₦airaland Forum

ibedun:
No amount of fiscal policy plans can change the current policy action.

The GEJ government are fully responsible for where we are. It is really tough being born into this world an African. It is almost like we are brainless, thoughtless and slave born.

@ the bolded. Nothing could be further from the truth. There is a lot Fiscal authorities can do to improve the current situation or, at the very least, prevent it from getting worse.

There needs to be clear policy initiatives on various sectors of the economy. Take Palm oil as an example - if that commodity is banned from CBN export list, it will be good to hear what government is doing to ensure that local production is ramped up to meet industry needs. Do we have high yield seedlings to provide to farmers for planting? Can we provide loans to enable farmers engage in mechanized cultivation? What support are we providing entrepreneurs to set up oil processing plants? etc.

There has to be a deliberate & comprehensive fiscal strategy in every sector of the economy. The ministry of Agriculture, Finance, Trade/Investments, etc should be communicating what the policy strategies are. Government needs to communicate what their fiscal priorities are, so that investors (currently sitting on their hands) can begin to position their investments. The problem is that there is a deafening silence on the economic front from this government.

Also, please note that every new government inherits the Assets & Liabilities of previous governments. The Jonathan administration story has been regurgitated so many times, it is becoming stale. PMB is now the president. He said he came in to correct the wrongs of the past - let him just get on with the job.

“I would like to end my address this morning on our agenda for CHANGE. Change does not just happen. You and I and all of us must appreciate that we all have our part to play if we want to bring change about. We must change our lawless habits, our attitude to public office and public trust. We must change our unruly behaviour in schools, hospitals, market places, motor parks, on the roads, in homes and offices. To bring about change, we must change ourselves by being law-abiding citizens.

The article is nothing but the expression of a man with so much prejudice and hatred.

I had to go back to read the speech again to see the context that statement was made. The quoted is the penultimate paragraph of that speech, and it is obvious the president was not just referring to ordinary Nigerians. He included himself, public officials (the bolded) and everyone else.

Whether we choose to admit it or not, Nigerians are unruly - govt officials, security officers, lecturers, students, civil servants, etc. The president did the right thing to call for a change of attitude from everyone.

The president's speech had at least 21 paragraphs and all the writer could pick up is the "unruly" part which he mischievously tried to interpret it out of context.

ibedun:
Mr, before choosing a strategic option you first do a strategic review. I believe that is what is happening. The perm secs in the ministry of finance are not sleeping and if you look closely you will find that there is a clear implied economic policy which is to ensure that our reserves are protected and real manufacturing can continue. There is controlled capital movement etc. You are partly correct that we are on Option 3 but with enough allowance and window for critical manufacturers imports. So we are doing the right things under the current circumstances.

I agree with the CBN policy at the moment and have spoken in their defense in various fora. However, we need to appreciate that this is only a stop-gap measure. If there are no right Fiscal Policies to ensure that there is local production to supplement the suspended items, then the inevitable will occur - the CBN will have to reverse itself and go back to option 2 (devaluation) or we face production cuts from these manufacturers.

Production cuts will lead to job losses, lower profits, lower taxes, lower supply contracts, etc. All these will deepen the economic slowdown and might ultimately lead to a recession. Remember, the CBN governor has warned that we might enter into a recession if things are not done quickly.

Please tell them to go to IBB Avenue and Nkemba street biko.

In the face of dwindling Forex revenue (due to falling oil prices), the options available to the CBN include, but not limited to:
(1) Dip into the Foreign Reserves to meet dollar demand
(2) Depreciate the naira to curb dollar demand
(3) Suspend certain items from accessing CBN dollars
(4) Borrow dollars (SDR) from IMF

We have already pushed option 1 too far and if we continue, we'll soon run out of reserves. Not having dollars to fund imports and payments would have catastrophic consequences.

Option 2 appears most logical and the lesser evil, but there are political reasons for not exploring that option - a new government has just come in. This option will cause inflation and economic hardship, so the new govt does not want to become unpopular so quickly.

