₦airaland Forum

By Elisha Bala-Gbogbo Dec 22, 2014 4:54 PM

Moody’s Investors Service said Nigeria’s economy remains resilient in the face of falling oil prices even as the currency slumped to a record low and growth in Africa’s largest crude producer is set to slow.

Nigeria economy, the continent’s biggest, will probably expand 5 percent next year, Aurelien Mali, Moody’s senior analytical adviser, said today in an e-mailed statement. That’s in line with forecasts from the International Monetary Fund and the government’s revised estimate of 5.35 percent.

The West African nation’s government relies on crude exports for about 70 percent of its income and 95 percent of foreign exchange earnings, leaving it vulnerable to price and quantity shocks. Finance Minister Ngozi Okonjo-Iweala is seeking to cut spending in next year’s budget by 8 percent to 4.36 trillion naira ($23.9 billion) as revenue plunges.

“Nigeria benefits from a resilient economy and robust fiscal position, although the recent drop in oil prices will likely put pressure on public finances and could lead to the widening of fiscal deficits,” Moody’s said. Spending cuts and taxes on non-oil industries may help to close the gap, it said.

Moody’s rates Nigeria’s debt at Ba3, three levels below investment grade, with a stable outlook.

Oil prices have slumped 45 percent in the past six months, eroding foreign-currency reserves and forcing the central bank to devalue the currency for the first time in three years. The naira fell 1.3 percent to 182.35 per dollar on the interbank market as of 4:10 p.m. in Lagos, the commercial capital.

Nigeria’s government debt, which is “very low” at 13.2 percent of gross domestic product, will probably increase to 14.6 percent in 2015, Moody’s said. As a proportion of government revenue, debt is set to rise to 130 percent from 121.8 percent, it said. Both ratios are low compared to market peers rated Ba3, according to Moody’s.


CREDIT: Bloomberg.com

FEDERAL REPUBLIC OF NIGERIA

OVERVIEW OF THE 2015 BUDGET PROPOSAL

“A Transition Budget”

DR. NGOZI OKONJO-IWEALA

COORDINATING MINISTER FOR THE ECONOMY AND
MINISTER OF FINANCE

17 December 2014

PROTOCOL
1. I am pleased to welcome you all to this public presentation of the proposed Federal Government Budget for 2015. As I present the fourth budget of this Administration which is the last before the general elections, I can say with confidence that significant achievements have been recorded by the federal government to deliver on its commitments. Let me first express my profound appreciation to H.E President Goodluck Ebele Jonathan whose leadership and commitment have made economic achievements possible. Let me also thank H.E Vice President Namadi Sambo whose guidance on numerous issues have been most impactful. Most of all my colleagues in the Economic Management Team have worked so hard to make our achievements visible.

2. I would also like to acknowledge the efforts of the Leadership of the National Assembly and its relevant committees for their contributions to the budget process. Over the 2011 – 2014 period, the Federal Government Budgets faced some difficulties before their eventual finalization. Both the Executive and the Legislature have taken the necessary lessons from this, and we have thus far, seen smoother collaboration on the preparation of the 2015 Budget. I thank the leadership and membership of the National Assembly for this cooperation.

3. Let me also thank the Members of the Federal Executive Council and particularly my fellow honourable Ministers for their understanding, especially with the challenge of having to draw up their budgets within limited resources imposed by our fiscal restructuring exigencies. I would also like to acknowledge the efforts of all other stakeholders including the press, the organized private sector, civil society organizations and especially the staff of the Budget Office of the Federation and the Ministry of Finance for their contributions and hard work in preparing the Budget.

4. Finally, I want to thank the Nigerian public. As I move around the country, I have never felt so much sympathy, respect, and support as I have felt from members of the Nigerian Public. Thank you for understanding that these are challenging times, thank you for understanding that my team and I are doing our best to keep the economy on a steady course. Truly, the Budget is our collective statement – a product of many constructive contributions - which has enabled us to prepare the Budget under the very difficult circumstances the nation is going through.
5. Ladies and Gentlemen, before I go further, I will like to say a few words on the 2014 budget and its implementation.

REVIEW OF THE 2014 BUDGET IMPLEMENTATION
6. We are approaching the end of a particularly difficult fiscal year that brought us quite a few obstacles as we moved ahead on the chosen path of fiscal consolidation and inclusive economic growth.

7. There have been challenges to the realization of the 2014 Budget revenue projections. For a number of reasons chief among which is oil pipeline vandalism and the resulting “shut-ins”, we faced a quantity shock in the sense that the quantity of oil produced averaged about 2.2 million bpd in the first 3 quarters of 2014 according to NBS data, falling short of the 2.38 million bpd projected in the Budget. The effects of this quantity shock is further compounded by the more recent price shock, with prices crashing from a peak of about $114 pb earlier in June, to around $58 pb now, which is below the Budget benchmark price of $77.5 pb for this year. As a result, revenues will fall short of the Budget targets of N3.73 trillion. As at the end of October, total revenues were about N2.72 trillion, so we won’t know the extent of the shortfall until government closes its books at the end of the year.

8. But in spite of this challenge, we have managed to keep the country running. Recurrent Expenditure is being paid and government is running. We are aware of some MDAs, e.g. Education, where salary payments are delayed due to glitches in IPPIS. This is being rectified and all will be paid this December. Capital expenditure however has suffered. We could not cashback N100 billion of 3rd quarter capital and have not been able to release 4th quarter capital. Nevertheless, we have managed to keep most of our priority projects going with the support of SURE-P resources. Of the N1.12 trillion in the Budget, the sum of N610 billion has been released (as at the end of October) with N465 billion of this amount only fully cash-backed. About 83.5 percent of the amount cash-backed had been utilized by MDAs as at the end of October.

9. The implementation of the SURE-P Budget improved in 2014. We voted a sum of N268.37 billion for various social safety net programmes and infrastructure projects. So far, N208.3 billion or a very robust 78% of this amount has been spent on various job creation initiatives and infrastructure projects. The SURE-P programme continues to support Social Safety Net programmes like Save One Million Lives which has saved over 631,250 lives by giving renewed priority to health interventions including nutrition, prevention of mother to child transmission of HIV, malaria control, and routine immunization.
10. Job creation efforts under SURE-P are doing well with the Graduate Internship Scheme (GIS) hiring and deploying 13,339 graduates so far and the Community Services, Women and Youth Employment (CSWYE) creating nearly 120,000 jobs for youth with a minimum of 3,000 in each state and the FCT. Several infrastructure projects across the country – such as the Lagos-Kano railway, the Abuja-Lokoja road, and the rehabilitation of the Benin-Ore-Shagamu road – were completed or advanced through SURE-P resources. The Ministry of Finance continues to publish the SURE-P savings in the newspapers every month to ensure transparency, and I assure you that our savings from fuel subsidy removal have been put to good use for the benefit of all Nigerians.

11. Ladies and Gentlemen, let me now turn to the 2015 Budget and take a few moments to provide some context.

Please read the rest in the attachment or here https://www.facebook.com/ngoziokonjoiweala/posts/870216989695233

SAHARA REPORTERS SPONSORED REPORT ON NOI POLLS IS FALSE AND MALICIOUS

Abuja, Nigeria. December 6th, 2014
This press statement has been necessitated by the malicious story published by SaharaReporters with the sole intent to bring to disrepute NOIPolls Limited and its founder Ngozi Okonjo-Iweala. It is clear that the online website went on a fishing expedition designed to mislead stakeholders and the public with sponsored lies and innuendos.

To state the facts:

NOI POLLS WAS SET UP IN 2006, LONG BEFORE OKONJO-IWEALA RETURNED TO GOVERNMENT AS MINISTER SO IT COULDN’T HAVE BEEN ESTABLISHED TO SUPPORT GOVERNMENT
NOIPolls was founded in 2006 by Dr Mrs Ngozi Okonjo-Iweala, she was not a serving minister nor in Government at this time. Shortly afterwards she went on to become the Managing Director at the World Bank. For Sahara reporters to imply that she set up this company to ‘burnish the image of President Jonathan’ is completely false and again points to a very biased and subjective reporting style that is completely flawed and should be disbelieved. More of this can be seen on our website or on this link http:///oee7fo4 that showcases our seven (7) years of polling.

IN LINE WITH GLOBAL PRACTICE, OKONJO-IWEALA IS NOT CURRENTLY INVOLVED IN MANAGING THE COMPANY OR ITS DECISION-MAKING
Dr Mrs Ngozi Okonjo-Iweala is also totally de-linked from the company and DOES NOT interfere with the operations. The Company is run by a Management team which is headed by Myself. Again details are all public and have been for as long as this company has existed, why Sahara reporters decided to publish a sensational piece without researching the company points to the incessant need to bully Dr Ngozi Okonjo-Iweala and anything that has her name on it. This MUST STOP. NOIPolls is a going concern with 50 HQ staff members, a workforce of 40+ interns and 300 field operatives. That figure moved up from 5 staff in January 2012 to now clocking almost 400 persons in Jobs that have been created over a 2 year period. That is the testimony of hardwork and commitment by my team to build a sustainable enterprise and promote the true voice of Nigerians which Sahara reporters is desperately trying to squash.

NOI POLLS HAS BEEN CONDUCTING POLLS ON PRESIDENTIAL APPROVAL RATINGS SINCE 2007
Approval ratings; NOIPolls has been conducting approval ratings for Nigerian Presidents since 2007, we have only had two presidents; the Late President Yar’dua and now President Jonathan. The first approval rating was done in 2007 when the maiden NOI- Gallup National Poll was conducted. Please see link http:///mnb6v63 for the result of the first approval rating for Late President Yar'dua. We started monthly approval ratings for the current President in January 2013. Again please see link http:///kl2hfut

THE MONTHLY OPINION SURVEYS ON THE PRESIDENT’S APPROVAL RATINGS ARE RIGOROUS AND CREDIBLE AND REFLECT BOTH GAINS AND LOSSES IN PUBLIC PERCEPTION FOR THE PRESIDENT
As fair minded and apolitical persons have observed, the approval ratings have not been static: they reflect changes in public perception of the president’s work. Not too long ago, it was 74%. The effort by Saharareporters to discredit the polls is evidently malicious and lacks credibility.

NOI POLLS TECHNICAL PARTNERSHIP WITH GALLUP USA COVERS METHODOLOGY AND SIMILAR TECHNICAL ISSUES; IT DOES NOT MEAN GALLUP IS INVOLVED IN DECISIONS ON THE MONTHLY OPINION POLLS
NOI Polls never claimed that Gallup was involved in the monthly approval polls. WE have been in a technical partnership with Gallup since 2006. First contract was for 5 years, ran from 2007 – 2012. Another was signed in 2013 and is still running. It’s a pity that in the rush to discredit a reputable firm, Sahara reporters have made very obvious mistakes;

The report states that Sahara reporters asked Gallup if they were involved in conducting the November’s approval rating; of course they cannot be involved, we are in a TECHNICAL PARTNERSHIP with Gallup, this means that they have taught us a methodology which we have adapted to the Nigerian context. This partnership does not mean that NOIPolls will have Gallup do all our polls. It means that we have perfected what we have been taught and only review methodology when necessary. To assume and then ask if Gallup is performing polls on our behalf shows the level of thought this report has if at all any. Can we please stop this colonial mentality? Nigerians are very capable of running operations smoothly.

Every year NOIPolls and Gallup do a national poll called the NOI-Gallup National survey, this is the flagship product of the partnership AND THE COMMERCIAL ASPECT of the relationship. Gallup mentioned us as a client and that is because they are paid for data collecting on this national survey. Again this reports can be found on the website. So we have both a TECHNICAL and COMMERCIAL relationship with Gallup USA.

The Reporter’s disturbing bias is clearly seen in not understanding the methodology used for the monthly polls, hence asked Gallup if they are, from the US conducting a monthly telephonic poll. Quite laughable being that the reporter also published our methodology.

If Sahara reporters does have staff working for them, a visit to the NOIPolls Opinion Polling Center (the NOPC) would have clearly shown the Pollsters at work in the call center administering the survey via telephones to Nigerians across the country and not sitting at their tables falsifying a poll. This would have represented a fair and unbiased approach to reporting, however obviously this is not their style of reporting. Again showcasing terrible reporting and an intent to discredit NOIPolls and our founder. Also we have OPEN DAYS for the public where anyone is allowed to walk in and see these pollsters at work and try to also make calls and administer a poll.

Methodology as taught by Gallup shows that 1000 sample size is representative of the Nigerian Adult Population (87.9m). Gallup uses same sample size for a population of 350 million Americans. Our methodology is scientifically proven and if Sahara Reporter had done an indepth research on global polling methodology standards, they will realize this.

Finally, we have on our website two members of the Gallup team as members of our team, would we be as bold to do this if no relationship existed? I daresay that Saharareporters was totally mischievous in this approach to questioning the Gallup staff about a monthly poll and not a partnership.

GALLUP HAS AN ESTABLISHED LONG STANDING RELATIONSHIP WITH NOI POLLS
Dr Ngozi Okonjo-Iweala's excellent relationship with Mr Jim Clifton helped to get the partnership with Gallup off the ground. And we are very grateful with Mr Clifton and Gallup for their support. This partnership will not be broken by this sponsored and malicious report by Sahahareporters.

NOI POLLS IS RECEIVING GLOBAL AND CONTINENTAL RECOGNITION FOR ITS RIGOROUS PROFESSIONAL WORK
Looking at the Gallup’s well being index, NOIPolls has been conducting the Personal Well Being index of Nigerians monthly for 23 months now, we have been given global recognition for this, we are only two African countries doing this survey on the continent. If the reporter again (I am truly tired of saying this) had done the job required of him, he would have seen clearly that our results mirror the same with Gallup findings.

