₦airaland Forum

upward to the Light! voice extraordinaire and drama maestro.

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hello

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rachyluv2013:
what is that amp of the batteries? and the breakdown of the prices.
thanks
serious buyer

200ah deep cycle batteries . d two batteries - 70k , d inverter - 35k.

Call to pick it up while offer last.

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Is it rocket science for Nigeria to have micro refineries? a 10,000bpd refinery can be built in less than 6 months. If 2,000 companies are given licence to do this and they all build simultaneously, we can have 2 million bpd of crude being refined daily in this country.

This massive output will end oil importation and about 50% of the current dollar demand for importation of refined oil based products will go off. We can even export to other countries to earn dollars as such naira will then gain in strength. Jobs will be created in this sector and those employed will pay taxes which means more money for FG.

We only need to take the right step, we cannot afford to wait for Dangote to build his 650,000 mega refinery that he says will be ready in 2018, now is the time to act. APC told us they will build micro refieries during their campaign, so, why cant they implement this ASAP ?

sholatech:
Kingviny, unfortunately I don't subscribe to your position. And if PMB team continue to think it's all about GEJ, then we will have no solution in the short term to our foreign exchange crisis.

Till date, no leader has tried diversification of our economy like GEJ. Who issued policies to reduce imports of wheat, tomato paste and worked with private sector to introduce local substitutes? Who first screamed on the need to remove oil subsidies to free up monies for capital expenditures? You also mentioned sls as giving advices to GEJ? Now, you can factually see that the reduction of our reserves was by Sls advice to defend our naira to prevent devaluation. He still said it on BBC radio last week that he deployed those reserves to defend the naira because it was huge. That really is where our reserves went. Please seperate corruption from foreign exchange management. I do agree that corruption was high under GEJ, but pls note that corruption is still ongoing.

Our reserves rose by 2bn after PMB was sworn in and Pmb was widely praised even by Cbn governor. Now it has dropped but you point yet at GEJ? We still have a long way to go with such biased perceptions!

I am not biased bro. Who was in power when oil was being sold at over $100 the highest ever in Nigeria's history? If his diversification effort as you have put it really yielded result, how come our import bills are still very high? there are empirical evidence by which one should measure good governance, I still maintain that he under performed. He might have tried in some areas but he was the luckiest cus he earned the most and we expected a lot more from him .

The reserve fell from $60 to around $45 billion during Yaradua, when Jonathan left, it was around $30 billion, did his regime use all the huge oil money earned to defend the naira? to the extent that our reserve still went further down? common! lets call a spade a spade.

It is not about sentiment but about facts. I know some of you like Jonathan but I had to take the pain to write all of these so as to open your eyes to the root cause of our economic quagmire.

On the contrary, Buhari is merely trying to patch the basket. If Jonathan had left upto $100 billion in our reserve , if he had effectively diversified our economy with our wealth , if he had listened to his then CBN governor in the person of Malam Sanusi, when he raised alarm about stolen billions which eventually landed him a sack , we would not have been in this problem. The sowing had been done in Jonathan's tenure, Buhari is just trying hard to manage the bitter harvest. Had Jonathan won a re-election, Nigeria would have gone under with oil selling at $30.

There is excess naira in the system (post election windfall), and now to launder these in addition to importers huge demand for dollars as against a reserve that cannot cope, what would you expect? we will surely experience what we are going thru right now... STAGFLATION.

Under his watch as President, between 2011 -2014, Nigeria made so much money like never before! but today, Nigeria is in a serious problem. Low reserve and falling price of crude has now caused inflation and naira devaluation (unofficially). There is so much hardship in the land.

I decided to do a rough estimate to arrive at the amount we would have earned from crude oil sales during our oil boom period. Militants were settled with amnesty largess and juicy security contracts so production was never halted during these 4 years.

Let us take an average figure of $100 per barrel for the 4 year period and 2.5million per day as production average to calculate. If it cost around $25 to produce a barrel in Nigeria then plus or minus, Nigeria should have been able to earn $40 as profit while the other $35 could have gone to their partners.

$40 * 2.5mil barrel should have given us $100 million daily, $36.5 billion in a year and $146 billion in 4 years. If we decide to add NNLNG revenue on natural gas, it can even be upto $160 billion !

