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We must dump fuel subsidy to avert public debt crisis – Budget Office

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Mr Ben Akabueze, DG of Budget Office of the Federation
Director General of the Budget Office of the Federation, Mr Ben Akabueze, said there was a need for the country to take urgent and decisive measures to avert public debt crisis.

He said among the decisive measures was the removal of subsidy on Premium Motor Spirit (PMS).

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Speaking on the topic: “The National Debt Burden: Causes, Effects and Realistic Economic Solutions” at the annual conference/awards of the Institute of Chartered Secretaries and Administrators of Nigeria (ICSAN), he said: “since 2020, public debt in Nigeria has risen to N32.9 trillion, equivalent to $86.4bn, It got to N39.6 trillion, equivalent to $95.8bn at the end of 2021 and this has risen to N41.6 trillion, equivalent to $101.1bn as of the end of March this year, while debt service approximately $7.7bn in 2021, an increase from 6.4bn in 2020, and because public debt is domestic debt, domestic debt service is also a significant proportion of debt service.”

Akabueze, who was represented virtually by his technical adviser, Olumide Ayodele, said the government believed that investment was required to bridge the infrastructure gap and provide public sector services to the people.

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He, however, said that the service exceeded the available resources of the government, which led the government to borrow to finance critical development project that would eventually improve revenue capacity generation for the economy, improve the business environment and sustain it over time to avoid a debt crisis.

In his welcome address, the president of ICSAN, Taiwo Owokalade, noted that the country had not only amassed huge amounts of debt but had kept borrowing at a fast rate, thus struggling to service the interest on the debt.

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Naira to Dollar Crashes Massively at Official, Black Market Exchange Windows, Surpasses 740/$

Naira, CBN
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The Naira to Dollar exchange rate has crashed massively at official and black market exchange rate windows. See the current exchange rate.

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On Tuesday morning, October 4, 2022, the Dollar to Naira at black market exchange rate crashed further to a record low of N745/$1, a drop of 0.68% from the N735/$1 recorded on Monday October 3rd.

This was contained in data obtained from Dollar to Naira black market exchange traders.

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However, at the Investors and Exporters window, where the dollar to naira is officially traded, the Naira to dollar crashed to 445/$1.

On Monday October 3rd, the exchange rate at the Investors and Exporters window crashed by 0.15% to close at N437.03/$1 as compared to N436.37/$1 observed in the previous session.

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Despite an increase in the volume of traded FX in the window, this is the case.

Total foreign exchange turnover was $223.3 million, an increase of 86.9% from the $119.49 million that was transacted in the previous trading session.

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The local currency, on the other hand, recorded a slight depreciation of 0.25% as compared to N735/$1 traded at the same time on Thursday, September 28, 2022, at the cryptocurrency peer-to-peer FX market, trading at a minimum of N736.8/$1 on Friday morning.

Nigeria’s external reserve decreased by 0.1% from the previous day’s $38.36 billion to $38.32 billion as of September 28th, 2022.

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Due to the CBN’s ongoing intervention in the official market to preserve the stability of the local currency, the country’s foreign reserve has been on the decline.

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FG files charges against Facebook, Instagram, Whatsapp over ‘unapproved’ adverts

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*Seeks N30 billion penalty

By Francesca Iwambe

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The Federal Government has filed charges against Meta Platforms Incorporated (owners of Facebook, Instagram, and WhatsApp platforms) and its agent AT3 Resources Limited at the Federal High Court, Abuja Judicial Division.

This was disclosed by the Advertising Regulatory Council of Nigeria (ARCON) on Tuesday.

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The apex regulatory body for Nigeria’s advertising ecosystem, ARCON in a statement noted that the government is seeking a declaration among others that the continued publication and exposure of various advertisements directed at the Nigerian market through Facebook and Instagram platforms by Meta Platforms Incorporated without ensuring the same is vetted and approved before exposure is illegal, unlawful and a violation of the extant advertising Law in Nigeria.

According to ARCON, Meta Platforms Incorporated’s continued exposure of unvetted adverts had also led to loss of revenue to the Federal Government.

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ARCON is seeking N30bn in sanction for the violation of the advertising laws and for loss of revenue as a result of Meta Incorporated’s continued exposure of unapproved adverts on it’s platforms.

The statement read in part, “ARCON reiterates that it would not permit unethical and irresponsible advertising on the Nigeria’s advertising space.”

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According to ARCON, the Council is not regulating the online media space. Rather, it’s focus is on advertising and marketing communications on the online platforms in line with its establishment Act.

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IMF urges quick actions against food insecurity affecting 345m people

IMF
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The Managing Director (MD) of the International Monetary Fund (IMF), Ms. Kristalina Georgieva, called for urgent actions against global food insecurity.

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Writing in a blog, she said that acute food insecurity was threatening the lives and livelihoods of 345 million people , across the world.

“The suffering is worst in 48 countries, many highly dependent on food imports from Ukraine and Russia. The financial costs of the crisis are rising, too.

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“We must all act now to ease the suffering of those experiencing hunger, by supporting countries who take strong policy action with the financing they need,” she said.

The IMF staff have estimated that the rising cost of food and fertilizer imports in countries highly exposed to food insecurity will add $9 billion to their balance of payments pressures in 2022-23.

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They warned, “This will erode their international reserves and ability to pay for food imports.”

According to them, many countries’ policymakers have introduced fiscal measures to protect people from the food crisis and that highly exposed countries would need as much as $7 billion this year alone to help the poorest households.

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According to the IMF, “The international community must…take decisive action to ensure that the needed financing is in place.”

Food and energy costs have been driving global inflation rates for several months, particularly since Russia’s invasion of Ukraine.

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In Nigeria, the food prices have also driven the inflation rate to 20.5 percent due to attacks on farmers by criminals claiming to be herders and bandits, which have negatively impact food production, across the country.

Flooding of farms has also exacerbated the challenges of food production, in the last two months.

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