Option 3 (which the CBN has chosen) is a form of capital control and is usually frowned at by foreign investors. This may also hurt local manufacturers who depend on imported raw materials for their manufacturing/production. If they can't access dollars to import raw materials, they may have to cut operations with attendant job losses.

Option 4 is a no go, since the country would have to deal with so many crazy conditions from the IMF.

In my opinion, the CBN governor is practically holding the economy (using option 3) all by himself just to buy time for the president to constitute his cabinet. On two different occasions, the CBN governor has stated the need to have Fiscal Policies to complement Monetary Policies. This, to me, is an indictment on the president for not having his Economic Team in place.

If things do not improve quickly, the CBN governor might be constrained to switch to option 2 to prevent manufacturing from suffering.

I am a huge supporter of the president, but on the economy, his performance is short of being abysmal. Yes, he is blocking leakages, ensuring accountability, ensuring prudent management, etc. But these things can run concurrently - they are not mutually exclusive.

She said forex flexibility plays very important role for investors and their investments.

There are two kinds of investors: (1) Portfolio Investors and (2) Real Investors.

The first group are only interested in Financial Assets. The equities & fixed income market is their playground. These folks need guarantee of FOREX so they can quickly exit the country at the slightest sign of a market crash or downturn.

The second group are interested in the real sectors of the economy. They build infrastructures, factories, plants and employ huge labour. They are in for the long haul, so they are not as desperate as the first group.

I have a sneaky feeling that the IMF is pushing for the interest of the first group.

Prudent management of available resources and the diversification of the economy is the way to go.

As a state governor and a member of the Federal Executive Council, Gov Okowa has a lot more to do in this regard than the NASS members.

He can start by attracting investments to his state and increasing its IGR. He should make similar recommendations to the FG during FEC meetings and not just go there to approve bogus contracts or share FAAC allocation.

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Wike know how, as a Federal Minister, he used the Might of the ruling party at the federal level to unsettle and frustrate a state governor in opposition. He is, obviously, worried that now that tables have turned, Amaechi might pay him back in his own coin.

omenka:
This has gotta be one of the greatest insult on Nigerian ever! How foolish do these guys actually think Nigerians are?? How in seven hells would they try to justify their gargantuan pay by doing a simple comparism with what their counterparts in other countries take, countries that are light years ahead of us in terms of development.

Now, for those of us that refuse to be deceived by this shameful "disclosure", here's what we demand they do if truly they want us to see what "peanuts" they earn:

1. What is the percentage of their total expenditure to our GDP and what is that of their counterparts in the countries stated??

2. What is the per capita income of those countries as compared to Nigeria's?? Is their pay justifiable on this basis??

3. What is the percentage of their take home to our GNP in comparism to that of their counterparts in the countries listed??

4. What is the percentage of their annual take home to the annual take home of a minimum wage earner, and how does that compare with those of their counterparts in the countries quoted??

5. What is the actual man hours contributed by the congressmen in a legislative calender compared to that of our "honourables"?? Is the pay of our legislators justifiable on the backdrop of their productivity??


It is only when these figures are presented and analysed that one could be better informed as to the propriety or otherwise of the size of their income.

Spot on! Couldn't have said it any better. But this is not even where the major problem lies.

The total of these figures (salaries & allowances) is about N16bn. The main problem lies in the balance of the N120bn budget. This is where most of the NASS fraud is hidden. Why should 2,500 persons have an annual budget of N120bn while most states in the country (with population of over 5m each) have an annual budget of less than N100bn?

Pangea:
Do we need people like strive to open up this kind of deals?
If their hands are clean, are they not supposed to be public knowledge?
Government in nigeria is run like a secret cult, I voted for Buhari but I must point out that even, he is also toeing thesame line.
From all indications, no one is clean, starting from out founding fathers.
I heard when we were growing up that for every bottle of coke you buy, that Awolowo's family receives 2 naira!
I don't know how true that is!
Until we the youths of this country, arm ourselves with knowledge and start asking relevant questions, I am afraid, this country will continue to be the grave yards of talents that it is, for the wealth that ought to be our support has all been looted.
And it will continue to get worse!
These information should be our rallying point and we should ask more questions from all the companies doing business in nigeria.