As Daniel Patrick Moynihan is famous for saying ‘Everyone is entitled to their opinion but not to their own facts’. In this case Saharareporters has totally misrepresented the facts and shown a total bias and ineptness to reporting. As we say in NOIPolls, our mission is to ensure that the voice of Nigerians are heard, the voice of one should never represent the voice of many!! In this case, Saharareporters is being used to push an agenda, the voice of one is not acceptable to us! If they disagree with the results of our polls, all they need do is send us an email, we get a lot of those and we respond and ask that the people come in to evaluate our work and methodology. We are a transparent and accountable firm.

This misbehavior on the part of Sahara reporters has to stop! Reporting should never be done this way. The media should always remain objective and ensure they have all their facts correct before going to press. The results from the polls are key to the work of our media partners all over the globe. The ability to rightly analyse and interpret the results is obviously what is missing in Sahara reporters capabilities and so the sudden flight to finger pointing and discrediting.

Finally, I would like to thank you for taking out time to read this long press release, NOIPolls has worked really hard and still is, to champion the importance of opinion research across the region and the continent. We have put Nigeria on the global stage by changing the narratives about our beautiful country. At last the voices of Nigerians are being put on a platform and on display for the world to see. We are telling our story! Shame on those that have chosen to disrupt a change process that is long needed in this country.


Ms. Oge Funlola Modie
Managing Director/CEO
On behalf of the NOIPolls team

Competing in an uncertain world

by Ngozi Okonko-Iweala

In addition, we have a short to medium term strategy typically used to deal with this kind of situation.

The recovery of the global economy remains fragile and uncertain due to the prevalence of significant downside risks and the emergence of new political risks. We are beginning to see: weaker-than-expected growth in advanced economies (except USA) and emerging markets like China and Brazil; excess oil supply due to the rise of new regional producers, increased exploitation of shale oil and gas particularly by the U.S, and weakening oil demand in major economies including in Asia and Europe. These developments, which have partly contributed to the significant decline in oil prices (to around $78 per barrel) in recent weeks, have unfavourable implications for the Nigerian economy.

However, let me clearly state that this event – the recent drop in oil price, did not come to us as a surprise. We had anticipated this (even before the 2008 global financial crisis), and that is why the economic management team has consistently argued for a reasonably lower benchmark oil price to enable us build up our fiscal buffers. You may recall that we had put in place the ECA in 2004, which was very useful during the 2008 financial crisis when oil price fell as low as $38 per barrel from $147 per barrel. We didn’t need to run to the IMF or the World Bank as some other countries did because the ECA had savings of up to $22 billion! By August 2011, this amount has been depleted to about $4 billion.

We built it up to $9 billion by December 2012. Some of it was then legitimately used to offset revenue shortfalls arising from quantity shocks and to narrow the fiscal deficit, but against our advice, significant portions were also used to augment monthly allocations as states argued that rainy days were already at hand (and in fact was already pouring). So the money needed to be used right away. I think most Nigerians were also witnesses to the annual budget struggle with the Legislature to keep the benchmark price for the budget lower and more realistic.

Let me point out that contrary to some analysts’ insinuations, we in the Finance team have been very clear to the country on the implications of falling oil prices, and quantity shocks resulting from oil theft and pipeline vandalism. We were very quick in 2012 to point out the possibility of falling oil prices and quantities as well as quantifying the magnitude of the losses at around $12 billion annually.

In addition, we have a short to medium term strategy typically used to deal with this kind of situation. We have extensive consultations with global analysts including the IMF, Citi Group and Goldman Sachs, and done our research and I strongly believe that we have enough in our arsenal to weather these storms.

Prices could fall to $70 a barrel, $65 or even $60. Prices could also rebound to $75 – $85 a barrel. What we did was to work within a range of $60 – $85 thought possible by analysts, put a package of measures around an estimate at the midpoint of that range, that is $73, and then build additional measures for scenarios at $70, $65 and $60 a barrel.

On the revenue side, a lot of work was already underway prior to the fall in price to improve non-oil revenue generation. This was sequel to our rebasing exercise which demonstrated a large $510 billion GDP with a diverse non-oil base. The efforts of the FIRS supported by McKinsey & Co. focus on strengthening tax administration and thereby plugging leakages and loopholes. For example, only 25% of our SMEs are registered taxpayers. Remedying that will broaden the tax base. Our auditors complete 3-5 audits a year compared to 50 a year in Angola. Speeding up audits will help improve tax collections and anomalies.

We are introducing surcharges on certain luxury goods in the country, not only to raise additional revenue but also to ensure that the better-off in our society contribute a little bit more to easing the pain resulting from the current economic headwinds. In summary, our aim on the revenue side is to raise an additional N480 billion ($3 billion) over the 2014 base in the next three years.

Let me now turn to the expenditure side. For the immediate 2015 budget, we shall cut certain recurrent spending such as purchase of administrative equipment, overseas travels and trainings, etc. This is the low hanging fruit. We shall also complete the work on IPPIS which has already covered half the agencies and weeded out 60,000 ghost workers saving N160 billion. Completing this work could save another N160 billion. In the medium term, the current pressures provide a unique opportunity for the country to reduce duplication of agencies, commissions and committees within the administration and to restructure and reduce recurrent expenditure, reform public administration and make serious efficiency gains.

Inevitably, there will also be some cuts in capital expenditure in the 2015 Budget, but this is being done in a way that is pro-poor and pro-average Nigerian. Focus will be on priority sectors of infrastructure, Health, Education and Security, as well as growth stimulating and job creating sectors like Agriculture, Housing and Creative industries. Even in infrastructure, there will be focus on certain priority national projects such as Lagos-Ibadan expressway and the second Niger Bridge, Oweto Bridge, Abuja-Kaduna Rail, Maiduguri-Enugu Rail, Zungeru, Kashimbila and Mambila Hydro etc.
Expenditures related to the average Nigerian will be the focus. In fact, let me say here that we are building a social safety net for the poor and vulnerable in our society with support from the World Bank and DFID. This is a direct outcome of Mr. President’s social policy drive. For example, using NIMC as a base, a Conditional Cash Transfer system will be developed and targeted at women and their households of up to five children. This will encourage them to send children to school especially girls and get themselves maternal and infant health care. This approach would complement what we have been doing with the SURE-P and MDGs.

Our fiscal measures will also now be accompanied by appropriate monetary policy measures as we have always stressed. As announced yesterday by the monetary policy authorities, the MPR and CRR on private sector deposits have been hiked to 13% and 20% from 12% and 15% respectively, while the RDAS mid-rate has moved to N168/$ from N155/$, and the band around it widened to +/-5%.

With these moves, the CBN has shown commitment to complementing the measures outlined by the fiscal authorities to deal with the current challenges and uncertainties facing the country, so the economy can be stabilised. The official devaluation of the naira and greater flexibility in its management also supports and provides some measure of flexibility to the fiscal authorities and the macro fiscal measures to stabilise the economy.

Macroeconomic stability is a crucial element of the performance of our capital market. It provides the bedrock that allows markets to operate. So let me now spend a little bit of time to talk about how our capital markets have fared with the current price shocks, and what the government is doing to restore market confidence. First, we have seen declines in a number of indicators within the capital market including the NSE All Share Index (ASI), Equity Market Capitalisation and Foreign Portfolio Investments (FPIs). This is really not unusual as there is some sort of close correlation between oil prices and capital markets. The NSE All Share Index slid by about 18%, from 41,135.75 points at the beginning of October to 33,875 points as at November 24. This is similar to the 18% decline in the NSE equity market capitalisation from N13.6 trillion as at the start of October to N11.2 trillion as at November 24, during which period oil prices fell by about 19%.

Foreign Portfolio Investment has also seen a reversal as it decreased by 32% in a month, September 2014 to October 2014! Of the N153 billion decrease, over 65% was attributed to FPI outflows. But as you have seen, we have now taken strong measures to stabilise the economy and the market has responded positively, finishing up in positive territory yesterday. Also, looking at our bond yields, the yields for our international and domestic bonds have also gone up by a few hundred basis points. Our five-year 2018 eurobond is up by 233 basis points in November, reflecting that investors still have confidence in our management of the economy.

Let me at this point re-emphasise government’s commitment to supporting the capital markets given the prominent role the market plays as the bedrock of investment in the country. Thus, in addition to the fiscal and monetary measures, which I have already discussed, government gazetted and implemented the VAT exemptions for stock market transactions and we are working on the stamp duty waiver. We are also working on deepening our stock market through strong encouragement of listing our big companies like those in the telecommunications, oil and gas sectors, and consumer goods sector.

Now, all these macroeconomic and capital market measures will need to be complemented by continued structural reforms for the economy to grow and move away from overdependence on oil, focusing more on the non-oil sector. We must render our economy more competitive.

For this to happen, we will need to continue the adjustments and reforms we have started in power, ports, rail, oil and gas sectors, and in our regulatory regimes. We must build the right institutions to galvanise the reforms in these areas. In particular, we must also strengthen our regulation and our competition laws in order to keep the country competitive. We now have some very reputable regulatory bodies like NERC but we need more in other sectors, such as Ports and Harbours bill, Road bill, etc. We also want to create a more conducive environment for business as a way of improving business opportunities and creating more jobs for our people.

In this regard, we must also look at the cost of doing business ranking and improve. Interestingly, Nigeria has gone up 5 ranks from 2014(175/187) to 2015 (170/189). Of course, in no way is 170 something to celebrate but it demonstrates that we can improve. A lot of the new gains have come from increasing access to credit where we are have gone up 30 percentage points in the past year. The MITI and the EMT are working hard on improving the entire Doing Business indicators. There is now a Competitiveness Council chaired by Mr. Vice-President and a 100-day work programme to further move us up the rankings. I know we can and will do better. We have really no choice in the present adverse global environment.

• Dr. Okonjo-Iweala is the Coordinating Minister for the Economy and Minister of Finance

FG to Review Duty Waivers, Others to Shield Economy from External Shocks

• We will protect the interest of the common man

by Eromosele Abiodun and James Emejo in Abuja

As part of the measures to help Nigeria navigate the current revenue shortfall arising from declining oil prices and save the country from future shocks, the Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, has said the finance ministry and the economic management team are working on several scenarios, which include reviewing the nation’s policies on investment incentives, and waivers and exemptions to stem the tide of abuses.

The finance minister made this know on Thursday in her keynote speech at the Securities and Exchange Commission's (SEC) 4th Annual Capital Market Committee Retreat holding in Abuja.

Other measures she disclosed include reducing oil price expectations; increasing the nation’s non-oil revenue as a percentage of gross domestic product (GDP) to $3 billion in three years; cutting certain recurrent spending such as the purchase of administrative equipment, overseas travel and training; and implementing some cuts in capital expenditure in the 2015 budget.

As part of the renewed focus on increasing tax revenues to mitigate the impact of the fall in oil prices, she said the Federal Inland Revenue Service (FIRS), working with Mckinsey, has been mandated to increase its target, adding that the agency has already made progress in reaching the target of N75 billion, over and above the regular collection target.

She stated that her first measure was to make up her mind that panic would not solve the problem, stressing that no nation manages economic crisis successfully with panic.

According to her, “Panic is not a strategy. We are managing the situation to keep the economy on a stable sustainable course and we will not listen to those who want us to throw up our hands in despair and give up.

“Our scenario-based approach to managing the impact of the oil price drop is proactive and comprehensive. Even if the price drops to 60 dollars we are ready.

“As a central part of our strategy, we have revised our oil price expectations over the short to medium-term. We have lowered our benchmark oil price assumption to $73 per barrel after some careful analysis of the possible future direction of oil prices as well as the soft floor price for shale oil, which is estimated at about $75 per barrel.

“But let me clearly state that we are not taking a point-estimate position as regards the future price of oil. We fully recognise that oil prices may fall lower or even rebound.”

Prices, she added, could fall to $70 a barrel, $65 or even $60, adding that prices could also rebound to $75 to $85 a barrel.

“What we did was to work within a range of $60 to $85 thought possible by analysts, put a package of measures around an estimate at the mid-point of that range, that is $73, and then built additional measures for scenarios at $70, $65 and $60 a barrel.

“The best way to manage uncertainty is to take a scenario-based approach to be ready for alternatives that may occur. This is what we have done, so panic is not a strategy.

“What is necessary is a systematic and focused approach. This is what we have. Our fiscal measures comprise both revenue and expenditure effort,” she explained.

On the revenue side, she said a lot of work was already underway prior to the fall in price to improve non-oil revenue generation.

“This was sequel to our rebasing exercise which demonstrated a large $510 billion GDP with a diverse non-oil base. The efforts of the FIRS supported by McKinsey & Co is focused on strengthening tax administration and thereby plugging leakages and loopholes.

“For example, only 25 per cent of our SMEs are registered taxpayers. Remedying that will broaden the tax base. Our auditors complete three to five audits a year compared to 50 a year in Angola.

“Speeding up audits will help improve tax collections and anomalies. Correcting for these loopholes is on target to bring in an estimated N75 billion above the 2014 FIRS revenue target.

“We believe that given the impressive performance and the now visible larger economic base, FIRS can do a lot more. Consequently, we have raised the 2015 budget threshold to N160 billion above the 2014 target,” the minister said.

She added that the cuts in capital expenditure in the 2015 budget will be done in a way that they are pro-poor and pro-average Nigerian.

She said: “Focus will be on priority sectors of infrastructure, health, education and security, as well as growth stimulating and job creating sectors like agriculture, housing and creative industries.

“The common man is a priority in our strategy for the fall in oil price. His interests are a priority. That is why even in implementing cuts in the capital budget for 2015, the areas that are of most benefit to the common man, critical infrastructure projects like the Lagos-Ibadan Expressway, the Second River Niger Bridge, rail and power projects, etc, which will create jobs and enhance the comfort of our people will go on.

