The Exit Of Shipping Firms From Nigeria

— 10th September 2016

With the Nigerian economy in recession, the spiralling negative effects have already begun to impact on the operations of key sectors of the economy. One of the sub-sectors that is at the receiving end of the current economic downturn is the shipping business.

Groaning under intense hardship as a result of government policies and global economic problems, the news from the Maritime sub-sector is not heartening, as over 20 shipping firms were reported to have exited the nation’s shores. Consequently, no fewer than 3,000 dockworkers have been laid off by various shipping companies, terminal operators and logistics firms. This is largely due to lack of poor import policies recently introduced by the Federal Government. According to the Dockworkers Union of Nigeria (DUN), the massive retrenchment in the sub-sector was due to the Federal Government inability to meet its joint venture obligation with the international oil companies which are major partners with the marine logistic companies.

The shipping lines exited our shores because of growing losses resulting from declining traffic volumes and recent government import policy.

It will be recalled that the Federal Government last year placed restriction on the importation of about 41 items due to Foreign Exchange scarcity. But, government defended its action and promised to encourage domestic production of some of the goods that could be produced locally. However, the shipping firms are complaining that the ban has adversely affected their operations. Therefore, they are asking that the restriction be lifted or else it will encourage smuggling, diversion of ships to neighbouring countries, leaving our ports virtually empty and general loss of revenue to government.

We urge the government and the relevant agencies in the maritime sub-sector to take a detailed analysis of the complaints that have resulted in the exit of the shipping firms with a view to restore the smooth operations of the maritime industry.

While it is necessary to restrict the importation of goods that can be manufactured locally and save scarce forex, the significance of the maritime sector of which shipping operators play a vital role should not be ignored. Statistics show that since this year, the number of goods imported into the country has shrunk by over 30 percent. This is because the shipping lines are reportedly shifting base to other West African countries in response to government new policy.

Government should review some of the policies as it affects the shipping operations in our shores.

There is need to meet the joint venture obligations with the international oil companies, which are major partners in the sector.

Government should not allow the shipping sub-sector to lag behind in the global sector.

Our country is vastly endowed with coastlines and navigable inland waterways, and strategically placed on the Atlantic Coast of West Africa. And 76 percent of shipping business that takes place in the whole of West Africa is reportedly done in Nigeria. That means that Nigeria should remain a key player in West Africa.

Therefore, government should do everything to contain the exit of shipping firms in our shores and save the jobs of millions of workers. According to Financial Intelligence that monitors the maritime sub-sector, despite Nigeria’s large export of crude and import of over 100 million tons of general cargo, no Nigerian flagship is currently plying international routes.

Also, statistics from the Nigerian Ports Authority (NPA) on ship calls to the country reveal that between 2009 and 2012, Nigeria’s tonnage has grown from 82m tons to over 150m with an estimated freight payment of rising from $4.1bn to above $7.5bn annually. But the participation of Nigerians remains almost zero.

Although the exit of foreign shipping firms may be the opportunity our local shipping firms may be waiting for, we doubt if they have the capacity and competency now to fill the void without harming an already bleeding economy with its other adverse consequences. Government should swiftly intervene and arrest a similar experience that saw the exit of some airlines to neighbouring countries.

Source:

http://sunnewsonline.com/the-exit-of-shipping-firms-from-nigeria/

Amancio Ortega Overtakes Bill Gates As The Richest Man In The World

Amancio Ortega, the Spanish retail genius who started Zara, passed Microsoft cofounder Bill Gates to become the richest man in the world on Wednesday. Shares of Ortega’s business Inditex, parent company to Zara, Massimo Dutti and Pull&Bear, ticked up 2.5% Wednesday, boosting his personal fortune by $1.7 billion. That lifted Ortega’s net worth from $77.8 billion to $79.5 billion. Gates is worth an estimated $78.5 billion.

The son of a railway worker from La Coruña, Spain, Ortega is as reclusive as he is rich. He started his career as a store clerk in his hometown before opening his own business. Beginning with less than $100, he and his wife Rosalia Mera began making lingerie, pajamas and nightgowns in their living room.

In 1975, the couple (who eventually divorced) decided to open a store named Zara. Eight years later, Ortega had expanded to nine locations around Spain. In 1984, he opened a 10,000 square foot logistics hub.

Unlike most retailers, Inditex hardly relies on advertising. Ortega has instead devoted most of his resources into turning his company into the most efficient retailing operation in the world. When companies like Gap and H&M were taking five months to design, make, distribute and sell new products in the early 2000s, Zara was doing it in three weeks. That meant Ortega’s companies could keep up with the whims of shoppers much more easily than its competitors — and also had to spend less on warehousing.

Ortega took the business public in 2001 and debuted on the Forbes billionaires list the same year, with a net worth of $6.6 billion. By then, Gates was already the richest man in the world, with a fortune of $58.7 billion.

From 2001 to 2002, as most billionaires struggled to hold onto their riches amid the dot-com crash, Ortega gained an additional $2.5 billion and became the world’s 25th-richest man. He repeated the trick seven years later, when the world plunged into crisis. From 2009 to 2013, while the Spanish economy was reeling, Ortega personally gained $39 billion.

Ortega briefly took the title of world’s richest man for the first time in October 2015, when Inditex shares hit an all-time high and boosted Ortega’s net worth to $80 billion. But the stock quickly dipped, and Gates once again claimed the throne. The two billionaires will likely continue to exchange the title as the stock prices of their holdings continue to bounce up and down.

Gates has donated nearly $31 billion in stock and cash to his foundation over his lifetime. If the Microsoft cofounder were not such a prolific philanthropist, neither Ortega nor anyone else on Earth would be anywhere close to as rich as Gates.