Apparently, this is why some people opine that Corruption is a CULTURE in Nigeria. It is so endemic and pervasive in all strata of society that one does not know where to start the cleanup or re-orientation from. Corruption is an open secret in Nigeria, starting from govt officials, law enforcement agents, lecturers, lawyers/judges, religious leaders, students, etc. Infact, it's so "normal" that you look stupid not engaging in it.

As challenging as the issues are, I believe that even if PMB cannot cleanup the mess, he will at least stall its progress. Sometimes, I wish it was possible for PMB to have won the elections under CPC, but it wasn't possible. The unwholly alliance with the likes of Tinubu, Amaechi, Atiku, Saraki, etc is very regrettable and might force the president's hand on some issues.

MY BANKING EXPERIENCE DURING THE SALE OF AKS SHARES IN ECONET

I remember working in the regional office of a first generation bank in Akwa Ibom state back in '07. During that time (specifically Feb '07), the proceeds of the AKSG divestment from Econet shares was paid into a domicillary account (which was hurriedly opened on a Sunday) in one of the branches in the region. The value of the proceeds was $80m. At that time, I had just joined the bank, so I had no idea what the State initial shares in Econet was or whether the divestment was full or partial, but that money was huge dropping on the CABAL of the branch. The branch made a profit of over N200m that month just from COT from that account.

Something else I noticed as a young lad then was that the State Accountant General wrote to the bank to convert the $80m proceeds into Naira and be paid into a stage govt Naira account. The curious part was that, at the time, dollar was exchanging at N128, but the AG specifically wrote to the bank stating that the dollars should be exchanged at N126/$. Of course, the bank exchanged the money @ N128 and paid N126 to the government account. The AG and the bankers shared N2x80m (N160m). How do I know all this? I was the P.A to the Regional Director, so I was naively privy to most of the correspondences and transactions.

Apparently, from what strive has written, it is obvious the state was massively short-changed in that transaction. Strive had said that the initial bribe was $9m but latter increased to $13.5m. Is it possible that the initial $9m was to be shared among 2 states @ $4.5m each, but then AKS came into the picture so they had to increase it by another $4.5m to $13.5m (just thinking!).

I have always held former Gov Victor Attah in high esteem, but Strive Masiyiwa is challenging that position now.

seunmsg:
If you read strive Masiyiwa's post very well, you will notice he never mentioned Tinubu's name. If he can mention James Ibori's name clearly, I really don't see why he can't mention Tinubu's name clearly as well.

Chances are that he mentioned Ibori because he has been convicted. He has also made reference to Dieziani, because she has been arrested and interrogated by the UK. He also mentioned Charles Taylor because he was convicted for war crimes by ICJ.

I admire that he is outspoken about the issues of corruption in Africa, but he should go the long haul and mention others who have not yet been convicted so that authorities can swing to action.

Booked.

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Why do others fight our battle better than us? Even with over 70 count charges bothering on corruption, Nigeria could not convict Ibori. Yet the UK was able to convict him with only 3 count charges bothering on money laundering.

This country is the worst victim of the activities of these Witches, yet we somehow always find it difficult to Hunt them down. We should demand for the repatriation of these people, prosecute them and give them life jail terms.

Our anti-corruption agencies need to be properly funded to improve their investigate duties. Our judiciary needs to be sanitized to ensure prompt conclusion of corrupt cases. Enough is enough!

4Play:
If you think of it, high exchange rates facilitate importation. It's cheaper to import at 199 Naira to the dollar than at 220 Naira to the dollar. Therefore, an argument to maintain a higher exchange rate is functionally an argument to make it easier to buy foreign goods and services.

Valid point. However, simply devaluing one's currency is not going to automatically translate to fewer imports or local production/manufacturing. Else, why is that local manufacturing has gradually become worse over the years even with continued devaluation? The reality is that our leaders have never had the Patriotism and commitment to implement a long-term Fiscal Strategy. They always choose the easy way out. A few years down the road, we are back facing the same problems, only worse.

