Okonjo-Iweala Explains Drop In Oil, Non-oil Revenues

Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, has disclosed that Nigeria is experiencing drop in her non-oil revenues adding to the drop being experienced in crude oil earnings as a result of oil theft and vandalisation.

In an interview with THISDAY in Lagos, Okonjo-Iweala explained that the amount of revenue generated by the Nigeria Customs Service has decreased as a result of some measures that were put in place by the federal government.

This, she pointed out, was anticipated, in view of the high tariff barriers that were adopted by the country.

“If you put in place high tariff barriers because you want to produce your own domestic products and do not want substitute, what will happen? The import will diminish for those products and the duties that you collect are going to be less. It is not a surprise so when we look at it, rice has been the biggest culprit,” she said.

“We announced in the budget that the tariffs will be up to 100 percent for all types of rice products, another 50 per cent levy and so on and so forth, keep pressure on rice.

“So you don’t see any shortage. There are lots of rice in the market; I think they are also smuggled. There also appeared to be a lot of smuggled rice in the market coming from the borders. We are talking to the Republic of Benin about this phenomenon and that is the flip side of the issue. Sometimes when your tariff is high, that’s what you have.”

Okonjo-Iweala also noted that the quantity of rice imported through the country’s borders had gone down, which has also contributed to drop in Customs duties.

She said further that as a result of the drop in oil output, some of the oil receipts of Federal Inland Revenue Service (FIRS) had also gone down.

“These are some of the things that have happened with revenue and  the issue is: What is the government doing on the oil theft issue? This is because it is a problem we just have to solve. It is a big task on the country and it’s one of a fiscal vulnerability. So the president has set up a task force chaired by the governor of Delta State and we have all the Niger Delta governors as members, I’m a member, the minister of petroleum resources is a member, ministers of national planning, armed forces including everybody that has anything to do with oil including oil companies,” she added.

She enthused: “I felt quite good about the direction in which the Delta governor has been chairing this and we are focusing on the short-term, on what we can do now to restore one or two key pipelines-Nembe Pipeline and Trans-Niger and I believe that in the next few weeks you will see these pipelines repaired, restored and protected in such a way that  will add value again.”

Leave a Reply

Your email address will not be published. Required fields are marked *