The Central Bank of Nigeria (CBN), has risen to safeguard the interest of customers seeking to purchase foreign exchange for personal obligations and checkmate any attempt at causing panic in the market.
It has, as result, released the sum of $100 million into the Nigerian Forex market, aimed at accommodating the spike in the seasonal demand for foreign exchange to meet various personal obligations, particularly pilgrimage.
The release, which was made today, Thursday, came barely 24 hours after the Bank injected $210 million into the wholesale segment of the market.
Information reaching us said that the apex bank is planning to inject more United States Dollars into the foreign exchange market in the coming days, to checkmate any attempt to trigger artificial scarcity of the greenback.
The Bank’s Acting Director in the Corporate Communications Department, Isaac Okorafor confirmed that the various moves were meant to protect customers from the activities of speculators who might want to capitalize on the increase in demand for foreign exchange at this time to make brisk gains.
He said that the CBN had sufficient foreign exchange to meet genuine needs, even as he cautioned dealers against speculation.
He stressed that the speculators could lose much if they chose to hoard currencies in anticipation of a spike and depreciation in the value of the naira.
It will be recalled that the CBN on Wednesday, expressed displeasure at the action of some banks that reportedly refused to sell forex to customers requiring the currency for the purpose of pilgrimage or Personal and Business Travel Allowance.
A female cleaner at the Murtala Muhammed International Airport (MMIA), Ikeja, Lagos State, Charity Bassey, has found the sum of $6,000 and promptly taken it to security officials at the terminal.
The cleaner who is an employee of Lakewood Development Company, was on duty at the departure wing of the airport when she picked up the item from the floor.
She recalled that she was standing in front of the toilet when a passenger drew her attention to something inside the toilet.
“I went in and saw the small black nylon on the floor. It looked dirty and rough, you won’t know it is money that was inside it”, Guardian quoted her as saying.
“I picked it, felt some notes inside and took it to the customer care. I was given a glove to bring out the contents and I counted 60 pieces of $100 dollar bills.
“I do my best to do a good job with clear conscience. This is not the first time I am picking up forgotten items like wallets, phones, small bags and even money. I have always returned them to the frontline desk or customer care desk”.
In his reaction, Managing Director of the company, Sam Nchezor said: “others would have picked the money and walked away, she can’t be traced to it.
“What could only happen is to indict everybody working there, but we thank her for her honesty, for picking up the money and handing it over to the management of ASL.
“We are going to compensate her, give her some money and also increase her salary. It is left for the management of ASL and Federal Airport Authority of Nigeria (FAAN) to reward her. We are proud of her.” [myad]
The Federal Government, states and local governments have shared N701 billion as revenue for the month of April. Details showed that N276.53 billion was allocated to Federal Government, N140.2 billion to states and N108.1 billion was allocated to local governments.
According to the Permanent Secretary in the Ministry of Finance, Mahmoud Isa-Dutse the amounts shared were the outcome of Federal Account Allocation Committee (FAAC) meeting held today, Wednesday.
The Permanent Secretary, who briefed newsmen today, Wednesday, said that mineral revenue increased by N50.7 billion from N360.51 billion in March to N411.2 billion in April. He added that non-mineral revenue also increased by N81.25 billion, from N120 billion in March to N201.3 billion in April.
According to him, Value Added Tax (VAT) collected increased from N80.35 billion in March to N83.4 billion in April.
“Gross statutory revenue of N613 billion received for the month was higher than the N480.59 billion received in previous month by N132.45 billion.
“Crude oil sales volume increased by 64 per cent, compared with 7.72 million barrels from the previous month, resulting in increased revenue from the Federation Crude Oil Export Sales by 226.90 million dollars.
“Also, average crude oil price increased from 65.7 dollars to 66.78 dollars per barrel.
“Performance for the month in review would have been better but for a few production shut-ins and shut-downs at various terminals for repairs and maintenance.”
Isa-Dutse said that the federal, states and local government decided to save some of the month’s revenue for rainy day in view of the significant increase in revenues.
