nairalanda1:


The problem with your argument is that it kicks off with a strawman...and a very bad one at that.,with all due respect.

You assume that I state that subsidy is the only cause of government borrowing. That's not right. In my opinion we borrow because

1) We are a resource dependent nation that relies on oil, whose prices are never stable for us to earn enough.

2.) We also spend a lot of money paying for rising subsidy costs every year.

3.We are not good at collecting taxes.

All the above are why we borrow. And the APC was not good at improving any of the three. WHICH IS WHY I NEVER VOTE FOR THEM. (In capital letters because you folk assume I support the thieves in APC. I don't , and neither do I deny they are corrupt, and that they waste money. But even if we dealt with the corruption and waste...AND WE SHOULD...it still don't solve the net problem).

As for the NNPC borrowing money....they are doing it so that they don't ask the government. Remember also the PIA has been signed. NNPCL is now a private company (theoretically...practically is another matter). NNPC isn't earning enough dollars. It is still early days. Had Buhari removed subsides in 2021, this borrowing would have taken place earlier.

It still doesn't pay for subsidies...it is just NNPC getting some dollars to take the pressure off government. (Of course it would translate into higher prices for fuel, but that's called capitalism. Every company , even outside Nigeria sometimes has to take loans. ).





Yes, and it is because of the above three points. And yes, our government needs to address those three points...plus fight corruption. But right now, we need money. If Obi took over or Atiku or anyone else took over, they would borrow. Especially since 99% of our revenue is going to debt servicing.


You guys should really pay attention to what I say and not what you think I say.

Politics / Re: Subsides On Fuel Always Leads To Smuggling. by nairalanda1(m): 11:26am On Jun 24

Brendaniel:


something they have been fixing since 2015 grin and you believe them , last year alone they still allocated 1.5 billion dollars to fix the port harcort refinery, that it will be ready by June this year or so, June is almost finishing, do you know how much they've spent since 2015, billions of dollars grin the Dangote refinery I don't see it as a saviour either, The same way Dangote's cement is not cheap is the same way the petrol might be, Once Dangote is monopoly he takes full advantage of it...


In this case, there is reason to believe they are serious this time, as a side effect of subsidy removal is that domestic refining becomes profitable again.

Politics / Re: Subsides On Fuel Always Leads To Smuggling. by nairalanda1(m): 11:34am On Jun 24

Brendaniel:


Oga, they are not serious, the same set of people who have been in charge are the same set of people now.... Nothing new


Well, this time, they are.

I expect more licenced private refineries to take up the licences and start working...because right now they would be able to get loans to start work.

Politics / Re: Subsides On Fuel Always Leads To Smuggling. by nairalanda1(m): 9:21am On Jun 24

Brendaniel:


Oga everything is you said is still rubbish if corruption is not fought because the end result will still remain failure,

It is like a child who is very brilliant and read very well for his exam and he was given money to buy Biro and pencil he will use to write the exam a day before the exam, only for him to use the money to buy drinks and went into the exam hall without a pen or pencil and couldn't write anything throughout the exam.

He will fail, so whether he read or he did not read or he was brilliant or dull in academics, at that point it means nothing, because even the dullest student there with a pen will still score higher than him.


Yeah, you keep using the word failure, because you think I am defending corruption.

I am not, and let me reiterate myself again....corruption has to be gone.

But corruption is not the main issue with subsides....it is a symptom even.

The main issue with subsidy is simple...so long as the cost of production and the cost of transport rises, so does the cost of subsidy.

Crruption happens because

1.The price fixing allows easy smuggling.

2.Free money, regardless of whether NNPC is working or not...provides opportunites for corruotion

But even minusing corruption, so long as costs of production rises, as well as cost of transport, the eventual end is that subsides will rise higher than the revenue we earn.

So, it had to go man. That's why all the three candidates all said subsidy should go. At the rate it was going...we were going to run out of money to pay for the thing.

Man, fuel is expensive.

