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Nigeria To Sell Ajaokuta Steel Company, Other Assets To Fund 2018 Budget

Ajaokuta Steel Complex

The Federal Government is ready to offer more of its assets for sale soon, under the ongoing privatisation programme aimed at raising more money to implement the country’s 2018 deficit-based budget.

Just recently, the Nigerian Security Printing and Minting Company Limited Plc was offloaded, with the Central Bank of Nigeria (CBN), which already has a majority stake, emerging the preferred buyer, given the company’s security status.

CBN Governor, Godwin Emefiele, who made the disclosure while briefing the Nigerian delegation at the end of the International Monetary Fund/World Bank Group meetings in Bali, Indonesia, affirmed that more assets are in the offing.

“I am aware, as a member of the National Council on Privatisation, that more are coming and I believe in due course that the Bureau of Public Enterprise (BPE) will make this available for us. I am aware of the situation of Ajaokuta Steel Company of Nigeria. It is also on the cart, first for a total review of the process of privatisation and payment, so that our aluminum sector can eventually come alive,” he said.

Emefiele’s disclosure on Ajaokuta Steel Company however, elicited mixed reactions. According to Prof. Ken Ife, a macroeconomic policy analyst, “The decision to privatise it is a wise one because the complex remains one of the white elephant projects we have in Nigeria. We need to look for a competent investor with a large war chest who can inject the needed funds to revatilise it, so that it can play its role in the country, providing the necessary steel derivatives for the rail, auto, manufacturing, building and construction industries across and beyond the country.”

But a development economist and public analyst, Mr. Odilim Enwegbara, disagreed, saying: “This administration cannot embark on the sale of a key strategic asset like Ajaokuta when it has less than a year to the end of its tenure. It should wait until after election. If it wins again, then it can do that.

“Besides, the executive lacks the power to sell such a critical national asset without the approval of the legislature. Let them look for funds elsewhere to fund the budget. They cannot sell a key national asset like that to fund one fiscal budget. What happened to the recovered loot they got?”

A recent audit report meanwhile revealed that a reactivation of the steel company would cost $652 million.

Also in Indonesia, the Minister of Finance, Mrs. Zainab Ahmed, revealed that the Nigerian National Petroleum Corporation (NNPC) would soon get a new reporting template that would ensure more transparent deals with public funds.

The template, she said, would have to be agreed upon. Then NNPC would start reporting in that template with the goal of making NNPC’s reporting simpler and understandable, so that more information would be provided on revenue generated and cost incurred.

The state oil company, which has been embroiled in allegations of financial overstatements, according to the minister, is now in discussion with a committee set up by President Buhari on revenue mobilisation.

Source: The Guardian

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