“This pro-common man focus can also be seen in the safety nets, which is a major priority for the president. The projection is for two to three million families across Nigeria to benefit from a conditional cash transfer scheme to encourage school attendance, improve health and nutrition, reduce infant and maternal mortality, etc.

“Anything that affects the poor, the young and vulnerable, we will prioritise it,” the minister said.

Meanwhile, the International Monetary Fund (IMF) has praised the measures introduced by the Central Bank of Nigeria (CBN) to cushion the effects of fall in oil price on the country’s economy, describing it as a move in the right direction, Daily Post reported on Thursday.

“In a combination of actions, most recently the communiqué after the Central Bank of Nigeria’s monetary policy committee meeting of November 24-25, the authorities have announced a set of policies aimed at mitigating the impact of the recent significant fall in global oil prices on the economy,” says the IMF chief mission for Nigeria, Gene Leon.

“These include: adjusting the exchange rate, resubmitting the medium term expenditure framework to the National Assembly with proposed tax and expenditure measures to achieve the deficit target consistent with a lower budget oil price, and tightening monetary policy.

“We are supportive of and welcome these actions, which we view as complementary and moving in the right direction.

“Of course, the global situation remains fluid and the key issue is being ready to manage downside risks and for the authorities to be prepared, based on assessments of credible scenarios, to consider additional measures, as necessary,” he pointed out.

CREDIT: ThisDay

Strategies In Place To Deal With Falling Oil Price

http://www.channelstv.com/2014/11/27/okonjo-iweala-says-strategies-place-deal-falling-oil-price/

https://www.youtube.com/watch?v=JGE45AOR1H0

https://www.youtube.com/watch?v=Jr1uMtvNSn4&list=UU_Lnb8ZHqqgLbp-7hltuT9w

Eleni Giokos: Nigeria is a country of two tales. It could be part of the world’s top 20 economies by 2030 with its GDP expected to triple to 1.6 trillion dollars and this could help pull 70 million Nigerians out of poverty. Of course the second outcome could be with the status quo remains poverty prevails despite the high growth rate.

Nigeria’s growth story has been impressive but, there’s a cloud hanging over the West African region and that’s Ebola. Now the death toll is rising and its hitting powerful economies like this. I caught up with Nigeria’s Finance Minister Dr. Ngozi Okonjo-Iweala and she says the world’s business meetings have been put on hold. She’s confident that the Ebola outbreak will not seriously affect the economy.

Dr. Ngozi Okonjo-Iweala: Well, let us first say it is a rather unfortunate situation and it is a risk. This is one thing that Nigeria has managed rather well. Both the World Health Organization and The Centre for Disease Control of the US working with us have commended the way the country has done this. What has happened? We’ve managed to contain it, the number of cases, right now as we speak, we don’t have any case because we had about 19 cases, six people have died so far, 11 or so have recovered and have been discharged, and a few are being monitored. There are people who were primary and secondary contacts about 400 in Port-Harcourt and a few more in Lagos who are being monitored and with some luck, maybe by this month, maybe on the twenty second, we may be able to say that Nigeria is okay.

Does that mean that we are complacent? No, absolutely not because we have to keep on the watch. So what am saying is this, because of the regional phenomenon, we’ve managed to contain it, you keep hearing of Ebola in West Africa, that has affected arrival of business people, there’s been some fall of hotel occupancy in Lagos in particular. Some meetings have been postponed but you still have some other business people arriving.

Tomorrow, I’m going to have a breakfast business meeting with the CEO of Unilever, Paul Polman, so as at now, we have a team that is monitoring the economic impact and we don’t feel that we are at the point where we say it has a huge impact on the economy. We hope it won’t get to that point.

Now, talking about the North-East of the country where we have the insurgency, we’ve taken a percentage point, we’ve discounted our GDP growth by half a percentage point to take account for the impact of the insurgence. The insurgence in the north is because agricultural production has fallen, we are not able to collect taxes in the area and so on. But I’m happy to say that in spite of this unfortunate situation, our army and air force is now very active, they are pushing back and I think, we are going to see a different picture in the north, even the north east in the not- distant future. The military and air force are now reacting very actively and have managed to seize back control some of the areas that were taken and so we are very hopeful. Yes, we would like to think that this is as bad as it can get, but I don’t want to make any comments, let’s just watch the action of our military and stand behind them so that they can put an end to this and to the suffering of the people in that area.

Eleni Giokos: The reality is that the headlines in the media… do you think that it overshadows and clouds the actual opportunities that lie in the country and as you have mentioned is growing relatively fast and is now the largest economy in the continent.

Dr. Ngozi Okonjo-Iweala: Yes I think so. We have to get used to it. When you’re in a large country, you tend to attract a lot of attention. I saw a recent Mckinsey report that looks at Nigeria’s economy and its drive for inclusive growth and it puts it well. Nigeria is a two track story. There is a track that Nigeria is doing well and President Goodluck Eblele Jonathan has launched a transformation agenda that is really working.

In agriculture, the way we approach it has changed. We are producing much more rice to self-sufficiency in rice; we produce dry season rice, two in a row now. 1. 1 million metric tonnes, our rice imports have gone down. We are launching a revolution in the housing sector; the President kicked it off in January this year. For the first time, we are going to have a systematic approach for mortgage finance. He launched the Nigerian Mortgage Re-Finance Corporation to kick off mortgage finance. Do you know in a country like Nigeria with a population of 170 million people, we are not doing better than twenty to fifty thousand mortgages per year. So, that alone, will make the economy grow faster, jobs will be created.

The President’s focus on this transformation agenda is jobs, jobs, jobs- jobs for farmers, plumbers, painters, carpenters, architects, quantity surveyors, interior designers by launching this one sector programme alone. We’ve got the creative industry, the film, the arts which is a big job creator. It created 200 direct jobs, a million direct jobs, 250 million dollars in value and I could go on and on. The manufacturing sector has now got new life breathed into it. We now have automobile manufacturers setting up in the country. Other sectors of the economy are taking up. Oil and gas- we made some new investment. Nigeria is more a gas-economy in the future than an oil-economy and investments are happening there. So I think when you look at it all that is the one track story that is missed.

The economy grew at 6.54% this second quarter of this year, it grew at 6.2% the first quarter and this is after we discounted for the challenges we are facing. The IMF is projecting about 7%. So, there is a lot of dynamics to it. On the other side, there are challenges, we are growing, but there is more inequality. We are still experiencing a lot of poverty at the bottom end of the ladder. Our challenge is how to turn this growth into a more inclusive growth so that we can pick up those at the bottom rung of the ladder and reduce this inequality. We don’t want to grow in such a way that leaves a lot of people behind. So, we’re struggling with this problem. But I think this Mckinsey report is interesting to me because they are saying people are focus more on the track- about the challenges: governance issues, corruption, lack of power, infrastructure, the inequality and the other side of the story which is what we need to focus on in order to correct the challenges is little talked about.

Eleni Giokos: We have seen the power challenges being looked at very carefully, in fact, power generation in Nigeria is at its highest than we’ve seen in two years but it’s not at its peak like we saw two years. Do you think enough money is being put into this specific sector? The reality is the economy could be growing so much faster if we could electrify more of the country and if the private sector didn’t have to own a generator.

Dr. Ngozi Okonjo-Iweala: You’re absolutely right. What’s amazing to us is that in spite of these challenges we face, we’re still one of the fastest growing economies in the world with a GDP of 510 billion dollars, we are now the largest economy in Africa and we are growing at 6.54% this last quarter. If we had the infrastructure investment accelerated and we could put more infrastructures in place, principally power, if we could do better and we are going to do better; you can then imagine what the growth of this country will be. So the fact that the President went ahead and launched the privatization of our power assets, we liberalized the sector so you have new entrants like Azura it’s an IPP, an independent power project with a billion dollars of investment, all of them designed to increase the megawatt we generate to give more power to our cities, when all of that is in place about one or two years from now, I think you’re going to see an even more accelerated growth and hopefully more inclusive growth.

Eleni Giokos: How does Nigeria plan to increase tax? We know that the tax to GDP ratio we heard that it dropped from 22% to 12% after the rebasing. What exactly are the figures you’re looking at now?

Dr. Ngozi Okonjo-Iweala: This is interesting because people think the rebasing is all about larger and larger figures but there are some ratios that don’t look too good. Prior to rebasing, our revenue to GDP ratio was about 2%, already 2% below middle income countries. After the rebasing, it’s fallen down to about 12%, so this doesn’t look so good. So for those who think we are going after rebasing for large numbers, no, this is a ratio that is not good and we have plans.

We are already focusing on better tax collection in the non-oil sector. The rebasing shows that our economy is much more diversified. Nigeria is not really an oil story or a gas story, yes, it will be a gas story in the future. It is a services, manufacturing and agriculture story. What does that mean? It means we have the base on which to build a stronger tax system and we’ve started. We hired Mckinsey, they are embedded with our revenue authority and already we are making good progress to strengthen our revenue administration plug leakages, and we’ve set targets to increase our tax collection first by half a billion dollars, then we go to a billion and we’ll wrap it up to two and three billion, so we’re working our way through. We’ll also look at tax policy once we’ve fixed tax administration because there’s no point changing policy if your administration is weak. Once we’ve done that, we’ll move to policy and you’re going to see that we have a target to get ourselves back up to 20% of the new rebased GDP.

There’s no real source of term money in this economy. It is very difficult for business people especially small and medium enterprises. To find any money for five to seven years, mostly they can borrow for a year to three years. If you want to grow your business sustainably and you want your economy to have sustained growth, you’ve got to fix access to finance, not just for running the company but also for longer term investment. That is why we are building the Development Bank of Nigeria and the ultimate vision is to capitalise it up to 10 billion dollars but we are going to start with about two billion then we’ll go up to five. The institution is going to get strong, get rated, and it will be able to float itself and get it some money to very strong capitalization. We are very excited about the prospects and we are getting so much help. The World Bank, the African Development Bank, the KFW of Germany, the BSBN of Brazil, the Development Bank of South Africa. The money comes from four sources: one of course is the Government, the second is the World Bank that is putting in half a billion dollars, the African Development Bank another half billion and African Development Bank is actually taking an equity stake in the institution which is unusual, they really believe in it. The KFW of Germany is also going to give us a line of credit and the Government will come in. This is not going to be like the old development banks we had that didn’t work. We have registered this, and I want to really commend President Goodluck Jonathan, he supported an unusual move which is to register this as a private sector institution. So it is a sort of public private partnership, government supported, but private sector registered and run and we run on principles by which governance will be very strong. Nigeria’s Sovereign Wealth Fund has now been rated as the second most transparent in the world by the sovereign rating institute. So we are going to do the same process, we will advertise, we will get the best people to run the institution.

Eleni Giokos: When I look at what is happening in the rest of the continent, we see a lot of Eurobonds being issued. When we look at a country like Ghana, just a few years ago we saw the debt scrapped and suddenly euro bonds being issued, the country doing well, and they also see the need to embark on talks with IMF. Putting Ghana aside, do you think that African countries issuing Eurobonds at a time when perhaps they should be concerned with not creating so much debt. Do you think there will be a problem down the line, do you think we will be able to take the money we raised from Eurobonds and spend it wisely?

Dr. Ngozi Okonjo-Iweala: I think we need a lot of caution. We’ve had a very difficult history with debt and we got debt forgiveness - the HIPIC Highly Indebted Poor Countries Initiative which freed many countries. For Nigeria there was a special case, we also got debt relief. I think the continent as a whole needs to be very careful. You got it right. If you’re borrowing to invest in activities, productive activities with high returns that is fine, including human resource development, because developing your people, and educating them is the wave of the future. So, I’m not necessarily talking about physical infrastructure but it has to be investment with high returns to justify the borrowing. But even then, I will be very cautious and I think on the continent we shouldn’t get too enamoured with going out and floating these bonds. Yes, carefully managed and as of now, countries are treading a little bit carefully. We have to watch it, so we don’t find ourselves as a continent back in the situation we were before. Each time you go to float these Eurobonds, you should do it making sure you get reasonable yields so that the interest rate at which people subscribe to is reasonable for the country. I’m not one who will say let’s rush out and accumulate a lot of debt maybe because of my experience to get debt relief with a lot of grey hair, it’s very difficult. So certainly, we don’t want to go that route.

Eleni Giokos: In terms of the oil price coming under pressure, at what point would you say Nigeria is in trouble if the oil price reaches a specific point and we’re talking about diversifying the economy, we see that happening already. Is it something you’ve got your eye on?

Dr. Ngozi Okonjo-Iweala: The point is knowing what we know about the volatility of oil prices, and the need to capitalize and diversify the economy, we’ve been working hard as you know. Years ago, during my first stint as the Finance Minister between 2003-2006, we put in place a mechanism in place to manage volatility and we started to de-link the oil price at which we budget away from the market price, so that gives us a cushion, so we budget much lower the market price, and whatever is above it, we try to save. This is the famous excess crude account. We have about 4.11 billion dollars in it now, and we will continue to do that, to cushion the volatility.

