Page 12 - DMEA Week 06 2023

DMEA NEWS IN BRIEF DMEA

POLICY REFINING Across the road, young men drenched
in sweat from the sweltering Lagos heat sell
US targets Iranian 4th SP refinery to boost petrol in plastic containers at more than
double the regulated pump price.
petrochemicals, petroleum output oil producer are adding to voter frustration
Recurring fuel shortages in Africa’s top
in fresh sanctions The production capacity of South Pars fourth as Nigeria prepares to hold presidential and
refinery will increase in the near future, the
parliamentary elections on Feb. 25. They are
The United States on Thursday imposed director of the refinery said. a stark example of the economic hardships
sanctions on companies it accused of playing Noting that the rise in output has been that have dogged Nigeria for years, including
a critical role in the production, sale and planned to prevent gas shortage in the surging inflation, widespread unemployment
shipment of Iranian petrochemicals and country, especially in the cold seasons, and acute shortages of foreign exchange that
petroleum to buyers in Asia, as Washington Behzad Salari added that the fourth refinery have severely weakened the naira currency.
increases pressure on Tehran. is scheduled to receive gas from the Kish Gas “People are suffering; there is no money;
The US Treasury Department in a Field, which will be developed in about a year, there is no food,” said Titus Nwafor, a
statement said it imposed sanctions on six the Oil Ministry’s news service reported. 53-year-old bus driver as he waited to fill up at
Iran-based petrochemical manufacturers The fourth refinery of the South Pars Gas the Lagos station.
and their subsidiaries and three firms in Complex is one of the 13 refineries, which With elections around the corner, he
Malaysia and Singapore over the production, processes about 85 million cubic meters expressed frustration with the candidates,
sale and shipment of hundreds of millions of of sour gas supplied by three platforms in who he said were “blaming this, blaming that”
dollars worth of Iranian petrochemicals and phases 6, 7 and 8 of the giant South Pars Gas without offering any solutions.
petroleum. Field, shared by Iran and Qatar in the Persian President Muhammadu Buhari, who
The latest US move against Iranian oil Gulf, on a daily basis, he said, noting that the will be stepping down in May after serving
smuggling comes as efforts to revive Iran’s refinery’s products includes sweet gas, ethane, his constitutionally allowed two terms,
2015 nuclear deal have stalled and ties propane and butane. promised to revive the economy and improve
between the Islamic Republic and the West are FINANCIAL TRIBUNE livelihoods when he took office in 2015.
increasingly strained as Iranians keep up anti- He has prioritised state-funded
government protests. infrastructure, investing billions of dollars in
“Iran increasingly turning to buyers in East FUELS new roads, bridges, airports and rail.
Asia to sell its petrochemical and petroleum Nigeria’s poor transport and power
products, in violation of US sanctions,” Fuel and cash shortages networks have stymied economic growth
Treasury’s Under Secretary for Terrorism and for decades, holding back the distribution
Financial Intelligence, Brian Nelson, said in rile Nigerian voters heading of wealth in Africa’s biggest economy where
the statement. 63% of people live below the poverty line,
“The United States remains focused on into election according to the national statistics bureau.
targeting Tehran’s sources of illicit revenue, Building infrastructure has, however, come
and will continue to enforce its sanctions At a fuel station in Nigeria’s commercial at a cost.
against those who wittingly facilitate this capital, tempers flare and harsh words are Nigeria’s foreign debt has risen fourfold
trade.” exchanged as motorists wait in line for hours to $40 billion under Buhari, and the
ARAB NEWS to fill up their tanks at one of the few outlets budget deficit has widened every year. The
with petrol left in the vicinity. government spent 98% of the revenue it
collected in 2022 on debt servicing, finance
ministry data showed.
Buhari has also pushed protectionist
policies, including import bans on the staple
rice. This initially spurred local production,
but spreading insecurity is hurting farmers’
ability to plant, while the high cost of fertiliser
and diesel have pushed the price of a 50 kg
bag of rice nearly 90%, to 55,000 naira ($120)
last year.
In 2017, the central bank introduced
a multiple exchange rate system to avoid
devaluing the naira currency, but this has
contributed to dollar shortages, and the local
unit has weakened to record lows against the
greenback on the black market.
A central bank decision to replace old
banknotes with new ones - part of an initiative
to curb cash in circulation and control double-
digit inflation - has caused huge controversy
because there are not yet enough new notes in

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