As I read the first 3 lines of your thrash I didn't bother reading the rest, you said in your own words that subsidy removal will end borrowing, I would have brought more of your mentions on me out on that, Nairaland has deleted all comments from 4 months back, but I could get these ones, read your comments and mine and see who was talking right about this present government and their subsidy removal...

You even said corruption is a symptom of subsidy, wow, subsidy itself is not bad, but the corruption in subsidy is what is bad, I told you subsidy removal will fail because subsidy was not the problem but the corruption in it, you claimed it will work, please read all your comments, I wish I could get more, you said a lot back then, I knew it will fail right from the start....

Brendaniel:













As I read the first 3 lines of your thrash I didn't bother reading the rest, you said in your own words that subsidy removal will end borrowing, I would have brought more of your mentions on me out on that, Nairaland has deleted all comments from 4 months back, but I could get these ones, read your comments and mine and see who was talking right about this present government and their subsidy removal...

You even said corruption is a symptom of subsidy, wow, subsidy itself is not bad, but the corruption in subsidy is what is bad, I told you subsidy removal will fail because subsidy was not the problem but the corruption in it, you claimed it will work, please read all your comments, I wish I could get more, you said a lot back then, I knew it will fail right from the start....

Good evening.

You missed the point I was trying to make, and thus, I can't continue this discussion. Also, neither of the comments you made proves your point.

Have fun, young padix.

Ye can enjoy

nairalanda1:




Good evening.

You missed the point I was trying to make, and thus, I can't continue this discussion. Also, neither of the comments you made proves your point.

Have fun, young padix.

Ye can enjoy

I want to believe you might be dropping your sanity before making comments here....

Brendaniel:


I want to believe you might be dropping your sanity before making comments here....

Lucy doesn't like angels talking to demons...

Blaze14k:


When u have nothing to say u act like u don't care and u find it difficult to take the truth. Empty block heads

You're the empty block head who have been saying a lot of nonsense about a deal you have no information about. I won't be wasting my time arguing blindly.

What's more important to me is that, there will be dollars to use in supporting the naira and make it strong. When the naira appreciate against the dollar, fuel prices won't rise but fall.

Naira will appreciate against the dollar and price of petrol and diesel won't rise, nah the main koko for me. I'm not interested in your blind and ignorant argument

Free2Fly:


Mumu supporter seen!

Is this how you guys are going to build Nigeria?

By borrowing to defend the naira after floating it

Una no well

You are the real mumu. It’s either you are not educated or enlightened or both. The reason for the free fall of the Naira against the dollar is because of the backlog of the FG obligations in dollars. What the government has done is to borrow against future oil production. They will be paying in crude oil. The FG would have cleared most of the backlog by then, the reserve can increase as a result of the cut in PMS consumption, subsidy removal,
Functional Dangote refinery. Less or no dollar would be needed for PMS importation. More dollars is earned from crude oil exportation then the FX can be channeled to the real sectors. Drastically the exchange will come down

nairalanda1:


Lucy doesn't like angels talking to demons...

You see what I'm saying.....

Brendaniel:


You see what I'm saying.....

But the peaches were so beautiful, as Petunia said..

nairalanda1:


But the peaches were so beautiful, as Petunia said..

So insanity has become your defense to economical debate

cidieschat:
I thought the NNPC is now a private company, why do they take loan on our behalf

Incase tinubu gets see disqualified. He won't lose

Is NNPC now CBN or Ministry of Finance or what..

Wetin person no go see for apc regime

Ikaeniyan0:
You're the empty block head who have been saying a lot of nonsense about a deal you have no information about. I won't be wasting my time arguing blindly.

What's more important to me is that, there will be dollars to use in supporting the naira and make it strong. When the naira appreciate against the dollar, fuel prices won't rise but fall.

