CEM REPORT | The Nigerian National Petroleum Company (NNPC) Ltd, has refuted the claim of the Central Bank of Nigeria (CBN) that it is the cause of the devaluated naira.
NNPC has revealed that it remitted $2.7 billion into CBN in the first six months of this year.
Record made available by the NNPC states that of the $2.7 billion remitted into its CBN accounts, $645 million was for dividends paid by the Nigerian Liquefied Natural Gas Company Ltd, while $1.786 billion was from the NNPC’s operational activities.
A breakdown of the remittances showed that funds into the accounts came thus: $18,770,418.97 (January 2022), $194,563,276.49 (February 2022) and $373,232,875.20 (March 2022).
Other remittances were: $247,884,295.52 (April 2022), $591,565,425.41 (May 2022) and $880,906,761.81 (June 2022).
These figures go contrary to the claim of CBN Governor Godwin Emefiele, that the weakened value of the naira was caused by a “zero-dollar” remittance to the country’s foreign reserve by the NNPC Ltd.
The Governor stated this while speaking before the Senate Committee on Banking, Insurance and Other Financial Institutions on the downward trend of the naira and the activities of the intervention funds the CBN earmarked to support some sectors of the economy.
At the time of the allegation, the naira traded for N700/$1 at the parallel market and N415.96/$1 at the official market.
Reactions from top officials of the apex bank disclosed that the NNPC remittance was not as federal government revenue.
“The fund they remitted is not oil imports.”
“The money they remitted was not even up to the forex they require for the importation of white products and that was why they sought augmentation to meet the threshold.”
Another official said it was normal for the NNPC to have operational accounts with the CBN but that remittances into the Federation Accounts Allocation Committee (FAAC) were halted by NNPC Ltd for several months as it has been using the fund for the importation of petrol at a subsidized rate.
Furthermore, reports reveal that the presidency has called both parties to a round table to clarify claims as finance experts have described the situation as “an embarrassment” to the country.
An official of CBN confirming this said;
“As we speak, there is a meeting over this issue at the presidency to resolve the anomaly because the report that they (NNPC) remitted $2.7bn to the federation is misconceived as money to the government.”
This is not the first time the CBN is blaming the rapid depreciation of the value of the naira on so many factors while exempting itself.
In 2018, Emefiele blamed the forex crisis on the importation of items he said should have been manufactured in Nigeria, leading to the ban on forex allocation for 41 items.
In 2021, Emefiele shifted the blame to BDC operators, who he accused of illegal forex trading.
He pointed fingers at ‘Aboki FX’, saying its activities were responsible for the naira’s depreciation, thereby cutting allocation to Bureau de Change (BDC).
This year, the CBN has blamed the forex crisis on money laundering and activities of those allegedly funding terrorism, as well as politicians.
The CBN further threatened to place on post no debt (PND) on accounts of politicians discovered to be buying dollars in bulk.
The motion that brought the CBN to the senate was moved by Senator Olubunmi Adetunmbi.
In his motion seeking Emefiele’s summoning, Adetunmbi said CBN’s earlier ban of forex sales to Bureau de Change (BDC) operators caused a spike in exchange rate.
He stated that a few people benefit from the import-export window meant to serve the forex needs of business enterprises.
According to him, even Personal Travel Allowance (PTA) and Business Travel Allowance (BTA) are not accessible, as less than 20 per cent of total forex demand by travellers and businesses is met by CBN.
Contributing to the debate, Senator Sani Musa (Niger East), said the naira would appreciate if Nigerians consume what they produce.
Senator Biodun Olujimi (Ekiti South) said, “The time has come for us to look holistically into what is happening. What is happening to the dollar is a replica of what is happening to Nigeria,” she said.
The Senate thereafter asked the CBN to stop the rapid decline of the value of the naira.
It was after the resolution of the Senate that the CBN governor brought in the NNPC angle to the matter.