Nigeria’s external reserves which have
maintained a downward trend since last year
fell to a two-year low of $39.725 billion last the
The current position of the reserves represents
a significant decline by $3.78 billion or 8.7 per
cent, as against the $43.505 billion it stood at
the beginning of this year.
The last time the reserves were around its
current value was in September 2012.
The Central Bank of Nigeria (CBN) has been
using the reserves to support the nation’s
currency which has been under intense
pressure in recent times.
The BGL Securities in a recent economic report
also identified oil theft, pipeline vandalism and
technical hitches as the albatross to Nigeria’s
foreign reserve build up as well as the Excess
Crude Account (ECA)/Sovereign Wealth Funds
(SWF) savings. This, it pointed out may affect
It argued that: “The country is currently
experiencing the worst oil production
disruptions in four years with output falling to
pre-amnesty programme levels.”
Meanwhile, the latest CBN economic report for
the fourth quarter of 2013 showed that total
federally-collected revenue fell to N2.202
trillion. This represents a decline of 22.3 and
19.8 per cent below the quarterly budget
estimate and the level in the preceding
Relative to the level in the corresponding
quarter of 2012, total federally-collected
revenue fell by 10.5 per cent.
The decline relative to the level in the
preceding quarter was attributed to the fall in
both oil and non-oil revenue.
In addition, at N1.538 trillion, gross oil receipts,
which constituted 69.9 per cent of the total,
fell below the proportionate budget estimate
and the level in the preceding quarter by 20.4
and 5.2 per cent, respectively.
The development relative to the preceding
quarter was attributed to the decline in crude
oil and gas exports during the review quarter.
Non-oil receipts (gross), at N663.53 billion
(30.1 per cent of the total), was below both
the proportionate budget estimate and the
level in the preceding quarter by 26.4 and
41.0 per cent, respectively.
The decline in non-oil revenue relative to the
preceding quarter was due to the fall in
receipts from components of the non-oil
revenue, except customs and excise duties as
well as VAT.
As a percentage of projected fourth quarter
2013 nominal GDP, oil and non-oil revenue
were 13.0 and 5.6 per cent, respectively.
Of the gross federally-collected revenue during
the review quarter, the sum of N1.490 trillion
(after accounting for all deductions and
transfers) was transferred to the Federation
Account for distribution among the three tiers
of government and the 13 per cent Derivation
Fund. The Federal Government received
N702.22 billion, while the state and local
governments received N356.17 billion and
N274.60 billion, respectively.
The CBN also disclosed that in the fourth
quarter of 2013, the Federal Government
received N31.97billion from the VAT pool
account, while the state and local governments
received N106.57billion and N74.60billion,
Giving an insight into the revenue sharing, the
report said, “The sum of N106.65billion was
also distributed as the Subsidy Re-Investment
and Empowerment Programme (SURE-P)
among the three tiers of government and the
13% Derivation Fund as follows: Federal
Government (N48.88billion), state
governments (N19.11billion) and 13%
Derivation Fund (N13.86billion).
“In addition, the sum of N22.85 billion from
NNPC Refund was shared by the sub-national
governments and 13% Derivation Fund as
follows: State Governments (N11.23 billion),
Local Governments (N8.65 billion) and 13%
Derivation Fund (N2.97 billion).
“Thus, the total allocation to the three tiers of
government in the fourth quarter of 2013
amounted to N1, 832.78billion. This was below
the 2013 quarterly budget estimate by
Giving an insight into the banking operation in
the last quarter of 2013, the report said the
total assets and liabilities of the DMBs stood at
N24, 334.7billion at the end of the fourth
quarter of 2013, representing an increase of
4.4per cent over the level at the end of the
preceding quarter. The report explained that
the funds, which were sourced, largely, from
increased mobilisation of demand deposit and
Federal Government deposit, were used for
accretion to reserves and purchase of
“At N12, 224.8 billion, banks credit to the
domestic economy rose by 8.6 per cent above
the level in the preceding quarter.
“The development was attributed, largely, to
the 346.9 per cent increase in claims on the
Central Bank’s credit to the banks however
recorded a decline as it fell by 1.6 per cent to
N229.8billion at the end of the review quarter,
reflecting the decline in overdrafts to banks,
while total specified liquid assets of the DMBs
stood at N6, 614.79 billion, representing 39.5
per cent of their total current liabilities. At that
level, the liquidity ratio, rose by 1.8 percentage
points above the level in the preceding
quarter, and was 9.5 percentage points above
the stipulated minimum ratio of 30.0 per cent.
The loans –to –deposit ratio, at 3,6.3 per cent,
was 2.9 percentage points above the level at
the end of the preceding quarter, but was 43.7
percentage points below the prescribed
maximum ratio of 80.0 per cent. Posted by duhdhex @dhlekan
Nigeria’s external reserves which have