The Week Ahead – It Is Not Yet Party Time…

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The FG was due to a break in the fight against Boko Haram and continued inflation relief. This has made some senators to essentially declare their fealty to the Buhari train, but the limbo over a lingering fuel scarcity, Delta communities fighting to salvage their livelihoods and the unwanted comeback of the excise tax mean it is not yet time for corks and screws.

FG scores important wins in Boko Haram fight

A court has jailed a Boko Haram militant involved in the 2014 kidnapping of the Chibok girls. Haruna Yahaya, 35, is the first member of the group to be sentenced for playing a part in the mass abduction. The former trader, who confessed to his role in taking the 276 schoolgirls, argued he was made to act under duress. But judges sitting at a court in Kanji, who are hearing the cases of more than 1,000 suspected Boko Haram militants, dismissed his excuse. Justice Ministry Spokesman, Salihu Isah, told AFP that Yahaya was given a 15-year jail sentence. Yahaya, who came from Potiskum in Yobe, was captured by a vigilante group called the Civilian JTF in 2015, – a year after the girls were snatched from Government Girls Secondary School in Borno. Of the 276 girls taken in April 2014, 112 are still in captivity.

Yahaya’s conviction is a very welcome development. Just this Monday, twenty people were found guilty of crimes associated with Boko Haram, while two were discharged for lack of evidence in what is the country’s biggest legal investigation of the militant Islamist insurgency. In October 2017, the Ministry of Justice said 45 suspects suspected of Boko Haram links had been convicted and jailed. A further 468 suspects were discharged, and 28 suspects were remanded for trial in Abuja or Minna. This is progress. Another form of progress, albeit one that bears close observation, is the release of thirteen hostages on Saturday after authorities negotiated with the Islamist militants. Three of the hostages were lecturers from the University of Maiduguri who were abducted while on an oil exploration trip in Magumeri, Borno in July 2017. The other 10, were women police officers kidnapped in a raid on a convoy the previous month. Their release is very welcome. It also reduces pressure on the FG who has been criticised for apparently abandoning other hostages due to the lack of public pressure on them in comparison to that of the Chibok girls.

Not everyone is abandoning Buhari joy train

A group of Senators from the ruling All Progressives Congress have rejected the Senate adoption of the conference committee report on amendment to the Independent National Electoral Commission (INEC) Act. The senators said they were opposed to the amendment to section 25 of the Act which rearranged the order of the 2019 elections. The House of Representatives was the first to amend the Electoral Act to change the order of the 2019 general elections putting the election of federal lawmakers first, before that of the state lawmakers and state governors, with the last being the presidential election. The Senators, 10 in number, left the chambers to address the press while plenary was still on. The 10 Senators are Abdullahi Adamu (Nasarawa-APC), Ovie Omo-Agege (Delta-APC), Binta Garba (Adamawa-APC), Ali Wakili (Bauchi-APC), Kurfi Umaru (Katsina-APC), and Andrew Uchendu (Rivers-APC). Others are Abdullahi Danbaba (Sokoto-APC), Yahaya Abdullahi (Kebbi-APC), Abu Ibrahim (Katsina-APC), and Benjamin Uwajumogu (Imo-APC). They described the amendment and process of passage as illegal, vowing that it would not stand.

The leader of the dissenting group, Abdullahi Adamu (Nasarawa-APC), questioned the conduct of the Senate President, Bukola Saraki (Kwara-APC), in the passage process. Ovie Omo-Agege (Delta-APC) alleged that the House of Representatives did not form a quorum when the issue was considered. Ali Wakili (Bauchi-APC), said four elections in one month will be too staggering and portend ill for the economy, politics, and security. Their reasons bear looking at. The proposed election timetable by the House of Representatives has been widely seen as a way to not tie their electoral fortunes tightly to President Buhari. This show of dissent by the 10 Senators not only shows their allegiance to the President but also strengthens opposition to the changed timetable by challenging its legality. It will be an event to be watched closely and all legal challenges will have to be concluded in time for parties to hold election primaries.

Birth, death and the return of the excise tax

The Federal Government will reintroduce excise duty on some goods manufactured in the country, and excisable imported goods in line with the directive of the ECOWAS Council of Ministers. The Cable reports that a letter from Finance Minister, Kemi Adeosun to President Muhammadu Buhari said, spaghetti and noodles would be exempted from the changes. Adeosun said noodles and spaghetti were exempted from the fact that “they currently constitute significant staple and accessible foods, which are easily affordable by all the economic class of the Nigerian society. The Minister had suggested that all excisable products removed from the excise list in 2009 be returned. The excise duty is five percent.