The permanent secretary said that N24.5 billion would be converted and added into the dollars denominated Excess Crude Account, adding: “based on increased revenue for the month and after due consultation, it has been decided that we will take out N24.5 billion and credit it into the Excess Crude Account.
“This brings the Excess Crude Oil Account balance to 1.11 billion dollars and the Excess Petroleum Profit Tax Account is 0.133 billion dollars.”
On the issue of reconciliation of accounts with Nigerian National Petroleum Corporation (NNPC), Isa-Dutse said it was ongoing.
He explained that reconciliation of monies collected by revenue generating agencies was also ongoing.
Nigeria is currently operating on a revenue allocation formula of; Federal Government — 52.68 per cent, State Governments — 26.72 per cent and Local Governments — 20.60 per cent.
Also, 13 per cent of the oil and gas federally collected revenue is given to oil producing states and communities as derivation revenue to compensate for ecological risks of oil production.
This formula was designed during the President Olusegun Obasanjo Administration.
However in 2015, the RMAFC saw the need to review the formula for balanced development of the country, hence it embarked on nationwide sensitisation tour to the 36 states of the federation to campaign for review.
The Civil Rights Groups (CRG) in Nigeria have asked the federal government to kick out Amnesty International from Nigeria over what they called ‘its plan to destabilize the country.’
The Civil Rights Groups which led over 1,000 people to protest against the body at its Abuja office today, Wednesday, alleged that Amnesty International is about to release a report with which it plans to totally destabilize Nigeria.
The leader of the Rights Group, Comrade Danesi Momoh, said: “the false report will among other things, claim that government troops and Civilian JTF routinely detain, rape, starve and kill women as well as minors. It claims that “Instead of receiving protection from the authorities, women and girls have been forced to succumb to rape in order to avoid starvation or hunger.”
“Several patriotic groups had only recently raised alarm that UNICEF is coordinating other international NGOs for evidence shopping as part of a major shift to start accusing the Federal Government and the military of sexual violence. This plot was being executed by UNICEF staff in conjunction with others under a purpose vehicle, Protection From Sexual Exploitation and Abuse (PSEA) Nigeria, with the mandate to tarnish authorities with alleged sexual crimes. Amnesty International has simply resumed the assignment it earlier handed over to PSEA and is now calling these agents of instability from PSEA its researchers.
“We are aware that staff of Amnesty International, UNICEF and the other member-organizations of PSEA were given quotas on the number of alleged sexual abuse/sexual exploitation cases to file towards the realization of these lies packaged as a report.
“The decision of Amnesty International to only base its so-called report on 2015-2018 is suspect and confirms that whoever is financing its PSYOP in Nigeria is angry that the tide was turned against their Boko Haram agents since the current political and military leadership took over the helms of affairs in 2015. It is sickening that Amnesty International can now be using its report to praise the dark era when cities as far south as Kogi state were under siege from Boko Haram terrorists.
“In its long-established tradition of compulsive lying, all its interviewees are unanimous. What is playing out here is another Nayira Testimony of Amnesty International’s Nayirah al-Ṣabaḥ legacy. It should have by now learnt that there are discerning people that see through these lies even before they are told. We are aware that Amnesty International has learnt since the Nayira saga to obscure the identity of its so call witnesses so that it becomes impossible to verify its claims, which would invariably be found to be lies since that is what its agenda thrives on.
“We like to put our military, intelligence and security agencies on notice that this is a pattern we have become all too familiar with. Whenever Amnesty International issues this kind of report it means it has just concluded paying mobilization to its Boko Haram fighters, recruited new suicide bombers and provided psychotropic drugs and explosives – all geared towards helping the terrorists regroup.
“It will not be surprising if there is a sudden spike in attempted Boko Haram attacks and lot diversionary incidents involving Amnesty International-backed separatist, extremist and militant groups operating in Nigeria. This has been the pattern over the years and we see same repeating in the coming days now that the criminal NGO is releasing its report.
