₦airaland Forum

oluwashaddow: 24. You will agree that inasmuch as the interest
rate regime is critical to the real sector borrowing
decisions, most principal factor in making
borrowing decisions is the business’s expected
rate of return on investing borrowed money? The
question, without efforts to protect local
businesses from their foreign counterparts, the
high cost of doing business in Nigeria, puts them
at such a disadvantaged position that it makes
no economic sense borrowing to invest in their
local businesses, why should we expect private
sector firms to be investing in the economy?

This question should be for the CBN governor and not the minister. The cost of borrowing is directly impacted by interest rates and inflation which the CBN manages autonomously without recourse to the Finance Minister.


26. Do you agree that the Excess Crude Account
as being operated by government is illegal and
unconstitutional, especially given how it has been
managed?

Dumb question? Why should her opinion matter on this? Is she the AGF or the Supreme Court? Ask the attorney general of the federation of the legality of the ECA. Not the Finance Minister.

30. Do you believe in the fight against corruption?
If you do why has EFCC not been proper funded?
Without properly funding the commission, how
should it be expected to carry out its duties
effectively?

Ridiculous question! They should also ask themselves. Don't they review and pass every budget?

oluwashaddow: 6. Since facts don’t lie, have you any
disagreements with the September 4, 2013 Global
Competitiveness Report of the World Economic
Forum for 2013-2014, which ranked Nigeria 120th
out of 148 countries ranked in the Global
Competitiveness Index, including being ranked far
behind some African countries such as Mauritius
45th, South Africa 53rd, and Kenya 96th?

Dumb question! What facts? They should rather mention the criteria used in the report as a basis for their questions. Anyone can write report using whatever criteria that suits their purpose.

7. ”For the first time in Nigeria’s 53rd year
history, we have successfully privatized the
electric power industry,’’ so said the President at
a recent meeting in London with some foreign
investors. As minister of finance should you agree
that the recent privatization of the country’s
power infrastructure is worth celebrating as a
major economic achievement in 2013, when in
reality there is little or nothing to show as an
improvement in the country power supply? Also
why our rush to wholesale privatization of the
power sector when countries like South Africa,
generating as high as 42,000MW still have their
power sector mostly in public hands?

Rush to wholesale privatization? Another dumb question. Where were these dishonourables all these years? We started this process more than 10 years ago and that is a rush? We didn't fare well with government holding the major stake in the power sector. How else should the problem be resolved if not by privatization, selling to those who know the business and who can keep it alive. Is South Africa the same as Nigeria? Why not make example of the United States where provision of power is completely private sector driven?


14. Your references to the country’s economic
growth profile have always been based on Fitch,
Standard and Poor’s, and Moody’s ratings. Are
you aware that these same rating agencies are
being sued in New York (with case #
652410/2013) by two Bear Stearns hedge funds
for fraudulently assigning inflated ratings to
securities in the run-up to the 2008 financial
crisis? If you do, why do you insist on accepting
the rating as reliable.

Another dumb question. Those are the best three credit rating agencies in the world at present. The fact that they are being sued does not make them culpable until the courts deliver judgment on the suits. Besides, their services expose them to legal risk as this, so it is expected that some people or organizations will question the reliability of their reports. How else should we appraise our growth potentials? Do the honourables have better alternatives?


19. Who determines the investment objective and
who establishes the risk parameter for the NSIA’s
portfolio? In providing answer to this question, it
is also important to understand and explain why
NSIA recently hired a Swiss national as its chief
portfolio investor? Answering this question is
important since it should help us to know who
determines the maximum draw-down that the
government would be comfortable with in
extremely negative market environments.

Simply request and read the charter establishing the SWF and the agency administering it. That is when they would have done their oversight functions. Lazy question!

4 Play: I find this interesting as it implies that external debt is superior to internal debt, that is to say, that it is better that the Nigerian Govt owes money denominated in foreign currency to foreign creditors than owe money denominated in Naira to domestic creditors.

The pitfalls of external debts should be obvious. It was external debt that birthed SAP and culminated in the erosion of living standards in the 80s which is unprecedented in the country's history. The main problem with external debt is the exchange rate risk as follows:

Supposing you borrow $10bn in 2007, assuming an exchange rate of N100 to $1, giving a debt of N1 trillion when converted to Naira. If exchange rates move against you, say it now takes N160 to buy $1, you suddenly have a debt of 1.6 trillion Naira. Many underestimate how exchange rates can deteriorate quickly. In the 70s to the 80s and I stand to be corrected, we went from 60 Kobo to $1 to in excess 2 Naira to $1 pretty rapidly, that would amount to a multiplication of the debt burden by more than a factor of 3. The funny thing is that the bigger your external debt burden, the quicker the deterioration in exchange rates because money has to leave the country to service the debt. Imagine what that does to the inflation rate and the living standards of Nigerians as much of what we consume is imported. High inflation brings about high interest rates which dampens the supply of credit to the private sector. The negative spiral is relentless and we have witnessed it before.

The high interest rates the Govt pays when it borrows in Naira is supposed to compensate for the higher rate of inflation in Nigeria but the flip side of high inflation is that the real value of Naira denominated debt is eroded over time than if the debt is denominated in a foreign currency. Remember that in the bond market, if the Govt borrows 100bn Naira for a term of 10 years at yields of 14% per year, it will merely pay the yield per year and redeem or pay back the 100bn Naira at expiration of the 10 year period. 100bn Naira in 2007 and at an inflation rate of 9% per year will mean that in the 10th year, the Govt will pay back the equivalent of 39bn Naira in 2017. In contrast to US dollars which erodes value at a slower rate, the redemption of Naira debt will be a lot cheaper than dollar debt.