Source: 

www.forbes.com/sites/danalexander/2016/09/08/amancio-ortega-richest-bill-gates-world-spain-inditex-microsoft-zara/#789c1e5c264d

Workers Block Road In Kaduna With Refuse Dump Over Owed Salaries

Yesterday, the popular Barnawa road in Kaduna state was blocked with refuse dump in protest for non payment of employees. According to reports, governor Nasir Elrufai has not paid the workers he employed to evacuate the refuse dump in Kaduna and in protest to that, the employees poured the wastes on the road and blocked from using the road.

See photos below

Source:

http://www.metronaija.com/2016/09/photos-workers-block-major-road-in.html

Engineers To Begin Work At Mambilla Hydro-power Project

Chinese engineers visited the site of the Mambilla hydro-power project station

They are expected to begin work after they submitted work plan to the federal government

This is expected to boost electricity supply in the country.

Source:

http://www.ajayiwrites.com/2016/09/engineers-to-begin-work-at-mambilla.html

Lagos Donates Land To German Firm Investing $75m In Lagos

Lagos State Governor, Mr. Akinwunmi Ambode on Thursday demonstrated his commitment to attract foreign investors into the State by approving land for the establishment of a training centre in Lagos where architects, civil engineers and craftsmen will be trained on modern trends and technologies in the construction sector.

Governor Ambode, who gave the approval when he received a delegation from The Knauf Group, which is a German firm currently establishing a $75miilion building/construction tools manufacturing factory in Lagos, said the approval for the land became imperative in view of the need to encourage investors to continue to invest in Lagos.

The Knauf Group is one of the world’s leading manufacturers of modern insulation materials, dry lining systems, plasters and accessories, thermal insulation composite systems, paints, floor screed, floor systems, and construction equipment and tools.

The delegation was led by a member of the Management Committee of the firm, Isabel Knauf and Consular General of German Embassy in Lagos, Mr. Ingo Herbert.

Governor Ambode, who recalled the last time Herbert visited the Lagos House about eleven months ago, said his administration has remained focused to the promise of upholding judicial and security sector reforms, as well as creating a friendly environment for investment to thrive.

He said the massive investment by The Knauf Group in Lagos was a pointer to the fact that investors were still willing to invest in Nigeria despite the economic recession, and that the country will come out of the economic doldrums even stronger.

“I must commend the German government and The Knauf Group for showing something important to all Nigerians that beyond the economic recession, their total believe in our economy is unshaken because it is not enough for any investor to come into an area where they have never invested before and months after, the parameters for investment are not really looking good, but you stuck in there and beyond the fact that you have gone to procure land, you also have an established office within the last eleven months and you are already pumping in money into what you want to do.

“This is a great pointer to the fact that you believe in the Lagos economy and also believe in the future of Nigeria and I like to encourage other investors to emulate what your firm and government is doing in Lagos and as they show interest, we will not hesitate to give them the necessary support,” the Governor said.

Governor Ambode said The Knauf Group specifically deserved to be commended for not just investing in Nigeria, but also bringing the German vocational expertise on an area of construction that was hitherto not in existence in Nigeria into Lagos.

Besides, the Governor said he was excited about the fact that the firm was not just establishing a factory here in Lagos, but also a training centre where Nigerians will be trained, adding that he would stop at nothing to encourage investors such as The Knauf Group.

Earlier, Isabel Knauf said the team was at the Lagos House to brief Governor Ambode on the progress made so far since the project started in September 2015.

She said the firm has 23 training centres all over the world training about 14,000 people annually, and that they would like to build the same training centre in Lagos where architects, civil engineers and craftsmen would be trained on how to technically install their products.

She said upon completion of the factory, the firm would create 25,000 direct employment, adding that the training centre will cost about two million Euros to establish, while at least 800 Nigerians will be trained annually in the first phase.

Knauf, however, solicited the support of the State Government in land space for the training centre and permit issues, a request which was instantly granted by the Governor.

Source:

 http://akinwunmiambode.com/lagos-state-government-donates-land-to-german-firm-investing-75m-in-lagos/

Femi Adesina: My Salary Was Cut By One-third, I Go Hungry Too

Femi Adesina, special adviser to President Muhammadu Buhari on media and publicity, has disclosed that took a pay cut to join the current administration.

Appealing to Nigerians not to lose hope in the government, the former managing director of The Sun Newspaper said he is not immune from the hardship in the land.

He attributed the economic crisis to mismanagement on the part of previous administrations, but said very soon, the people would have course to rejoice.

The presidential aide said his principal had not forgotten the promises he made during the campaign period.

Adesina said this in an article entitled: ‘After Ye Have Suffered A While’. It was published on the backpage of The Sun.

“Here comes the preacher. What does he want to tell us? Doesn’t he know that we are hungry, and the din of hunger makes one deaf to reason? The rumble in our tummies, as the worms compete for the little food left there, will surely be louder than what anybody can say now. True? Not exactly. Come, let us reason together,” he wrote.

“Father Ejike Mbaka, that fearless priest of the Catholic church, gave an illustration recently, which I believe was not revealed to him by flesh and blood. There is hunger in the land, with people severely famished. And there is ululation, loud enough to deafen the deaf all over again, and wake the dead from his eternal sleep. The wailers are wailing so loud, as if Bob Marley had resurrected with his band, the Wailing Wailers. But hear Fr. Mbaka: somebody came, looted your kitchen, carried away all the food.

