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FG targets offshore investment profits to fund projects

By on August 29, 2016

In a bid to shore up revenue to implement its programmes for the rest of year, the Federal Government is targeting dividends from its investments abroad.

The dividends are said to be in millions of dollars.

The move, it was learnt, became imperative due to the fact that dividends accruing from some of the investments had not been received for a while.

The investments were reportedly made on behalf of the Federal Government by the Ministry of Finance Incorporated.

The Accountant General of the Federation, Alhaji Ahmed Idris, who confirmed the development, said the Federal Government would intensify efforts at ensuring that it recovered all outstanding dividends accruing from its foreign and local investments.

He gave an example of a sugar company in Swaziland, with an annual dividend of $1m, adding that the dividend accruing from this investment had not been forthcoming.

He said, “The Office of the Accountant General of the Federation also houses the Department of Revenue and Investments and that department is responsible for all the Ministry of Finance Incorporated’s investments.

“We noticed quite on the list of investments particularly those outside this country some investments, which are not yielding and we became more curious. We decided to put ourselves on task to attend board meetings of such companies where Nigeria has substantial amount by way of shareholding and to follow up on dividend.

“I know that there is a sugar company in Swaziland, which used to give Nigeria on annual basis over $1m in dividend. That is a huge dividend and there are a couple of other investments and the department is working assiduously to identify and engage with those companies outside Nigeria.”

Apart from the overseas investments made on behalf of the Federal Government, it was gathered that a committee had been set up to look into some of government investments in Nigeria.

Some of them are in the form of government holdings in some privatised assets done by the Bureau of Public Enterprises.

Since the beginning of the year, the gross revenue into the federation account has been experiencing a huge decline owing to the suspension of oil production to enable the refineries to undergo repair.

There had been, for instance, explosions at Escravos terminal and a force majeure was declared at Brass terminal in January and February as a result of attacks on oil facilities.

The 2016 budget, which was signed by President Muhammadu Buhari had projected a daily oil production output of 2.2 million barrels per day with a budgeted oil benchmark price of $38 per barrel.

Based on the budget, the Federal Government had projected total revenue of N3.86tn where oil related revenue was expected to contribute N820bn.

In the same vein, non-oil revenues, comprising Company Income Tax, Value Added Tax, Customs and Excise duties, and Federation Account levies, are expected to contribute N1.45tn while N1.51tn is projected to be earned as independent revenues from Ministries, Departments and Agencies of government through strict compliance with the Fiscal Responsibility Act, 2007.

 

[Punch]