More often than not, our Fiscal authorities do not come up with the right policies to complement Monetary Policies. For instance, the CBN has been crying out for diversification of the economy, the need to invest in infrastructure to support local businesses, Import substitution policies, etc. These are all policies that should be implemented by Fiscal authorities to help make sense of CBN policies. If they fail in their job as they always do, then the CBN gets the stick.

I have noted in one of my earlier comments on this subject, that devaluation will be counter-productive to the economy. It will simply lead to imported inflation. Because we import nearly all our fuel and because most goods are transported by road, devaluation will mean that virtually everything in the market will go up in price as producers transfer this cost to consumers. An already impoverished population will become poorer. Businesses might even start experiencing unsold inventory as a result of consumers low purchasing power and high price of goods/services.

The only real beneficiaries of devaluation will be those invested in Financial Assets, as the country will experience an influx of PORTFOLIO Investors.

shizzy7:
I repeat
Nigeria had 4 Presidents during Jonathan's regime

*Mama Patience - Administrative president
*Allison Deiziani- Functional president
*Ngozi Iweala - Ad-hoc President
*Goodluck Jonathan - Sitting President..

That's why I always refer to them as GEJ and the three Musketeers

ogb5:
I see many kids on this thread hailing the trade restrictive policies of the govt. Anywhere there is trade restriction, economic growth suffers.
And many of you hailing the trade restrictions will suffer more.

If the keep the restriction on import of vital industrial raw materials like palm oil, cold rolled steel and galvanised steel, industries will either fold up or downsize.

The shortfall in industrial output due to this will be filled up by smuggled imported products, who losses.

I think the WTO needs to have a good talk with the govt. If the govt insist on trade restrictions when the world is moving towards trade liberalisation and countries are sign bilateral trade agreements daily, then Nigeria needs to be shown the way out of the WTO. We can then choose to isolate ourselves like North Korea and keep all the foreign exchange, while they citizen stay impoverished.

With all those blacklisted items, do you have any idea of what our monthly FOREX demand is from Importers? Do you also have any idea of what our FOREX revenue is currently?

I'll help you. Due to fall in crude oil prices, Nigeria's foreign exchange earnings has dipped below $7b monthly, while Importers still demand well over $7b monthly. If the CBN continues to meet all forex demand, this will result in a NET negative impact on Reserves - eventually running out. This is the point you lot will finally WAIL to high heavens that PMB policy makers had no clue on how to manage the economy - reminding us how PMB had F9 in Mathematics & Economics.

Even on a personal level, if your income goes down, then it is only reasonable that you adjust your lifestyle. Of course, you can tell (deceive) yourself that all your needs are important and should therefore be met. When you completely deplete your savings and possibly sell off your assets, I wonder what you will be telling yourself then.

There are dire consequences in allowing an Import-dependent country to continue devaluing its currency. The vast majority of Nigerians are either unemployed or underemployed. This means that the purchasing power of these category of people are limited. If the naira is allowed to depreciate further, this will make imports more expensive, thereby making final consumer goods also more expensive. Since nigeria imports almost all its fuel demand and nearly all our goods are transported by road, this will lead to an increase in prices of virtually everything in the market (a case of imported inflation). An already impoverished population will find it difficult to purchase more expensive goods, leading to a problem of unsold inventory for businesses.

You may also wish to note that our Foreign Exchange demand by importers as at June was about $8billion monthly, higher than our total Foreign Exchange earnings of around $7b. If the CBN continued to meet all these forex demand in the face of dwindling oil price, then this would have resulted in a steady decline of reserves. If oil prices do not rebound, then we would eventually run out of reserves. The CBN had to exclude certain items from forex to preserve the reserves.

The exclusion of the items from forex is also intended to encourage local manufacturers to seize the opportunity to meet the supply gap. This should create local jobs and save Foreign Exchange. My only worry is that the government has not articulated its Fiscal Policies to compliment CBN Monetary Policies.

According to IndexMundi, a data portal, the domestic palm oil produced totalled 930,000 MT in 2014, while the consumption of palm oil in Nigeria amounts to 2.0 million MT per annum in exclusion of the manufacturing sector. The official figures states that the shortage in oil palm industry is estimated to be around 1.07 million MT annually.

