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Tinubu Speaks on Civil Servants Collecting Salaries despite Relocation Abroad

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President Bola Tinubu has pledged to address the issue of civil servants who still receive salaries from the government despite relocating abroad.

The president, who was represented by the Secretary of the Government of the Federation, Sen. George Akume, made this known in Abuja on Saturday night at the conclusion of the 2024 Civil Service Week.

He commended the Head of Service for the moves being made so far to discover the erring workers but called for more consequences for those caught.

Recall the head of service disclosed some days before that 1618 civil servants with fake employment letters were also caught and dismissed.

President Tinubu said,

“During my recent visit to South Africa, I kept abreast of the week’s activities and was particularly struck by the revelations shared by the Head of the Civil Service regarding employees who had relocated abroad while drawing salaries without formally resigning. It is heartening to hear that measures have been taken to address this issue, but we must ensure those responsible are held accountable and restitution is made.”

He ordered that superiors of the civil servants must also be brought to book over the fraudulent action.

“The culprits must be made to refund the money they have fraudulently collected. Their supervisors and department heads must also be punished for aiding and abetting the fraud under their watch. The Nigerian Civil Service cannot just be a workplace where ‘anything is possible,’ where workers violate rules without the fear of punishment or repercussion. The civil service of any nation is too important for such misconduct to take root or be tolerated,” he added.

Also speaking, the Head of the Civil Service of the Federation, Dr. Folasade Yemi-Esan, called for excellence from workers.

She said,

“In underscoring the nexus between incentives and performance, it is pertinent to emphasize that the Civil Service must not be seen as a dumping ground for job seekers but must attract the best and the brightest who will contribute fresh ideas and demonstrate the determination and capability to drive national plans and solve our socio-economic problems.”

She further commended the federal government’s efforts in enhancing the welfare of civil servants.

“The Federal Government has also progressively made modest interventions for the improved welfare of civil servants in recent times. At this juncture, I wish to profoundly appreciate His Excellency, President Bola Ahmed Tinubu, GCFR, for demonstrating both the will and passion for improving the welfare of the workforce through the ₦35,000 provisional wage award for all treasury-paid Federal Government workers for six months and ongoing efforts to review the minimum wage,” she added.

Numerous civil servants carted home prizes on the awards night and pledged to do better as they were spurred on by the recognition for their hardwork.

 

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FG delists some workers from payroll

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The Federal Government has deleted at least 1,618 civil servants from the the Integration Personnel Payroll and Information System (IPPIS) in one year.

Head of Civil Service of the Federation, Dr. Folasade Yemi-Esan revealed that the workers were delisted for possessing illegal and fake employment letters.

Yemi-Esan spoke on Wednesday in Abuja, during a media parley organized as part of programmes marking the 2024 Civil Service Week.

She disclosed that through physical verification conducted by the Ministries, Departments and Agencies (MDAs) of Government, the once over-bloated federal civil service has now been brought down from over 100,000 to 69,308 who have been verified and are on the payroll.

Yemi-Esan revealed that apart from the ghost workers who were parading fake employment letters, there was also the issue of some civil servants who “japa” for greener pastures in overseas that were caught napping during the physical verification exercise.

According to her, some of them who came into the country for the verification exercise like one or two weeks after the exercise had been conducted under the pretext that they were not aware of the scheduled physical verification exercise, were graciously given two weeks to appear for the verification exercise.

The Head of Civil Service of the Federation, said instead of waiting for the two weeks in addition to the days they had already spent in Nigeria, “a lot of them tendered their resignation letters because no UK organization would afford to give two additional weeks in the country to perfect the verification process.

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Western multinationals fleeing Nigeria are being replaced by Asian and Turkish firms

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As US and Europe-based multinationals exit Nigeria, Asian and local companies are stepping in to fill the void.

Last week, London-based Diageo Plc sold its controlling stake in Guinness Nigeria Plc to Singapore’s Tolaram Group Inc. The Fouani Group, a local firm, operates a diaper and sanitary pad plant in a complex where Cincinnati-based Procter & Gamble Co. shuttered a $300 million facility making the same products.

According to Bloomberg, Lagos-based Fidson Healthcare Plc is expanding its manufacturing range after the UK’s GSK Plc closed its Nigerian distribution arm. Turkish diaper-maker Hayat Kimya AS has also established itself in Nigeria.