Naira will appreciate against the dollar and price of petrol and diesel won't rise, nah the main koko for me. I'm not interested in your blind and ignorant argument

The federal government just mortgaged your future dump fuk.. your only concern is theres dollar. What a full and a block head for that matter. They no longer talk about dangote refinery. Na so ebola go use ur head dey play ludo empty skull

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All because we don’t produce
We only consume.
Nigeria has failed,
We hope for the best

fergie001:


NNPC Limited

NNPC?
Why not CBN
Tinubu Why

Taylor90:
At the end na still South South Oil them go use salvage the Mumu naira at the expense of our destroyed and damaged soil that that can’t grow a mere grass

Na we still dey suffocate with black soot all over Niger Delta while the barren region eat fat on our Mumu disunity

Omo Abeg I no wan vex this evening

this na coded subsidy...

Ikaeniyan0:
The bank is not owned by the west but by Africa.

NNPLC is flushing $3Billion into the FX market

Not directly, the aren't. What you don't know is that the current banking system was created by the West and distributed to the rest of the world to enrich a select few.

What is the business of NNPC with currency stability?

Una don become CBN?

Kyari should have been sacked from day one. That money will be stolen or used for any rerun elections. I pity nigeria and Nigerians living in nigeria

skj1377:
The issue is not aboki but the fact that dollar inflow is sold to parallel market straight making the gov the only source that want to sell to the IE window. Best bet is to liquidate all domiciliary accounts in all banks in Nigeria them creat a deliberate parallel market for undocumented and unambiguous buyers while creating a gov artificial rate of N80 Naira to the dollar. A policy of strictly chemical and machinery as well as only industrial purposes to access this non cash rate. You will find out that machines and spares for industries will be cheaper including cars and cost of construction industry . Houses will be cheaper to build making life more affordable to Nigerians . The parallel market or cash market can be as high as N20,000 to $1 . This window will be for people that want cash to travel out or probably pay expatriates. This dual exchange rate system has to go along with domestic production of petrol and diesel as well as other petroleum by-products. Like I said the official exchange rate will be strictly for manufacturing and purchasing of parts and chemicals which will never be cash based. This will eliminate the possibility of round-trip. We all know that spares are not bought every day neither are chemical imputes so the pressure from the industries will be seasonal . . The people that require cash for many other reason can be based on the ability of demand and supply; floating. All profits from foreign coys can be repatriated by either they buy gold form osun state or zamfara state and export the cold abroad to get liquid cash. This will also help our mining sector. This is my advice and solutions

nice idea but it seems you don't know how savvy we Nigerians are, let me give u an example that is happening and that will still happen if the govt still maintain a window for exchange apart from the parallel market even if it's non cash based.. I open a dorm account, but dollars with my 10m got lets say 7200 current official rates on my govt form which I use to apply for the purchase which is form M I calm I want to buy x chemical for my company to produce y product, x chemical is sold in Germany, I have a friend in Germany, I tell him to give me his account.. I transfer$7200 to him collect $7100 either in cash or I tell him to do a transfer for a used vehicle eg a Toyota camry 2015 model, I ship it in, pay the required 30% on import duties on cars sell car for 16 million naira... That's another form of round-tripping.. Don't underestimate Nigerians we can go to any length to take advantage of any loophole..
There won't be a stop to the slide of naira until the official window is closed and let everyone buy and sell at the parallel market rate both CBN, Bank and BDCs... That's when the currency will stabilize, when that is done Government can gradually increase wages quarterly. Minimum wages should be negotiated by FG for federal staffs and respective states should negotiate their own minimum wages according to their various state economy.. That's the only way forward.

fergie001:


NNPC Limited

Frypan to fire 🔥

This country is fvcked...

Bullshit...

For how many years will they be applying this method to stabilize the Naira? Dem no get sense at all!

All we want is solution to our mega problem .. Emilokan knew he has entered into serious work in Naija

Ikaeniyan0:
The bank is not owned by the west but by Africa.