“We therefore warn authorities to be vigilant for this spike in attacks.
“They must also begin to build confidence of the population because the war on terrorism has now spread to become the battle for perception as Amnesty International is intensifying efforts at maligning the country’s security architecture so that people will perceive the military in bad light and stop volunteering information that have been crucial to degrading Boko Haram.
“The Federal Government is hereby reminded that the demand made last year for it to kick Amnesty International out of the country has not been withdrawn. Amnesty International, its staffers and so-called researchers are persona non grata and Nigerians shall not be liable for whatever befalls them as a consequence of trying to emasculate the military as part of larger plot to collapse Nigeria.
“Nigerians are not going to sheepishly step on the conveyor belt of Amnesty International’s destabilization agenda to be like Iraq, Yemen, Libya and other countries where Amnesty International has successfully executed its contract of incapacitating the military through webs of lies spun in the name of upholding human rights.
“The protest march of today is merely a rehearsal. It is the beginning of the occupation of Amnesty International until it gets out of our country. With the tenacity the NGO has shown in its bid to destroy Nigeria, we will not pull back like we did the last time its lies made us to occupy its premises. We have had enough of its destabilizing lies and we say Amnesty International must leave Now!”
During the protest today, angry Nigerians stormed the office of the Amnesty International, virtually bringing its activities to a temporarily end.
This development came barely one week after the Nigerian Army panel of inquiry exonerated the military of colliding with terrorists in the country.
Comrade Danesi Momoh who is the National Convener of the Civil Rights Groups, said that the protest march today, Wednesday, was merely a rehearsal, insisting that the International agency must quit Nigeria if it fails to stop such false information.
The Deputy Governor of Bauchi State, Nuhu Gidado, has resigned.
According Channels Television’s report today, Gidado submitted his resignation letter to Governor Mohammed Abubakar earlier today, Wednesday, citing his waning enthusiasm for the job as reason for leaving.
The Christian Association of Nigeria (CAN) has called on Nigeria and other countries to relocate their embassies from Tel Aviv to Jerusalem.
The CAN President, Samson Ayokunle, who made this call yesterday, Tuesday in Abuja in a statement signed by his spokesperson, Adebayo Oladeji, said that the relocation of the capital to Jerusalem should be a “Special Anniversary Present from the God of the Patriarchs.”
Ayokunle commended the Israeli government on the 70th anniversary of their country, adding: “it is our prayers that other countries, including Nigeria will relocate their embassies from Tel Aviv to Jerusalem.
“We appreciate the leadership role of the United States in the landmark historic event. We are happy that countries such as the United States of America, Guatemala, Honduras, Romania and Paraguay have relocated their embassies from Tel Aviv.”
According to the CAN President, the declaration made by President Donald Trump on December 6, 2017 was a fulfillment of Biblical prophecy.
Former President Olusegun Obasanjo has responded to President Muhammadu Buhari over his statement that he (Obasanjo) should explain to the nation what he did with N16 billion voted for power sector during his regime.
In a statement responding to Buhari’s accusation, Obasanjo said that records from the National Assembly had exculpated President Obasanjo of any wrong-doing concerning the power sector and has proved the allegations as false, even as he described Buhari as lacking proper understanding of the issue at stake.
Obasanjo therefore challenged the President to set up another enquiry if in doubt and unsatisfied with the EFCC report and that of the Hon. Aminu Tambuwal-led ad-hoc committee.
Part of the statement, issued by Obasanjo’s media aide, Kunle Somorin, goes thus:, said a statement by Kunle Somorin, his media assistant.
It has come to the attention of Chief Olusegun Obasanjo that a statement credited to President Muhammadu Buhari, apparently without correct information and based on ignorance, suggested that $16 billion was wasted on power projects by “a former President”. We believe that the President was re-echoing the unsubstantiated allegation against Chief Obasanjo by his own predecessor but one.
While it is doubtful that a President with proper understanding of the issue would utter such, it should be pointed out that records from the National Assembly had exculpated President Obasanjo of any wrong-doing concerning the power sector and has proved the allegations as false.