But beyond that, I think we need to stop thinking of Nigeria, even we Nigerians, need to stop thinking of Nigeria as an oil economy, we really have to work very hard, there is no complacency here, we must capitalize on the real sectors of the economy, on the assets we have, we have land which is good for agriculture, we have a lot of other minerals which we haven’t even exploited. 33 solid minerals, you can name it from gold, to tantalite, to granite, we’ve got it, we haven’t even started to exploit that. My beautiful floor here is Nigerian granite. We’ve got our human resources in creative industry, we’ve got housing, we’ve got so many things to capitalize on and I want us to really start changing our mind-set about Nigeria. Nigeria’s story is not only about oil or energy. Yes, it will continue to be important as a source of revenue, but we really need to drive the country away from where we have 70% of our revenue in oil and 30% from other sources. We want to drive it to where a third of our revenues come from oil two thirds from the non-oil sector and that is the vision for this economy. That is when we can say that yes, we are capitalizing on our very diversified base and it will take us time, it’s not going to come overnight but once we have that vision, a decade from now, 15 years from now, we should be moving towards that goal.

https://www.youtube.com/watch?v=5nsdP9AA9rc

NIGERIA RISES: Economy has Grown by Around 6% Annually For Decades

Transcript of CME’s interview on France 24 on the Growth of the Nigerian Economy

Markus Karlsson: Hello and welcome, I’m Markus Karlsson, Nigeria seems to be on course to becoming Africa’s biggest economy with an average annual growth rate of about 6 to 7% over the past decades, it looks set to take over South Africa. Today, I’m speaking to the woman who is in charge of this rising economic power. Ngozi Okonjo-Iweala is the finance Minister of Nigeria. She is in Paris for the summit of African Leaders hosted by the French President. He is also bringing together African and French business leaders.

Minister Iweala, thank you very much indeed for speaking to us and welcome.

Dr. Ngozi Okonjo-Iweala: Thank you Markus.

Markus Karlsson: I spoke about an annual growth rate around about 6% in the past decades or so. There are concerns that the Nigeria growth rate could come down if there are adverse shock. What do you say about that risk?

Dr. Ngozi Okonjo-Iweala: Well, it actually sits somewhere better than 6% in the past decades edging towards seven. And yes, there are risks, it is a very robust growth rate built on the back of good macro-economic management and stability and emerging sources of growth in the non-oil sector. And of course, there are risks and we are still quite dependent on oil for 70% of our revenues. So should the oil price come down too much, we are vulnerable, but we have made provisions to manage that, because we have an account that we try to save the excess crude oil account that we try to save during the time of excess crude oil prices. That helps us to cushion in times of shock. We are planning that next year we’ve spent some of the money in that account 2013, but we will be building it back up as a cushion.

Markus Karlsson: there are some critics of the Nigerian economy, when I spoke to the head of the Nigerian central bank just a few months ago and who, for instance, spoke about a comatose industry and a bloated government. What do you say of his criticism and that criticism, which still exist?

Dr. Ngozi Okonjo-Iweala: I love my Central Bank Governor dearly and of course he says some of these remarks. It is true that our recurrent expenditure is very high and we will like it to go down. And it is almost 74 to 75% of total cost. That’s too high. We agree with that and we have been working hard to bring it on a downward trajectory. But recent awards of wage increases to public servants in 2010 really bloated the budget. So, we are working, looking for areas to streamline, make economies. We are also instituting something very interesting which is a biometric method of paying our wages which is designed to weed out what we call ghost workers from the work force. Sometimes there are people inserted who are not really there. And we’ve been doing this exercise over a year. To save considerable amount of over a 100 billion Naira and weed out about 45,000 ghost workers. We want to finish that exercise that will help us slim down our roles. We also need to streamline and merge some agencies. It is not easy because they are underpinned by law and, you can see, politically it’s quite charged.

Markus Karlsson: You spoke about the oil sector before and still today, Nigeria an export is still dependent on the oil sector, how do you counter that? How do you diversify the economy? What’s your plan?

Dr. Ngozi Okonjo-Iweala: You must have followed what’s happening recently, I really want to counter the governor’s charge about comatose industry. This is completely changing. The president of Nigeria, President Goodluck Ebele Jonathan really lunched what we call a transformation agenda. What does that mean? It means the true effort to diversify the country away from oil. The only way we see to really solve the fundamental problems in Nigerian economy is to diversify away from oil because we need to create jobs. Even though we are growing better than 6% as you noted. And the IMF has projected 7.4% next year. The point is we are not creating enough jobs. We need non-oil growth and what is driving the economy right now is non-oil growth. Growth in the economy is coming from Agriculture; it’s coming from Manufacturing. Manufacturing is no longer comatose and it’s beginning to take off. We’ve got investment in different sectors in petrochemicals. We just have a very big investment in by “Indorama” of 1.2 billion in plastics and fertilizers. Nissan is looking at investing in automobile industry. We have Dangote, a rich businessman who is investing, not only in cement, but he’s also going into oil refineries and others. We’ve got Procter and Gamble that just built a factory for 250 million in the west of the country. So, we have real investment coming in, everybody is looking into investing in the country. But Agriculture, as I said, the housing sector is about to be kicked off, manufacturing is coming in and we’ve got others, non-oil, minerals within the country that are really helping us as sources of growth. And don’t forget, we have the creative industries and services. Nigeria has the second largest movie Industry in the world after Bollywood. It has created 200,000 direct jobs, a million indirect jobs, $250 million in value and counting.

Markus Karlsson: You mention a few companies that have invested in Nigeria and who are investing in Nigeria. Do you think the western companies have been too slow to catch on the growth that is taking place now in Nigeria? And in elsewhere in Africa, for instance, because there has been so much focus so much in Chinese investment in Africa in the past. Let’s say a decade.

Dr. Ngozi Okonjo-Iweala: Well, let me say this when you look at what is happening in Africa, I think there are two interesting phenomenon that you really need to look at. One is that most of our investments now are South-South. It’s coming from China, India, Brazil and other African countries. South Africa is a major investor in Nigeria, for instance. And this is a phenomenon that is happening all over the continent. In developing countries as a whole, South-South investment is big. There is one other piece of interesting information and that is Africa-to-Africa investment is increasing. Nigeria is investing in so many other African countries. Our banks are in fifteen countries, our cementing plants being built by Dangote in more than twelve to thirteen countries. So we are also investing in each other. Now what I see is, of course North-South or South-North investment is very important. We value it, but the point is that there may be a little bit slow. I say to investors from the North, they really have to work quite hard now in order to be able to catch their opportunities.

Markus Karlsson: Do you think Western companies; European companies for instance are taking the African market for granted?

Dr. Ngozi Okonjo-Iweala: I will be presumptuous for me to say that, I don’t know if they are taking it for granted. But I do know that if they don’t scramble for the opportunities that are emerging now they will be left behind.

Markus Karlsson: And who is going to take over if they are indeed left behind?

Dr. Ngozi Okonjo-Iweala: Countries from the south. I mean countries from the south. We have countries coming in everyday. Indonesians making investment, it’s not just the BRICs but also the non-BRIC countries are coming in to make investment. And our own domestic investors are also seizing the opportunities, which is really what you want to see. First and foremost, investors need to see your own domestic investor, putting in money in the country and that’s happening big time in Nigeria. You know we’ve got a company called Innoson manufacturing cars now. Almost more than 50% of the part built in Nigeria, that’s amazing to me.

Markus Karlsson: Let me just ask you about the business climate in Nigeria. You use to work for the World Bank. The World Bank comes out with its annual doing business report. In that business report Nigeria is in spot 147 out of 189 countries. Doesn’t that scare off potential investors?

Dr. Ngozi Okonjo-Iweala: Not really, I think if you look at many of the BRICs, their positions are not that great. Some of them are in 100, while some are in 88. They are not at the top. That doesn’t mean that we don’t need to do better, of course we would like to do better. But we need to look at those particular areas on how we are being scored and focus on them. It is true that we have a lot of bureaucratic hurdles. I’m not saying we are in the position we want to be. We have pledged to work very hard, I think point by point. I think what we are doing now is that we have a competition council that have been set up. Minister of trade and investment is taking this on and we are going to take this point one by one. We are seeing that it is not really scaring off investors. Nigeria is the largest destination for investment in Africa.

Markus Karlsson: So do you think investors are looking at the growth rate than other factors, so to speak.

Dr. Ngozi Okonjo-Iweala: Yes, they probably are. But that does not make us complacent, I think the question we ask ourselves is, “Yes, we are the largest destination for investment” maybe we could get more if we solve some of those problems. I’m not here to say that we feel very glad. We are not where we want to be and we have to work very hard as a country. We are not complacent at all and let me say this, growth is not everything. You know we are growing, but we are not creating enough jobs. And we have young people coming into the market, so we worry every time about whether the type of growth, we have is the type we need to have. That’s why we are happy that the non-oil sector; this attempt that the president is pushing to diversify is beginning to work now. This past 12 months we created about 1.6 million jobs. We need about 2 million, so we are not there yet.

Markus Karlsson: We are going to wrap it up there Ngozi Okonjo-Iweala; it’s been a pleasure to speak to you. Thank you very much indeed for being here. With that we are going to wrap up this edition of Business Interview. Thanks for watching.

The World Bank Doing Business project has shown that Nigeria has implemented 10 regulatory reforms making it easier to do business.

A statement from the World Bank said the majority have focused on improving business incorporation, trade, and credit reporting systems—allowing the country (Nigeria) to gradually narrow the gap with the best regulatory practices in the region.

The report ranked the country among the top five economies in sub-Saharan Africa in the ease of getting credit and the strength of minority investor protections.

Between last year and now, Nigeria saw an increase of 3.6 points in its distance to frontier score, greater than the global average increase of 0.8. This, the World Bank report said “is due in large part to an increase in the coverage rate of Nigeria’s credit reporting system and a reduction in the company registration fee that made it less costly to start a business.”

This year, for the first time, the Doing Business report analyses business regulations in Kano as well as Lagos. Nigeria is one of 11 economies with a population of more than 100 million where the report now covered.

The Doing Business 2015: Going Beyond Efficiency report finds that differences between cities are common indicators measuring the steps, time, and cost to complete regulatory transactions where local agencies play a larger role.

The report noted that “resolving a commercial dispute takes 720 days in Kano but 447 days in Lagos. In contrast, registering property takes less time in Kano at 45 days, than in Lagos at 77.”

However, while the regulatory environment for Nigerian entrepreneurs is improving, the World Bank believes that “considerable challenges remain. Businesses spend valuable time and resources to comply with local regulations, especially in four areas measured by the report: getting electricity, dealing with construction permits, registering property, and paying taxes. To get a new electricity connection, for example, a local entrepreneur has to complete nine procedures and wait 257 days. In Namibia, the process takes only six procedures and 37 days.”

“Removing burdensome regulations is an essential step toward a stronger private sector,” said Rita Ramalho Doing Business report lead author, World Bank Group. “Although Nigerian enterprises face regulatory obstacles, implementing business-friendly reforms will allow local entrepreneurs to use their time and resources more efficiently and thus become more competitive.”

CREDIT: The Nation

Okonjo-Iweala and Nigeria’s Economic Health

Category: Opinion
Published on Thursday, 30 October 2014 05:00
Written by Idang Alibi idangalibi@dailytrust.com

For the better part of this year, the price of crude oil, the commodity that provides Nigeria the bulk of her foreign exchange earnings, has been falling in alarming manner.

Today, over 20 per cent of the revenue Nigeria used to earn in the good old days of steady oil prices on the international market only a few months back, has reportedly been lost. Expectedly and quite rightly, this has made many Nigerians jittery. But Nigeria is not the only victim of the jitters about falling oil prices. It is an economic epidemic, so to say, that has befallen all oil producing nations the world over. There is however a greater anxiety here because we operate a near mono-cultural economy. And when that main revenue earner is threatened, we have every cause for some concern.

This fear and anxiety are reflected in some alarmist and sensational headlines in newspaper and magazine articles written by some of our concerned commentators. We often come across articles with titles such as: ‘’Is Nigeria broke?’’ ‘’How healthy is the Nigerian Economy?’’, ‘’Development in the International Oil Market: Cause for alarm for Nigeria’’. Others have also asked: Is the government cognizant of this frightening global development? If so, what steps have been taken to avert any impending further deterioration in the revenue profile of the nation?

It is against this back-ground of national apprehension that many concerned patriots eagerly sought to listen to the Minister of Finance and Coordinating Minister for the Economy, Dr Ngozi Okonjo-Iweala who on Tuesday, 21st October, at the National Press Centre, Radio House, Abuja, mounted the Ministerial Platform to give account of the activities of, and the progress recorded by, the Ministry of Finance in the past one year.

After her eloquent and graphic presentation, the question inevitably popped up and was addressed to none other than Mrs Okonjo-Iweala: Is Nigeria broke or is there no cause for serious alarm? Nigerians were eager to hear from the horse’s mouth. No, Nigeria is not broke, she answered simply; and humorously added that from the frequency of that poser, it was if some Nigerians secretly desire that their country should be broke! The finance minister proceeded to assure Nigerians that the country will not be caught napping as government was keenly watching development in the oil market and that a contingency plan was being developed to contain the situation as it develops.

She admitted that Nigerians’ anxiety was quite understandable but that government was not in any way laid back about the situation. She said the situation would call for some belt tightening quite alright and that government expenditure might be cut but that we will weather the storm and move on. I have become jittery have told members of my household to prepare for the coming economic storm, but Mrs Okonjo-Iweala’s re-assuring words have indeed done me a great good. It has calmed me down a bit.

In terms of real policies, projects and plan to meaningfully address the volatile oil market, Mrs Okonjo-Iweala told the nation that the ministry’s able macro-economic management and government’s efforts towards diversifying the economy by steering it away from dependence on crude oil, have yielded some remarkable dividends. She pointed out that non-oil revenue is increasing. As to be expected of a minister of finance, she gave plenty facts and figures to buttress her assertion that all was well with the Nigerian economy. But as she herself said at some point, it is not about the money and it is not about the numbers but it is essentially about making a real difference in the lives of people.

On this score, she was particularly proud of what the newly formed Nigerian Mortgage Re-financing Company has done by the number of mortgages it has created for thousands of Nigerians. She said the Federal Government’s 10,000 houses for public servants has attracted over 60, 000 Nigerians in both the public and private sector who desire to own their own homes. Although only 10, 000 were targeted, all the over 60,000 compatriots who have applied will be considered.

