₦airaland Forum

papaejima1:
I will support anything against the current dumbfuck in Aso rock now

It's this logic of anybody but the current president that got Buhari in power in the first place.

People need to make sure that the potential replacement is not worse than the incumbent.

plaetton:
I said it that the N6 trillion budget proposal was a huge joke, a stuuuupid but very cruel joke on Nigerians.
I said it.

Only people who couldn't count 123 properly would cheer a padded N6 trillion budget at a period when government revenue from our only exportable product is down 70%.

It was the budget proposal that really really exposed and confirmed this government as a bunch of delusional jokers who have ZERO, ZILCH, to add to the advancement of Nigeria.
The blind leading the blind.

To make matters even worse, they continue to NAUSEATE us daily with their sheer dishonesty.

The budget was an exercise in fantasy as I alluded in my thread in December: https://www.nairaland.com/2827820/why-implementation-2016-budget-unlikely

But what I found scary about it is that up till then, I had thought the policy missteps of the present administration were largely attributable to Buhari. What the budget illustrated - with the naive attempt to do a fiscal stimulus in a high inflation environment- is that economic illiteracy was also shared by key members of the Buhari government.

A stimulus package which injects cash into the economy in the midst of a currency collapse is wrong headed because every Naira out there is potentially going to be used to buy US dollars. This is why in a currency crisis, it's advisable to reduce your money supply by implementing austerity and increasing interest rates.

That being said, the move away from the fixed exchange rate regime and from subsidising fuel may mean that the worst is over for the economy. Hope this view will prove right.

I have a feeling the worst is over conditional on no major banking crisis happening. With the partial reversal of the insane fixed exchange rate policy and the removal of subsidy, 2 major bulwarks against economic revival have been removed. Of course, it takes time for the person on the street to start feeling the effects but my cautious prediction is that we have seen the worst of the downturn and that things will start getting better.

Nigeria "is caught in a macro hurricane," famed short seller James Chanos told the annual Sohn Investment Conference last week. With currency reserves running low, the country could have "a big problem" within a few years, he said. Calling the country "a borderline failed state," Chanos added that he was shorting South African assets, in part because of their exposure to Nigeria.

In the year that Nigerians elected a new president, oil prices collapsed by at least 30 percent. This week, Nigeria's stock market staged a relief rally after the closely watched MSCI Frontier Markets Index decided to keep the country in the benchmark, after warning last month that Nigeria was at risk of being booted from the index. Still, the outlook for Africa's largest economy remains grim. The extremist group Boko Haram has created significant political and security challenges for the embattled government of Muhammadu Buhari, and raise risks that could hit oil production.

"Nigeria is in trouble," Steve Hanke, a professor of applied economics at Johns Hopkins, told CNBC in an interview. Amid double-digit inflation, Nigeria's foreign reserves are dwindling as the government races to shore up a swooning currency, the naira.

Using a purchasing power parity metric, Hanke estimates that the country's prices are surging by a whopping 46 percent, far above the official rate of between 11 and 13 percent. Weak growth — Nigeria's economy expanded by less than 3 percent last year — has done little to curb soaring food prices, which have risen every month since December 2015.

Meanwhile, oil prices remain firmly under $50 per barrel, heightening the risk of what consulting firm PricewaterhouseCoopers noted in a 2015 report could become a "security shock," as weak growth feeds political instability. Currently, the country's 2016 budget assumes an oil price of $38 per barrel. Razia Khan, chief economist for Africa at Standard Chartered, expects crude will rise later in the year, but growth is likely to remain muted. Khan noted that the International Monetary Fund "expects growth to decline even further in 2016, to 2.3 percent."

Oil gives Nigeria around 95 percent of its foreign earnings. Should crude remain at current levels, PwC expects growth to contract and oil revenues to dwindle to $20 billion. Meanwhile, the currency has already overshot PwC's worst-case forecast for this year, blowing past 320 to the U.S. dollar recently. "The currency is junk and the government is incompetent and corrupt," said Johns Hopkins' Hanke. "The only sure-fire way to solve all these problems is for Nigeria to officially replace its junk currency."