Nigeria, with a population of more than 200 million, is Africa’s most populous nation, in theory presenting a huge market for consumer goods. But rampant unemployment, widespread poverty and insecurity, a plummeting currency, sky-high inflation and decades of economic mismanagement have turned it into a graveyard for multinational consumer goods companies.

The naira has swung wildly in recent months and is 56% down against the dollar over the past year, the most of any African currency. That’s made it difficult for companies that import goods and service foreign debts to make a profit as they struggle to pass the necessary price increases to consumers. And while the central bank has now cleared a $7 billion backlog that companies were seeking to repatriate the difficulty in doing so in recent years made many businesses unsustainable.
The gaps in the market left by the departing multinationals present an opportunity for domestic companies and foreign firms that focus on sourcing raw materials in Nigeria and manufacturing locally, thereby avoiding the currency risk that has hounded some foreign companies out.

And while the departures show just how unattractive the Nigerian consumer market has become they also highlight the success of strategies of companies such as Hayat and Tolaram, which have each turned their brands into household names.

Localized Costs
For companies such as Tolaram, used to operating in challenging environments such as Indonesia, the answer has been to localize as many costs as possible. That’s helped it turn Indomie instant noodles into one of Nigeria’s most popular brands, and led it into joint ventures with US cereal and snack maker Kellanova and Danish dairy giant, Arla Foods.

“Brands can’t continue to operate the way they’re used to. You need to adapt to the market accordingly,” said Girish Sharma, an executive director at Tolaram. “There is hardly anything in Indomie that we import. We have our own flour milling, we have our own palm oil refining, we have our own packaging.”
Tolaram operates 24 “fully backwardly integrated” plants in Nigeria, meaning the company produces the raw materials they need, and is even setting up its own oil palm plantations, Sharma said in an earlier interview. GSK, by contrast, imported its products.

That doesn’t mean that local firms aren’t struggling.
“In theory, we think we can better manage the difficulties of doing business in Nigeria,” said Jide Ogundare, managing director of MBO Capital Management Ltd, which took over supermarkets run by Shoprite Holdings Ltd. when the South African company quit Nigeria in 2021. “In actual fact, we face the same challenges as the foreigners except that we can’t leave and go elsewhere.”

Still, despite the narrowing margins and reduced spending power, the weaker naira is making Nigerian manufacturing competitive.

“We’re exporting to some West African countries like Mali and to East Africa and our target is to export to another five to 10 countries by the end of next year,” said Imokha Ayebae, Fidson’s executive director.

Oil, Technology
The exodus of firms including Kimberly-Clark Corp., Sanofi SA and Bayer AG are hindering Nigerian President Bola Tinubu’s bid to breathe life into the struggling economy.

Microsoft Corp. in May said it would shut the engineering section of its Africa Development Center in Nigeria two years after it opened. Meanwhile, oil majors Shell Plc, Exxon Mobil Corp. and Eni SpA have all sold their onshore operations to local companies, denting confidence in the industry that accounts for most of Nigeria’s exports and leaving behind decades of environmental devastation.

By contrast, Tinubu’s spokesman said Tolaram’s $70 million purchase of the Guinness stake was a vote of confidence in the Nigerian economy.

“The multi pronged reforms and interventions being implemented on the economic and financial fronts would deliver sustained growth and enduring profitability,” Bayo Onanuga, special adviser to the president on information and strategy, said in a post on X.

For now the companies still invested aren’t seeing that uptick. South Africa’s Multichoice Group, the biggest satellite television provider in Nigeria, saw subscriber numbers fall 18% in the year to March saying that Nigerian customers “had to prioritize basic necessities over entertainment.” Revenue at Johannesburg-based MTN Group Ltd., which runs Nigeria’s biggest mobile phone network, fell 53% in the first quarter of the year when measured in its home currency.
But in challenging environments there is also opportunity, said Tolaram’s Sharma, who emphasized the company’s belief in Nigeria’s potential.

“If everything was good I don’t think Guinness would think of partnering with Tolaram. Now when they saw there’s adversity they chose to partner with us,” he said. “Nigeria has 200 million people. They have to eat, they have to drink. We don’t see why Nigeria should not be the country where we’ll continue to stay and continue to invest.”