Other steps which Mrs Okonjo-Iweala said the government is doing right which will mitigate the effects of the falling oil prices and keep Nigeria out of recession include tight fiscal management which she said has kept this year’s fiscal deficit not as large as of other years. She said there is great prudence in the management of our national debt. The government has kept domestic borrowing down and borrowed more from external sources, especially from multi-lateral organisations with long tenor and generous repayment terms. Contrary to the fears of many Nigerians that the government was borrowing too much, a development that could take Nigeria back to the debt noose, the finance minister said the uniqueness of this government’s borrowing is that it is targeted at developing the nation’s infrastructure to enhance the growth of the economy. She gave the figure of the nation’s debt-to-GDP as about 12 per cent which she said is within acceptable limits.

To further douse the tendency among Nigerians to portray their situation as worse than it really is, Mrs Okonjo-Iweala said that our foreign reserves and the money in the Excess Crude Account are enough to sustain over nine months of imports. From Ngozi Okonjo-Iweala’s body language the message was clearly that Nigerians should not worry unduly. I agree with her and wish to add that even if the situation is dire (which she said is not), we need to re-assure ourselves that all is well. Doing so is both spiritual and rational. We will call evil upon our country by exaggerating our fears. Agonizing unnecessarily at this point will do us more harm than good. As the late activist Taju Abdulraheem would say, we do not need to agonise but to organise. The time has come for us to do more to diversify our economy and make it less dependent on oil. We have said this for so long that it has become a cliché. The rude shock from the oil market should be a wakeup call on us all.

There is growing confidence of investors both domestic and foreign in the Nigerian economy. We ourselves should therefore not say or do anything that would cast doubt about our ability to steer the economy towards the safe and sound direction. The granting of full membership status to the Nigerian Stock Exchange by the World Exchanges Federation is a vote of confidence on the Nigerian economy. With a self-confident person like Okonjo-Iweala at the helm of our economic management team, the goodwill of the international community and with our prayers, one hopes that Nigeria is safe.

An address by Dr. Ngozi Okonjo-Iweala, the coordinating minister of the economy and minister of finance at the NCRIB 2014 national insurance conference held in Abuja on 22nd October 2014

Protocol

I am delighted to be with you today on the occasion of your 2014 National Insurance Conference. I am quite sure that a good list of topics is lined up for discussion at this conference and reputable resource persons are on hand to do justice to them. However, I crave your indulgence to say one or two things on the theme of this conference.

With growing incidences of disasters across the country and their impact of loss on human and material assets, the theme: Disaster Management: Any Role for Insurance and sub-theme; Insurance Regulation: The Global Trend, is very apt.

The primary role of insurance is to restore the policyholder back to business whenever the risk insured crystallises. In fact, insurance is the confidence entrepreneurs need to embark on any significant venture. Natural catastrophes affect all sectors of business, both directly and indirectly. Disasters can cause operational and supply chain disruptions through the physical damage to property and/or loss of critical resources and infrastructure, which can cripple an entire operation.

Yet, there is this erroneous belief by some entrepreneurs that perceive insurance as a cost. This, indeed, is an error. In reality, insurance is probably on of the biggest value additions to any business. We have experienced devastating events such as natural disasters without any prior warning. Insurance is the only effective mechanism to minimise the loss caused by these unforeseen events, which in some instances can mean saving an entity from having to close shop.

There had been incidences in the country of fire disasters, collapsed buildings, flooding and storms and fatal accidents. Without insurance cover foe these losses, individual is immediately reduced to poverty while victims are left without compensations. The recent flood disasters in the country washed off so many homes and businesses including fish ponds. From available records, the insurance industry was on hand to restore businesses that were insured with them, particularly farmland and produce that were washed off by the flood. So to answer the question posed in the theme whether insurance has a role to play in disaster management, my answer would be emphatically yes!

It is noteworthy that you would spend time to discuss Insurance Regulation. The impression one gets is that insurance operators, intermediaries and underwriters abhor regulation. I’ve seen commentaries in the media of recent, of complaints from operators, of excessive regulation. I’ve seen and read about sections of your profession advocating and soliciting to regulate themselves. I’m glad that you would be discussing the global perspective of this subject in details and it is hoped that international best practice only and not self-interest would predominate in your discussions.

From understanding of regulation, especially that of financial services, the essence regulation is to do with the protection of multiple interests, sometimes against themselves. In insurance regulation, these interest could be that of the consumers (policyholders), Intermediary, Insurance Company and it sshareholders, its Board of Directors and Management. It could also be of the Government or members of the general public.

Conflicts between these parties are common place in modern business; therefore regulation becomes imperative to protect management from the excesses of Companies Directors, the Management and Directors against infringing the interest of Shareholders and Policyholders or the exuberant Insurance Broker against the interest of the Insurance Company or vice versa.

Given the above sample scenarios, definitely regulation is beyond the registration or management of a club membership. Clubs arevoluntarily set for the protection of some interest and the promotion of some benefits and where the two mix, conflicts arises. Regulation should be the coming together of some responsible structure that cater for all and more, of the interest listed above, especially that of responsible governance and of the public image at large.
I should not finish this address without admonishing you on the need to join hands with the Federal Government’s quest to ensure Financial Inclusion in all spheres of our community. This task will entail conducting yourselves in a manner that would help deepen insurance which arguably is the weakest in the chain of financial services.

We cannot add value to this noble objective with a decimated insurance industry, no matter the personal urge to satisfy private ends. I would therefore enjoin you all to avoid any journey in self-destruction, no matter the temporal benefit that may be perceived as attainable. This industry is growing at a pace not as fast as we desired but there has been remarkable improvement over the last five years, where the industry was ranked number five in Africa. Today, we are number three, trailing behind South Africa and morocco. Our economy is the largest in Africa, thus we have the potential to be thelargest insurance industry in the continent sooner than later. We can only achieve this by remaining cohesive and focused.

It is the exception of the Federal Government that the insurance industry will propel economic growth. We shall therefore continue to support the National Insurance Commission’s on-going efforts toinstil market discipline and international best practice.

It is my hope that by the end of this conference you would come out with responsible and dispassionate resolutions that would help move the Nigerian Insurance Industry to the right place it deserves.
While wishing you successful deliberations, it is my pleasure and honour to declare this conference open.

Thank you and God bless.

Okonjo-Iweala: We are Stabilising the Economy

The Conference of the National Council on Finance and Economic Development (NACOFED) has said the significant fall in global oil prices and oil production hiccups in the domestic affairs have had adverse impact on the revenue stream of the Nigerian economy and called for urgent steps towards diversification.

But the Coordinating Minister for the Economy and Finance Minister, Dr. Ngozi Okonjo-Iweala, who raised the alarm of falling oil prices a few days ago, gave an assurance that contingency plans were being made to keep the economy stable while the excess crude account is built to cushion the effect of further drop in oil prices on the international market.

Frowning on the proponents of ‘share all revenues collected’, whom she said forgot that Nigeria was saved from plunging into a financial mess in the aftermath of the 2008/2009 global economic crisis because it had a $22 billion excess crude account (ECA), which it resorted to, Okonjo-Iweala said the federal government was already re-building the ECA to a level which, according to International Monetary Fund (IMF) standards, is comfortable.

The finance minister told THISDAY in an interview at the conclusion of the 2014 IMF-World Bank meetings in Washington DC: “Now we are trying to build the ECA up again. We did our modelling and forecast at $5 billion. If we can save that, it will save us for a little while. The IMF did its own model and said we need about $6.3 billion in that ECA minimum, to cushion us. Right now we have $4.05 billion, so we have a gap of $2 billion. All this time we have been shouting let us save and not share…We will try to manage the best we can.”

“We all want the best for our country, which is to make sure that our reputation for keeping a stable economy is sustained. We don’t want one in which the exchange rates is fluctuating, most Nigerians don’t want it. You have to relate the level of reserves and the amount of money in the ECA to the exchange rates, that’s what keeps it stable. If you now go spending everything and you have a crisis and the oil price fall, you will not have anywhere to turn. And this is what we have been preaching for the past three years and we are being harassed because of it but now we are seeing it happen. What we are doing is that we are making contingency plans to keep the economy steady as much as we can through this crisis,” she added.

NACOFED also directed that steps should be taken to facilitate the early processing of the request from states for the floatation of bonds and issue of Irrevocable Standing Payment Orders (ISPOs) while it urged the states to observe the regulations guiding internal and external borrowings.

It said there was need to broaden and improve on revenue generation to finance government expenditures, as well as sustained effort by the governments in arresting the current challenges in the oil and gas sector particularly the vandalisation of oil and gas installations and crude oil theft.

According to highlights of its resolution reached at the end of the 2014 Conference of the National Council on Finance and Economic Development (NACOFED), which was held in Enugu State, it announced a collaboration between the federal and state finance authorities to work towards broadening and improving revenue generation as a means of effectively financing government expenditures.

The resolution, a copy which was made available to THISDAY among other things noted that though the world economic outlook remained uncertain, the Nigerian economy had continued to show strong resilience despite the current security challenges.

It also commended President Goodluck Jonathan on his efforts towards resolving the security challenges in the country
While calling for good governance, transparency and accountability at all levels of government, it further resolved that “the Chairman, Federal Inland Revenue Service (FIRS) be approached to assist the states being owed and the state governments were also urged to look into the issue of loans they owed the Federal Government.”

Also, it said the issue of the refund to state governments on the expenditure incurred for rehabilitation and renovation of federal roads be further looked into while states were however urged to ensure that due process is followed in undertaking such projects in order to merit refund.

by Kunle Aderinokun in Lagos and James Emejo in Abuja
CREDIT: ThisDay Live

Okonjo-Iweala: We are Stabilising the Economy

The Conference of the National Council on Finance and Economic Development (NACOFED) has said the significant fall in global oil prices and oil production hiccups in the domestic affairs have had adverse impact on the revenue stream of the Nigerian economy and called for urgent steps towards diversification.

But the Coordinating Minister for the Economy and Finance Minister, Dr. Ngozi Okonjo-Iweala, who raised the alarm of falling oil prices a few days ago, gave an assurance that contingency plans were being made to keep the economy stable while the excess crude account is built to cushion the effect of further drop in oil prices on the international market.

Frowning on the proponents of ‘share all revenues collected’, whom she said forgot that Nigeria was saved from plunging into a financial mess in the aftermath of the 2008/2009 global economic crisis because it had a $22 billion excess crude account (ECA), which it resorted to, Okonjo-Iweala said the federal government was already re-building the ECA to a level which, according to International Monetary Fund (IMF) standards, is comfortable.

The finance minister told THISDAY in an interview at the conclusion of the 2014 IMF-World Bank meetings in Washington DC: “Now we are trying to build the ECA up again. We did our modelling and forecast at $5 billion. If we can save that, it will save us for a little while. The IMF did its own model and said we need about $6.3 billion in that ECA minimum, to cushion us. Right now we have $4.05 billion, so we have a gap of $2 billion. All this time we have been shouting let us save and not share…We will try to manage the best we can.”

“We all want the best for our country, which is to make sure that our reputation for keeping a stable economy is sustained. We don’t want one in which the exchange rates is fluctuating, most Nigerians don’t want it. You have to relate the level of reserves and the amount of money in the ECA to the exchange rates, that’s what keeps it stable. If you now go spending everything and you have a crisis and the oil price fall, you will not have anywhere to turn. And this is what we have been preaching for the past three years and we are being harassed because of it but now we are seeing it happen. What we are doing is that we are making contingency plans to keep the economy steady as much as we can through this crisis,” she added.

NACOFED also directed that steps should be taken to facilitate the early processing of the request from states for the floatation of bonds and issue of Irrevocable Standing Payment Orders (ISPOs) while it urged the states to observe the regulations guiding internal and external borrowings.

It said there was need to broaden and improve on revenue generation to finance government expenditures, as well as sustained effort by the governments in arresting the current challenges in the oil and gas sector particularly the vandalisation of oil and gas installations and crude oil theft.

According to highlights of its resolution reached at the end of the 2014 Conference of the National Council on Finance and Economic Development (NACOFED), which was held in Enugu State, it announced a collaboration between the federal and state finance authorities to work towards broadening and improving revenue generation as a means of effectively financing government expenditures.

The resolution, a copy which was made available to THISDAY among other things noted that though the world economic outlook remained uncertain, the Nigerian economy had continued to show strong resilience despite the current security challenges.

It also commended President Goodluck Jonathan on his efforts towards resolving the security challenges in the country
While calling for good governance, transparency and accountability at all levels of government, it further resolved that “the Chairman, Federal Inland Revenue Service (FIRS) be approached to assist the states being owed and the state governments were also urged to look into the issue of loans they owed the Federal Government.”

Also, it said the issue of the refund to state governments on the expenditure incurred for rehabilitation and renovation of federal roads be further looked into while states were however urged to ensure that due process is followed in undertaking such projects in order to merit refund.

by Kunle Aderinokun in Lagos and James Emejo in Abuja
CREDIT: ThisDay Live

Dr Ngozi Okonjo-Iweala, the Minister of Finance, has urged foreign investors to continue to invest in Nigeria through the Nigeria Sovereign Investment Authority (NSIA).

Okonjo-Iweala made this known at a meeting with Business Council for International Understanding at the Annual Meetings of the World Bank and International Monetary Fund in Washington DC.

She said that Nigeria Sovereign Wealth Fund (NSWF) had been rated second most transparent in the world after that of Norway.

“The NSWF has now been rated the second most transparent after Norway by the Sovereign Wealth Fund institute and that is saying a lot.

“I think there are encouraging signs that we have an institution that is going to be a solid building block for our economy going forward.

