In the past year, the Nigerian Presidency, under President Bola Tinubu, has spent an astounding N16.06 billion on purchasing foreign currencies for international trips, according to the data from GovSpend, a platform by the civic organization BudgIT.

This expenditure, covering the period from June 23, 2023, to May 25, 2024, reflects the significant costs associated with the president, vice president, First Lady, and the Chief of Staff’s international engagements.

The data highlights the spending patterns and raises critical questions about the prioritization of government expenditure amid economic hardships faced by ordinary Nigerians.

Breakdown of the Expenditures

President’s Spending: The bulk of the forex purchases was attributed to President Bola Tinubu’s international trips, amounting to N10.93 billion. These trips included high-value purchases of foreign currency to support diplomatic missions.

For instance, N82.04 million was spent on July 28, 2023, to purchase $176,392.80 for a trip to Ghana. On multiple occasions, large sums such as N152.37 million, N228.55 million, and N146.65 million were spent to purchase $200,000, $300,000, and $315,300, respectively.

Additionally, N197.70 million was utilized four times for the purchase of $1,000,000 each for trips dated July 19, 2023. Further expenditures included N71.74 million, N18.33 million, and N135.93 million for purchases of €300,000 each on September 6, 2023.

Vice President’s Spending: The Vice President’s international trips cost N101.68 million. Notable expenditures included N58.66 million for the purchase of £1,000,000 on June 23, 2023, and N426.88 million for $483,277.00 for a trip to Switzerland on February 24, 2024. An additional N43.02 million was spent on the purchase of €300,000 for trips on September 6, 2023.

First Lady’s Spending: The First Lady’s trips amounted to N623.05 million. Significant purchases included N149.79 million for $152,831 for a trip to France on January 4, 2024, and N202.39 million for $126,834 for a trip to Mozambique in March 2024.

Further expenditures included N144.57 million for $96,118 for a trip to Addis Ababa, Ethiopia, on February 9, 2024, and N126.3 million for $83,967 for a trip to London in March 2024.

Chief of Staff’s Spending: The Chief of Staff’s office spent N59.24 million on foreign currencies for international engagements. Notable expenditures included N46.51 million for $100,000 for trips to the UK on August 10, 2023, and N12.73 million for $79,740 for preparations towards Nigeria’s participation in the 78th session of the UNGA in the USA on November 22, 2023.

Presidential Air Fleet: The Presidential Air Fleet’s forex transit funds amounted to N4.97 billion. Major allocations included N387.60 million on August 15, 2023, N2 billion on August 16, 2023, and N713.22 million on August 29, 2023.

Currency Dominance and Exchange Rate Impact

The analysis reveals that the dollar was the dominant foreign currency purchased, with about N6.42 billion spent to buy $9.98 million. In comparison, expenditures on UK Pounds totaled N58.66 million for £1 million, and about N269.02 million was spent to acquire €1.2 million. The largest expenditure category was Forex Transit funds, amounting to over N9.42 billion, though the specific type of foreign currency purchased was not disclosed.

Under President Bola Ahmed Tinubu’s administration, the naira has experienced a dramatic depreciation. On May 30, 2023, the naira traded at N464.5/$1 on the official market, but by July 12, 2024, it had plummeted to N1,563.80/$1—a 70.3% decline.

This steep depreciation has profoundly impacted the expenses for international trips, as more naira is required to purchase the same amount of foreign currency. For example, NairaMetrics noted that $1 million required N464.5 million in May 2023, but by July 2024, the cost had surged to N1.56 billion.

Against Govt.’s Call for Sacrifices

These expenditures raise critical questions about the government’s fiscal priorities, especially given the severe economic challenges facing many Nigerians. The substantial amounts dedicated to international trips highlight the high costs associated with maintaining diplomatic engagements and the operational needs of the Presidential Air Fleet.

While the government’s commitment to sustaining a robust international presence is clear, the need for transparency and prudent use of public funds have been overly advocated.

This is because the spending is occurring amid government calls for the masses to make sacrifices as the economy bites harder. The significant expenditures on international trips by the presidency have been noted as hypocritical and indicative of predatory leadership.