NNPLC is flushing $3Billion into the FX market

then why giving out loan in dollars? Abeg na proxy bank.

masseratti:
We cannot go on like this.. This is not the way out to stabilize the naira, the only solution is to go the way we did with fuel subsidy, no more special treatment, if you have a window the I and E window and a parallel market with two different rates in one economy, some privileged people who have access to the I and E window to buy Dollars will buy it at a lower rate and sell at the parallel market at an higher rates, also the world is no more in the 90s where market forces closes with banking hours, shut down the I and E windows, buy and sell the dollars at the going rates in the parallel market.. With that you have unified the exchange rates and allowed it to float freely, stop selling to the banks. If you have to sell to the banks sell at the aboki rates and buy at aboki rates.. The demand for dollars I can guarantee will go down 40% under just one week.. Thereby forcing the rate down...
The CBN honcos knows this, this is what we need not loans to defend the naira

It might be ok for short term but what happens when it's exhausted? It's a vicious circle.. Only way out is for CBN since they are the largest holder of the currency or the IOCs to buy and sell at the parallel market rates abolish the I and E window.. It's just a conduit for another round tripping.. That's what is causing the rise in dollars thereby triggering inflation.

So make dem shut down I & E window make Aboki dey determine Forex rate. Na wa for Una.

skj1377:
The issue is not aboki but the fact that dollar inflow is sold to parallel market straight making the gov the only source that want to sell to the IE window. Best bet is to liquidate all domiciliary accounts in all banks in Nigeria them creat a deliberate parallel market for undocumented and unambiguous buyers while creating a gov artificial rate of N80 Naira to the dollar. A policy of strictly chemical and machinery as well as only industrial purposes to access this non cash rate. You will find out that machines and spares for industries will be cheaper including cars and cost of construction industry . Houses will be cheaper to build making life more affordable to Nigerians . The parallel market or cash market can be as high as N20,000 to $1 . This window will be for people that want cash to travel out or probably pay expatriates. This dual exchange rate system has to go along with domestic production of petrol and diesel as well as other petroleum by-products. Like I said the official exchange rate will be strictly for manufacturing and purchasing of parts and chemicals which will never be cash based. This will eliminate the possibility of round-trip. We all know that spares are not bought every day neither are chemical imputes so the pressure from the industries will be seasonal . . The people that require cash for many other reason can be based on the ability of demand and supply; floating. All profits from foreign coys can be repatriated by either they buy gold form osun state or zamfara state and export the cold abroad to get liquid cash. This will also help our mining sector. This is my advice and solutions

Arm chair economists here and there. Ndi Cambridge. Make dem liquidate all domiciliary accounts How? Why? Na wa for Una.

How?

fieryblitz:
I guess Aramco also borrows to hedge the Saudi riyal?

lol......Saudis current debt to Gdp ratio is 23% with most of it tied to crude contracts, but for your small mind Saudi is debt free......Oga sit and stop thinking like a child......

vanitybutiwanti:
It's still a form of subsidy because dollars will be supplied to the marketers at a the official rate as opposed to the parallel market rate.

parallel market is only thriving based on speculation.....with the free float of the Naira the official rate is the real value of the currency......the parallel market is just speculation and once there's liquidity at the official window the parallel market will crash, rate my guy gave me this evening was 840.....with this news I won't be surprised if it closes at 800 tomorrow or less cause those who bought at 910 in the last week will want to offload quickly to guard against complete loss creating more liquidity in the general market.

leokid866:
lol......Saudis current debt to Gdp ratio is 23% with most of it tied to crude contracts, but for your small mind Saudi is debt free......Oga sit and stop thinking like a child......

you're shifting the goalpost without answering my questions! Does Aramco borrow to hedge the Saudi Riyal?

fergie001:


NNPC Limited

Nnpc gets loan to stabilize naira, not cbn
Not even loan to fix refinery

fieryblitz:
you're shifting the goalpost without answering my questions! Does Aramco borrow to hedge the Saudi Riyal?

Oga if I was going to take debts against my crude you think the agency whose job it is to sell the crude will not be involved? You forget the NNPC is a company current owned by the Fg even as a private company.....the FG can at anytime ask them to raise capital for any and all uses......