Monday, June 6, 2016

How Nigeria Can reinvest Recovered $9.1 billion (N2.05 trillion) of Stolen Money

Nigeria Can reinvest Recovered $9.1 billion (N2.05 trillion) of Stolen Money


Nigeria’s government has recovered $9.1 billion in stolen money and assets. That is 6 billion pounds. And at the official Dollar to Naira conversion rate of N199 per dollar, equals N2.05 trillion. That is alot of money in cash and/or assets. In a statement, Nigeria's Information Minister Lai Mohammed said cash and assets recovered between May 29, 2015 and May 30, 2016 totaled $9.1 billion.


“All these are monies recovered from individuals and entities who had either hidden, stolen, diverted or were in possession of monies belonging to the nation,” the minister’s special adviser, Segun Adeyemi, told Reuters.

“These recovered funds include monies withheld by past government officials, monies kept in private accounts, monies diverted to private pockets and monies in possession of government officials not disclosed after leaving government.”

The information minister told Reuters he could not name any individuals from whom money had been recovered for legal reasons. He said some of the money came after companies that had failed to pay taxes were forced to do so retrospectively.

The government has said it plans to generate 3.38 trillion naira ($17 billion) this year from non-oil sources to help fund the $30.6 billion budget signed into law by president Muhammadu Buhari last month. 

Nigeria can reinvest the recovered 9.1 billion dollars into the power sector. In March, president Buhari said he would increase power generation by 2,000 megawatts this year and raise it by 2019 to 10,000 megawatts.

The privatization of electricity to 17 power companies three years ago was meant to attract investment needed to expand power supply in Nigeria. That initiative has failed. Private investors blame increasing debt owed by government and an inability to obtain foreign exchange to import equipment and, now, militant attacks on key installations as key issues for the failure.

“If the vandalism is not addressed urgently and comprehensively, electricity will continue to deteriorate and the government’s aspiration to significantly increase power generation by 2019 would be a mirage,” said Desmond Ogba, managing counsel and head of energy projects at Lagos-based law firm Templars

With Africa’s biggest gas reserves of more than 180 trillion cubic feet, gas-generated power was touted as the obvious solution by a succession of governments to end daily blackouts that cost the economy at least 2 percent of gross domestic product growth annually, according to the Ministry of Finance. Gas-fired power plants provide about 80 percent of Nigeria’s electricity supply, according to Pabina Yinkere, head of research at Lagos-based Vetiva Capital Management Ltd.

With current power output the lowest in a decade, millions of Nigerians either do without electricity or are forced to buy fuel for their own generators. Even when output reached its 5,000-megawatt peak, most of the country are still in darkness.

$9.1billion is a lot of money. That money can be reinvested towards power generation in Nigeria.

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