For the records, Chief Obasanjo has addressed the issues of the power sector and the allegations against him on many occasions and platforms, including in his widely publicised book, My Watch in which he exhaustively stated the facts and reproduced various reports by both the Economic and Financial Crimes Commission (EFCC), which conducted a clinical investigation into the allegations against Chief Obasanjo, and the Ad-Hoc Committee on the Review of the Recommendations in the Report of the Committee on Power on the Investigation into how the Huge Sums Of Money was Spent on Power Generation, Transmission And Distribution between June 1999 and May 2007 without Commensurate Result.
We recommend that the President and his co-travellers should read Chapters 41, 42, 43 and 47 of My Watch for Chief Obasanjo’s insights and perspectives on the power sector and indeed what transpired when the allegation of $16 billion on power projects was previously made. If he cannot read the three-volume book, he should detail his aides to do so and summarise the chapters in a language that he will easily understand.
In the same statement credited to the President, it was alleged that there was some bragging by Chief Obasanjo over $16 billion spent on power. To inform the uninformed, the so-called $16 billion power expenditure was an allegation against Chief Obasanjo’s administration and not his claim. The President also queried where the power generated is. The answer is simple:
The power is in the seven National Integrated Power Projects and eighteen gas turbines that Chief Obasanjo’s successor who originally made the allegation of $16 billion did not clear from the ports for over a year and the civil works done on the sites. [myad]
The Monetary Policy Committee of the Central Bank of Nigeria (CBN) has given pass mark to the economic performances of the federal government, attributing it to the steady decline in inflation, rebound in oil prices and increase in production level, as well as the continued stability in the foreign exchange market.
In a communiqué issued at the end of its meeting in Abuja today, Tuesday, the Committee referred to the data from the National Bureau of Statistics (NBS), which gave the real Gross Domestic Product (GDP) for Q4 2017 being reversed from 1.92 per cent to 2.11 per cent, while a growth of 1.95 per cent was recorded in the first quarter of 2018, up from a contraction of 0.91 per cent in the corresponding period of 2017.
“The development was due to growth in the oil and non-oil sectors by 14.77 and 0.76 per cent, respectively. The Monetary Policy Committee also noted the sustained positive outlook based on the Manufacturing, and Non-manufacturing Purchasing Managers’ Indices (PMI), which rose for thirteenth and twelfth consecutive months to 56.9 and 57.5 index points, respectively, in April 2018. The Committee welcomed this development but believes that growth remains largely fragile and could benefit from further reforms and stimulus.
“In this regard, the MPC urged the various levels of government to accelerate the settlement of contractor debt and salary arrears as well as facilitate the quick implementation of the 2018 Federal Government budget. “
The full report goes thus:
Background
The Monetary Policy Committee (MPC) met on the 21st and 22ndof May, 2018 against the backdrop of optimistic global growth outlook and sustained recovery in the domestic economy. The Committee examined the performance, risks, vulnerabilities in theglobal and domestic economiesup to May2018, and the outlook for the rest of the year. In attendance were nine members of the Committee.
Global Economic Developments
The momentum of global economic activities remained broadly sustained, with outcomes likely to be shaped by emerging geo-political issues including: easing geo-political tensions on the Korean Peninsula; reduced trade tensions between China and the United States; United States withdrawal from the 2015 Iranian Nuclear Deal; easy financing conditions in the Euro Area, the UK and Japan; as well as difficulties associated with the Brexit negotiations. Accordingly, global output is projected to grow at 3.9 per cent in 2018,up from 3.8 per cent in 2017. Growth in the advanced economies is projected to strengthen to 2.5 per cent in 2018 from 2.3 per cent in 2017 premised on improved investments and consumption spending. Similarly, output growth in the emerging markets and developing economies (EMDEs) is projected to rise marginally at 4.9 per cent in 2018 reflecting improvements from 4.8 per cent in 2017,led by oil exporters, such as Russia, Brazil, and Nigeria. The Committee noted that despite these optimistic developments, the downside risks to global growthinclude: the geo-political tensions in the Middle-East; lingering uncertainties from BREXIT negotiations; and growing trend towards trade protectionism.