Any smart entrepreneur should be grinning from ear to ear with this policy. Have you seen the shortfall in Palm Oil supply to local industries because of the ban? An item we can conveniently produce locally and supply the market?

Lord, please give me some money to quickly setup a Palm Oil processing plant to meet this supply gap. Any business partner in the house? I already have a well researched business plan using templates from Malaysia & Indonesia (the world's largest producers/exporters of palm oil).

The CBN policy will have temporary difficulty. But in the end, the policy is intended to promote local production, create local jobs, promote import substitution, save Foreign Exchange, etc.

But why is Shekarau now taking a moral high ground criticizing PMB advisers, when he himself was a Governor for 8 years and also a Minister and adviser of PGEJ.

If PMB had appointed him a Minister, would he still be holding this view?

As painful as it is to admit, one would have to agree with Shekarau, especially as it concerns that Ota Emperor.

In any case, I have observed that a civil servant who resumes work at office by 10am will immediately start resuming work by 7.45am if he takes up an employment with the bank. Our security officers who act like touts here in Nigeria suddenly behaves in exemplary manner once they go on int'l peace missions. Even our erudite NOI was said to have performed differently under GEJ and OBJ.

My point is that the Leader, Environment and Rules will bring out different behavior from those being led. That is why, I believe, PMB has spent the last 4 months preparing the ground rules and the kind of environment these folks will operate. We'll surely see a different character from these same ol' peeps.

These Gangsters virtually RAPED our National Treasury with reckless Impunity. Sadly, our "Hero" had no CLUE what was going or who knows, he may have been complicit.

As if what these criminals have done is not bad enough, some of our youths still display the highest level of imprudence & imbecility by defending these lot, just to show their hate for PMB - akeen to cutting the nose just to spite the face.

As someone succinctly put, I now believe that these reprobates are suffering from a local variant of Stockholm Syndrome.

I hope they conduct the screening with every sense of Patriotism, with less partisanship.

MosakuAW:
The list is not really my interest rather the portfolio the names on that list will hold.

I can speculate on a few names:

Kayode Fayemi - Foreign Affairs
Lai Mohammed - Information
Chris Ngige - Health
Abdurrahman Dambazzau - Defense
Audu Ogbeh - Agriculture
Fashola - National Planning

Don't quote me anywhere pal. It's just my speculation.

Mynd44:
More like those he worked with on the way to getting that position and since they performed well during the campaigns why cant they be part of his team as he governs?

My only regrets is Donald Duke

No regrets yet pal. There is no nominee from Cross River state on #TheList. He might still make it during the next batch. Remember, he is a PDP member - so his name might have ruffled a few feathers.

I hope he does make it. He is pure class.

Why am I disappointed with #TheList? It is simple - I expected to see more Technocrats and fewer Politicians. #TheList is too conventional & uninspiring.

Well, I do appreciate the precarious situation PMB is in, trying to balance all the contending political interests within the party, so Wailers won't have a laugh with their "Use and Dump" line.

However, now that this list has satisfied political fraying nerves, something tells me that during the subsequent batches of nominees, the President will exercise his full prerogative and get in real technocrats. The president might also reshuffle his cabinet at a latter time, giving him more latitude to appoint other persons.

...

hinwazaka:
First, they used EFCC, that failed. Then they tried CCB, that failed too. Now they have resorted to INEC. This will fail as well. So the same APC that helped him forge the result, now wants us to believe the SP's election was fraudulent. In that case, they should allow the opposition and INEC to validate and investigate the elections that saw the entrance of the other APC senators. RUBBISH!

I did note in one of my earlier comments about this Saraki saga, that it is "like a Chess Game where you make one strategic move after another until your opponent's King is finally cornered".

I expect the APC to keep tightening the screw until Saraki capitulates. It will be a miracle if he survives.

It is understandable that the administration's Economic Agenda will come into full force starting from 2016. But a sound Economic Team is needed comprising of Ministers of Finance, National Planning, Trade & Investments, Agriculture, etc.

It is my hope and belief that the 2016 budget will be much bigger than the 2015 one due to the effect of the TSA. I do also hope that CAPITAL will have a much higher percentage allocation than we have experienced lately.