Connect with us

Economy

Nigeria, others lose $1.6bn daily to illicit flows – AfDB

Published

on

Akinwumi AdesinaThe African Development Bank has revealed that the continent loses about $1.6bn every day to illicit financial flows and profit shifting on the part of multinationals operating in Africa.

This was disclosed by the Chief Economist of AfDB, Kevin Urama, in an exclusive interview with The PUNCH.

According to the International Monetary Fund, illicit financial flows refer to the movement of money across borders that is illegal in its source (e.g. corruption, smuggling), its transfer (e.g. tax evasion), or its use (e.g. terrorist financing).

For decades, the IMF has played a key role in international efforts to combat these opaque and often destabilising transfers. It also has longstanding concerns with flows that are not strictly illegal but are associated with tax avoidance

Advertisement

Urama said that Africa was losing more than it was getting back via Foreign Direct Investment and said that the focus of stakeholders should be on blocking the outflow rather than chasing inflows.

He said, “There are so many things that happen on the continent that actually make corruption a big issue. And some estimations show that Africa loses about 248 billion US dollars every year due to corruption. If you add illicit financial flows of over $90bn and add profit shifting; corporates operating in Africa but then maybe have headquarters somewhere else and they find clever accounting ways of legally not paying taxes. In Africa, we are losing about $275bn. When you sum all these up, these are things you can trace through banks, then you find that Africa is losing about $587bn every year.

“That’s about $1.61bn every day. Yet we spend all our time chasing FDI, foreign direct investment, official development assistance, portfolio flows and remittances. All these together during the year we did this study for 2022 was about $174.5bn. That’s less than three times, I mean what we are losing is three times more than what we are getting from the global market. So how do we engage with the global market? Are we not focusing on the wrong priorities? Because if you ask me if I’m losing almost $600bn, I will focus on how not to lose it instead of going to get more. Tackling it, is what we are doing.

Highlighting some of the ways to shut the door on the outflow, Urama said, “It all comes down to the quality of institutions, the accountability systems for institutions, the capacity of individuals in government, in public service to first understand the implications of decisions they make but also to have the tools, the regulations, the policies and principles and technologies to be able to track it down and stem it.

Advertisement

“And that is why in the African Development Bank, we not only are developing these issues on debt but we’ve also now developed what we call a Public Service Delivery Index for Africa which measures the quantum of public services delivered in all key sectors of development but also the perceptions of the citizens on how that public service is. You may say you have provided electricity to me because you put a pole and wires passed behind my house, but maybe I have not been able to connect.”

Illicit financial flows were one of the reasons Nigeria has been on the greylist of the Financial Action Task Force since February 2023.

However, the Nigerian Financial Intelligence Unit in October said that FAFT had approved the fourth progress report of the country at its last plenary meeting.

Speaking on the sidelines of the last IMF’s annual meetings in Washington, Deputy Governor, Central Bank of Nigeria, Philip Ikeazor reinforced the commitment to exiting the grey list, saying, “Practically sending money home is impossible and if we are talking about driving remittances and FDI’s then we need to get out of the Grey List.”

Advertisement

The CBN Governor, Yemi Cardoso outlining measures to meet this target, said stronger oversight and collaboration with international money transfer operators and Nigeria’s diaspora were key.

Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Economy

Imported food inflation hits 42% as FG’s duty waiver delays

Published

on

Nigeria’s imported food inflation surged to 42.29 per cent in November 2024, according to the Consumer Price Index report released by the National Bureau of Statistics.

This represents a significant rise from 23.74 per cent recorded in November 2023, marking an 18.55 percentage point year-on-year increase.

On a month-on-month basis, the inflation rate increased from 40.96 per cent in October 2024, a 1.33 percentage point rise in just one month.

The data highlights the relentless upward trajectory of imported food inflation throughout 2024, which began at 26.29 per cent in January.

Advertisement

By October, the inflation rate had crossed the 40 per cent threshold, and November’s figure of 42.29 per cent is the highest recorded in the past two years.

This sharp rise has been attributed to multiple factors, including currency devaluation, global supply chain disruptions, and inefficiencies in domestic policies.

The Federal Government’s attempt to address the situation through a duty waiver on imported food has been fraught with delays.

In July 2024, the Federal Government announced a 150-day duty-free import window for food commodities as it stepped up efforts to tackle rising inflation, which had impoverished many Nigerians.

Advertisement

The commodities include maize, husked brown rice, wheat and cowpeas. Under this arrangement, imported food commodities will be subjected to a Recommended Retail Price.

It was designed to reduce import costs and make staple foods more affordable. However, the implementation has stalled due to bureaucratic delays.

