???? Sustainable energy BEN EGUZOZIE, Nigeria’s Financial & Business Newspaper IN PORT HARCOURT Experts, analysts weigh in Monday, June 7 - Sunday, June 13, 2021 www.businessamlive.com A X E X P E R T S, ANALYSTS AND on Nigeria’s plan to chase LEGAL practitio- ners are now seri- taxpayers to bank accounts ously weighing in onT the planned deduction of taxes from potential pay- Pro-tax reformers say model from US ers’ bank accounts by the capitalist-oriented tax system Nigerian government through its Federal Inland Revenue Challenge is lack of tech to drive it through Service (FIRS), with varied responses to this newspaper’s Over 40m Nigerians unbanked business series of inquiries across the Country’s low fintech a major setback country. The system is one of the FG targeting to clear N4trn budget deficit portions of the Tax Reforms audit and financial advisory firm, in open and operate a business bank Act 2020, signed into law by a January 2020 note: The new law account. President Muhammadu Bu- contains over 90 changes to 7 differ- But some tax experts and re- hari last December which took ent tax laws including: an increase in formers have called the planned effect January 2021. the rate of VAT from 5% to 7.5%; 0% move disingenuous, describing the According to Pricewater- CIT rate for small businesses; and a impending tax recouping model, houseCoopers (PwC), the tax, lower rate of 20% for medium-sized a.m.TOWARDS MORE EFFICIENT MARKETS companies; requirement of TIN to Page 2 CBN sees light as Nigeria gradually unifies FX rates Summary Apex bank embraces market fundamentals Africa needs $16bn for oil refining AFRICA’S OIL SECTOR DOWNSTREAM organisation, the African Refiners and Dis- FSDH analysts say move could build investor tributors Association (ARDA), says Nigeria confidence, improve capital inflows and other African countries would require $15.7 billion to upgrade the 42 oil refineries in the continent in the years ahead... As economy navigates through tides of uncertainties CHARLES ABUEDE the FMDQ independently and objectively de- which could, in turn, improve forex inflows Page 3 termined NAFEX rate, has received endorse- into the economy. FINANCE & INVESTMENT HE RECENT ACTION BY THE ments by high ranking members of Business Nigeria’s exchange rate has remained un- CENTRAL BANK OF NIGERIA A.M.’s universe of analysts’ communities who der pressure despite a consecutive two-quar- Nigeria’s reserves still pressured (CBN) to shift towards a more described the move as a positive one for Nige- ters’ gross domestic product (GDP) expansion DESPITE A 36 PER CENT INCREASE in comprehensive, unified and mar- ria’s economy. In particular, they said the apex in Q4 2020 and Q1 2021. But a slowdown in crude oil price from January to May 2021, ket-driven foreign exchange rates bank has taken a bold step towards ensuring output growth in the Q1 2021 data is seen as regime by adjusting its official rate to reflect clarity and improving market confidence Nigeria’s external reserves have remained T Page 2 around the $34 billion band, below pre-CO- VID-19 levels. For the Nigerian govern... Page 10 ENERGY, POWER & REVEWABLE NNPC equity chase mimics Aramco The new position taken by the Ni- gerian National Petroleum Cor- poration (NNPC) to acquire stakes in privately owned inde- pendent re ner- ies in the country appears to position to state-owned oil company to... Page 22 INSURANCE & PENSION Insurers, drivers & motor insurance WHILE MANY ROAD DRIVERS are quite confident about their driving skill, there is al- ways a need to have a plan in place to take care of unforeseen eventualities... Page 14 TRANSPORT BUSINESS New K5: Sport, safety, luxury The K5 luxury sedan since its launch in Ni- geria has continued to wow and creates head- turning experiences to people across L-R: Dan Okeke, executive director, Heirs Holdings and chairman, Heirs Life Assurance; Niyi Onifade, managing director/CEO, Heirs Life As- the country. Its wide acceptance and awe... surance Limited; Tony Elumelu, chairman, Heirs Holdings and Heirs Insurance Limited; Babajide Sanwo-Olu, governor, Lagos State; Sunday Page 29 Thomas, commissioner for insurance/chief executive officer, National Insurance Commission (NAICOM), and Adaobi Nwakuche, Ag. managing director/CEO, Heirs Insurance Limited, during the official launch of Heirs Insurance Limited and Heirs Life Assurance Limited and the commis- COMMODITIES & AGRICULTURE sioning of Heirs Towers in Victoria Island, Lagos recently. Goldmine in timber reformation VISIONARY VOICES EXECUTIVE KNOWLEDGE SERIES Global forestry and logging market, ac- cording to re- ports by the Food and Agricul- Investing in Data Saves Lives Breaking Bad: Humanitarians Who Went Corporate ture Organ- isation (FAO), reached a val- ue NEW YORK – When the COVID-19 HOW THREE