The National Bureau of Statistics (NBS) has said that Nigeria’s headline inflation increased by 0.72 per cent to 28.92 per cent in December 2023, up from 28.20 per cent in November 2023.
In its report released on Monday, NBS said that on a year-on-year basis, the headline inflation rate was 7.58 per cent, higher than the 21.34 per cent recorded in December 2022.
This shows that the headline inflation rate (year-on-year basis) increased in December 2023 when compared to the same month in the preceding year.
Furthermore, on a month-on-month basis, the headline inflation rate in December 2023 was 2.29per cent, which was 0.20per cent higher than the rate recorded in November 2023 (2.09per cent).
This means that in December 2023, the rate of increase in the average price level is more than the rate of increase in the average price level in November 2023.
The highest level of the average cost of goods and services since 1997 under the regime of the late Gen. Sani Abacha.
The rise in food inflation on a year-on-year basis was caused by increases in prices of oil and fat, bread, cereals, potatoes, yam, and other tubers, as well as contributions from fish, fruit, meat, vegetables milk, cheese, and eggs.
On a month-on-month basis, the food inflation rate was 2.72 per cent, this was 0.3 per cent higher compared to the rate recorded in November 2023 (2.42 per cent).
The rise in food inflation on a month-on-month basis was caused by an increase in the average prices of potatoes, yam and other tubers, bread and cereals, fruits, and fish.
The average annual rate of food inflation for the 12 months ending December 2023 over the previous twelve-month average was 27.96 per cent which was 7.02 per cent points increase from the average annual rate of change recorded in the same period of 2022 (20.94 per cent).
While urban inflation was 31.0 per cent, rural inflation came in at 27.1 per cent in December 2023. Experts laud FG’s over 40% shareholding transfer to MOFI. Some power experts have lauded the Federal Government over the transfer of its 40 per cent shareholding in electricity distribution companies. The experts gave the commendations in a separate interviews with the News Agency of Nigeria (NAN), in Lagos on Monday.
NAN reports that on Jan. 12 the federal government transferred its 40 per cent shareholding in electricity distribution companies from the Bureau of Public Enterprises (BPE) to the Ministry of Finance Incorporated (MOFI).
Commending, Dr Ayodele Oni, Partner at Bloomfield Law Practice, described the move as a significant step towards fostering more robust board room discussions.
This, he said, could ultimately encourage new influxes of capital into the sector and would gradually diminish the monopoly of the market and its associated bureaucracy.
Oni expressed that the shift demonstrated the government’s commitment to enhancing the competitiveness of government-owned companies and assets.
He stressed that the redirection of shares was not a miraculous solution, but rather a practical move based on a strategic vision.
With the Ministry of Finance’s board duly constituted and operating as a business entity, Oni it signified that they would be witnessing more direct investments in the Discos in 2024 and beyond.
“MOFI was set up in pursuant to Sections 2 and 3 of the MOFI Act 1959, as an assets holding company vested with the responsibility of being the sole manager of all federal government investments, interests, estates, easement and rights.
“The BPE was, however, set up for the purpose of privatising public enterprises, carrying out sector reforms and liberalisation of key economic sectors.
“It was, thus, an anomaly to have BPE continue to hold, on behalf of the federal government of Nigeria, those shares of the electricity distribution companies as MOFI was set up, to do just that.
“The step, now being taken by the government, in my view, is indicative of the government’s seriousness to improve the quality of the government’s investments in the Discos.
“This is so, because, whilst the BPE does not have the powers to make investments, as its primary purpose is the privatisation of entities, MOFI on the other hand has far-reaching powers to make investments.
“Not only does the MOFI have such powers, it does have a decent asset base from which to deploy resources to possibly support and or rescue the Discos from their financial doldrum,” he said.
Oni said with the current business targets of MOFI, deliberate steps would be taken to generate revenue for the government, improve foreign direct investments and ensure the financial protection of all investments in its custody.
On his part, Dr Akinrolabu Olukayode, Chairman of the Customer Consultative Forum of Festac/Satellite Town, Lagos State, acknowledged that opinions on the transfer of shareholding might vary.
Olukayode said some might perceive it as a positive step towards increasing transparency and accountability, as the Ministry of Finance gains more oversight and control over the electricity distribution companies.
He said that others might be concerned about potential politicisation of the sector, as the ministry was a political entity.
The expert said: “The impact on the economy, Nigerians, and investment will depend on how the Ministry of Finance manages its new role.
“If it leads to improved governance, efficiency, and investment in the electricity distribution sector, it could have positive effects on the economy and Nigerians by ensuring reliable power supply.
“On the other hand, if mismanagement or political interference occurs, it can hinder investment and negatively impact the economy and Nigerians who rely on electricity services,” he said.
The EKEDC customers forum chairman said that the transfer of shareholding might not directly enhance the regulatory authority of the Nigerian Electricity Regulatory Commission (NERC) or government appointments into the boards of Discos.
He, however, said that it could potentially lead to changes in the regulatory framework or decision-making processes if the Ministry of Finance decided to exercise its new authority in this area.
Also, Mr. Chinedu Amah, another power expert, said the government just moved the portfolio between two govt offices.
Amah said If the government wishes to trade its shares, it should do so already, adding that he don’t see how this would improve supply significantly.
He said: “If the challenges of the sector includes funding then may be trading the equity with a view to attract investment would be key.
“Unfortunately, trading the government equity will not have any direct funds injection into the disco. So, I do not see any direct correlation connecting this action to any form of progress.
“The present Discos holders should have a right of first refusal. Government should open up the market by enabling cost reflective tariff and also enforce value added franchising to increase supply capacity
“The same Finance Ministry that is is not clearing Ministries, Departments and Agencies (MDAs) debts.
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COMFORT EKELEME,