The PUNCH earlier reported that the average price of imported high-quality rice has surged by 144.77 per cent year-on-year as the Federal Government delays implementing its duty-free food policy.

Since the announcement of the policy, the price of one kilogramme of imported rice has risen by 3.21 per cent, climbing from N2,329.05 in July to N2,403.86 in September.

Advertisement
Continue Reading

Economy

Aviation authority decries flight cancellations

Published

on

The acting Director General of the Nigeria Civil Aviation Authority, Chris Najomo, has expressed concern over the increasing rate of flight cancellations, saying not less than 190 flights were canceled within two months.

Najomo stated this while delivering his speech at the Airlines-NCAA engagement over the spate of flight disruptions in the country on Friday.

He disclosed that out of 5,291 flights operated in September 2024; 2,434 were delayed while 79 were cancelled.

The acting DG added that out of 5,513 flights operated in October 2024, 2791 were delayed while 111 flights were also cancelled.

Advertisement

He said, “Delays and cancellations are sometimes inevitable, but poor management of these disruptions is not. It is the responsibility of airlines to ensure that every disruption, whether due to operational, technical, or weather-related challenges, is handled with the utmost professionalism and regard for passengers’ rights.

“Our flight operations data record indicates that in September 2024, five thousand two hundred and ninety-one domestic flights were operated with 2,434 delays and 79 cancellations.

In October 2024 5513 flights were operated with 2,791 delays and 111 cancellations recorded.

“We must remind all operators of the NCAA Regulations on Passenger Rights during disruptions, as outlined in the Nigeria Civil Aviation (Consumer Protection) Regulations, 2023. These regulations are not optional; they are mandatory obligations.”

Advertisement

Speaking at the sideline of the event, Najomo also stated that he had been receiving phone calls from the presidency and members of the National Assembly over the unruly behaviours of passengers at the airport, mostly occasioned by flight disruptions/ cancellations, describing such as an embarrassment to Nigeria.

This was as the NCAA boss insisted that no stone would be left unturned in tackling the menace and restoring the sanctity of the Nigerian airports.

While asking the airlines to tidy their end of the air transport bargains, Najomo promised to meet with the Federal Airport Authority of Nigeria after which a fresh decisive decision on how to better tackle the development would be made.

He said, “The unruly behaviour of some passengers is fast becoming very disturbing, I am getting calls from the presidency and even the National Assembly. This unruly behavior is not good for our image as a country and we are resolute in putting a stop to it.

Advertisement

The aviation regulator who understood that flight cancellations and disruptions were mainly responsible for the unruly behaviours of passengers at the airports insisted that violence should, however, not be the next resolution.

Also expressing her dissatisfaction with the trend of unruly behaviours, the Managing Director of the FAAN, Olubunmi Kuku, said the agency was disturbed about the development at the airports.

Kuku said, “I have continued to harp on communication and engagement with the NCAA, FAAN, and the Airline Operators of Nigeria. I have also enjoined operators to ensure that they provide us with the right information.

“We have continued to tell the passengers to ensure that they provide their email addresses to the airlines so they can get information but if you do act like a criminal within the terminal building, you would be treated as one. We understand the plight of passengers but to start behaving in a manner that is demeaning to airline staff or the airport, we would prosecute or even put you on a no-flight list.”

Advertisement
Continue Reading

Economy

NCC Approves MTN’s Spectrum Renewal Deal

Published

on

The Nigerian Communications Commission (NCC) has granted approval for the renewal of MTN Nigeria’s spectrum lease agreement with Natcom Development and Investment Limited (NTEL).

This renewal will allow MTN to enhance its network services and expand coverage across multiple states in Nigeria.

According to MTN’s Company Secretary, the agreement covers NTEL’s 5MHz frequency division duplex (FDD) in the 900MHz spectrum band and 10MHz FDD in the 1800MHz spectrum band. This lease spans 19 states and has been renewed for an additional two years, effective May 1, 2025.

Additionally, the NCC approved a one-year lease expansion of the spectrums to cover the remaining 17 states and the Federal Capital Territory (FCT). This extension will take effect on January 1, 2025.

Advertisement

MTN Nigeria’s Chief Executive Officer, Karl Toriola, expressed satisfaction with the agreement. He stated, “We are pleased with the renewal of the spectrum lease agreement with NTEL, which now includes coverage for all states, including the FCT.

“The lease enables us to enhance our 3G and 4G user experience as we improve coverage and capacity by utilizing the spectrums. This positions us to capitalize on the growing demand for data and improve the delivery of services to our customers,” he added.

The renewed agreement is expected to further improve MTN’s ability to provide reliable and high-quality connectivity services, meeting the increasing demand for data and digital services nationwide.

Advertisement
Continue Reading

Trending

Copyright © 2024 Naija Blitz News