Nigerians who want intra-state competitiveness should support Governor Umaru Bago of Niger State who is making a case that his state should be paid “a 13% derivation fund, similar to other oil-producing states in Nigeria”. He continuted, “We need 13 percent derivation for water supplied to the Delta. Our people are ravaged and displaced year in, year out because of the flow of water from the Niger to the Delta…The Federal Government will pay Niger State N1 trillion in the next three months for hydrocarbon exchange; they must. We have provided this country with hydropower for a long time; nobody is compensating us for it.”
That said, it should not end there. I am not a real fan of this 13% derivation payment; I want states to own and be in charge of their assets. Period. In other words, Bayelsa’s oil should belong to the state, and it can only pay taxes to the Federal Government.
Using the same logic, states should pay Niger State for electricity supplied, not because a dam was located in Niger State, but because there is electricity supplied by the state. For that to happen, Bayelsa, Niger and others have to source the investors and operators to turn their latent assets into opportunities.
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Our challenge today is that the spirit of comparative advantages has faded because everyone is waiting for Abuja at the end of the month. So, let us support this message from the governor and demand absolute and complete fiscal federalism so that states can return to what they do best.
If Niger can produce affordable electricity, that is a strength. Pay to get it. If Anambra State can run the largest market in West Africa (the Onitsha Main Market), that is something it needs to build up. And with that, we can spread opportunities and advance the citizens.
Comment on Feed
Comment 1: Niger state Governor demanding 13% derivatives because of the environmental degradation they experience from Kanji Dam.
I do not really have any problems with demand. I hope all the states in Nigeria will also pay Ondo state $1billion each for using our Cocoa money to develop the oil in Nigerdelta and the Kanji dam itself.
We from Ondo state has been cheated from the days of Awolowo when our Cocoa was used to drive the economy of the Western region and Nigeria at large. Part of the revenue from Ondo was used by BP to develop the oil and gas sector.
This argument should kick start the discussion around Fiscal federalism. State controlling the resources within their territories. Ogun state should make Similar demands because its hosting the industrial hub of Nigeria and Environmental pollution from the industries affects people too.
Comment 2:
Nigerians who want intra-state competitiveness should support Governor Umaru Bago of Niger State who is making a case that his state should be paid “a 13% derivation fund, similar to other oil-producing states in Nigeria”: 'The Federal Government will pay Niger State N1 trillion… pic.twitter.com/WNE5FqYYvn
— Ndubuisi Ekekwe (@ndekekwe) November 8, 2023
Niger State Governor Demands 13% Derivation Fund for Hydrocarbon Exchange
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