The question is, what have they done with all of these billions of dollars? This is apart from the incomes from taxes and levies, just oil and gas ( though the major income earner ) . But the point or rather the question to ask is ... where have these billions gone to?

When OBJ left office, our reserve was around $60 billion with zero foreign debt, oil price average for his tenure was berely around $50 per barrel. Yaradua was not profligate either, so how did G.E Jonathan then manage the wealth of this nation? He left a paltry $30 billion and huge external and internal debt for President Buhari to chew amist constant falling prices of our main source of revenue .. oil.

He no try abeg! and President Buhari is not the one to blame for this, the blame should go to his predecessor. We should also blame ourselves for allowing this monumental kleptocracy to happen in our country.

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Jesus died by OUR sin and not FOR our sin.

Thou shall not kill so says the Lord... (or is that commandment selective?)

Jesus death was a murderous crime commited by the Jewish leadership of His time. They said His blood (death) should be upon them and upon their generations. Hithler masacred 6 million Jews about 2,000 years later. They even did not have a country of their own until 1948 and even uptil now, they have not known peace. Do you still think Jesus death was proper with the gloomy but just fate of the Jews hitherto?

The parable of the husbandmen says it all. The owner of the vineyard is God. The servants sent severally to collect rent are the prophets, the vineyard is this earth and the wicked workers are the evil people on this earth. The beloved heir that was murdered by the wicked workers is non other than Jesus. Did that parable by Jesus vindicate the wicked workers, the Father of the Prince certainly would have sent his soldiers to kill all of them! God's angels are coming to do the same in the soon to commence apocalypse.

Forget about the lies you have been told in the past Toks, your spirit knows the thruth and you are a very intelligent man, your thread's topic says it all. Even in our traditional setting, if a village offend their god, is it the god that sacrifices or the people?

That sad day when He was murdered, the elements revolted, there was earthquake etc even the curtain protecting the ark of covenant was torn into two as a sign of disapproval. Had our Lord not pleaded with His Father to tamper justice with mercy on the cross under an unimaginable pain, the earth would have been destroyed by the angels.

However, His sacrifice to face death in the face of freedom if only He would have renounced the teachings He brought to liberate mankind from spiritual darkness and to deny His origin is the more reason why we should value His mission. The Love of God personified indeed showed love to the very last.

Follow Jesus teachings in spirit and every mystery will be clear irrespective of what the author of Leviticus etc might have written. Only the master is perfect, the servants are not so dont take their word as the absolute truth.

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Activa:
Why are u sounding exasperated?

When states sell their dollars to BDCs and banks directly, the rate would be market-determined and the naira would fall below the current 'fixed' official exchange rate.

It's also not true, as opined by Boyo, that the cbn currently prints naira to give to the states in exchange for their dollars. Do u want an explanation of this too?

I am not, but as for me, I will only condemn when I have a better idea to contribute. On the contrary, you merely rubbished the contributory effort of this eminent economist and then came up with an opinion that is the root course of our problem.

Excess naira liquidity as a result of this dollar mis-use internally is the major cause of our problem.

All dollar earnings should be held in the reserve to finance legitimate imports and to defend the naira, it is not be shared by government tiers. There is enough of naira in circulation already and state government should only earn and spend in naira afterall they collect taxes in naira. Even if they have dollar share from the national patrimony, they should only be given dollar certifcates while the CBN should still hold the real dollar in the nation's vault. They should only exchange such certificates thru CBN when they need to import for capital projects.

In as much as CBN can meet up with all dollar demands, naira will always be protected. Give the dollars to the governors and most of them will develop wings. Change it to naira and give it to them (which is what CBN has been doing hitherto) and face excess naira liquidity which will in turn lead to inflation etc.

Activa:
What Boyo is saying effectively amounts to devaluation or rate flexibility.

There's nothing novel there.

