 percent from 11 percent to try to curb the galloping inflation, a surprise reversal that came just four months after rates were cut.

“The focus inevitably shifts to what sort of monetary policy reaction to anticipate,” said Razia Khan, chief economist, Africa at Standard Chartered bank, looking ahead to the monetary policy committee meeting due next Monday and Tuesday.

“With the central bank governor previously stating that a headline inflation rate in excess of the MPR (benchmark interest rate) is undesirable, expectations of tightening are likely to build,” she said.

NBS said petrol prices and electricity tariffs were major factors in the inflation rise.

Last week, the government announced it was scrapping a costly fuel subsidy scheme and increasing petrol prices by up to 67 percent which will affect many of Nigeria's 180 million people who rely on gasoline to power electricity generators as well as transport.

The new prices have yet to feed into the inflation figures, but NBS data suggests fuel was already generally sold at a higher price than the new official ceiling throughout much of April, meaning more inflationary pressure could be building.

Food prices, which account for the bulk of the inflation basket, rose 13.2 percent in April, up 0.4 percentage points from March, the bureau said on its website.

Inflation has also been fuelled by pressure on the naira, which on Monday slipped to its weakest level in months against the dollar in the non-deliverable forward market.

Speculation that the central bank will soon devalue the currency - which the bank denied on Sunday, has swirled since the vice president last week said foreign currency policies needed to be changed to encourage investment.

EWN

New FIFA president to visit Nigeria

The Nigeria Football Federation on Sunday announced that President of Federation of International Football Associations, Gianni Infantino, will visit Nigeria in June.

A statement issued in Abuja on Sunday by NFF’s Assistant Director of Communications, Ademola Olajire, said that the visit was a fall-out of NFF President, Amaju Pinnick’s recent meeting with Infantino in Mexico.



The statement said that during the visit, the FIFA president would visit President Muhammadu Buhari and also attend the final of the NFF/ZENITH Bank Future Eagles Championship.

“He will also have an evening with Corporate Nigeria and as well as have an interactive session with a horde of African FA Presidents who will also be in Nigeria to receive him,’’ it said.

It added that Infantino believed that Nigeria was a big country and a massive football-playing nation that should help with the new FIFA leadership’s drive to truly develop the game.

Infantino assumed office as head of world’s football governing body after winning election at an extraordinary general congress in Zurich on Feb. 26, 2016.

PUNCH

Nigerian government arrests Niger Delta Avengers oil militants

The Nigerian army has arrested several suspected members of a militant group called the "Niger Delta Avengers" (NDA), thought to be behind recent attacks on oil pipelines in the south.

The country's oil production has been severely disrupted by the attacks.

US oil giant Chevron shut down an offshore platform this month after an attack claimed by the Avengers group.

Many militants joined an amnesty programme in 2009 after an insurgency in the oil-rich delta region.

Nigeria has long been Africa's largest oil producer, but its economy is currently facing difficulties due to the recent drop in global oil prices and its output is now behind that of Angola.

Most of Nigeria's oil wealth comes from the Niger Delta, an area which remains poor and underdeveloped.

Previous insurgent groups said they were fighting so local people could benefit more from their region's natural resources.

Oil spills have also resulted in environmental devastation over the years.

BBC

Related stories: Niger Delta Avengers threaten new insurgency in Nigeria

New militant group Niger Delta Avengers disrupting oil supply in Nigeria

Video - Leaders attend summit in Nigeria to tackle Boko Haram

French President Francois Hollande has hailed the efforts of his Nigerian counterpart Mohammadu Buhari in tackling the Islamic extremist group Boko Haram.Hollande together with other regional Heads of states are in Abuja for a summit on the issue, having taken part in bilateral meetings. The leaders also highlighted the progress made against the militants, as well as the plight of 2.1 million internally displaced persons in Nigeria. Buhari's initiative to convene Saturday's summit was described as "crucial" by the UN Security Council, whose members have strongly condemned attacks by Boko Haram. Some 20,000 people have died in Boko Haram's nearly seven-year uprising to create an Islamic state. A multinational force made up of troops from Nigeria and neighbouring countries have since made military advances against the extremists.