PROFESSIONALS who started of nearly $535.96 billion in 2020... pandemic began in March 2020, Af- in purpose-driven organisations continued to do Page 24 ghanistan had only 300 ventilators and good after migrating to “the other side”. two intensive-care units. Early epide- When we began to write this, we thought it For subscription call: miological models predicted that the might be a mirror reflection of an article we wrote about for-profit executives moving into purpose- 07039371360 country, with a population of about 38 million, would experience a peak of up driven roles. We had the somewhat naïve... to 520,000 cases and 3,900 deaths.. ... N250 Page 10 Page 15 No 174 News: 2 & 5 Comment: 6 Finance & Investment: 11 Technology: 30 Commodities & Agriculture: 24 BUSINESS A.M. MONDAY, JUNE 7 - SUNDAY, JUNE 13, 2021 2 NEWS CBN sees light... Page 1 indicative and reflection of a fragile economic recovery for Nigeria as the non-oil sector grew marginally to 0.8 per cent from 1.7 per cent in the last quarter of 2020 while Nigeria’s trade sector, which is key to her economy, continued its contraction as a result of shortages of foreign exchange and weak aggregate demand. The move towards a single ex- change-rate system for the local currency is becoming a reality as the apex bank has before now, de- valued the the domestic currency, the naira, by 7.6 per cent against the dollar; and by further replacing the fixed rate of N379 to the dollar for official transactions with N410 as contained on its website after the currency defied all interventions to retain its value. Godwin Emefiele, governor of the CBN, had said that the drop in crude oil earnings and the decline in foreign portfolio in- flows (FPIs) had a significant impact on the supply of foreign exchange in Nigeria. Goodluck Ebele Jonathan, former president, and Sijibomi Ogundele, managing director, Sujimoto Construction Limited, at the official opening and launch With the foreign exchange situa- event of Lagos Marriott Hotel, Ikeja, Lagos recently. tion in the currency market and the level of illiquidity in the FX segment, fiscal, monetary and industrial poli- SMIS operators to N380 per dollar; tions. If sustained, perhaps, this a setback for real sector investment analysts have projected the naira to cies to improve liquidity in the forex and the inclusion of maize in the signals a breakaway from the heavy in Nigeria; (d) movement in external trade at N460 to a dollar in 2021 in market. list of imported goods banned from interventionist role of the apex bank. reserves and also in interest rates on a worst-case scenario and to trade Comparatively, over a 10-year official forex access in Nigeria. This could improve reserves posi- government securities, which will at N430 per dollar in a moderate period, the local currency has sig- Furthermore, the second half of tion and boost market confidence. now be dependent on forex liquidity case, as the economy recovers and nificantly been devalued relative to the year 2020 saw another adjust- To get inflows into the window to and capital restriction policies and embraces the new normal on the some comparable countries as the ment of the rate to N379 from N360 pre-pandemic level, a fresh injec- (e) the performance of the real sec- back of covid-19, oil price move- official rate depreciated by almost per dollar as the apex bank resumed tion of a huge amount of forex, tor following the gradual economic ment and a possible disruption in 163 per cent to N412 to the dollar forex sales to BDCs in August after particularly from private sources recovery and the opening of the land the local economy. as of May 2021, from N156.7 in 2011. the initial halt due to COVID-19; would be needed.” border which is expected to trigger But since the first quarter of 2020, This, according to experts familiar the final two months in 2020 then Factors shaping exchange rate improved non-oil export; albeit the naira has depreciated across the with the matter, is unimpressive came with an amendment by the movement in 2021 below pre-pandemic levels. different foreign exchange (forex) when compared with performances apex bank to the rules for diaspora With experts predicting that On top of these is the expecta- markets while the existing gap be- of large economies such as Indone- remittances which was to allow for the naira will settle around N430 to tion that Nigeria’s trade deficit will tween the apex bank rate and rates sia (58.3%), Malaysia (30.6%), Egypt recipients to receive foreign cur- the dollar in the latter part of 2021, narrow in the coming quarters with in the Importers’ & Exporters’ (I&E) (158.8%) and South Africa (72.8%), rency in cash while it instructed more inflows of forex are anticipated reduced pressure on the exchange window and parallel market has during the same period.