Do you have something better? how would these effective monetary and fiscal policies proposed by Mr. Boyo cause devaluation? please explain. This country sef!

oyinkinola:
OIL AND LFR
[b] THE TWO MAIN MEANS OF INCOME FOR NIGERIA ECONOMY
[b].....with the determination of Nigeria president Buhari and the trust of of world leaders toward nigeria, from America, Eroupe, Asia and gulf nation the down price of oil and the rise in $ is not a corse to nigeria but a blessing.
Among the oil producing countries, and OPEC only nigeria have what other didn't, we have oil in common but nigeria have the looters as well, this opportunity raise nigeria above other oil nation and when all this country are frustrated with oil down price, nigeria have turn to her looted fund reserved to keep her economy running.
Nigeria is bless with oil and (LFR) looted fund reserve, when the oil price is down, the rise-up of dollar $ hike the value of our LFR, if government inject the LFR recovered on the economy, it will boot our economy!
at rate of $ to ₦ today if government managed to recovered $1 trillion LFR it will give us:

$1=₦400, $1trillion=₦400trillion!
I hereby challenge the Nigeria economists who insist that rising $ and downwards of oil price is a broke to nigeria economy to come-up for debate!
Note (LFR is looted fund reserve)[/b]

1. All looted funds cannot amount to $1tr

2. If you convert looted dollar to naira, there will be excess naira liquidity in the system and this will lead to inflation.

Stop populating threads with this your concept, it is good you are thinking even though it is at tangent to reality.

President Buhari, it is time to sack the CBN governor and to replace him with HENRY BOYO asap!

The era of using former bank M.Ds to head CBN should be over! you wouldnt expect them to create policies that would hurt their constituency. Banks are making fantastic profits off this currency mishap because their man is at the top. Let there be CHANGE!

This column has consistently maintained that the root cause of Nigeria’s economic paradox of increasing income, with unbridled unemployment rate, and deepening poverty will be found in the conscious but incorrect adoption of a faulty and distortional process for the infusion of our crude oil export dollar revenue.

Hereafter, we will discuss the related adverse consequences of the Current Payments Model against the POSITIVE attributes of the Advocated Payments Model for the allocation, for example, of $1bn export revenue in the following explanatory steps.

Thus, in CPM: -1 The Central Bank of Nigeria unilaterally determines the naira exchange rate and thereafter unconstitutionally captures the distributable $1bn revenue and prints/creates in replacement (read as monetises) N200bn as statutory allocations, which are then domiciled in the bank accounts of beneficiaries.

CPM:-2 If, however, the CBN’s mandatory Cash Reserve Ratio for banks is, for example, 10 per cent, the N200bn inflow can be leveraged tenfold, to create additional credit and expand consumer spending power which will invariably fuel inflation. The recent establishment of the Treasury Single Account will, regrettably, only temporarily, absorb such cash injections, as the N200bn allocation, for example, will ultimately migrate when spent into private sector bank accounts and invariably expand naira liquidity, banks’ credit capacity and consumer demand.

CPM:-3 In response to evolving inflationary threats, the same CBN, ironically, “altruistically” sells Treasury bills and borrows money it does not need, often, at over 10 per cent, just to combat the challenges of systemic excess naira and excessive consumer demand! Inexplicably, however, despite the crying need of the real sector for cheap funds, these CBN borrowings are simply kept as idle funds, while fresh cash interventions are created to stimulate sectors of the economy, despite the subsisting systemic liquidity challenge.

CPM:-4. Since unrestrained access to excess cheap funds instigates spiralling inflation with adverse economic and social consequences, the CBN responds by raising its Monetary Policy (Control) Rate to force banks to also significantly increase their own lending rates, so that higher cost of funds would discourage borrowing, and sadly, inadvertently also reduce any prospect of industrial growth and job creation. Thus, the CBN unexpectedly becomes vicariously liable for the very high cost of funds that cripple the real sector.

CPM:-5. Meanwhile, Ministries and state governments, who require imports to enhance social infrastructure become constrained to buy back their earlier captured dollars at a higher regulated rate from banks that strangely become the prime beneficiaries of the CBN’s dollar auctions. Ultimately, naira exchange rate comes under threat as increasingly surplus naira is unleashed by the CBN to chase the dollar rations it regularly auctions. Consequently, the market dynamics of demand and supply become unfavourably skewed against the naira, despite the CBN’s custody of relatively impressive “reserves.”

CPM:-6. The less dollars sold, the larger will be the CBN’s purported reserves, but the weaker ironically also will be the naira rate, as less and less dollars become pitted against the excess naira that the CBN earlier instigated. Ultimately, the gap between official and black market naira rates will invariably widen, to provide irresistible opportunities for speculation, hoarding and currency round tripping.