Source:http://www.afripol.org/afripol/item/1845-the-currency-naira-is-junk--professor-hanke-of-johns-hopkins-university.html?tmpl=component&print=1

I don't share Steve Hanke's pessimism - but of course, I may be biased because I am a Nigerian. The main worry is whether the actual level of foreign reserves held by the CBN is lower than the official data suggests. If it is and oil prices don't rally anytime soon, expect more pain in the immediate future.

He should also tell us how the economy benefited from the fixed exchange rate. What he does not realise is that his comments increase the chances of currency depreciation as investors infer that further political intervention with the CBN is likely and desist from bringing in forex into Nigeria.

IGR alone does not tell you much about a state's financial health, you also have to look at things like its debt servicing requirements, debt stock and recurrent expenditure.

A state that generates N40bn in IGR but spends N60bn in debt repayments is no better than a state that generates N10bn in IGR but spend N2bn in debt servicing. States like Rivers and Ogun have high debt loads, the latter as I have always pointed out on this forum required a FG bailout.

jhydebaba:
As a shareholder in union bank, I lost so much money due to his inability to repay common loan.

he is always seen dishing out common sense to FG on how to run a very big entity like NIGERIA while a small business under his care is collapsing.
#commonsenseindeed

I have no time for Bruce as he is a corrupt bloviating charlatan but I find some of the comments like the above difficult to accept. If you are the shareholder of a bank who face crisis because of effectively one debtor, that tells you a lot about the shoddy risk management and imprudent lending of your bank.

Anambra is now engaging in Osun style propaganda.

delivite:
Take it easy fellas. I disagree with anything the western media says about Nigeria simply because it's the western media that said it. We can report our own news and know our own problems, thank you very much.

By the way, were they not just hailing buhari as the saviour Nigeria most desperately needed 1 year ago

This is why I said this in September 2015:

4Play:
We replaced an inept government with an even more inept government. Knowledge of the extent of the current government's ineptitude will accumulate overtime. When we had the buffoon GEJ as president, I can't remember any Western analyst who said he was inept barely 100 days into his tenure. His ineptitude only became common knowledge subsequently. Buhari will prove the same.

It sometimes takes time for a government's ineptitude to sink in.

uselessgoat:
He should be in prison while Deziani and GEJ walks free according to you IPOB yoots does having a certificate translates to good governance Smh

No, in a civilised country, GEJ, Deziani and Buhari would all be in prison.

Sweetlemon:
When people kept complaining that Kemi Adeosun does not have credentials to compete with Iweala and all that I kept telling them to hold on a little and give her a chance.
The difference between the two is that while the latter impresses you with economic jargons, the former is more realistic about situations on ground while giving practical solutions to issues.
Give Kemi another two years, most of you will campaign for her to be our Hillary Clinton. Lol.

I am not surprised you put LOL at the end of your post as you must have been reeling with laughter at the sheer stupidity of your post. The person you are singing her praise was also the Commissioner of Finance for Ogun state for 4 years until 2015 and can you remind us whether Ogun state needed a bailout by the end of her tenure?

Had the FG's finances been mishandled as badly as states' finances, including Ogun's, the FG won't be in a position to be arranging a bailout for the states.

Though she did not specify the expected amount to be cut from the budget or any particular expenditure head to be affected, a budget office source told Vanguard that looking at the current revenue trend, over 50 percent of the capital expenditure budget would not be implemented. This gives about N900 billion out of the total N1.8 trillion budgeted for capital expenditure in 2016.

This is was what I said in December 2015:

The FG simply cannot implement its budget in the current form without lots of asset sales and a huge devaluation in Naira but this is not proposed in the budget.My guess is that much of the capital expenditure will not be implemented. I leave you guys to ponder this.

https://www.nairaland.com/2827820/why-implementation-2016-budget-unlikely

It's like choosing between gonorrhoea and syphilis. My view on this has always been that GEJ represented the lesser of 2 evils. He seemed a bit of a naif with bovine intellect but he had the good sense not to imagine himself an expert on economics in contrast to Buhari who makes proclamations about the exchange rate undermining the independence of the CBN with disastrous consequences.

In the Nigerian context, a weak leader is often less damaging than an inept strong leader.

This is good news. It is a shame we had to endure this stupidity of a fixed exchange regime for a long time before retracing our steps.

It is not optimal as I hear they intend to maintain a fixed exchange rate regime for "vital" sectors but it's better than what obtained before.