In our 2018 outlook, we said that the Federal Government would look for more ways to shore up revenues. In spite of the Finance Minister’s claims that over ₦400 billion was released for capital expenditure, CBN records show a much smaller amount, about ₦90 billion, indicative of less actual revenue available to the government to execute its projects. As the year progresses, we expect to see more attempts to raise revenue of this nature, and it is the organised private sector that is easiest to tax, hence the government will continue to target them, rather than the harder work of taxing the more diverse informal sector.

Petrol scarcity highlights need for downstream reform

Nigeria’s petrol supply crisis entered its thirteenth week with reports suggesting that President Muhammadu Buhari appears to be sitting on the report of a committee he constituted to address it for distinctly political reasons. A month after the crisis resurfaced in December, the President’s Chief of Staff, Abba Kyari, inaugurated a committee on 2 January, headed by the Minister of State for Petroleum Resources, Ibe Kachikwu, and including the Nigerian National Petroleum Corporation Managing Director, Maikanti Baru, key players in the downstream sector of the country’s oil and gas industry, and representatives of labour organisations to investigate the causes of the crisis. Premium Times quotes a source as saying that some of the solutions requiring legal processes were to go to the National Assembly for necessary legislation, while those that need a political resolution, and labour issues that need to be addressed, were handed over to the Presidency for implementation. In spite of the efforts by the NNPC to ensure resolution of the crisis, the scarcity of petroleum products at filling stations across the country persists.

Some of the key proposals include immediate and holistic deregulation of the downstream sector of the petroleum industry, involvement of marketers in the petrol importation programme, and plans to construct a refinery to end the importation of petroleum products. The best time to have implemented the first two propositions were when the country was going through the low oil prices of 2016 and 2017. This crisis has been wasted. The next best time is now. We urge all those involved to consider these propositions seriously, to deregulate and liberalise the downstream sector so that anyone can import once the petrol meets required standards and let the market determine the price of petrol. This is the only long lasting solution to recurring petrol scarcity.

Are we at the end of inflation’s downward path?

Annual inflation in Nigeria slowed for the twelfth month in a row in January, to 15.13 percent, compared to 15.37 percent in December, the Nigerian Bureau of Statistics said on Wednesday. A separate food price index showed inflation at 18.92 percent in January, compared to 19.42 percent in December. The rise in the food index was caused by increases in prices of imported food in general as well as bread and cereals, milk, cheese, meat, potatoes and other tubers, the NBS said in a report. Yemi Kale, head of the NBS, last month said he expected the rate of inflation to fall faster this year compared to 2017, but activities leading up to presidential elections next year could stoke prices.

We expect the downward trend in inflation to turnaround by March, as the base effect on inflation finally comes to an end. New drivers will turn the inflation up, including the price of petrol which has been unofficially increased during the scarcity, as well as the Easter festivities which will lead to full-blown campaign season.

Hope fades for Delta communities in Abuja, and in London

The Court of Appeal in London ruled on Wednesday that two Nigerian communities cannot pursue Royal Dutch Shell in English courts over oil spills in the Niger Delta. The two-to-one split decision upheld a High Court ruling last year that was a setback to attempts to hold British multinationals liable at home for their subsidiaries actions abroad. The court rejected the appeal from the law firm, Leigh Day, on behalf of Nigeria’s Bille and Ogale communities, and upheld a ruling that English courts do not have jurisdiction over claims against Shell’s Nigerian subsidiary Shell Petroleum Development Company (SPDC). Shell said the court rightly upheld the earlier ruling and said Nigeria’s well-developed justice system was the correct place for the claims. The SPDC has also denied responsibility for the spills, which it says, were due to sabotage, and illegal refining. King Okpabi, the ruler of the Ogale community, said the English courts were the only hope, and that they cannot get justice in Nigeria. Leigh Day said the two Nigerian communities intended to bring the case to Britain’s Supreme Court.

The communities approached the English courts in the first instance because of the perceived inability of Nigeria’s judiciary to address their concerns in a timely and reasonable manner, a state of affairs that is its own commentary on the vitality of the judicial system. Some observers believed the Shell oil spill case would succeed in the English courts because of a growing body of thought which surmises that Western multinationals should face legal action in their home countries over their subsidiaries’ actions abroad. In 2017, an appeal court upheld a ruling that a case brought by Zambian villagers against the mining company, Vedanta Resources, over environmental pollution could be heard in England. Vedanta will appeal the decision, but with the Shell ruling, it appears there is little appetite by foreign courts to construe their jurisdiction in a more liberal, and expansive manner. That will provide little comfort for the communities who continue to deal with loss, devastation, poverty, and little cover for a country that almost six decades on, cannot adequately defend the interests of its own people.

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