“He did not even leave you crumbs to console yourself with. And then comes another person, trying to replenish your pantry, trying to restock your kitchen. And then you begin to shout; we are hungry o, we are hungry o, to the point of distracting and discouraging the new man. Who should you rather wail and rage against? The man that looted your kitchen, of course.

“That is the exact similitude of the position of Nigeria. There is hunger, lack, and deprivation in the land. But is it a death knell? Not when the kitchen is being restocked, and we will soon feed till we want no more.

“I am on a national assignment that has cut my legitimate annual income by one third, so when there is hunger in the land, I go hungry too. Well, almost. When people talk of lack of money, I penny-pinch, too.

“Well, almost. Let nobody think those in government are insulated from what is happening in the country. At least, those who have truly come to serve. But those precious promises hold true any day. ‘In the days of famine, my people shall be satisfied.’ ‘The young lion may lack, and suffer hunger, but those that trust in the Lord shall not suffer any good thing."

Source:

https://www.thecable.ng/femi-adesina-income-cut-one-third-go-hungry

Apapa Customs Generates A Record N35bn In August

The Apapa Command of Nigeria Customs Service (NCS) announced a record monthly revenue of N34,923,757,810.77 in August.

The revenue was about N8 billion higher than N27 billion generated in July, and it is the highest monthly reported revenue by any customs command in the country in the last 10 years.

According to Willy Egbudin, a customs area controller of the command,“A remarkable feature of this is that it was made at a time the ports were said to be having low volume of trade and shipping companies reported to be leaving the country in the face of some trade restrictions and high exchange rate regime.”

However, he said the increase was a result of increased supervision, closer monitoring and regular outreach to importers and agents, “on the need to comply while issuing demand notices for infractions like under-declaration detected.”

He further stated that “We have persistently urged officers of the command to continually work to redouble their efforts in maximum revenue collection, speed in legitimate trade facilitation and uncompromising enforcement of all customs laws.”

”The Comptroller General’s directives are very clear on matters affecting our duties. We must not in any way act outside the law or encourage people to do so. Importers and agents who violate the law will face the full wrath of it and I can assure you all that I will not spare any customs officer collaborator. Any attempt to shortchange the government under my watch here will not be treated with kid gloves” the Controller warned recently.”


Source:
http://investorsking.com/apapa-customs-generates-a-record-n35bn-in-august/

Fuel Price Hike Can't Be Stopped: IPMAN

The much speculation of possible increase in price of Premium Motor Spirit, PMS, otherwise known as petrol, may not be considered mere, as the Independent Petroleum Marketers Association of Nigeria, IPMAN, Thursday warned of threat to product availability in the country, as it is gripped with series of challenges confronting the petroleum sector.

This came as expert blamed marketers of insensitivity to price moderation when government placed a cap on petrol price in May.

But, other operators have argued that the price of petrol is driven by laws of economies, which cannot be altered for a long time, and as such is expected to increase giving the current challenges of FOREX and others.

Speaking to Vanguard, National President, IPMAN, Mr. Chinedu Okoronkwo, stated that flexible way to assessing FOREX has been given rather than black market dependence for the purpose of importing critical items to the country.

He said, “But I will advice for total deregulation. The price moderation, which is the cap placed is not healthy for the petroleum industry to grow.

“There are people who have the FOREX to bring product and sell. By so doing, FOREX will crash. But when the industry is over protected like ours, the current challenges will be unending. The market force should drive the price.”

He stressed that, “If the refineries are working to a good capacity like 70 percent, the product will not be less than N130 per litre. We should focus on making the refineries work. Because by the time you keep on importing, FOREX challenges will keep on re-occurring and there would no head way.

Source:

www.vanguardngr.com/2016/09/hike-in-petrol-price-is-inevitable-ipman-others/

Only 5% Of N500bn Social Intervention Funds Released – Rep

Three months to the end of the fiscal year, Chairman, House of Representatives Committee on Poverty Aleviation, Mohammed Ali Wudil, said the Federal Government has only released N20bn or about five per cent of the N500bn budgeted as social intervention programme in 2016.

The lawmaker spoke yesterday at a Civil Society Organisation, CSO’s engagement on monitoring

Federal Government’s Social Protection and Sustainable Development Goals, SDGs.

According to him, lawmakers are engaging the executives to speed up actions on the programme to ensure that citizens, who are supposed to benefit from it are not left to continue to suffer.

He expressed concern that the year would wind down in about four months without achieving any meaningful impact on the lives of the poor.

Wudil said over eight million Nigerians were expected to benefit from the N500bn social intervention, adding that apart from the social intervention, jobs would also be created by infrastructural projects that would be restored and the new ones that would soon be taking off.

“The huge budget of N500bn remained idle amid increasing socio-economic pressures on the would-be beneficiaries.

“Definitely, the office of the Special Adviser, Social Investments in the Presidency is facing challenges rolling out plans for the implementation.

“The huge amount that was allocated to the office needs to be justified, particularly now that poverty has gone so high in the country,” he said.

In her presentation, Special Adviser to President Muhammadu Buhari on Social Investment, Mrs. Maryam Uwais, who outlined different Special Intervention Projects of the Federal Government, said it is designed for delivery under five sections.

These include the N-power, designed to help young Nigerians acquire and develop life-long skills to become solution providers in their communities and to become players in the domestic and global markets.

There is home grown school feeding for primary school children through locally sourced foods within the country; direct cash transfer of N5,000 monthly to targeted poor and vulnerable households, targeting one million people.

She also listed enterprises and empowerment program, involving financial inclusion and access to credit for market women, artisans, youths and farmers as well as STEM bursary program.

Also, Head Partnership and Local Rights Program, ActionAid, Suwaiba Jubrin, said the civil society is engaging the government to ensure that the program implementation is actualised. She observed that it was laudable for the present administration to invite the CSOs to participate in holding the government accountable for the project via monitoring and evaluations.

