The Federal Government may sell stakes in no fewer than 20 state-run companies including the Nigerian National Petroleum Corporation, NNPC to raise funds and improve governance in the entities.
The Chief Executive Officer at the Ministry of Finance Incorporated, Armstrong Takang noted that the NNPC is considering options including strategic sales and initial public offerings and aims to implement the plan within 18 months.
He disclosed that some of the entities need the private sector to take controlling shares and the major consideration for the Government is to create value rather than retain control.
He added that the Federal Government will be going for value rather than control, noting that: “It is better for us to own 49 percent of a high performing than 90 per cent of an entity that is underperforming”.
These sales may coincide with President Bola Ahmed Tinubu’s plan to reform the country’s economy, he added.
Takang stated that the Agency is in the process of appointing consultants including valuers, financial advisers, lawyers, bankers, and others to handle different aspects of the transactions.
Nigeria has, over the years, sold some of its assets, including the Nigerian Aviation Co. Plc and the Power Holding Company of Nigeria, which has been structured into distribution companies in the hands of private handlers while the Government controls generation and transmission.
If the country is able to hand over some of its assets to other parties, it will help cut down on the large expenditure used in running these entities as the country grapples with economic challenges.
In addition to this, Tinubu-led Government is considering raising tax revenues, with the country’s Tax-to-GDP estimated at 10.86 percent in 2021, a low rank among global peers.
He recently established a committee, headed by ex-PWC lead, Mr Taiwo Oyedele, to reform Nigeria’s tax administration with a target to double the collection rate within three years. They are to focus on fiscal governance, tax reforms, and growth facilitation.
“The committee, in the first instance, is expected to deliver a schedule of quick reforms that can be implemented within 30 days”, the President said.