PassingShot:
I just tried to help your ignorance. You're free to refuse to be helped.

Your cup of tea.

Anyone who doesn't know that every spending outside budgetary allocation and statutory spending must be approved by the NASS, and yet refusing to be educated, has surely deliberately chosen to remain ignorant. There is little anyone can do to help such person.

Stop yarning drivel, you are the only one who brought up spending outside statutory spending. The NASS has approved spending, the FG does not need further NASS approval to meet the approved spending using the phantom recovered funds. Indeed, if the money did actually exist, the FG would rather use it than have to borrow as it spends more than a third of its revenue on debt-servicing (it wouldn't want to add to its future debt-servcing obligations). -

LAGOS, March 3 (Reuters) - Nigeria expects to spend 35 percent of its federal government revenues servicing debt this year, up from 26 percent last year, the Debt Management Office (DMO) said on Thursday.

http://af.reuters.com/article/nigeriaNews/idAFL8N16B523

The reality is that much of that money does not exist. The problem with lies is that when you tell a lie, you need further lies to sustain it. By claiming the government is engaged in a successful anti-corruption war yielding billions of dollars, there is a natural need to explain why these additional funds are not manifesting in an improved FG fiscal profile. Now we have a new lie - the FG cannot use the funds because the NASS did not approve it! You guys make me laugh

[quote author=stevedure post=46291614][/quote]What I find funny is the uncoordinated lies - he says the government needs NASS approval to spend recovered loots even though the NASS has approved spending of N6 trillion which government officials are running helter skelter to finance. Adeosun noted recently that implementation of the budget is not a given due to lack of money:

The Minister of Finance, Mrs. Kemi Adeosun, said on Thursday that there was no guarantee that the Federal Government would implement the 2016 budget in full.

The minister, who took her turn to address members of the House of Representatives at the ongoing sectoral debate initiated by the House, explained that much depended on how much money was available to the government from crude oil sales to implement the N6.06tn budget.

http://punchng.com/cant-guarantee-full-budget-implementation-finance-minister/

But passingshot also says the government may want to spend the money outside of the budget! So the government is not sure it can fund its budget approved by NASS, but it may look to spend money in ways not yet approved by NASS using money for which it needs NASS approval to spend - I have never seen such disoriented and harebrained attempts at propaganda as you see in Naija politics.

PassingShot:
Recovered loots cannot be spent without a bill approved by the NASS.

Again, the FG may have different plans on how to utilize the money outside the budget. Whichever way it decides to use it, the spending must be approved by the NASS.

The recovered loot does not require a bill from the National Assembly to be spent. The NASS has already approved spending to the tune of N6 trillion towards the 2016 budget for which the FG is looking to borrow 2.2 trillion Naira to meet:

ABUJA Dec 22 (Reuters) - Nigeria expects a budget deficit of around 2.2 trillion naira ($11 billion) in 2016 which would be funded by local and foreign borrowing, President Muhammdu Buhari said on Tuesday.

http://af.reuters.com/article/nigeriaNews/idAFL8N14B1DC20151222

If the government has "recovered" 3 trillion Naira, not to mention the 3 trillion Naira recovered into the TSA, it would not be looking to borrow. You are spreading misinformation and I suspect you are being paid to do so. For more on the government's borrowing plans and bond issues, see below:

Nigerian officials are meeting bond investors in London next week, according to a person familiar with the matter, as the government considers tapping international debt markets for the first time in three years to help finance its record budget deficit.

http://www.bloomberg.com/news/articles/2016-06-01/nigeria-said-to-plan-bond-investor-meetings-in-london-next-week

The DMO may not balk at the bids at the next auction, given the scale of the funding requirement. Net domestic debt issuance is set this year at about N950bn, and holders of the Aug ‘16s have to be paid a further N560bn on maturity. Ytd the DMO has raised N418bn.

https://www.proshareng.com/news/Bonds/Another-rise-in-yields-at-FGN-bond-aucti/31072

If Buhari is blocking the use of state funds to finance APC, that is good leadership. Political parties are private associations and should self-finance.

tbaba1234:
King solomon...

It is not vague. There are legal issues with releasing people names like that. This gives a good summary of the progress so far.