“We hope most of the investors would take a very detailed interest in trying to work with Nigeria,’’ she said.

The minister said though the fund started with one billion dollars but an addition 550 million dollars had been given to it.

She said that government was working on a permanent source of increasing the capital of this institution.

“So the idea is that this is not going to be an institution of one billion or 1.5 billion dollars entity but we are working toward five billion dollars to begin with and it will grow.

“And we are already seeing some good results in its investments. What we are excited about is the ability to co-invest.

“We have got a charter that allows them to invest in the economy unlike many other SWFs which operates the old model of channeling liquidity and capital outside,’’ she said.

The minister said that the NSWF was helping to develop the economy and many more models were now taking a cue from it.

She explained that the fund had fantastic ability to attract good capital for co-investments for some of the more prestigious firms and industries.

“So it is in that regard that I invite you to look at this relationship, this is one of the most important institutions in Nigeria,’’ she said.

(NAN)

SURE-P Supports Youths in Boko Haram-Torn States with $70,000

By Emmanuel Udom Snr. Correspondent, Lagos

The Subsidy Reinvestment Programme (SURE-P) of the Federal Government has so far supported jobless youths in Boko Haram-ravaged states in North-East with about $70,000 grants this year.

Minister of Finance, Ngozi Okonjo-Iweala, dropped this hint while speaking at Atlanta in the United States, on the successes and challenges confronting Nigeria, whose estimated population is placed at about 160 million.

According to the minister, who is also in charge of the Nigerian economy, the President Goodluck Jonathan administration, since the outbreak of terrorism in Nigeria has also increased the number of troops in the northeastern states of Bornu, Yobe and Adamawa from 15,000 to 20,000.

This is even as neighbouring countries, Chad, Cameroon, Benin and Niger, have resolved to assist Nigeria in tackling terrorism and have also contributed troops to fight Boko Haram members.

The SURE-P community services scheme, Okonjo-Iweala said, has so far recruited 11,500 youths, made up of 4,000 from Borno, 3,500 from Adamawa and 4,000 from Yobe State.

CREDIT: Daily Independent

Okonjo-Iweala Named African Finance Minister of the Year

WASHINGTON, Oct. 9, 2014 -- Nigerian Finance Minister and Coordinating Minister for the Economy Dr. Ngozi Okonjo-Iweala was today named African Finance Minister of the year by leading investment and international group, African Investor.

Okonjo-Iweala was announced winner from a shortlist which included Finance Ministers of Kenya, Angola, Rwanda, Liberia, Seychelles, Zambia and Kingdom of Morocco.

The Minister was described as a successful advocate and leader who has fought hard for Africa as an investment destination both for domestic and international investors.

She was also lauded for initiating reforms that have transformed the Nigerian economy thereby making it more attractive for business.

Okonjo-Iweala expressed gratitude for the recognition.

"I am delighted and honoured to have been picked as African Finance Minister of the Year 2014. Africa has come a long way from decades of economic stagnation to steady growth that has seen the continent make a huge leap for the better.

"In Nigeria, we are marching on. The building blocks for a greater future are being laid. I want to thank you for this recognition and I want to thank my President, Dr. Goodluck Ebele Jonathan for his constant support and my team at home, without which the job would have been impossible. Finally, I encourage every one of us to participate in the growth and development of our countries and our continent. Together, we will make it."

Africa Investor is an investment and communications groups advising governments, international organisations and businesses on capital market and foreign direct investment on the continent.

The group publishes Africa Investor, the leading international magazine for investment on the continent. The Africa Investment and Business Leaders award, which is in its 7th year, recognizes good businesses and institutions and individuals that positively impact investment climate on the continent.

Source: World News

Vision for Sustained Prosperity in Nigeria

Speech By
Dr Ngozi Okonjo-Iweala
Coordinating Minister for the Economy
&
Honourable Minister of Finance
Federal Republic of Nigeria
at
The Atlantic Council.
October 8, 2014.
1. Protocol Observed

2. Distinguished ladies and gentlemen, I bring you greetings from Nigeria and particularly from our President, Dr. Goodluck Ebele Jonathan, who was quite delighted when I informed him of my invitation by the Atlantic Council to speak on Nigeria. As I understand, this is the first of a series of talks on “New Africa”, in partnership with Thomson-Reuters. It is therefore an honour for me to be the first speaker in these series so I’m standing before you today with a deep spirit of appreciation to Thomson-Reuters and the Atlantic Council led by Frederick Kempe, and the Director of the Africa Center, Dr. Peter Pham for taking the initiative, and for the vision, vigour and passion that is obviously evident in their work on Africa.

Africa Rising
3. I’ve been invited here today to speak on the Vision for Sustained Prosperity in this great country of mine called Nigeria but in keeping to the theme of the series I want to start off by saying that an exciting transformation is taking place on the continent of Africa. In the decades of the 1980s and the 90s, we saw an Africa that was heavily indebted with an average debt-to-GDP ratio of 75 percent; an Africa plagued with slow economic growth of about 2 percent annually, hyperinflation – with inflation rates as high as 48 percent on occasion, and rampant poverty; an Africa troubled by civil wars and political strife, and an Africa in desperate need of donor aid and assistance.

4. Fast-forward two decades and the story is remarkably different. We see now, an Africa whose economy is growing faster than most economies in the World with better than 5 percent annual growth in GDP. We see an Africa with low debt, averaging about 32 percent of GDP (which is certainly much lower than those of developed countries including the US and several in Europe), low inflation – at single digit on average, and a middle class that has nearly tripled in size – from about 126 million people (or 27 percent of total population) in 1980 to nearly 350 million people (or 34 percent of population) by 2010, according to the African development Bank.

5. We see an Africa that is obviously enjoying a peace dividend and better governance with democracy now entrenched in most countries. We see an Africa that is now being courted by foreign investors with FDI increasing from $9 billion in 2000 to about $50 billion by 2012. You will agree with me, that Africa has come a long way but it has gone from a being lost cause to an almost hot prospect. Now you may think this sounds strange when all everyone is talking about is the Ebola crisis and flashpoints of insurgency like the Boko Haram in Nigeria and El Shabab in Kenya. You might also think it sounds strange with conflict in CAR and South Sudan.


6. Yes, these are certainly challenges. Ebola could be devastating if not decisively dealt with as a global challenge. The IMF estimates 1.5 to 3.5 percent off growth rates of Liberia, Guinea, and Sierra Leone. Nigeria and Senegal are relatively unscathed. But if not stopped, Ebola will travel as we have seen and could cause considerable harm. But Ebola is not a problem that is permanent, it is a problem that can be managed so don’t expect it to reverse Africa’s growth trajectory. Boko Haram and El-Shabab are real problems but again the push back is beginning. But what is interesting is that the existence of these problems has not managed to turn back the tide of a better performing Africa.

Nigeria in Africa Rising
7. Now, Nigeria is a classic example of this Africa Rising phenomenon, and perhaps one of its most successful stories. The return to democratic rule at the turn of the millennium brought with it better macroeconomic management and a series of reforms that unleashed economic growth, with GDP growing at an average 7 percent per annum over the last decade driven by the strong growth in the non-oil sector, particularly telecommunications, manufacturing, construction, wholesale and retail, to name a few.

8. The recent GDP rebasing exercise revealed that Nigeria is now the largest economy in Africa and the 26th largest in the world, with a GDP of $510 billion, and perhaps the most diverse economy on the continent. Only 15 percent of GDP is from resources (mainly oil and gas) while the services sector accounts for 51 percent of the GDP, agriculture – 22 percent, telecoms – 8.7 percent, manufacturing – 6.7 percent, and our film industry (known as Nollywood) also contributing 1.2 percent. Nigeria is also Africa’s largest population with about 170 million people – or nearly 20 percent of the continent’s population, and also its largest market. A recent report by the McKinsey Global Institute reveals that there are almost 40 million Nigerians in the consuming class households – which are households with incomes exceeding $7500 per year.

9. So distinguished ladies and gentlemen, Nigeria is certainly an economic powerhouse and deserves to be a member of clubs of its peers like the G-20. But more often than not, Nigeria is underrated with its sore points magnified beyond belief particularly in the Western media. My country receives little or no praise even when things are done right, but is left battling with the prejudice of a country where nothing works.

10. Take as an example the recent fight to contain the deadly Ebola virus. The efforts of Nigerian medical personnel that prevented the early spread of this deadly disease to the United States are rarely acknowledged. The individual, now known as the index case, who brought the disease into Nigeria from his own country Liberia was actually on his way to the US when he took ill and was quarantined in an hospital in Lagos after he was found to have been infected by the deadly virus. Sadly, members of the medical team that looked after him also died. They are the true heroes of this global war against Ebola.

11. A total of 19 confirmed cases were found in Nigeria – most of them primary contacts of this index case. Seven of these people died, while 12 recovered, thanks to the work of our medical personnel. Hundreds of people were quarantined for periods of time in an effort to curb the spread. For about a month now, no new cases of the Ebola virus have been found – which for a country of Nigeria’s size, is truly remarkable and I believe this is due to the measures put in place by our government. Had the Nigerian government been slow to act or ineffective to tackle the spread of the virus, the reality would be much worse. Nigeria has also supported other West African countries who are struggling to contain the disease with a US$3.5 million grant. Yet, until the past week, Nigeria did not received much credit for these efforts.

Nigeria’s Bright Future and Challenges.
12. So there is real contradiction here which needs to be redressed. Whereas the echoes of optimism in an Africa rising reverberates across the globe, the narrative on Nigeria – a key driver of the continent’s transformation – is often filled with tales of pessimism. Yet the country’s future is very bright and its key economic indicators are sound. This year, we are expecting the economy to grow by 6.5 percent, even though the IMF expects us to grow by about 7 percent – which is one of the fastest rates in the World. And our fiscal deficit is low, expected at 1.03 percent of GDP in 2014, inflation is in single digits, reserves are relatively strong at almost $40 billion including $4 billion in savings in our Excess Crude Account and $1.55 billion in our Sovereign Wealth Fund. Our Pension Fund has $27 billion in savings. Our stock market has been one of the better performing on the continent, even though profit taking by investors has slowed the market down this year. The study by the McKinsey Global Institute shows that Nigeria has the potential to expand its economy by 7.1 percent per annum through 2030, raising GDP to more than US$1.6 trillion, thus bringing the country to a top-20 economy with the potential to lift 70 million of its people out of poverty.

Please read the rest on the official Facebook Page https://www.facebook.com/ngoziokonjoiweala/posts/827588293958103

https://www.youtube.com/watch?v=s7WCwkeIKK4

#Nigeria's Minister of Finance @NOIweala and #SouthAfrica's Minister of Finance, Nhlanhla Nene at #AfricaGrowthShare

By Ngozi Okonjo-Iweala

When the Liberian-American Patrick Sawyer arrived at Lagos airport on July 20, he immediately collapsed. Rushed to hospital, he was diagnosed with Ebola and died within five days. There would be seven more fatalities in Nigeria following his arrival. Yet it could have been far worse.

Ebola has the power to terrify, partly because of the distressing nature of its symptoms, but also because of the reputation it has developed: of being unstoppable. This is false. Through decisive leadership, with the right resources and a highly co-ordinated response, the virus can be managed and overcome, as the experience of Nigeria proves.

Speed is vital. Soon after Sawyer’s death, President Goodluck Jonathan declared a state of emergency and the Lagos state government acted decisively to contain the virus. Protective gear, isolation tents, thermometers and millions of hand sanitisers were flown in. Health workers used contact tracing, isolation, treatment and massive public awareness campaigns to tackle the disease. Of 20 confirmed or probable cases, 12 recovered. At present, there are no known cases of the virus in Nigeria.

Control of the disease has proved more challenging for Liberia, Guinea and Sierra Leone. Nigeria’s experience – which began with a single patient who was quickly quarantined – is clearly different from these countries, where the virus often spread through remote communities for weeks and months before it was recognised. These are trying times for these nations, and we feel as one with them. The economic consequences are of great concern: the International Monetary Fund estimates growth in 2014 could decline by 3 to 3.5 percentage points in Liberia and Sierra Leone, and by about 1.5 points in Guinea. This is a significant blow to nations that had worked so hard to overcome years of conflict. The global response should be twofold. We must give money, equipment and expertise to these countries in their time of need. Nigeria has donated $3.5m, in addition to other forms of assistance. Working with partners, it stands ready to do more.

Second, when the word “Ebola” can cause so much fear, we must be specific about describing the scale of the outbreak. There are 16 countries in west Africa and 54 on the continent. So far, only five countries in west Africa have recorded cases of Ebola – Liberia, Guinea, Sierra Leone, Nigeria and Senegal. While there is little room for complacency, the latter two countries have contained the disease and have no more Ebola cases.

Referring to broad regional aggregates such as “west Africa” and “Africa” when talking about Ebola risks undermining all African countries. This could scare away vital investment and trade . There are already signs some insurance companies are refusing to cover travellers to west Africa. Despite advice to the contrary from the World Health Organisation, some airlines have introduced flight bans. In August, Korean Air halted its three weekly flights to Kenya. Some countries have banned nationals from Ebola-affected countries. The tourism sector in Gambia has been hit hard. Ghana, Senegal, Burkina Faso, Côte d’Ivoire and Nigeria have seen the cancellation of some international meetings. There has been an impact on hotel occupancy rates in these countries.

Africa has fought hard over the past two decades to make economic progress. Before Ebola, the continent’s image as an investment destination, rather than a proving ground for aid, had begun to be cemented.

As the international community works to tackle this virus, we must ensure that the hard won economic progress of African countries is protected. For it is these gains that will help defeat Ebola today, and ultimately prevent its resurgence in the future.

