No meaningful and successful public wealth creation can take place without achieving energy security, the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC Ltd), Mele Kyari, has said.
The GCEO spoke at the Public Wealth Management Conference organized by the Ministry of Finance Incorporated (MOFI) in Abuja on Tuesday on the theme, “Championing Nigeria’s Economic Prosperity”.
He said all other wealth generation activities such as agriculture rely heavily on one form of energy or the other to thrive.
“If you don’t have energy, you don’t have agriculture. You can do all the agriculture, but you can’t take it to the market. You may not be able to preserve it. You can’t even export it. So, all those indices are clearly connected to the ability to create energy,” Kyari who spoke as the head of the portfolio and partner companies at the event, said.
With a huge energy deficit of about 70 percent of the over 220 million population lacking access to clean cooking fuel and over 50 percent lacking access to electricity, he said Nigeria was still grappling with a lot of impediments to achieving energy security.
He listed some of the impediments to the achievement of energy security including lack of investment in the energy sector due to a climate of uncertainty in the business environment and multiple taxation regimes.
In the last 10 years, he said less than 3 percent of the total investment flow into Africa came into Nigeria.
He, however, assured that NNPC Ltd was working hard to lay a solid foundation for sustainable wealth creation by filling the energy deficit gap, stressing that the company’s growth trajectory from a loss position of N803 billion in 2018 was reversed to a profitable position of N2.5tr in 2022.
This, he said, was a positive testimony to the abundant potential of NNPC Ltd to lead the process of wealth creation in the country with the right incentive.
Despite the challenges, he said the NNPC Ltd still accounts for the highest value-addition agency as the highest tax-paying corporate entity in Nigeria.
In his keynote presentation at the occasion, President Bola Tinubu decried the incessant mismanagement and underutilization of Nigeria’s public assets.
Tinubu, who was represented by Vice President Kashim Shettima said his administration planned to create millions of jobs for Nigerians by unlocking the value of the country’s vast public assets to optimize and double the country’s Gross Domestic Product (GDP).
With economic revitalization as its top priority, Tinubu said the federal government has a target of raising at least $10 billion to increase foreign exchange liquidity that would, in turn, help stabilize the Naira.
“The Federal Government has set a goal to raise at least $10 Billion to increase foreign exchange liquidity, a key ingredient to stabilize the Naira and grow the country’s economy.
“At the core of this effort is to ensure optimal management of the assets and investments of the Federal Government towards unlocking their revenue potential. This includes our bold and achievable plan to double the GDP growth rate and significantly increase the GDP base over the next eight years,” the President said
He said that decades of mismanagement and underutilization of the country’s public assets have plagued the country across all sectors of the economy, both within and outside the country, leading to revenue losses that have hindered economic growth.
The newly restructured Ministry of Finance Incorporated (MOFI), he pointed out, has been charged with the responsibility of acting as the custodian and active manager of these assets, to create the needed value for them.
Emphasizing transparency and accountability as key principles to imbibe in the effort to create wealth, Tinubu expressed the belief that improved corporate governance, innovative partnerships, and attracting alternative investment capital would significantly increase returns on investments in these assets.
These improved returns, he noted, would then be directed towards “crucial funding for education, healthcare, housing, power, roads, and other areas vital to lifting millions out of poverty” and stimulating sustainable economic development and job creation for the youths.
Stressing that this initiative was not just about revenue generation, the President said it was also about creating inclusive and sustainable growth, adding that by efficiently managing public resources, the government aims to build a more equitable society and unlock the full potential of its citizens.
He called on all stakeholders, including Ministries, Development Financial Institutions, and both public and private sector players, to partner with MOFI in optimizing these strategic assets, expressing hope that such collaborative efforts would unlock Nigeria’s full potential and create a brighter future for all citizens.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said President Tinubu was mindful of the pains of the administration’s reform programmes on Nigerians and was deploying appropriate mechanisms to address them.
Edun assured that while 42,000 metric tons of assorted grains were being released, with about 60,000 metric tons to follow shortly, the government was determined to sustain intervention measures to arrest rising food inflation and curb food prices in the coming months as a result of government actions and policies.
The Minister urged the management and board of MOFI to, among other things, develop a specific line of revenue for the national budget as part of its renewed mandate of supporting the Federal Government’s fiscal stability.
On his part, the Chairman of the MOFI Board, Shamsudeen Usman, assured that MOFI would, going forward, play a more active role in the management of assets under its purview, even as he urged operators of the assets to see MOFI as a partner, rather than competitor or regulator.
The new MOFI management, Usman said, was committed to a high level of corporate governance, adding that the company has integrated a non-conflict of interest policy to guide against practices that undermine professionalism among members of staff.
In the same vein, the Managing Director/Chief Executive Officer (CEO) of MOFI, Armstrong Takang, who gave an overview of the MOFI’s renewed mandate highlighted the expectations from the public and the private sector.
Armstrong used the occasion to announce the unveiling of an N100 billion Project Preparation Fund by MOFI as part of its renewed mandate to ensure professionalism in the management of public assets.
He said the overall objective of the Fund was to deliver commercial value for the common good of the people, assuring that the company would transform the fortunes of public assets under its purview and restore investor confidence in both the operations and management of the assets. A ten-year plan was also unfolded to unlock the value of Nigeria’s public assets.
In his presentation, the guest speaker, who is also an investment advisor, author, and expert on public commercial assets, Dag Detter, said the achievement of public wealth creation requires enormous political will on the part of those in government to come up with policy decisions to dismantle the roadblocks of lack of transparency and accountability in the management of public assets.
He cited the example of Singapore whose government took critical decisions that helped transform its economy into one of the biggest economies in the world through the transparent and accountable management of its public assets.
The guest speaker said Nigeria has a lot to learn from the experience of Singapore if it were to transform many of its moribund assets to create value and help grow the country’s economy.