So, it's actually likely that from issuance to maturity, an internal bond denominated in Naira is cheaper for the Nigerian Govt than an external bond denominated in US dollars for instance. Almost all sovereign debt crisis occurs in countries borrowing in currencies that they do not control - Greece, Portugal, Spain, Zimbabwe, Ireland, e.t.c.

External debt is good in the short term but incredibly dangerous in the long term. The talk about borrowing in Naira crowding out local borrowers assumes that there is strong domestic private sector demand. If there is such strong demand, then the economy is doing well and it undercuts the opposition's argument.

Listening to and reading policy debates in Nigeria, it's almost like the 80s never happened. Those who refuse to learn from history are bound to repeat it.

bappahman: PTF was created during the Abacha era under Gen Buhari to utilise the 2 naira added on PMS....
Sure P was created by Goodluck under Kolade to utilise 32 Naira saved from subsidy payments
So which of the 2 programs have helped nigeria and Nigerians more?

bokohalal: Balewa and Ciroma are not Fulanis.

Adejoro74: https://www.youtube.com/watch?feature=player_embedded&v=jxNTHrMRdKg

I understood the Gov's anger and why he abused the woman, but watch the video and judge him without bias

Caveat: I am not PDP, APGA or APC but I hate APC because of their hypocrisy. In this case, Oshiomhole has shown a difference from Fasola/Tinubu

karfe: I guess its because it is so difficult to separate them that other Nigerians refer to them as Hausa-Fulani

For people like SLS, isn't there likely to be some Hausa blood in their veins?

I am not so sure Balewa was Hausa

Ogbeche77: For this calamity to end, I think the people of Akure should do the right thing, recall the previous Deji of Akure that was dethroned.. If one Oba isn't dead another one shouldn't be ascend the throne . It a tradition, any attempt to float this leads to premature death and further calamities in the land... The people of Owo tried it and failed....

pandriod: Your in-laws? If Amaechi is finished as they said, then why is he removing Nsirim from chairmanship of Obio /Akpor without anyone raising eyebrow? Do you by any chance know who is OCC, the father of Nsirim? I bet you don't!!!

pandriod: You are not a novice, but ignorant. Why should I be debating with you? You don't know anything about rivers politics. By the way, do you know that almost everybody is moving to APC with amaechi? I bet you don't know. All PDP members i.e. G.U Ake's faction, All house of assembly members excluding 5 anti amaechi lawmakers, all house of representative members, all senators, all LG chairmen, all councilors, all commissioners?


If amaechi is not in control, why is everybody moving with him to APC? I thought most of you guys said he is on his own?

nairaarea: HE HAS CONSTITUTIONAL RIGHT SIR

jmaine: Guess you don't really know which part of the divide X-factoria is .

He is anti APC.

dayokanu: ^^ You really dont know much about these north, We love to deceive ourselves about the divide in the North

The truth is most of the political power belong to the Moslems in the North Kaduana, Nasarawa, Gombe Adamawa (Boni Haruna a xtian only became governor because the elected governor Atiku moved onto higher tings

Go to Kaduna where Ishaya Balat thought he would succeed Makarfi and see how he was rigged out till date in these states you mentioned they havent had a Xtian governor

dayokanu: Yuguda governor of Bauchi won governorship under ANPP and later decamped to the PDP and nothing happened

Tinubu won election under AD later he moved to AC yet nothing happened

alaoeri: GEJ is too clueless for what u stated beside its too late, he took the Northerners for a ride now they are in for it, we keep saying this GEJ is surrounded by bunch of sycophants & praise singers (bad advisers). Believe Aboki 'll always be Aboki the little ppl that still support him from the North 'll soon switch allegiance. In Nigerian politics don't fvck with the North because they control it that's the reality.

bolayei: Idoh bale ni mo wa o baba....those who have ears let them hear and those who can read let them read this and pass the message on.

This elder was 32 years old in 1960 that alone means he know what he is saying.

Nigeria is a mixture of the unmixable, different nationalities (yoruba,hausa,igbo,ijaw etc) forcefully algamated in 1914, remember baba was born probably 14 years after that. Nationality is used to describe someone from a nation and a nation can be a country,saying that, every part of nigeria now, that is speaking yoruba or any language similar to yoruba is meant to belong to yoruba nation, same for other languages too.

This entity called nigeria is not working and we can all see and feel it. if we go back to regional government there wont be tribal sentiments, if anything it will be within tribes and that is easy to sort out amongst themselves and every region live within their means.

Polio: STFU..... I dont know any main political party that does not get involved in rigging in Nigeria.

Whichever party wins is usually the party which rigs best .... I cant remember when elections were free, fair and credible in Nigeria!

Or do you?!

Manchidede: Election Scandal: ballot box snatching in Anambra Poll as Two gets Shot.

According to reports from TheNationOnline, two people have reportedly been shot in Amaenyi, Awka South Local Government Area while allegedly attempting to snatch ballot boxes.

Details on the shooting Comming Soon.....
Source: http://..com/2013/11/election-scandal-ballot-box-snatching.html

pontirock: Rigin tins