The writer is finance minister of Nigeria

CREDIT: Financial Times

by Simon Kolawole

One of the most exciting things I have ever done, and I mean it, was my study of oil-producing countries in 2008. I set out on a study of five countries: Norway, Venezuela, Indonesia, Saudi Arabia and United Arab Emirates. On a comparative basis with Nigeria, I looked at their policies and practices: local content, product pricing, revenue sharing between national and sub-national governments, “resource control” and management of “excess revenue”.

The research took a lot of energy out of me, but I was better off at the end of the gruelling field work which took me to several countries. It taught me new things and reinforced my beliefs about how a country should manage its resource wealth. One of the reinforced beliefs is the need for a Sovereign Wealth Fund (SWF). At the time my report was published in THISDAY in March 2009, Nigeria was experiencing what I called “crude crunch” oil prices had crashed from an all-time-high $147 a barrel to just a third of that, making a mess of the national budget.

The Excess Crude Account (ECA), which was set up by former President Olusegun Obasanjo under the inspiration of Dr. Ngozi Okonjo-Iweala in 2004, was the saving grace. Nigeria would have lapsed into a catastrophic economic downturn. Yet, when Obasanjo set up ECA, governors kicked against it, describing it as unconstitutional. All money must be shared, they said. If Obasanjo had caved in, there would have been nothing to fall back on in 2009 when the crunch set in. We still make use of it till today. So much for constitionalism.

ECA is, of course, not the same thing as SWF. ECA simply saves the difference between the budgeted and the actual prices of crude oil. It is a stabilisation fund, summoned when it is needed, especially by the governors who continue to wave the constitution in our face anything they crave raw cash. SWF, on the other hand, is primarily an investment. The first known SWF was the Kuwaiti Investment Board set up in 1953 to give that country some flexible income streams rather than a sole dependence on oil money. Today, over 60 countries are known to have set up SWFs for strategic economic and political interests.

In my most recent article, I listed the SWF as an achievement of the Jonathan administration. The Nigerian version was conceived by Dr. Olusegun Aganga in 2010 when he was Minister of Finance. I was glad Okonjo-Iweala pursued it to a logical end when she returned as Minister of Finance in 2011. One reader, angry that I listed SWF as something to celebrate, asked the all-important question: how can we be saving money when we have infrastructural deficit? Why don’t we spend the money to build infrastructure instead? He illustrated his opinion with a very good analogy: how can you be saying you have money in your bank account when you can’t pay your children’s school fees?

Unknown to the reader, he was making a case for SWF. While ECA is like having money sitting pretty in your bank account, SWF is a way of investing your money so that you can earn returns for life and continue to pay your children’s school fees, as it were! The SWF is even much better when you consider that the Nigerian version has three components Future Generation Fund, Nigeria Infrastructure Fund and Stabilisation Fund managed by the Nigeria Sovereign Investment Authority. You save part for the future, invest part in building infrastructure and keep the rest for fiscal stabilisation to play the role of ECA.

What’s more? SWF is being used an instrument of diplomacy by many smart countries. Ecobank is the leading independent regional banking group in West and Central Africa, with operations in 36 countries. You know its biggest shareholder? Public Investment Corporation. It is, in some way, the South African version of SWF. PIC currently manages funds in excess of $150 billion. South Africa has been using its weight in Ecobank to push decisions its way, seeking to relegate Nigeria to the background in the boardroom. Gulf countries have invested in several public assets in European countries and America and have become increasingly relevant in the economic and diplomatic calculations of the West.

Singapore, one country we drool over, has two SWFs: Temasek Holdings and Government of Singapore Investment Corporation. In a 2013 essay entitled “Sovereign Wealth Funds as Tools of National Strategy: Singapore’s Approach”, Devadas Krishnadas outlined how Singapore has used SWFs to further its political, military, diplomatic and economic interests globally. One interesting aspect, he pointed out, is that Singapore has been consistently voted the best country to do business largely because of its incomes from SWFs. This has allowed the country to charge ridiculously low rates for personal income tax at 7%, corporate tax at 7% and VAT at 7%. That is strategic thinking.

I am always amazed when Nigerians argue against savings and investment. As a kid, my grandma taught me to save for the future. She gave me a piggy bank. My pastor has consistently taught me not to spend all my income. If you earn even N10, try to save or invest 10k, he says. Nigerians like to drool over Ghana a lot. Ghana that discovered crude oil only recently has set up its own SWF called Ghana Petroleum Funds. Countries that are poorer than Nigeria have. Countries that are richer than Nigeria have. The less developed and the developed countries have. We have to build infrastructure, unquestionably, but modern economic practices mean we can even build bridges and roads without spending a kobo! It is called PPP globally.

I agree that the constitution does not envisage a situation where we would need to save. The framers of the constitution say all federally collected revenue must go into the consolidated federation account and thereafter shared by the three tiers of government. This has provided the basis for people to argue that savings and investments are unconstitutional, even when common sense and global practices show that there is an economic logic behind it. The compromise we could reach, to satisfy the desires of those who say there should be no federal savings, is that each state should save and invest on its own. Governor Rotimi Amaechi of Rivers has done very well in that regards.

My conclusion: SWF does not hurt. It can serve economic, political and diplomatic interests. The benefits will not be that obvious today. When Kuwait set up its fund in 1953, it could never have imagined that it would be worth $410 billion today. Neither did Norway, which set up the Government Pension Fund in 1990 and it is today worth $893 billion. Some food for thought, that.

CREDIT: ThisDay

Dear Friends,

Our attention has been drawn to the existence of numerous fake Facebook Accounts and Pages created in the name of the Coordinating Minister for the Economy and Honourable Minister of Finance, Dr. Mrs. Ngozi Okonjo-Iweala. These accounts were created by unscrupulous persons with the intention of misleading and/or defrauding innocent people.

They have been reported to Facebook for appropriate action. But, in the meantime, please see a list of some of them below:

1. https://www.facebook.com/ngoziokonjo.iweala.9231
2. https://www.facebook.com/profile.php?id=100006208817864
3. https://www.facebook.com/ngozi.okonjoiweala.7543
4. https://www.facebook.com/hajiamaryam.abacha.7
5. https://www.facebook.com/ngoziokonjo.iweala.90
6. https://www.facebook.com/ngoziokonjo.iweala.10
7. https://www.facebook.com/profile.php?id=100004399814711
8. https://www.facebook.com/ngoziokonjo.iweala.777
9. https://www.facebook.com/iweala.ngozi.3
10. https://www.facebook.com/ngoziokonjo.iweala.507
11. https://www.facebook.com/ngozi.okonjoiweala.39
12. https://www.facebook.com/profile.php?id=100004692048445
13. https://www.facebook.com/ngoziiweala.okonjo
14. https://www.facebook.com/ngozi.okonjoiweala.562
15. https://www.facebook.com/ngoziokonjo.iweala.946
16. https://www.facebook.com/ngozi.okonjoiweala.52
17. https://www.facebook.com/profile.php?id=100005675686073
18. https://www.facebook.com/ngozi.okonjo.501
19. https://www.facebook.com/profile.php?id=100007309575919
20. https://www.facebook.com/ngozi.okonjoiweala.357
21. https://www.facebook.com/profile.php?id=100008369793857
22. https://www.facebook.com/ngozi.okonjoiweala.102
23. https://www.facebook.com/ngozi.okonjoiweala.33
24. https://www.facebook.com/ngoziokonjo.iweala.16
25. https://www.facebook.com/Okonjo.ngozi
26. https://www.facebook.com/ngoziokonjo.iweala.399
27. https://www.facebook.com/profile.php?id=100006553518208&ref=br_rs
28. https://www.facebook.com/ngozi.iweala.56
29. https://www.facebook.com/profile.php?id=100005230576408
30. https://www.facebook.com/DrNgoziOkonjoIwealaForPresident2015
31. https://www.facebook.com/pages/Ngozi-okonjo-iweala/353428051338389
32. https://www.facebook.com/ngoziokonjo.iweala.750
33. https://www.facebook.com/ngoziokonjo.iweala.399
34. https://www.facebook.com/profile.php?id=100005611184862
35. https://www.facebook.com/ngoziiweala.ikeambaokonjo
36. https://www.facebook.com/profile.php?id=100008407085069
37. https://www.facebook.com/oge.okoye.731
38. https://www.facebook.com/ngozi.okonjo.94
39. https://www.facebook.com/ngozi.okonjo.566
40. https://www.facebook.com/ngozi.okonjoiweala.505
41. https://www.facebook.com/ngoziokonjo.iweala.56
42. https://www.facebook.com/profile.php?id=100006129047198
43. https://www.facebook.com/profile.php?id=100004965404845
44. https://www.facebook.com/ngozi.okonjoiweala.395
45. https://www.facebook.com/ngoziokonjo.iweala.12
46. https://www.facebook.com/okonjoiweala.ngozi.7
47. https://www.facebook.com/ngozi.okonjoiweala.942
48. https://www.facebook.com/ngoziokonjo.iweala.5815
49. https://www.facebook.com/ngoziokonjo.iweala.963
50. https://www.facebook.com/ngoziokonjo.iweala.94
51. https://www.facebook.com/terry.gee.94043?ref=br_rs
52. https://www.facebook.com/profile.php?id=100005298287386
53. https://www.facebook.com/ngozi.o.iweala
54. https://www.facebook.com/ngozi.okonjoiweala.948
55. https://www.facebook.com/profile.php?id=100008192448969
56. https://www.facebook.com/profile.php?id=100007384741212
57. https://www.facebook.com/ngozi.okonjoiweala.923
58. https://www.facebook.com/profile.php?id=100008024296189
59. https://www.facebook.com/profile.php?id=100005288740284
60. https://www.facebook.com/profile.php?id=100007379478076
61. https://www.facebook.com/ngoziokonjo.iweala.9
62. https://www.facebook.com/ngoziokonjo.iweala.5621
63. https://www.facebook.com/ngozi.okonjoiweala.7528
64. https://www.facebook.com/ngoziokonjo.iweala.142
65. https://www.facebook.com/ngoziokonjo.iweala.754
66. https://www.facebook.com/ngoziokonjo.iweala.3538
67. https://www.facebook.com/profile.php?id=100007006727396
68. https://www.facebook.com/profile.php?id=100004815427650
69. https://www.facebook.com/profile.php?id=100006201227192
70. https://www.facebook.com/ngozi.okonjoiweala.184
71. https://www.facebook.com/ngozi.okonjoiweala.165https://www.facebook.com/ngozi.okonjoiweala.165
72. https://www.facebook.com/profile.php?id=100004823117510&ref=br_rs
73. https://www.facebook.com/profile.php?id=100008101874632&ref=br_rs
74. https://www.facebook.com/profile.php?id=100004693607666&ref=br_rs
75. https://www.facebook.com/ngozi.okonjoiweala.79?ref=br_rs
76. https://www.facebook.com/profile.php?id=100007329765078&ref=br_rs
77. https://www.facebook.com/profile.php?id=100006400785127&ref=br_rs
78. https://www.facebook.com/ngozi.lweala?ref=br_rs
79. https://www.facebook.com/profile.php?id=100006292547160&ref=br_rs
80. https://www.facebook.com/profile.php?id=100005640914657&ref=br_rs
81. https://www.facebook.com/ngozi.okonjoiweala.98?ref=br_rs
82. https://www.facebook.com/ngozi.okonjoiweala.524?ref=br_rs
83. https://www.facebook.com/profile.php?id=100005919167093&ref=br_rs
84. https://www.facebook.com/ngozi.okonjoiweala.96?ref=br_rs
85. https://www.facebook.com/drngozi.okonjoiweala.7?ref=br_rs
86. https://www.facebook.com/ngozi.okonjoiweala.104?ref=br_rs
87. https://www.facebook.com/profile.php?id=100004927399261&ref=br_rs
88. https://www.facebook.com/ngozookonjo.iweala?ref=br_rs
89. https://www.facebook.com/profile.php?id=100007956198292&ref=br_rs
90. https://www./99671154688/
91. https://www.facebook.com/profile.php?id=100006066466742&ref=br_rs
92. https://www.facebook.com/profile.php?id=100008405553088&ref=br_rs
93. https://www.facebook.com/profile.php?id=100007343597143&ref=br_rs
94. https://www.facebook.com/victor.gift.927?ref=br_rs
95. https://www.facebook.com/ngozi.okonjoiweala.75?ref=br_rs
96. https://www.facebook.com/ngozi.okonjoiweala.92?ref=br_rs
97. https://www.facebook.com/profile.php?id=100007251047138&ref=br_rs
98. https://www.facebook.com/profile.php?id=100008142227162&ref=br_rs
99. https://www.facebook.com/profile.php?id=100006992057127&ref=br_rs
100. https://www.facebook.com/ngoziokonjo.iweala.906?ref=br_rs
101. https://www.facebook.com/profile.php?id=100005193436229&ref=br_rs
102. https://www.facebook.com/profile.php?id=100006809385681&ref=br_rs
103. https://www.facebook.com/ngozi.okonjoiweala.549?ref=br_rs
104. https://www.facebook.com/ngozi.okonjoiweala.3367?ref=br_rs
105. https://www.facebook.com/ngozi.okonjoiweala.984?ref=br_rs
106. https://www.facebook.com/ngozi.okonjoiweala.71?ref=br_rs
107. https://www.facebook.com/okonjo.com1?ref=br_rs
108. https://www.facebook.com/ngozi.okonjoiweala.735?ref=br_rs
109. https://www.facebook.com/profile.php?id=100006213735882&ref=br_rs
110. https://www.facebook.com/OkonjIweala?ref=br_rs
111. https://www.facebook.com/ngozi.okonjoiweala.35?ref=br_rs
112. https://www.facebook.com/ngozi.okonjoiweala.1656?ref=br_rs
113. https://www.facebook.com/amarasteven.diomande?ref=br_rs
114. https://www.facebook.com/profile.php?id=100006065626516&ref=br_rs
115. https://www.facebook.com/ngoziokonjoiweala.ngoziokonjoiweala?ref=br_rs
116. https://www.facebook.com/burna.damini?ref=br_rs
117. https://www.facebook.com/ngozi.okonjoiweala.3954?ref=br_rs
118. https://www.facebook.com/profile.php?id=100004127118927&ref=br_rs
119. https://www.facebook.com/profile.php?id=100007104909249&ref=br_rs
120. https://www.facebook.com/ngozi.okonjoiweala.56232?ref=br_rs
121. https://www.facebook.com/profile.php?id=100008275995657&ref=br_rs
122. https://www.facebook.com/david.arriyo?ref=br_rs
123. https://www.facebook.com/ngozi.okonjoiweala.188?ref=br_rs
124. https://www.facebook.com/ngozi.okonjoiweala.336?ref=br_rs

TEMITOPE OSHIKOYA: THE LIES OF A DISAPPOINTED MAN

By Paul C Nwabuikwu

It is a shame that someone with the credentials of Dr Temitope Oshikoya would display the kind of dishonesty and moral turpitude present in his article, “Golden Girl and the Icarus Paradox” published in The Guardian of Monday, September 8, 2014. The article is a commentary on the ongoing recruitment process for CEO of the Nigerian Mortgage Refinance Company (NMRC).