The present government has remained adamant in response to calls to cut the cost of governance. Economic experts say that this disconnect between government spending and the economic realities faced by ordinary Nigerians underscores a pressing need for more responsible and equitable fiscal policies.

Aliko Dangote, President of the Dangote Group, has revealed ambitious plans to list the fertilizer and petrochemical business of the Dangote Refinery on the stock exchange in the first quarter of 2025.

This announcement comes at a time when the refinery, Africa’s largest, is grappling with significant challenges in securing a steady supply of crude oil.

During a media briefing at the Dangote Refinery, Aliko Dangote emphasized the importance of involving Nigerians in the ownership of the refinery and its associated businesses.

“Because of the nature of the business we have, both the refinery and the fertilizer, we are targeting end of this year but it depends, most likely, worst case we will be able to list them before the end of first quarter of next year, so that we will sell shares and Nigerians will buy.” Dangote stated

This move follows recent reports that Dangote plans to pursue dual listings of the refinery on both the London and Nigerian stock exchanges. Dangote has a history of listing many of his businesses, such as Dangote Cement, which is currently the most capitalized company in Nigeria with a market valuation exceeding N11 trillion.

The refinery has previously held stakes by entities like the Nigerian National Petroleum Corporation (NNPC). However, Dangote revealed on Sunday that the state-owned company holds only a 7.2% stake in the refinery, not the 20% that was previously reported.

The Dangote Refinery, positioned as Africa’s largest oil refinery and the world’s largest single-train facility, is poised to transform Nigeria’s oil industry. Situated in the Lekki Free Trade Zone, this state-of-the-art facility boasts a production capacity of 650,000 barrels per day (bpd).

The refinery includes a 900 ktpa polypropylene plant, a 36 ktpa sulfur plant, and a 585 ktpa carbon black production unit. It features a total storage capacity of 4.5 billion liters, ensuring Nigeria’s crude and gasoline requirements for 20 and 15 days, respectively.

After completing its test run in January 2024, the refinery transitioned to steady-state production by March 2024. Production is set to increase to 500,000 bpd by August 2024, 550,000 bpd by the end of the year, and reach its full capacity of 650,000 bpd by the first quarter of 2025. Gasoline production is expected to commence in July 2024, with sales starting in August. The annual revenue from the refinery is projected to exceed $26 billion.

Crude Oil Supply Challenges

Despite its advanced infrastructure and ambitious targets, the Dangote Refinery faces a significant hurdle: securing a consistent supply of crude oil. The inability of the NNPC to provide adequate crude has forced the refinery to look beyond Nigerian borders. As a result, the Dangote Refinery has begun sourcing crude oil from international markets, including the United States, Brazil, and other countries.

However, sourcing crude oil from international markets has logistical and financial implications for the refinery. While the refinery is expected to reduce the cost of petroleum products in the country, analysts have warned that importing crude oil means higher transportation costs and longer lead times, which can disrupt production schedules and increase the overall cost of refining. These additional costs are likely to be passed on to consumers, potentially impacting the price of petroleum products in Nigeria.

Moreover, analysts have pointed out that relying on international crude suppliers exposes the refinery to global market fluctuations and geopolitical risks. Any disruption in supply chains, such as political instability in supplier countries or changes in international trade policies, could adversely affect the refinery’s operations.

In response to these challenges, the Dangote Refinery has made strategic adjustments to its operations. The facility’s configuration has been optimized to minimize the production of low-value products and maximize the output of more profitable crudes and products. This flexibility allows the refinery to adjust its production based on the quality and cost of the crude oil available, thereby enhancing its economic viability.

Additionally, the large-scale operation of the refinery helps to reduce production costs and enables it to serve a vast market efficiently. By leveraging economies of scale, the Dangote Refinery aims to maintain competitive pricing despite the higher costs associated with importing crude oil.

The listing of the refinery and its associated businesses on the stock exchange is expected to provide a significant boost to the company’s capital base. The influx of investment from public shareholders is expected to enable the refinery to expand its operations, invest in new technologies, and possibly secure more stable sources of crude oil in the long term.