Nigeria raises $ 5.3 bn for power sector

Oct 02, 2008 02:00 AM

The Federal Government appears set to declare the much-awaited state of emergency in the energy sector any moment from now. As a prelude, more than 98 % of State Houses of Assembly have passed the law enabling states to contribute to the funding of the sector.
The governor of Ekiti State, Mr Segun Oni, told State House correspondents after the National Economic Council (NEC) meeting that by the next meeting of the council, the remaining States' Houses of Assembly would have passed the enabling bill. The states are expected to jointly contribute with the Federal Government, the sum of $ 5.3 bn from the excess crude account to fund the power sector.

Other decisions taken by the NEC which was presided over by Vice President Goodluck Jonathan include the issue of Nigerians displaced by the ceding of Bakassi to Cameroun, desertification, the gas master plan and erosion national power fund. The Governor of Kaduna State, Alhaji Namadi Sambo, who joined his Ekiti counterpart and the Minister of National Planning, Sanusi Daggash, noted that by the progress made by states on the matter, it is expected that they would have enacted the Act before the next meeting of the NEC.
"Ninety eight % of the states have passed this bill and the 2 % outstanding have confirmed that it will be ready soon. As such, all the states of the federation are giving the support that is needed to ensure that the power issue in this country is sorted out," he said.

Speaking on the gas master plan on which the council had set up a committee to work out its final implementation, the committee directed the chairman and the governor of Imo State, Chief Ikedi Ohakim, to liaise with the minister in charge of gas to streamline its recommendation along with the master plan.
On Bakassi, the council noted that the neighbouring states of Akwa Ibom and Cross River were experiencing an influx of returnees beyond their envisaged capacity. It, therefore, called for more assistance for the states to help them cope with the challenge.

"The states of Cross River, Akwa Ibom and other neighbouring ones are experiencing an influx of numbers that were not estimated. Akwa Ibom has about 15,000 residents that are there. The challenge is that the provision of the camp sites and temporary settlements are not coming up as fast as the numbers of returnees that are coming."
"Secondly, this is putting an additional pressure on the states because the FG assisted Cross River with finances but not Akwa Ibom and Imo who are now using their resources so that they can contain, in a very patriotic manner, the additional pressures on their meagre resources to assist and assuage the problem. Part of the discussion is that we should now work out a strategy to support the states."

The governor of Cross River stated that a number of citizens are used to living by the seaside, ocean or on the water.
"Now, we are bringing them on land and, relatively, most of them are fishermen rather than farmers, so there is a little bit of restiveness in trying to hold a transitionary position to be able to contain expectations," he added. "The third is the issue of origin. When an influx comes in and somebody wants to settle by the waterside or in the creeks, how do you resettle him within an area when there are already challenges about ownership of scarce areas of land for settlement? So, these, are some of the challenges that have been discussed and a committee is to be set up to see how we can strengthen and support the other states," Senator Daggash explained.

Meanwhile, the Minister of Finance, Dr Usman Shamsudeen, and the Governor of the Central Bank of Nigeria (CBN), Professor Chukwuma Soludo, are expected to appear before the Senate, according to the Senate notice paper. The duo are expected to brief the Senate on the looming crisis in global credit.
The invitation of the officials of the two regulatory authorities in the financial sectors is coming at a time when the wave of global financial crisis is sweeping through the United States of America and Europe, prompting the US President George W. Bush to request $ 700 bn bailout for the American economy.

The summon is coming on the heels of a motion sponsored by the Deputy Chairman, Senate Committee on Information and Media, Senator Anthony Manzo, and 18 other lawmakers.
Co-sponsors of the motion include: Senators Jubril M. Aminu, Victor Ndoma-Egba, Grace Folashade Bent, Ayogu Eze, Nkechi Nwogu Nazif Suleiman, Ike Ekweremadu, Olorunnimbe Mamora, Iyabo Obasanjo-Bello, Ayo Arise and Joel Danladi Ikenya. Others include: Senators Ganiyu Olanrewaju Solomon, Feslim Kolawole Folarin, Felix Kayode Bajomo, Zaynab Kure Alloysius Etok Ehigie, E. Uzamere and Osita Bonaventure Izunaso.

According to the motion, the global financial crisis is the first in the 21st century that the world would witness after the Wall Street crash of 1929, the Great Depression of 1930 and the stock market crisis of 1984 and 2001, respectively.
The motion reads in part: "The Senate notes that while more advanced capital markets may be able to absorb their losses owing to their debt, the Nigeria capital market where banking assets alone account for 65 % of market capitalisation may not, as a result of investors movement to fixed income securities."

"In spite of our poverty and vulnerable mono-economy, all that we have been receiving are soothing assurances from those authorities who, by now, should be informing and consulting appropriate bodies and organisations, including the National Assembly, and generally sensitising our people to the possible deterioration of the economy, especially with the concomitant, and not surprising fall in the oil prices and, therefore, attenuated national revenue."
It continued: "Concerned that the United States of America, which is the largest economy with about 40 % of the global Gross Domestic Product may have slipped into recession, the senators were of the opinion that the biggest danger of the global credit squeeze and the reluctance of the banks to lend money to one anotherhas worsened the situation with the implication that Nigerian banks which have had easy access to credit from international banks will now find it difficult, if not impossible, to benefit from such facility."

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