She lamented economic growth over the years in the country which has been bedeviled by inequality, increasing poverty and rising unemployment.

“Nigeria’s capacity to generate revenue to support pro-poor development has remained extremely limited,” she said.

Sourec:

http://www.newsflashng.com/5-n500bn-social-intervention-funds-released-rep/

9 Buhari's Ministers Nigerians think Are 'incompetent'

After President Buhari finally appointed his 36 ministers to oversee vital the sectors of the country, Nigerians expressed their dissatisfaction with the people the president picked, being that he took six months to screen and appoint them..

Ten months since the ministers were sworn-in, mixed reactions have continued to trail their performances.

Nigerians have continued to express their dissatisfaction towards the ministers as some sectors of the country are yet to witness commendable development.

1. Sports minister (Solomon Dalung) 

Since the sports minister, Solomon Dalung, was sworn in, he seems to have been in the news for the wrong reasons. His critics, especially sports lovers, have blamed him for the crisis in the Nigeria Football Federation (NFF) which contributed to the inability of the Super Eagles to qualify for the 2017 African Cup of Nations.

The minister came under attack recently when the Nigeria U-23 football team was stranded in Atlanta, and almost missed their first match against Japan , arriving only five hours before the kickoff. It got worse when the minister made a blunder and referred to the USA as the ‘United States of Nigeria ’, sparking series of reactions on social media.

2. Finance minister (Kemi Adeosun)

Kemi Adeosun, who hails from Ogun state, has been criticized for lacking the handle the affairs relating to the nation’s economy. She has been criticized on several occasions. In February, Nigerians came for her when she made a mathematical blunder saying the addition of 16 billion and 6 billion would amount to N24billion, instead of N22billion.

Recently, the minister received some serious bashing from compatriots after she reportedly said ‘recession is just a word’. She has been called ‘incompetent’ a number of times by some Nigerians who now want Ngozi Okonjo-Iweala back .

3. Minister of solid minerals (Kayode Fayemi)

Kayode Fayemi has been criticized for not making adequate income for the country from the sector, as against the valuables embedded in the sector. Nigeria is richly endowed with a variety of solid minerals of various categories ranging from precious metals to various precious stones and industrial minerals.

According to the Nigerian Extractive Industries and Transparency Initiative (NEITI), there are about 40 different kinds of solid minerals and precious metals buried in Nigerian soil waiting to be exploited. The minister is yet to show Nigerians that he is capable of handling the position, despite confirming the discovery of nickel .

4. Minister of budget and national planning (Udoma Udo Udoma)

Some days ago, Senator Dino Melaye said Minister Udoma Udo Udoma was not competent for the office.

“ Now, you bring a lawyer to become Minister of National Planning. That to me, is giving carpentry job to a tailor, he will never succeed ,” he said.

The senator maintained that the Ministry of Budget and Planning needs somebody that is not only intellectually mobile in public finance but in development economics and even strategic development.

5. Minister of women affairs (Aisha Alhassan)

Aisha Alhassan, fondly called ‘Mama Taraba’ is yet to prove to Nigerians that she is the woman for the job. The minister, who contested for the Taraba state governorship election but failed, has disappeared from the spotlight since her appointment.

6. Minister of power, housing and works (Babatunde Raji Fashola) 

Many have said the ministries given to Babatunde Fashola were too much for him to manage. On several occasions, Fashola has been called minister of darkness as power has not improved since his appointment.

Many have said he is not competent enough for the job but Fashola has asked anybody who has a problem with his position to go and complain to President Muhammadu Buhari.

7. Minister of labour and employment (Chris Ngige)

Some youths in the country have criticized Chris Ngige for his inability to fix a profitable minimum wage. Instead of the government creating employment for the unemployed, many are losing their jobs on a daily basis.

8. Minister of foreign affairs (Geoffrey Onyeama)

Many had expected Geoffrey Onyeama to wield in his international expertise into Buhari’s agenda, but 10 months since he was appointed, Nigeria is yet to have a focused foreign policy agenda. He is yet to convince Nigerians that he is the right man for the job.

9. Minister of Communication (Adebayo Shittu) 

Adebayo Shittu is yet to prove to Nigerians that he is the best hand for the job. He recently came up with a proposal to impose a 10 per cent tax on phone calls, text messages, data and more, which according to him, would help enhance telecommunication services in the country.

Source:

 https://www.naij.com/960104-9-buharis-ministers-nigerians-think-incompetent-sacked.html

Nigeria In Recession Because Of Hurried Implementation Of TSA – Ben Murray Bruce

The lawmaker representing Bayelsa Central Senatorial District, Senator Ben Murray Bruce, has reasoned that the “hurried implementation” of the Treasury Single Account, TSA, may be one of the reasons the country is in economic recession.

Taking to Twitter on Thursday, the entertainment entrepreneur regretted that everything is politicised in Nigeria, adding that the country’s current interest rate is ridiculous for a country in recession.

His tweets read: “Nobody locks up money in a vault in a recession. In fact, the hurried implementation of TSA may be part of the reason we are in a recession.”

“We must make it easier, not more difficult, for business to obtain credit.”

“Now that we have found ourselves in a recession, we must do the commonsensical thing to do and spend our way out of the recession.”

“We politicize everything in Nigeria. It is our undoing because the economy should bow to politics, politics should not bow to the economy!”