For the sake of transparency, Dr Oshikoya should have let the world know that he was a candidate for this position but unfortunately, he did not make it. The fact that he neglected to mention this is very instructive and demonstrates that he is nothing but a disappointed bitter person who is not man enough to take responsibility for his own performance.

It is quite disheartening when people like Oshikoya, who is expected to know better, impugn efforts to institutionalize a merit-based approach to recruitment for key positions in the country simply because the results did not favour him. Some of us need to learn to put the collective good ahead of individual selfish interest.

The NMRC is, of course, the government sponsored but private-sector driven institution which is central to the Jonathan administration’s plan to make mortgage finance accessible to Nigerians. The launch of the first 10,000 mortgages scheme on July 31 underscores the government’s commitment to the realization of this objective.

The interview for CEO of NMRC which Dr Oshikoya participated in was part of a transparent process managed by the globally respected consulting firm, Deloitte and Touche. The firm shortlisted ten Nigerians from within and outside the country in a global headhunt which met the standards of international best practice. The interview panel included Managing Director of Stanbic IBTC Bank, Mrs Sola David Borha; interim CEO of NMRC, Mr Sunny Ayere; CEO, Nigerian Sovereign Investment Authority, Mr Uche Orji; CEO of Aso Savings and Loans Plc, Alhaji Hassan Usman; and representatives of the World Bank, International Finance Corporation and DFID. In the end, Dr Oshikoya did not make the short list of the final three candidates who are being proposed to be interviewed by the Board of the NMRC.

It is understandable to feel disappointed in this kind of circumstance. What is not understandable – or justifiable – is to write an article full of vicious falsehoods and distortions against the chair of the interview panel who, for reasons best known to Oshikoya, he erroneously blames for his poor performance. The unwarranted attack against the Coordinating Minister for the Economy and Minister of Finance by Oshikoya is nothing but a despicable effort by a person who obviously has an inflated opinion of himself to channel personal frustration against a false object of disappointment.

Oshikoya’s long winded article is full of allegations which are as false as they are laughable. For instance, he shamelessly repeats the unfounded story that Okonjo-Iweala appointed Igbos to head agencies in the financial sector. But this is totally untrue as it is a verifiable fact that the heads of the Securities and Exchange Commission, AMCON, Nigeria Stock Exchange and others were already in office before Okonjo-Iweala returned to government in August 2011. It is also a fact that Mr Uche Orji, the CEO of the Nigerian Sovereign Investment Authority emerged through a competitive and transparent process supervised by the reputable international consulting firm KPMG and in which the respected Mr Fola Adeola headed the nominations committee.

It is indeed sad that Dr Oshikoya would, by implication, impugn the integrity of Mr Kunle Elebute, Managing Partner of KPMG who supervised the process of hiring the top management team of the NSIA, Mr Dotun Philips, head of Philips Consulting who supervised the FIRS version and Mr Joseph Olofinsola of Deloitte and Touche who oversaw the NMRC process which inspired his article.

In his haste to tar the Minister, Oshikoya neglected to do even the most basic homework. He obviously does not know that the DG of BPE, Mr Benjamin Dikki, one of the “Igbos” whom Oshikoya identified as the Coordinating Minister’s appointee is from Kebbi State not Okonjo-Iweala’s so-called “geo-ethnic circles” (sic)! Of course, Dr Bright Okogu, the DG Budget Office who is also mentioned is Urhobo from Delta State. He carefully does not mention Dr Mansur Muhtar, Nigeria’s most senior representative at the World Bank and Dr Shehu Yahaya, Executive Director at the African Development Bank as well as other qualified persons whose nominations were supported by Dr Okonjo-Iweala. To a mind warped by disappointment and bitterness, the truth is dispensable.

It is beneath contempt for Oshikoya to resurrect old lies about Okonjo-Iweala’s alleged role in the failed bid of Mr Bisi Ogunjobi to be elected President of the African Development Bank ten years ago. The final outcome had little to do with Dr Okonjo-Iweala who campaigned vigorously for him once he was nominated as Nigeria’s candidate. The truth is that Mr Ogunjobi performed creditably in a competitive process in which all ministers of finance in Africa interviewed candidates but did not emerge the winner. The notion that Okonjo-Iweala could have singlehandedly swung the vote in Mr Ogunjobi’s favour but refused to do so is fanciful nonsense.

It is even more despicable for Oshikoya to try and set Dr Okonjo-Iweala up to take the blame, ahead of time, should Nigeria’s candidate for the presidency of the African Development Bank this time around fail to make it. It is clear in his appalling write up that Oshikoya is an ethnic bigot carrying out an agenda that is designed to target Dr Okonjo-Iweala. I am sure that Nigeria’s candidate for the AfDB presidency, Dr Akin Adesina, given his background and profile, will be keen to dissociate himself from this unscrupulous attempt to sully his reputation and his serious bid for the presidency of AfDB. I know that, unlike Oshikoya, Dr Adesina is perfectly capable of taking responsibility for his performance, good or bad, when the time comes.

Oshikoya’s comments on Okonjo-Iweala’s historic and widely applauded run for the presidency of the World Bank is the final nail in the coffin of an article that trivializes fact and assaults common sense. Apparently, Temitope Oshikoya, Phd, was asleep when a respected rival, Dr Ocampo stepped down for Okonjo-Iweala during the race and the leading lights and respected voices in the world’s premier institutions and media declared her the better candidate to run the institution.

And he must have been oblivious when the world criticized the post Second World War tradition which made the position a monopoly of the US and which was used to stop Okonjo-Iweala from becoming the first non-American to head the institution. Of course he also conveniently forgot that African Presidents who recommended her and President Goodluck Ebele Jonathan who graciously put her forward were major reasons for her decision to participate. There is no substance in the charge of hubris which Oshikoya lays against Okonjo-Iweala. Obviously for a pseudo-intellectual with an ax to grind there are no limits to the sheer variety of lies that can be deployed in the service of an unholy cause.

Rather than pollute public discourse with an opinion piece riddled with lies and bitterness, Temitope Oshikoya should accept that he simply did not do well in his recent quest to head a key emerging institution and get on with whatever is left of his life. He should step up his game at his next job interview. We wish him good luck.

Nwabuikwu is Special Adviser Media and Communication to the Coordinating Minister for the Economy and Minister of Finance

FEDERAL MINISTRY OF FINANCE
News Release. September 2, 2014

OKONJO-IWEALA, NASS TEAM ENGAGE DIASPORA ON ECONOMIC DEVELOPMENT

In response to the long-standing desire of the Nigerian diaspora to support economic development in the country, a high level Executive-Legislative team is currently holding a series of interactive sessions with Nigerians in Europe and the United States. The sessions are organized by the Debt Management Office, led by its Director-General, Dr. Abraham Nwankwo.

The delegation is headed by the Coordinating Minister for the Economy and Minister of Finance, Dr Ngozi Okonjo-Iweala and includes key members of relevant committees in the National Assembly. The members of the National Assembly are: Senator Ahmed Makarfi Chairman, Senate Committee on Finance, Senator E. Uzamere, Chairman, Senate Committee on Local and Foreign Debts, Senator Ita Enang, Chairman, Senate Committee on Appropriation, Honourable Adeyinka Ajayi, Chairman, House Committee on Aid, Loans and Debt Management, Honourable Famurewa Ajibola Israel, House Committee on Diaspora, Honourable Abdulrahman Terab, House Committee on Finance and Honourable Emmanuel David Ombugadu, House Committee on Appropriation.

It will be recalled that Nigerians in the Diaspora have been seeking ways and means to contribute more to the country’s development. This interest is backed by substantial capacity: the value of remittances from Nigerians abroad in 2013 was $20.77 billion; for the first half of 2014 it is $10.40 billion. This includes contributions through remittances to their families, friends and communities, medical missions and provision of scholarships.

Indeed, the experience of countries such as Israel and India shows that the Diaspora are a force to be reckoned with in the growth and development of any country, through the funding of critical development projects, among other means. The current effort is directed at providing the Nigerian Diaspora similar opportunities.

The Meetings which started yesterday in London, will continue in New York, Washington DC and Houston between September 2-4, 2014. The London meeting hosted by the Nigerian Ambassador to the United Kingdom, H.E. Dr. Dalhatu Sarki Tafida, was attended by over 140 invited Nigerian professionals. The meeting provided an avenue for the CME and the other members of the team to update Nigerians in the Diaspora on the developments in the Nigerian economy, the major achievements of the Transformation Agenda under the Administration of His Excellency, President Goodluck E. Jonathan and the opportunities available in Nigeria for Diaspora Nigerians.

Nigerians were also reassured of the developments in Nigeria with respect to the Ebola Virus Disease and the Government’s management of the situation. Participants expressed concern about the security situation and urged the government to do more particularly with respect to the return of the Chibok girls. Participants also showed a lot of interest in contributing to development with investments in infrastructure, SMEs and in the housing sector.

It is expected that through these Sessions, Nigerians in Diaspora will be better informed about developments in the country and be encouraged to contribute in various ways to the development of the economy and nation-building in general.

Paul C Nwabuikwu
Special Adviser to the Coordinating Minister for the Economy and Minister of Finance

I would like to commend the Nigerian health care professionals who have put their lives on the line to precent the spread of Ebola in Nigeria.

Their spirit and determination are embodied in the heroic self sacrifice of two women Dr Stella Adadevoh and Nurse Ejelonu who put the wellbeing of all Nigerians ahead of their own when they treated Nigeria's first case of Ebola and worked to prevent its spread.

My thoughts are with their families and loved ones as we mourn their passing and celebrate their courage. May they stand as an example to all Nigerians.

My condolences also to the families of other victims of Ebola. May the Almighty comfort and grant them strength at this difficult time.

FEDERAL MINISTRY OF FINANCE

REJOINDER. August 2, 2014

ALLEGED LOSS OF N1 BILLION ON CAR IMPORTS: DAILY TRUST’S STORY IS COMPLETELY FALSE AND MISLEADING

Our attention has been drawn to an erroneous story in the Daily Trust Newspaper of Friday, August 1, 2014 titled “World Economic Forum on Africa: Federal Government Loses N1 Billion on Import of 290 Cars”. The story demonstrates ignorance both of Nigerian government policy and standard universal practice in the management of waivers. To expect beneficiaries of government waivers to return the goods for which the waivers were issued, as Daily Trust proposes in its story, demonstrates a misunderstanding of elementary facts and logic.

In the said article, the newspaper claimed that the Federal Government lost N1 billion in respect of a duty waiver granted to import 290 cars for the World Economic Forum on Africa (WEFA) held in Abuja in May, 2014. As already stated, it then tried to make an issue of the fact that the cars were kept by the company after the event. This is clearly another example of poor journalism and an attempt by Daily Trust and embittered interest groups to cause mischief.

For the benefit of the public, the facts of the matter are as follows:

i. Government granted import duty waiver to Messrs Globe Motors for importation of vehicles for the WEFA in May 2014, following a formal request by the Federal Capital Territory Administration, the hosting city for the event;

ii. The company that used its own money to import the vehicles naturally gets to keep its goods after deploying them to service the event. Government does not purchase such vehicles but only grants duty waivers on them in return for the services provided by the importing company. To expect the company to give the vehicles to government after the event is preposterous, to say the least. And Daily Trust trying to make an issue out of this clearly shows an embarrassing lack of understanding of what the process entails.

iii Waivers are granted to serve as encouragement to the company providing the transportation services for visiting delegates. The service provided to government is the value which the country gets from granting the incentive. This is the way it has worked for similar events organised by other State governments such as Lagos, Rivers, Delta, etc, that have benefitted from the scheme in the past. The rationale for this approach is that the Nigerian private sector has not yet developed a viable car leasing industry.

The newspaper further claimed that Nigeria lost N1.4 trillion to waivers in the last 3 years. Here again, the correct position is that waivers worth a total of N170 Billion were granted to a variety of sectors to assist their development, including Power, Agriculture, etc. This is a common instrument that countries use as part of their industrial development strategy.

Decent journalism requires at least a minimum ethical standard of reportage. This one does not. We cannot stop Daily Trust from reflexively attacking government but it should, in the interest of journalism ethics and its readers, do its homework.

Paul C Nwabuikwu
Special Adviser to the Coordinating Minister of Finance and Minister of Finance

https://www.youtube.com/watch?v=-UMI9-6gmzE