Central Bank of Nigeria (CBN) Governor,
Sanusi Lamido Sanusi, said the Nigeria National Petroleum Corporation (NNPC)
had no right to retain $10.8 billion in income, which has contributed to a drop
in savings that’s left the nation exposed to possible price shocks.
“Given where the oil price is, we should have
more in terms of reserves and savings, and because we don’t have that we are
susceptible to shocks in the event of a decline in the oil price,” Sanusi told
Bloomberg.
A letter Sanusi wrote to President Goodluck
Jonathan alleging the Nigerian National Petroleum Corp. had withheld $49.8
billion in revenue sparked a public outcry when it was leaked to local
newspapers last month. Finance Minister Ngozi Okonjo-Iweala told reporters on
Dec. 18 a reconciliation of the accounts showed unaccounted oil receipts stood
at $10.8 billion.
“No one has the right to retain money that
should have gone to the federation account, so the fact that you’ve admitted
retaining, or withholding $10 billion is itself bad enough,” said Sanusi. “This
money was supposed to come in and if it came in, it would be part of our
reserves and part of our excess crude savings.”
Bernard Otti, the NNPC’s group executive
director of finance and accounts, said on Jan. 10 the $10.8 billion was spent
on pipeline repairs, fuel subsidies and reserve fuel.
The lack of accounting in oil revenues has
increased pressure on Jonathan as he faces defections from the ruling Peoples
Democratic Party and former President Olusegun Obasanjo criticized him for
failing to tackle corruption. Lagos-based ThisDay newspaper reported on Jan. 9
that Jonathan told Sanusi to resign because he allegedly leaked his letter
about the NNPC to Obasanjo.
Sanusi, who doesn’t plan to renew his
contract as governor when it expires in June, said there is no request from
Jonathan to resign and “it’s back to business as usual.”
Nigeria’s gross reserves have fallen 11
percent from last years peak of $48.85 billion in May. The excess crude
account, which holds the savings the nation makes when the crude price is above
the benchmark price estimated in the budget, dropped to under $5 billion from
$9 billion at the beginning of the year, Okonjo-Iweala said in October.
Lower savings are “not explained by a huge
increase in government spending, because there wasn’t between 2013 and 2012,”
Sanusi said. “So if spending didn’t increase much and if the oil price didn’t
crash much and exports didn’t crash much, there’s a leakage.”
A decline in oil production doesn’t explain
the draw down in savings either because the crude price has exceeded the
government’s budgeted price, Sanusi said. The spot price of Nigeria’s benchmark
Qua Iboe crude has exceeded $100 a barrel for most of 2013, above the $79
budgeted price that year.
“This whole process for me is one in which we
need to force greater transparency over oil revenues,” Sanusi said. The NNPC
has “now given explanations and they’re going to be called to show evidence.”
Sanusi said his letter to Jonathan was never
meant to be made public.
“What was in fact an invitation to
investigate somehow became read as the end of an investigation, the conclusion
from an investigation and that wasn’t it,” he said. “This was an initial report
given that, for me, raises sufficient concern to ask the president to have an
investigation so we can know exactly where the money is.”
Jonathan’s PDP, which has been in power since
military rule ended in 1999, may face its sternest electoral challenge next
year. That’s adding to risks that government spending may increase and
inflation will accelerate from 8 percent in December. Expenditure climbed 17
percent before the 2011 presidential vote.
The Finance Ministry will probably be able to
keep spending under control in the run up to the vote, Sanusi said.
“I have had a number of discussions with the
finance minister and I get a sense she is very, very committed to keeping a
tight leash on spending especially as we come towards elections,” he said.
Jonathan hasn’t given any indication yet of who will be the next governor.
Lagos-based Vetiva Capital Management Ltd. said in an Oct. 28 report that
potential candidates include Sanusi’s four deputies and Aigboje Aig-Imoukhuede,
chief executive officer of Access Bank Plc. (ACCESS) Sanusi declined to comment
on who he thought would be the best candidate.
Drawing criticism from members of parliament
opposed to his push for spending curbs on salaries, Sanusi fought off plans by
lawmakers in 2012 to amend rules that would curtail the governor’s powers over
the central bank.
“I could have annoyed these guys a little bit
less if I was a bit more politically sensitive and more tactful,” he said.
“Some people have strong diplomatic skills and can make the same point without
annoying people. My father was a career diplomat, so he took all diplomacy in
my blood, I have nothing left.”
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sanusi ur mouth just dey run any how dis days..44billion today 10billion tomorow..ok e o...continue...one day monkey go enta market to come out nor go gree..
ReplyDeleteSanusi it is becoming too much of u.
DeleteDis is a serious financial but attracted only 2 comments dat did nt address d indictment issue raised. If it were useless political matter as in Mbu's atrocities in Rivers state dis wil b full of useless comments. Dis naija mentality is a shame.
ReplyDelete