Source:

http://dailypost.ng/2016/09/08/nigeria-recession-hurried-implementation-tsa-ben-murray-bruce/

Nigeria’s Exports Grow By 63% To N1.873trn In Q2 - NBS

The total value of Nigeria’s export trade increased to N1.873 trillion in the second quarter (Q2) of 2016, representing an increase of N725.6 billion or 63.3 per cent, over the value recorded in the preceding quarter.

The National Bureau of Statistics (NBS) disclosed this in its foreign trade statistics for Q2 2016 that was released on Tuesday.

According to the NBS, the improvement in export value was largely due to the depreciation in the value of the naira.

It, however, pointed out that the structure of the export trade is still dominated by crude oil exports, which contributed N1.493 trillion or 79.7 per cent to the value of total domestic export trade in 2016.

Exports by section revealed that Nigeria exported mainly mineral products, which accounted for N1.735 trillion or 92.7 per cent of the total export value. Other products exported by the country included “animal and vegetable fats and oils and other cleavage products” at N55.7 billion or three per cent.

“Base metals and articles of base metals” at N28.4 billion or 1.5 per cent, and “prepared foodstuffs; beverages, spirits and vinegar; and tobacco” was at N16.2 billion or 0.9 per cent.

The export by direction showed that the country exported goods mainly to India, United States, Spain, Netherlands and South Africa whose values stood at N402.7 billion or 21.5 per cent, N235 billion or 12.5 per cent, N215.2 billion or 11.5 per cent, N133.3 billion or 7.1 per cent, and N119.9 billion or 6.4 per cent respectively.

In addition, the natural liquefied gas recorded N198.0 billion of the total export value during the period under review.

Export by continent showed that Nigeria mainly exported goods to Europe and Asia, which accounted for N611.7 billion or 32.7 per cent and N606.4 billion or 32.4 per cent respectively of the total export value during the period under review.

Furthermore, Nigeria exported goods valued at N265.9 billion or 14.2 per cent to other countries in Africa, while export to the ECOWAS region totalled N86.9 billion.

Meanwhile, the total value of Nigeria’s merchandise trade in Q2, 2016 was N3.942 trillion. This was 49 per cent more than the N2.645 trillion recorded in the preceding quarter.

This development arose from a rise of N725.6 billion or 63.3 per cent in the value of exports (largely due to exchange rate gains) combined with a rise of N570.8 billion or 38.1 per cent in the value of imports against the levels recorded in the preceding quarter.

The current trade position brought the country’s negative trade balance to N196.5 billion during the period under review. This showed a N154.8 billion reduction in the country’s trade deficit over the previous quarter.

Furthermore, it showed that Nigeria’s import trade stood at N2.069 trillion at the end of Q2, 2016, showing an increase of 38.1 per cent from the N1.498 trillion recorded in the preceding quarter. As with exports, the increase in import value was also traced to a decline in the value of the naira.

The structure of Nigeria’s import trade by section was dominated by the imports of “Boilers, machinery and appliances; parts thereof” which accounted for 34.9 per cent of the total value of import trade in Q2, 2016.

Other commodities, which contributed noticeably to the value of import trade during the review period, were mineral products (15.8%), vehicles, aircraft and parts thereof; vessels etc.(14.7%), products of the chemical and allied industries (7.6%) and base metals and articles of base metals (5.1%).

“The import trade classified by broad economic category revealed that capital goods and parts ranked first with N663.6billion or 32.1 per cent. This was followed by industrial supplies with the value of N421.2billion or 20.4 per cent and transport equipment and parts standing at N356.1billion or 17.2 per cent.

“The value of motor spirit stood at N296.1 billion. Nigeria’s import trade by direction showed that the country imported goods mostly from China, Netherlands, United States, India and the United Kingdom, which respectively accounted for N493.5 billion or 23.9 per cent, N285.7 billion or 13.8 per cent, N199.0 billion or 9.6 per cent, N124.9 billion or six per cent, and N119.3 billion or 5.8 per cent of the total value of goods imported during the quarter,” it added.

Further analysis of Nigeria’s imports by continent revealed that the country consumed goods largely from Asia with import value of N886.1 billion or 42.8 per cent. The country also imported goods valued at N813.9 billion or 39.3 per cent from Europe and N255.3 billion or 12.3 per cent from America. Import trade from Africa stood at N89.1 billion or 4.3 per cent, while imports from the region of ECOWAS amounted to N20.8 billion.

Source:

http://www.thisdaylive.com/index.php/2016/09/07/nigerias-exports-grow-by-63-to-n1-873trn-in-q2/

Nigeria's Recession May Last Till 2020 If.....agbakoba

Former President, Nigerian Bar Association, NBA, Dr. Olisa Agbakoba, on Tuesday, expressed concerns that Nigeria may continue to experience the current recession cycle till 2020, if the President Muhammadu Buhari-led Federal Government fail to immediately bounce the economy massively.

Agbakoba, who spoke in Lagos, lamented that having done a diagnosis of the nation’s current economic woes, it seems to be complicated by inflation, high interest rates, unemployment, weak infrastructure, lower oil price and no growth economy.

In a statement made available to journalists, the human rights and maritime lawyer, who had an analysis of President Buhari’s economic policy pointed that cohesion is needed at this point, noting that there is a need to develop a coherent fiscal, trade and monetary policy.

According to him, the tight liquidity operated by the Central Bank of Nigeria, CBN, where it jerked up its Monetary Policy Rate (MPR) to 14 per cent is ridiculous, adding that CBN’s focus on Forex management is rather encouraging round tripping and creating asymmetry in the system.

The legal practitioner advised the CBN to focus on productive value of the economy and not the numerical value of the naira, saying “the full deregulation of the forex market to allow level playing field and removing distortions such as round tripping, will ensure that at least $20 billion inflow will instantly occur.”

