Nigeria/EITI

Nigeria Records Highest Revenue Since 2014, Shared N3.95trn In H1 2018

Disbursements made by the Federation Accounts Allocation Committee (FAAC) has shown that the federal, states and local government areas shared N3.95 trillion from the Federation Account within the first half (H1) of 2018.

This is as the country recorded it’s highest revenues in Q2, 2018, which was the first time an amount in excess of N2 trillion was shared to the arms of government since Q3 2014. “This is a run of 14 consecutive quarters of disbursements below N2trillion,” the report said.

According to the latest edition of the NEITI Quarterly Review published by the Nigeria Extractive Industries Transparency Initiative (NEITI), the disbursements made by FAAC in the first half of 2018 represented an increase of 41percent when compared to the N2.79 trillion disbursed in the first half of 2017 and a 95percent increase in the N2trillion disbursed in the first half of 2016.

A breakdown of the disbursements showed that the Federal Government received N1.65 trillion, states received N1.38 trillion while local governments got the least share of N795billion within the first half of this year. The disparity in the revenues received by each of the three tiers of government, the analysis notes, “was based on the revenue sharing formula of the Federation as stipulated in the constitution.”

The Review shows that the lowest monthly figure of N635.6 billion disbursed in the first half of 2018 was N121.4 billion higher than the highest monthly figure (N514.2billion) disbursed in the first half of 2017 and N218 billion higher than the highest monthly figure (N417billion) for 2016.

“These figures clearly indicate that revenue accruing to the Federation in the first half of 2018 completely outstripped revenues in the previous two years”, stated the report.

The Quarterly Review further disclosed that total FAAC disbursements in the second quarter of this year was 46percent higher than the figure for the same period last year and 127percent higher than the figure for the same period in 2016.

Analysis showed that while N2trillion was shared in the second quarter of this year, N1.38 trillion was disbursed during the same period last year and only N886.38 billion was shared in the second quarter of 2016. “In fact, Q2, 2018 was the first time an amount in excess of N2trillion was disbursed since Q3 2014,” the report said.

According to the report, the phenomenal increase of disbursements recorded in the second quarter of 2018, was the highest to the Federation since the third quarter of 2014, a development it attributed to the rise in crude oil prices and similar increase in oil production.

“Average oil price in 2016 was $43.5 per barrel, while in 2017 oil price averaged $54.2 per barrel. However, in the first six months of 2018, average oil price was $70.6 per barrel. Thus, on the average, oil price increased by 62.2percent between 2016 and the first half of 2018”, the NEITI Quarterly Review noted.

Similarly it noted that total oil production in 2016 was 661.1 million barrels while the figure was 690 million barrels in 2017. In 2016, average monthly oil production was 55.1 million barrels while it was 57.5 million barrels in 2017. But for the first two months of 2018 for which data is available, average production was 59 million barrels, the report disclosed.

On net FAAC disbursement to states, the review disclosed that during the first half of this year, “the highest receiving state was Delta State with N101.19 billion, while the lowest receiving state was Osun State with N10.24 billion. This implies that Delta State received 988percent more than Osun State received,” it noted.

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