That's nonsense. If anything, the main legal issue lies in not revealing names - if a person unlawfully receives public funds and is reasonably suspected as so doing, there is no legal obligation to conceal the person's identity. Indeed, a person from whom loot is recovered has admitted the receipt of loot so their guilt, though not adjudicated on, has been effectively established .

What you shameless propagandists are claiming is that the law somewhat requires the FG to conceal the names of looters who have effectively admitted to being looters by returning their loot. The depths to which some Nigerians sink in spewing mindless and ignorant propaganda is staggering.

The problems with this list are myriad: the figures can be fabricated; monies recovered could represent monies recovered from Abacha for instance. If the FG actually has additional 78bn Naira or $10bn (2 trillion Naira), the latter under interim forfeiture, our cash strapped governors would be knocking on the Aso Rock door instantly to discuss how the money is to be shared. The most likely reality is that much of the amounts touted, like the spun TSA recovered cash, does not actually exist.

In 2011, defence and security had a budget of N348 billion or just over $2 billion. In 2012, it skyrocketed to N921 billion or $5.7 billion. It grew to N1.055 trillion in 2013 or $6 billion. In 2014, N968 billion was budgeted for defence and security or $5.8 billion. The 2015 budget was passed in April and President Jonathan handed over to President Buhari a month later so I cannot see how the previous administration could have 'chopped' that money. So of the $19 billion budgeted for defence and security while former President Jonathan was in office, how could $15 billion have been looted when more than half that amount went to paying salaries?

I have always marvelled at things like the above - the capacity for Nigerians to spout and believe stories that are transparently implausible. Whether it's the $20bn or you may remember IBB's $12.6bn Gulf War windfall. Some months ago, I engaged in a rather IQ-shrinking debate with Sagamite who claimed with utter confidence that GEJ stole (conservatively) 40% of the yearly FG budget!

Now, in pointing out that these stories defy basic logic and numeracy, I am not seeking to defend our corrupt politicians. However, informed discourse is good in of itself, as well as being ethically more defensible, and serves a practical value in accurately holding our governments to account and weighing our political choices.

In a previous post, I pointed out that these embellished claims have a practical value: they persuade Nigerians to overlook/ignore the shortcomings or thievery of one set of politicians by fostering the belief that the other set of politicians are or were engaged in Olympian logic-defying levels of theft.

No adult of sound mind believes that APC is full of honest politicians but by claiming, for instance, that Okonjo-Iwealla needs to account for "missing" N30 trillion for the nearly 4 years she was minister, you create the impression that the previous administration's theft was so gargantuan that the corrupt acts associated with the APC are mere foibles by comparison. The impression was created that all one needs to do is remove one set of thieves - the PDP - and we are a long way towards solving our problems. Except, that this is hardly true as both sides are in reality barely distinguishable from each other.

idupaul:
Those of us that voted Buhari need to stop and take a deep breath then say Yes we Ma a big mistake by voting a man whose only pro is integrity and his cons are plenty plenty from lack of intelligence to poor vision

People thought that integrity was sufficient (though in fact Buhari lacks this in any case) as many Nigerians think Nigeria's main problem is corruption. When people read stories about $20bn being pilfered in an 18 month period, it's tempting to think that by merely removing those thieves, much of our problems are solved. The snag in this line of thinking is that the factual premise - about the scale of corruption - was exaggerated in the first place.

Nigeria has a massive corruption problem, probably unrivalled in scale anywhere else, but the policy environment trumps corruption as the greater obstacle to prosperity. You can develop with corruption & good policies but not with bad policies even if you totally eliminate corruption. Not only would Buhari not have eliminated corruption, he wouldn't have been able to get elected without financing from corrupt allies, but his poor grasp of policy would overwhelm any achievements from the purported anti-corruption drive.

Another update:

FG's share for April is N101.2bn
[url]
http://www.pmnewsnigeria.com/2016/05/26/faac-fg-states-lgs-share-n281-5billion/[/url]

The finance minister has now hinted at what should have been apparent when I started this thread, implementation is not certain given revenue generation - http://punchng.com/cant-guarantee-full-budget-implementation-finance-minister/

In all, it's actually a good thing if the budget is not implemented in full as the borrowing required would have caused interest rate rises (crowding out effect) and the injection of cash into the economy will fuel inflation and Naira depreciation.