The former NBA Chairman, who listed a number of solutions for President Buhari to revive the economy said there is an immediate need for “a Presidential Proclamation at the National Assembly, switching from austerity to growth policy. The Federal Government needs to spend more to boost growth.”

Agbakoba, however, pointed that President Buhari doesn’t need the envisaged economic emergency powers, noting that former President Shehu Shagari had it in his time and still failed, adding that the so-called economic emergency powers is also not working in Venezuela.

Agbakoba, further said “President Buhari must reverse the anti-austerity and tight money, as the G-20 nations all now agree; use all policy tools and embrace fiscal stimulus; adopt the Keynesian economic model of massive government spending on public works; reducing the raging inflation at 17% in medium term; reduce the Monetary Policy Rate (MPR) to single digit- 5 per cent Quantitative Easing and effectively implementing the 2016 Budget to reflate the economy.”

He added that to revive the economy, “Nigeria must spend its way out of recession; establish a National Treatment Policy- Fiscal and trade Protection Policy, establish urgently a Development and Guarantee Bank; prepare Public Sector Borrowing Requirement, PSBR and borrow as our debt Ratio can sustain this, as well as develop Assets securitisation.”

According to Agbakoba, there is need for the Federal Government to pay-off the country’s domestic debt to inject liquidity in the system.

He suggested that FG must give the Treasury Single Account, TSA money back to the banks at single digit rates and supervise the banks, even as he recommended lending base rate of 5 per cent.

Prudential Regulatory Authority

Dr. Agbakoba added that to reflate the nation’s economy from recession, the Federal Government must create a Prudential Regulatory Authority, PRA, to supervise commercial banks to lend, as well as create a Financial Conduct Authority, FCA, to get banks to behave.

“Consequently, the Federal Government must limit the CBN to Monetary Policy and take away banking supervision to the new Prudential Regulatory Authority, PRA and banking ethics to the Financial Conduct Authority, FCA. If the banks focus on lending and not trading, money will flood the system for productive value. Moreso, there is need to create a debt factor market to soak up non performing loans of banks now at 12 percent and in excess of N20 trillion. FG must also create a robust mortgage private sector led market, by waking up dead capital trapped in it.

“Consequently, the Federal Government must limit the CBN to Monetary Policy and take away banking supervision to the new Prudential Regulatory Authority, PRA and banking ethics to the Financial Conduct Authority, FCA. If the banks focus on lending and not trading, money will flood the system for productive value. Moreso, there is need to create a debt factor market to soak up non performing loans of banks now at 12 percent and in excess of N20 trillion. FG must also create a robust mortgage private sector led market, by waking up dead capital trapped in the national housing stock valued at $7 trillion.

“Government must get out of business and enable the Private Sector led growth. It must also massively fund small businesses by Development and Guarantee Banks as this is the engine of economic growth. I have expected the government to by now implement massive social benefits such as the N5,000 it promised Nigerian youths,” said the legal icon.

Further suggesting the way forward, Agbakoba advised the current leadership to as a matter of urgency, “begin to communicate and give Nigerians hope with a clear vision, like former America President, Franklin Delano Roosevelt, FDR, during the American great Depression; urgently explore alternative income sources-Agriculture, Maritime, Infrastructure Power and support, as well as create efficiency in government and consider re-balancing Federal Power to bring in the States as economic enablers.”

“President Muhammadu Buhari must as a matter of urgency, carefully study Roosevelt’s new deal that got the US out of the Great Recession (Depression) in the 1930s.

“Roosevelt communicated hope; created massive public works programmes, especially the momentus Tennesse Valley Authority, a depressed 640, 000 square mile area in the Tennesse Valley; enacted the Glass-Stengall Banking Act, directing banks not to speculate or trade but to lend; enacted the National Industrial Recovery Act, to deal with massive employment and created the Works Progress Administration, putting back millions to work on the public infrastructure,” he said.

Recovery Path

According to Agbakoba, despite the country’s current state of recession, “a recovery path is possible by the Second Quarter of 2017 (Q2 2017) with vigorous implementation of a new economic model, otherwise, this recession cycle may/will extend up to Fourth Quarter of 2020 (Q4 2020).”

Source:

http://www.vanguardngr.com/2016/09/nigerias-recession-may-last-till-2020-agbakoba/

Naira is Worst Performing Currency In Africa In 2016-The Economist

SOMETIMES the worst is not bad enough. Or such is the case for Nigeria’s currency, which nosedived by 30% when the central bank first removed its peg to the dollar on June 20th. The naira is now this year’s poorest-performing currency in Africa. Internationally, only the currencies of Venezuela and tiny Suriname have fared worse. Yet were it truly free, it would be weaker still.

In fact, the naira’s free float seems to have lasted exactly a day. Since its sharp drop on the first day of its devaluation, the currency has more or less flatlined at about 282 per dollar (see chart). This is rather odd given the pent-up demand for dollars after the central bank governor, Godwin Emefiele, restricted the supply in a bid to defend the currency at its old peg of 199 to the dollar. Many analysts expected it to plummet as low as 350 when businesses hoovered up a backlog exceeding $4 billion.

Bankers say this stability came about after the central bank sold dollars and traders were bullied by it to keep to an unofficial peg. “If you want to sell or buy higher than the managed peg, life will be made difficult,” says the former CEO of a bank.

So why did the central bank ignore its own policy on allowing a float? The most plausible explanation is that Mr Emefiele has been kowtowing to President Muhammadu Buhari, who fears a weak currency. But these sorts of flip-flops hardly reassure foreign investors, whose dollars Nigeria desperately needs to fill a gaping trade deficit. Nor do they encourage Nigerian exporters to repatriate foreign exchange, since they still expect a further fall in the value of the local currency.

