Nigeria Crude Oil Export Down 42%, New Health Agency And Challenge of Revenue

Nigeria Crude Oil Export Down 42%, New Health Agency And Challenge of Revenue

One month, one new bureaucracy in Nigeria. The latest one is the National Emergency Medical Services Agency. Yes, Nigeria plans to establish the National Emergency Medical Services Agency to magically deal with our lack of healthcare services. Of course, nothing will change since the healthcare budget is not changing anytime soon. What will happen is that the available funds will be divided with an additional agency in the mix. 

The Nigerian Senate passed a bill to establish the launch of a  National Emergency Medical Services Agency.

The bill was passed on Tuesday after the Senate considered a report by the Committee on Health Secondary and Tertiary at plenary, presented by the Chairman of the Committee, Sen. Yahaya Oloriegbe.

The Committee said the bill aims to ensure all Nigerians had access to early, good, and quality emergency medical service, and critical care, when needed, adding that after establishment, the agency would provide assistance for the development of a comprehensive area emergency medical services system in Nigeria.

For Nigeria to fix the healthcare services, it needs resources and that will come through higher productivity and economic activity. Yes, improved tax revenue to fund budgets. That is the playbook we need to scale urgently. Crude oil may not help here as it continues to drop: “Nigeria’s crude oil exports fell by a whopping 41.9% year-on-year in the first quarter of 2021. This is according to data contained in the Central Bank of Nigeria’s balance of payment report.” But while crude oil was down, solid minerals did just fine; Nigeria Extractive Industries Transparency Initiative (NEITI) in a report noted that N79.9 billion was earned by Nigeria within the solid minerals sector in 2019.

Nigeria received in its current account, crude oil and gas export proceeds of $6.48 billion in the first quarter of 2021 compared to $11.1 billion in the corresponding period in 2020. It also represents a 16.4% drop when compared to the $7.7 billion recorded in the 4th quarter of 2020.

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Nigeria relies majorly on crude oil exports as its major foreign exchange earner. Thus with export proceeds falling by 42%, hope for a more robust foreign exchange reserve is dimmed. … The fall in reserves corresponds with a depreciation in the exchange rate which has now crossed the N500/$1 ceiling at the parallel market

Yet, the nation could generate significant revenue from its planned concession of Calabar & Kano Free Trade Zones and other infrastructures in 36 states which the Bureau of Public Enterprises has projected could generate as much as N5 billion annually.

The government hopes to inject funds into healthcare services in the nation, according to Director-General of the BPE, Mr Alex Okoh: “In the health sector, the reforms being undertaken by the bureau will involve the implementation of initiatives which will radically transform health care delivery across Nigeria. This will improve availability, accessibility, affordability and quality of health care services with the ultimate objective of having a physically and an emotionally healthy population.”

Despite this drop, the trajectory could look promising in the short-term now that the OPEC+ standoff is officially over as Saudi Arabia and the United Arab Emirates have reached a deal on output levels: “OPEC+ source stated that the U.A.E. is allowed to boost the baseline used to determine how much crude the OPEC+ member is allowed to pump.”

 

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