I started a thread in December 2015 stating that the budget was unlikely to be implemented as the revenue projections were too optimistic:
https://www.nairaland.com/2827820/why-implementation-2016-budget-unlikely

For those blaming Niger-Delta Avengers, remember that the budget assumed minimal oil revenues (also based on $38 p/b). It was clear from the outset that the budget's estimates stretched the bounds of credibility.

Does anyone notice that there is no longer talk of the $20 billion? The EFCC is talking of election campaign funding but $20bn - which equates to 2/3 of this year's budget at the official exchange rate - is rarely mentioned, if at all.

Support for politicians in Nigeria is based on a toxic mixture of delusion and bigotry.

For Buharists who invested so much hope in him, admitting that he's not what they expected is a big blow to the personal ego. No one wants to accept thst something they passionately advocated for was a mirage. Krugman puts it best:

Bear in mind that embarrassment, and the desire to avoid it, are enormously important sources of motivation. Consider, as a weird, self-aggrandizing, but I think relevant observation, what has happened to supposedly smart guys who predicted soaring interest rates and runaway inflation 6 or 7 years ago. Almost none of them have conceded that they were wrong, and should have done more homework. Instead, many of them — especially the academics — have become ever more obsessed with claiming that they were somehow right, and/or trying to tear down the reputations of those of us who were in fact right. Nobody likes looking like a chump, and most people will go to great lengths to convince themselves that they weren’t.

[url]
http://mobile.nytimes.com/blogs/krugman/2015/12/15/the-donald-and-the-chump-factor/?referer=[/url]

AnakinSkywalker:
There is actually a lot of fact regarding the I.Q of the African. Note, this does not imply that his I.Q is fixed. Potentially, the average African when given the opportunity and then trained in a proper environment (devoid of bias, nepotism, bigotry, religious fanatism, greed and avarice, violence, etc.) he shows how limitless he can be in making the world a better place and contributing to the development of the human race. His IQ is supper.

I think it is a learned thing. It is more of a psychological thing which is passed down by Family and the society to all Africans. Unfortunately my theory on the root cause does not have a solution.
It is almost impossible to simply stop the African society from passing on these things unto new generations. For the old generations are still filled with these unwanted traits.

How do we also describe the white man who come to Nigeria and permits his driver to go against traffic? How do we explain the European who decides to pee on th streets of Lagos just opposite the Muson Center in Lagos Island?
Do we explain it as a lack of laws and institutions to control the behavior of man? Are we then saying when given the chance, men can become as low as animals? The London riots for instance?

Could it be that when resources and amenities are scarce it breeds greed and violence? Then perhaps we can argue that wealth distribution is poor in Africa due to bad leadership and governance and a such Africans are behaving the way they do (hoarder and greedy) due to scarce resources. They also teach this "grab, grab and grab as you can", and the "use any opportunity to your selfish advantage" mentality.

There was a very interesting but controversial book on how low IQ determines a nation's state

As Garett Jones argues in Hive Mind, modest differences in national IQ can explain most cross-country inequalities. Whereas IQ scores do a moderately good job of predicting individual wages, information processing power, and brain size, a country's average score is a much stronger bellwether of its overall prosperity.

[url]http://www.amazon.com/Hive-Mind-Your-Nation%C2%92s-Matters/dp/0804785961[/url]

oduastates:
Big deal .
Obasanjo left $64 billion at an average of less than $30\ barrel and in spite of ND criminal bombings.
22 billion of that reserve was revenues in the ECA.
Jonathan not only spent , stole or wasted $34 billion of what OBJ left , he also squandered the $500 billion earned during the boom. Include the debt mess he left behind in spite of the revenues.
Algeria saved forex of over $150 billion .
Jonathan dollarised the economy in such a way that the $29 billion he left in CBN will last for less 6 months.
By the way , a country needs foreign reserves to pay for imports .
The way Obj managed the economy, Nigerian should have had nothing less than $120 billion ,give or take $30 billion.
This is how much should have been left behind.
You are talking about $29 billion which took OBJ less than 3 years to save at $16 a barrel

You guys can't see that you are tying yourself in knots. If you tell people that OBJ "saved" $64bn when oil $30 p/b (which is false anyway) and saved $29bn when oil was $16 p/b, they are inevitably going to start asking why Buhari can't do same when oil is $45 p/b.

sunnyb0b0:
Obasanjo met the foreign reserve at $3.5bn, oil price at $9 and a foreign debt of $32bn.