Source:

http://www.economist.com/news/middle-east-and-africa/21702474-new-floating-exchange-rate-was-fixed-may-be-changing-if-you-love-it?fsrc=scn/tw/te/pe/ed/ifyouloveit

Block Moulders Embark On Strike Action Over Increasing Rate Of Building Material

The National Association of Block molders of Nigeria yesterday began a five-day warning strike over the increasing price of building construction materials such as granite, cement and others. President of the association, Rasco Adebowale, says the strike action will among other things, afford them the opportunity to review the price of blocks to reflect the new prices of the building construction materials.

According to the moulders, there have been a 50% increase in the price of raw materials they use in moulding blocks particularly cement which went from N1,600 to N2,300 last week.

They say the price of cement is as high as N2,350 in some places that are not easily accessible. 

Source:
http://www.newshelm.com/2016/09/block-moulders-embark-on-strike-action.html

Fuel At N145/litre No Longer Sustainable – NNPC

John Ameh, Fidelis Soriwei, Friday Olokor, Adelani Adepegba and Okechukwu Nnodim

Former and present Group Managing Directors of the Nigerian National Petroleum Corporation have expressed fears that the current pump price of N145 per litre is no longer feasible.Close 

Fuel at N145/litre no longer sustainable – NNPC

John Ameh, Fidelis Soriwei, Friday Olokor, Adelani Adepegba and Okechukwu Nnodim

Former and present Group Managing Directors of the Nigerian National Petroleum Corporation have expressed fears that the current pump price of N145 per litre is no longer feasible.

They said the amount does not correspond with the price-determining components of the commodity and the fluctuations of the foreign exchange rate.

They stated this after a one-day meeting they held with the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, in Abuja.

The NNPC in its statement said, “They (the GMDs) noted that the petrol price of N145/litre is not congruent with the liberalisation policy especially with the foreign exchange rate and other price determining components such as crude cost, Nigerian Ports Authority charges, etc remaining uncapped.”

The declaration of the NNPC present and past bosses confirmed an exclusive report by SUNDAY PUNCH on August 7, 2016, in which oil marketers revealed that the actual or real cost of petrol was N151.87 when all the pricing components are adequately captured.

The marketers had stated that they were struggling to maintain petrol price at N145 per litre because of the stiff competition in the downstream oil sector, but stressed that the practice was not sustainable.

The GMDs, however, commended the NNPC for resolving the fuel supply crisis and urged the corporation to come up with measures that will ensure sustenance of seamless supply of petroleum products nationwide.

According to the corporation, the GMDs expressed concerns about the declining crude oil production level and its consequences on the environment and the nation’s revenue.

They further agreed that if the current situation remains unchecked, it could lead to the crippling of the corporation and the nation’s oil and gas sector which is the mainstay of the Nigerian economy.

The Nigeria Labour Congress, Trade Union Congress, Afenifere, former federal lawmakers, security experts and rights activists, however, warned the President Muhammadu Buhari administration not to contemplate any further increase in the pump price of petroleum products in the country

The General Secretary of the NLC, Dr. Peter Ozo-Eson, who stated this in an interview with SUNDAY PUNCH, said Nigerians would not accept further fuel price increment.

Ozo-Eson had warned the government earlier this week against increasing the pump price of petroleum products in the country.

He said, “We had given a warning before that Nigerians cannot take any further increase, that they shouldn’t do it.

“That remains our position, and if they go ahead and do it, it is up to Nigerians to say how they want to respond to it. But we remain opposed to any new increase in the price of petroleum product.”

Source:

http://punchng.com/fuel-n145litre-no-longer-sustainable-nnpc/

"FG, CBN To Blame For Economic Woes" — WAIFEM DG

Director-General of the West African Institute for Financial and Economic Management, WAIFEM, Professor Akpan Ekpo, weekend, blamed the Federal Government and the Central Bank of Nigeria, CBN, for the country’s current economic woes and its recent plunge into recession.

WAIFEM was established July 22, 1996, by the governors of the Central Banks of The Gambia, Ghana, Liberia, Nigeria and Sierra Leone.

In an email response to Vanguard enquiries in Abuja, Ekpo, an economists, former CBN director as well as ex-Vice Chancellor of the University of Uyo, noted that the delay in passing and implementing the 2016 budget and the CBN’s monetary and foreign exchange policy stance helped worsened the country’s economic situation.

Laments near absence of fiscal policy 

He said: “There was a near absence of fiscal policy – the economy lacks the necessary fiscal buffers. Money and exchange rate policies were the only voice. Rather than implementing quantitative easing, the CBN was interested in tightening monetary policy. When an economy is almost in a recession, monetary expansion would help towards recovery.”

He further argued that the CBN’s foreign exchange framework was another policy in the wrong direction, stating that rather than implementing a robust managed exchange rate regime, the CBN allowed the naira, which is not convertible, to float freely looking for a non-existent stability and equilibrium in both the short and long-terms.

“When a commodity is in short supply, market forces cannot determine the ‘correct’ value. The only source of foreign exchange for the economy is crude oil export, hence unrealistic assumptions under a competitive market cannot work in the foreign exchange market,” he added.

Faults CBN’s forex futures market, other policies 

Ekpo faulted the CBN’s decision to introduce a futures market within a foreign exchange market, stating that it further complicated Nigeria’s economic woes, especially in view of the fact that the Nigerian economy is heavily dependent on imports of goods and services and has only one major single source of earning foreign exchange.