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Dangote refinery attains double Nigeria’s 11-yr power output

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…Generates 1,500MW versus FG’s 760MW

Nigeria took eleven years to add just 760 megawatts of power to the national grid, while the Dangote refinery doubled that output, generating 1,500mw in a shorter time.

For decades, the country has suffered from chronic power shortages, and repeated promises to fix the problem have long dominated election campaigns.

Data sourced from the Nigeria Electricity System Operator showed Generation Companies (Gencos)’ delivery to the Distribution Companies (Discos) via the Transmission Company of Nigeria (TCN) has increased by 22 percent from an average of 3,400mw in November 2013 to an average generation of 4,160mw, as at 12 June 2024.

However, Dangote’s oil refinery produced 1,500mw of power after construction in 2018, surpassing the total national grid expansion achieved in over a decade.

“We don’t put pressure on the grid. We produce about 1,500 megawatts of power for self-consumption,”

Aliko Dangote said at the Afreximbank Annual Meetings and AfriCaribbean Trade & Investment Forum in Nassau, The Bahamas.

This development has raised concerns about the snail pace of growth in Nigeria’s power sector despite billions of dollars in investment and an 11-year-old privatisation exercise.

“The government and some operators in the sector may say there has been some form of growth since 2013, but in actual terms, how many people are benefiting from the privatised power sector? most conglomerates are generating their power,” Charles Akinbobola, a senior energy analyst at Sofidam Capital said.

He added, “The challenge of the power sector has not entirely been the scarcity of funds, several trillions of naira have been pumped into that industry. The sector has been plagued by the shortcomings of its managers”.

Nigeria can produce 13,000mw of power compared with more than 58,095mw for South Africa, which has a similar-sized economy and a quarter of the population.

Nigeria’s ageing grid however delivers only about 4,000mw of power to its over 200 million citizens — roughly what the city of Edinburgh provides for 548,000 residents.

GoodLife’s analysis shows that although Nigeria’s transmission capacity has increased by 20 percent to an average of 4,200mw since 2013, Nigeria’s population has soared by 57 percent within the same period from 131 million people to 206 million, according to the latest World Bank estimates.

For instance, Egypt, a country with a population of 114 million inhabitants, added a total of 28,229mw to its national grid between December 2015 and December 2018, resulting in a total installed capacity of 58,818mw.

According to the United States Department of Commerce, International Trade Administration, this has been achieved through a fast-track project that worked on installing 3,636mw of electricity in 8.5 months and is worth $2.7 billion.

Egypt also signed another project with Siemens in March 2015, which added 14,400mw in 2.5 years by building three mega combined power cycle stations.

“By converting old simple cycle power plants to combined cycle, another 1,850mw were installed,” the US report said.

In Ghana, between 2000 and 2020, electricity generation capacity increased at a rate of 6.4 percent a year from 1,358mw to 4,695mw, according to data from the country’s energy agency.

“While other countries seem to be getting it right in terms of power; Nigeria’s power sector issue has become a major conundrum in the economy. There is a major funding and liquidity crisis which is posing significant risk to investments in the electricity value chain,” Muda Yusuf, the chief executive officer, the Centre for the Promotion of Private Enterprise said.

He added,

“Some fundamental issues need to be addressed in the electricity value chain. There are issues of technical and commercial losses which are yet to be addressed. These are inefficiencies costs that consumers are compelled or expected to pay for as part of the cost recovery argument. And these costs are in billions of naira”.

GoodLife’s findings showed that rising energy costs are disrupting productive activities in Africa’s most populous nation as factories self-generate more than 14,000 megawatts of electricity due to poor supply from power distribution companies.

According to documents compiled by the Manufacturers Association of Nigeria, member companies spent N639 billion on alternative energy sources between 2014 and 2021.

Manufacturers spent N25 billion in 2014, N59 billion in 2015 and N129.95 billion in 2016.

Moreover, they spent N117.38 billion in 2017; N93.11 billion in 2018; N61.38 billion in 2019; N81.91 billion in 2020, and N71.22 billion in 2021.

Findings showed the figures have varied over the years due to the effects of inflation and the number of member companies in the association, among other factors.

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