Buhari met the foreign reserve at $30bn, oil price at $40 and foreign debt of about $8bn.

So, what are you guys on about?

There is an obvious flaw in your argument but to get to it, APC fans will have to admit something they have always mendaciously denied - that the size of the economy has grown substantially since 1999 such that foreign reserves of $30bn and oil prices of $40 are not sufficient to maintain our present standard of living.

In 1999, the minimum wage was about 550 to 800 Naira. At today's income levels, Nigerians consume far more (much of it imported) that foreign reserves of $30bn are now insufficient to maintain present consumption levels. This is also a major indictment of our PDP governments. If you wanted to know why GEJ's era failed to produce savings from the high oil prices, look no further than recurrent expenditure (the public sector wage bill and its attendant effect on aggregate consumption).

Wages should increase in line with productivity growth, but by more than tripling wages (the minimum wage went from N5000 to N18,000), it meant government needed oil prices to remain at +$100 p/b to pay workers. The big increase in wages meant that consumption increased and with that our import bill. Because these wage increases were not driven by productivity growth but by government fiat to gain cheap popularity, they were unsustainable once the government and the economy's main source of income and forex, oil, collapsed.

Where I differ from most is that I do not attribute blame for these policy mis-steps to just the political class. It's Nigerians' penchant for supporting populist and economically illiterate policies that puts us in these dire situations. Yar'Adua & GEJ increased public sector wages because such financially suicidal policy goes down well with Nigerians. When people today laugh at Osun, we should remember that its fiscal troubles are not because Aregbesola was extraordinarily corrupt, it's because he was trying to gain/maintain popularity by spending on infrastructure at a financially unsustainable rate. To illustrate how financial imprudence is popular with Nigerians, recall that APC's official policy according to Lai Mohammed when oil prices were high was that the excess crude account and other saving measures like the SWF ought to be abolished. You see, the political class are drawn from the ranks of Nigerians and as long as Nigerians support moronic policies, changing the ruling party won't make much of a difference in the long run.

This absurd piece of illogic making the rounds is stunning for its audacity. What purports to pass for a reasoned argument goes as follows:

GEJ is so corrupt that we opposed his removal of subsidy as we couldn't trust him with the saved money.

Anyone with a modicum of intelligence will instantly recognise the false dichotomy in the argument. For, if you cannot trust GEJ with the subsidy savings, then it is out of the question to trust him with the subsidy spending. Those who spout this dissonant guff are simply trying to rationalise positions adopted out of bias. This is why I have argued that many Nigerians support policies depending on their ethnic/religious leaning fabricating ever more absurd pseudo-arguments to justify why policies they vehemently opposed not long ago are now the best thing since sliced bread.

Subsidy removal was and is the economically literate thing to do. You cannot continue to spend a depleting resource - oil and the revenues therefrom - on a consumption good like petrol. Think of the total subsidy bill in the last 4 years alone and the opportunity cost. The main reason the subsidy programme lasted this long is because it was a lucrative conduit for corruption.

mrhansome12:
That one is unrepentant I doubt if he will even change

Many on here earn a living from posting partisan propaganda. I am reminded of the quote, "It is difficult to get a man to understand something, when his salary depends on his not understanding it.". I have seen worse in Nigerian politics, go back to the Abacha era when many earned a living advocating Abacha for president.

In other words, nothing has changed. Great defence of the current government.

This news is confusing for those who lump people from the far North together as one "Hausa-Fulani" ethnic group. There are different ethnic groups in the North and Boko Haram, which is largely drawn from the Kanuri ethnic group, do not see Fulani herdsmen as their allies.

Another thing this news draws attention to is the savage mindset of many Nigerians. You have people who celebrate this kind of news as the victims are largely Fulani/Muslims and because it paints the government in a bad light. On the other hand you have a conspiracy of silence amongst Nigerians particularly in the media. This news was reported by Bloomberg, a US publication. The continued slaughter of Nigerians in the North East is no longer viewed as worthy of reporting lest the government might be embarassed given its risible claim to have defeated, technically of course, Boko Haram.

What kind of people rejoice or ignore the murder of their fellow citizens? Only a nation of savages would behave the way we do.