The three tiers of government, federal, state and local government councils, shared N2.517 trillion Federation Allocation Account Committee, FAAC, exchange rate gains in 2023.
A review of the FAAC report from January to December 2023 disclosed this.
According to the reports, the federation received N2.836 trillion during the period and deducted N318.29 billion from the non-oil excess account, which made it N2.517 trillion.
From the N2.517 trillion, the federal government received N1.211 trillion, while the 36 states shared N614.49 billion, and the LGAs received N473.92 billion.
The eight states, which are Akwa Ibom, Delta, Rivers, Bayelsa Ondo, Edo, Imo State and Abia, producing mineral resources like oil, received N217.38 billion as 13 per cent derivation.
Further analysis of the figures reveals that between January and April, FAAC allocation shared by the component units of the federation did not include any FX gain. However, the federation recorded the N2.836 trillion reported above from May to December.
The highest gain from forex was recorded in May, with around N639.39 billion accruing to the federation’s account.
The period of consistency in FX gain nearly coincides with the time the Central Bank of Nigeria (CBN) unified the forex market- a move analysts described as a partial float.
The FAAC report for the 12 months also contained FX differential/equalization payments for February, April, and July, totalling N246.31 billion.
For February, the FX differential/equalization stood at N120 billion; for April, it was at N70 billion. In July, the payment stood at N56.31 billion.
Recall that on June 14 last year, the Central Bank of Nigeria floated the Naira, which saw a hike to N708 per US dollar on June 21 from N464.5 in May.
Similarly, barely a week ago, CBN issued ‘Financial Markets Price Transparency and Market Notice of a revision to the FMDQ FX Market Rate Pricing Methodology’ last week, weakening Naira from N891.90 per US dollar on January 26 to N1418.78 on Wednesday.