CPM:-7. In order to reduce the gap between parallel market and official exchange rates, the CBN commits the unforced error of allocating dollars to the Bureaux de Change, who in turn fund the requirements of treasury looters and smugglers of contrabands, not minding the adverse economic impact of such misguided dollar allocations; (thankfully, after seven long years the CBN terminated this clearly obnoxious strategy of official dollar sales to the BDCs in January 2016).

CPM:-8. The CBN, ironically, continues to maintain its monopoly of the forex market and sits on bountiful naira and dollar reserves, while domestic and external debt accumulation and deepening poverty, inexplicably, persists, while banks unexpectedly simultaneously celebrate bountiful profits.

Conversely the Advocated Payments Model will turn around the existing counterproductive process and operate as follows:

APM:-1. The same $1bn distributable revenue is not immediately substituted with N200bn allocation; instead, constitutional beneficiaries receive dollar certificates equal to their respective allocations, while the actual $1bn remains domiciled in the CBN, while the naira exchange rate is conversely determined by competitive market forces of demand and supply.

APM:-2. With strictly dollar allocations, the $1bn income does not translate to additional FRESH naira inflow; consequently, naira supply remains the same, and cannot therefore further instigate the usual disenabling spectre of systemic surplus cash which fuels inflationary consequences.

APM:-3. Without the usual systemic naira surplus, the CBN does not have to mop up liquidity by borrowing money it does not need, often with interest rates above 10 per cent. Consequently, the present N12tn ($60bn) oppressive debt and related service charges will become restrained. Additionally, reduced government borrowing will also naturally force commercial banks to chase the real sector for business and promote economic growth.

APM:-4. Furthermore, with optimal naira liquidity, the CBN can gradually align its Monetary Policy (control) Rate to international best practice below three per cent; commercial banks will also, without persuasion, correspondingly drop lending rates across board to single digit, to attract real sector borrowers.

APM:-5. The MDAs and state governments can directly exchange for naira, all or portions of their dollar allocations from time to time, through commercial banks. Thus, in the absence of the usual naira surge when the CBN substitutes fresh naira creations for dollar revenue, market dynamics will inevitably change to favour the naira, with relatively more dollar supply chasing the existing stable naira balances. A stronger naira rate will expectedly reduce production cost and also lower fuel prices to make subsidy totally unnecessary. Furthermore, a 10 per cent sales tax on cheaper petrol and kerosene could favourably consolidate over N1000bn annually into the treasury.

APM:-6. The CBN’s usual monopolistic dollar auctions will cease, as the constitutional beneficiaries directly trade their dollar certificates for existing naira balances with banks before spending, (since the dollar is not legal tender in Nigeria). Nonetheless, the dollars will remain domiciled with the CBN, irrespective of the ultimate buyer, until the apex bank receives appropriate instruction from respective banks to directly pay overseas suppliers of “authorised” goods/services, from the dollar balances in the accounts, banks maintain with the CBN. This payment process certainly provides a more transparent usage of funds than presently.

APM:-7. With optimal naira liquidity and relative dollar surplus, the naira rate will gradually improve, and stabilise and promote the perception of naira as a safe store of value. Furthermore, with little motivation for round tripping, capital flight and speculative dollar purchases, the black market for the dollar will rapidly contract.

APM: 8. Optimal naira liquidity will invariably precipitate lower MPR, and therefore promote single digit interest and inflation rates below three per cent, with positive knock-on impact on consumer demand, industrial consolidation as well as increasing job opportunities, with bourgeoning economic prosperity. A stronger naira will similarly drive down fuel prices and ultimately eliminate annual oppressive subsidies.

Sadly, the patriotic and rational fervour evident in President Muhammadu Buhari’s recent affirmation, at a meeting with the Nigerian community in Kenya, that he did not see any valid reason to further devalue the naira, may ultimately come to nothing if the increasing pressure from local and international experts and powerful interest groups persists and the gap between official and parallel exchange rates further widens.

In conclusion, therefore, the present payment system will shunt us back to the Fourth World, while the advocated model will propel us amongst the top world economies within a decade. Clearly, our fate as a nation is not in our stars, but obviously in the choices we make.

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