Page 11 - AfrOil Week 07 2023

AfrOil POLICY AfrOil

Tullow said assessments span through 2010- to shore up revenues as it seeks to finalise a $3bn
2020 and relate to the disallowance of loan-inter- International Monetary Fund (IMF) bailout
est deductions and proceeds received through a amidst a loss of access to international capital
business interruption policy, the company said. markets, has been demanding from a growing
It added: “Tullow believes that resolution number of companies to pay millions of dollars
through international arbitration will bring it alleges they owe in back taxes.
certainty, which is in the best interest of all Apart from Tullow Oil, the GRA has also
stakeholders. Notwithstanding this formal step, informed Johannesburg-listed miner Gold
Tullow intends to continue to engage with the Fields Ltd., Dallas-based Kosmos Energy Ltd
Government of Ghana, including the GRA, with that they are allegedly in arrears. However, the
the aim of resolving these disputes on a mutually West African state has withdrawn a $672mn tax
acceptable basis.” bill it imposed on South African-based telecom
Ghana’s cash-strapped government, looking giant MTN Group on similar charges. ™

IMF urges Nigeria to eliminate

domestic gasoline subsidies

NIGERIA THE International Monetary Fund (IMF) is Even in the face of these positive develop-
pressing Nigeria’s government to uphold its ments, though, Nigeria still needs fiscal reforms
pledge to eliminate subsidies for domestic gaso- to reduce its debt load and to minimise vul-
line prices by the middle of this year, calling the nerability to unexpected events such as price
current policy a drag on public finances. fluctuations and production stoppages caused
The IMF’s executive board summed up the by floods, the report said. Eliminating the gas-
results of its most recent Article IV consulta- oline subsidy and finding other ways to protect
tion in a report released on February 8, stating low-income consumers should be key compo-
that Nigeria’s economy was showing signs of nents of this process, it added.
improvement. It said the West African country The IMF’s executive board has “urged the
had regained the momentum it lost during the authorities to deliver on their commitment
coronavirus (COVID-19) pandemic, partly due to remove fuel subsidies by mid-2023 and to
to rising consumption but also due to favourable increase well-targeted social spending,” the
pricing conditions on world oil markets. report commented. It said that this approach
This progress is evident in the fact that Nige- was likely to be more efficient than the current
ria’s GDP, adjusted for inflation, has already policy, which had caused the national deficit to
moved back up to pre-pandemic levels, the widen in 2022 even though world oil prices had
report noted. It also pointed out that the third been relatively high for much of the year.
quarter of 2022 had been the eighth consecutive The report further noted that Nigeria’s cur-
quarter in which the Nigerian economy had rent account had improved last year, even as
grown, despite problems that served to con- capital outflow pressures caused the country’s
strain oil production and exports. foreign currency reserves to decline. ™

Previous attempts to eliminate the gasoline subsidy have proven unpopular (Photo: CFR)

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