He said: “The delay in adjusting the band of the value of the naira to the dollar, when the market provided a guide through scarcity, heightened the crisis. If recession persists, monetary, fiscal policies would be ineffective.”

He, however, warned that if the recession persists, monetary and exchange rate policy would be ineffective, adding that except drastic measures to reflate the economy were put in place, the third quarter of 2016 would not be different.

LIST CONDITIONS FOR ECONOMIC REVIVAL 

For the country to be able to get out of recession, Ekpo said the Federal Government should place emphasis on spending on capital projects and recurrent expenditures, especially in the area of payment of salaries owed workers, while also increasing its spending on power, roads and other infrastructure.

He disclosed that the Federal Government must assist states to pay workers owed salaries to stimulate aggregate demand, adding that the time to design policies to diversify the economy was now.

“I hate to disappoint Nigerians, the private sector cannot get us out of the recession. Government must lead for the private sector to follow until recovery sets in. As part of stimulating aggregate demand, the social programmes in the budget must be implemented urgently.

“Furthermore, government has no choice but to borrow externally and domestically to spend and get the economy out of the recession.

“Our economy consumes what it does not produce, hence there is need for a re-orientation for citizens to prefer locally produced goods and services. Heavy tariffs must be placed on imported goods and services. Lending rates are just too high to revamp the real sector.”

“Government must be strategic and think outside the box by grafting policies and programmes which would enable potential investors produce and supply both domestic and external markets.

“There has been too much emphasis on producing to earn forex; we only need a productive economy and other things would adjust.

‘’However, it must be noted that recessions are regular occurrences in a capitalist economy, hence the need for proper economic management in order to minimize its adverse effects.

“There is no doubt that this recession would pass away but another one would come, for no two recessions are alike. Therefore, managing an economy is not a tea party,” he added.

Source:

http://www.vanguardngr.com/2016/09/recession-fg-cbn-blame-economic-woes-waifem-dg/

Marketers Ask FG To Remove Fuel Price Cap

Fuel marketers in the country have called for the removal of the cap on the pump price of fuel.

They said yesterday that the N145 per litre ceiling was unsustainable in view of the falling value of the naira against the U.S dollar.

The marketers expressed support over the decision reached at a gathering of former Group Managing Directors of the Nigerian National Petroleum Corporation (NNPC) on the removal of the price cap on petrol in the country in Abuja on Saturday.

NNPC’s present and past GMDs, as well as the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, at the end of their one-day meeting noted that the N145 per litre fuel price did not reflect the price-determining components of the commodity and the fluctuations of the foreign exchange rate.

Sources close to the major oil marketers association told our correspondents yesterday that they were yet to start importing fuel since the fuel price had been pegged at N145/litre.

They said current exchange rate of the naira to the dollar made it difficult for importers to import fuel and sell at N145 per litre. 

The sources added that the marketers were, however, not suggesting that the pump price should go up. 

According to a source, “The skyrocketing exchange rate in the country makes it impossible for marketers to import and sell fuel at the price cap of N145 per litre.”

Executive Secretary of Depot and Petroleum Products Marketers Association of Nigeria (DAPPMA), Mr.Femi Adewole, told our correspondent that his members had to source the product from the NNPC because they could not access forex to import it.

He wondered why the price of fuel in the country had not been re-modulated since last May when it was fixed for N145 per litre against the N280 exchange rate to a dollar then.

A member of the Independent Petroleum Marketers Association of Nigeria (IPMAN) Press Committee, Barrister Dibu Aderibigbe, said marketers had warned at the inception that fixing a cap price for PMS would not solve the problem.

“And now what we have said is coming to reality,” Aderigbigbe said.

“The official rate today is about N315 or so. So, from N200 to N315/dollar and if we have to recover cost, can we still continue to sell at N145? I think it is simple based on the forex crisis unless there is a magic maybe they want to start giving importers special rate at N200/dollar and you don’t run economy that way,” he added.

The meeting of the forum on Saturday expressed reservations about the ceiling placed on the price at which the Pipelines and Products Marketing Company, an NNPC subsidiary, sells premium motor spirit to marketers.

The meeting which reviewed the status of the corporation and the nation’s oil & gas Industry, observed that the current ceiling on price of PMS was not in conformity with the liberalisation policy of the government and current realities in the foreign exchange market.

The forum however noted, “That the PMS price cap of N145/litre is not congruent with the liberalization policy especially with the foreign exchange rate and other price determining components such as crude cost, Nigerian Ports Authority (NPA) charges etc remaining uncapped.”

The forum advised that the existing refineries be rejuvenated using the Original Equipment Manufacturers (OEMs). It also said that the refineries must be restructured to operate as an incorporated joint ventures (IJV) similar to the Nigerian Liquefied Natural Gas (NLNG) model with the participation of credible partners with requisite technical and financial capabilities.

The meeting commended “NNPC for resolving the fuel supply crisis but urged the corporation to ensure sustenance of seamless supply of petroleum products nationwide.” 

It advised that funding of JV Operations should be the first line charge to oil revenue to ensure sustainable production and reserve growth.

Earlier at the meeting, the GMD, Dr. Maikanti Kacalla Baru, had presented his 12 Business Focus Areas towards putting the corporation on the path of growth and profitability before the forum went into the brainstorming session on the declining production level and its attendant consequences on the environment and the nation’s revenue.

The forum reviewed the security challenges threatening Oil & Gas production and damaging the Niger Delta environment and urged the government to engage the various host communities as well as established social and traditional structures to develop an actionable partnership framework toward finding a lasting solution to the present unrest.

Source:

http://www.dailytrust.com.ng/news/general/marketers-ask-fg-to-remove-fuel-price-cap/161409.html