Page 10 - DMEA Week 22 2021

DMEA FUELS DMEA

Nigeria seeks to clear bottlenecks

in domestic LPG credit programme

AFRICA NIGERIA’S government is reportedly looking [These practices] slowed down the amount of
for ways to help local fuel retailers access credits people whose balance sheets can allow them [to]
that Abuja has made available to encourage the access the loan.”
sale of CNG as motor fuel and LPG as cooking Abuja is determined to streamline the pro-
fuel. cess of distributing the loan funds and is consid-
According to Dayo Adeshina, the programme ering its options for tweaking the programme,
manager of the Office of the Vice Presidency’s Adeshina was quoted as saying by The Guardian.
National LPG Expansion Implementation Plan, “That is being looked at to see how associated
the government has been evaluating the results bottlenecks can be resolved to make it easier for
of its decision last year to distribute NGN250bn people to access,” he remarked.
worth of subsidised loans via the Central Bank of The programme manager was speaking
Nigeria (CBN). The results of this process indi- around the same time that Habeeb Jaiyeola, the
cate that some organisations are having difficulty associate director of PricewaterhouseCoopers
accessing the funds, he said. Nigeria, praised the National LPG Expansion
This problem appears to have arisen because Implementation Plan. Jaiyeola spoke favoura-
the commercial banks seeking to secure the cred- bly about the Nigerian government’s decision
its on behalf of fuel retailers hoping to expand to work through CBN to facilitate investment in
the CNG and/or LPG sales are taking the same the domestic LPG trade, saying: “The intent of
approach to the subsidy programme as they do the fund is also quite comprehensive and seeks
to commercial lending, Adeshina stated. This has to ease funding challenges for all players within
had the effect of preventing many eligible sellers the LPG value chain.”
from participating in the programme, he said. But he also asserted that Abuja would have
“To access the loan, it is your commercial to ensure that the subsidised credits had maxi-
banks that will approach the CBN,” he explained. mum impact. Specifically, he said, government
“But unfortunately, the banks were treating it as officials should review applications carefully,
commercial loans. Typically, they would ask for enforce repayment agreements introduce a mar-
the same things they ask when you ask for nor- ket-driven pricing system for LPG that allows
mal loans – equity contribution, security and all. retailers to recoup their investments.™

P10 www. NEWSBASE .com Week 22 03•June•2021