Inflation in the advanced economies is projected to rise by 2.0 per cent and would remain subdued relative to the long term trend. In the emerging marketsand developing economies, price developments could surge by 4.6 per cent in 2018. The International Monetary Fund (IMF) forecasts that inflation may rise modestly over the medium to long-term, due to rising asset prices and long-term yields in the major financial markets.
Domestic Output Developments
The Committee noted improvements in the domestic economy, attributable to the steady decline in inflation, rebound in oil prices and increase in production level, as well as the continued stability in the foreign exchange market.
According to
The Committee noted that broad money supply (M2) grew by 2.16 per cent in April 2018 from 1.26 per cent in March 2018, annualised to 6.48 per cent. This was in contrast to the provisional growth benchmark of 10.48 per cent for 2018. The performance of M2 was mainly driven by the growth in Net Domestic Credit (NDC) of 6.24 per cent (annualised to 18.72%), owing largely to net credit to government, which grew by 46.13 per cent (annualised to 138.39%) against the provisional benchmark of 54.97 per cent. Credit to the private sector, however, contracted by 0.16 per cent (annualised to -0.47%) in April 2018, in contrast to the provisional annual benchmark of 5.64 per cent. Net Foreign Assets (NFA) grew by 7.38 per cent in April 2018, annualized to 22.13 per cent, compared with the provisional benchmark of 18.15 per cent. Narrow money (M1), however, contracted by3.31 per cent (annualised to -9.94%), compared with the provisional benchmark of 8.04 per cent.
Inflationary pressures continued to moderate with headline inflation (year-on-year) declining for the fifteenth consecutive month to 12.48 per cent in April 2018 from 13.34 per cent in March 2018. Food and Core inflation also decelerated to 14.80 and 10.92 per cent from 16.08 and 11.18 per cent, respectively,during the same period.
The average inter-bank call rate decreased to 3.34 per cent in April 2018 from 9.49 per cent in December 2017. Similarly, the average Open Buy Back (OBB) rate fell to 2.96 per cent in April 2018 from 8.46 per cent in December 2017. The movement in the net liquidity position and interest rates reflected the combined effects of Open Market Operations (OMO) auctions, foreign exchange interventions and statutory allocation to state and local governments.
The Committee welcomed the sustained improvement in the level of external reserves, which stood at US$47.79 billion onMay18, 2018,compared with US$46.73 billion at the end of March 2018. The Committee urged the Bank to sustain this momentum and continue to boost investor confidence in the economy. The Committee also welcomed the continued rise in the price of crude and called on the Federal Government to seize the opportunity to build fiscal buffers against future oil price shocks.
The All-Share Index (ASI)decreased by 6.6 per cent from 43,330.54 on February 28, 2018 to 40,472.45 on May18, 2018, owing largely to profit taking activities of investors,andcapital reversals in response to monetary policy normalization in some advanced economies particularly, the United States. Similarly, Market Capitalization (MC) fell by 5.7 per cent from N15.55 trillion on February 28, 2018 to N14.66 trillion on May18, 2018. The Committee noted the need to maintain remunerative domestic rates to stem the trend towards huge capital outflow.
The MPCwelcomedthe continued stability in the foreign exchange market,promoted by improved dollar liquidity in the market due to the high level of activity at the Investors’ and Exporters’ (I&E) window, that is equally driving rates towards convergence at all segments of the market.Total foreign exchange inflow through the economy from January to March 2018 stood at US$24.719billion, of which funding from the CBN was US$8.81 billion or 28.5 per cent, while autonomous sources accounted for the larger balance of US$15.91 billion or 71.5 per cent of the total. In addition, the Committee welcomed the US$2.5 billion or RMB 15 billion Currency Swap between the Central Bank of Nigeria (CBN) and the People’s Bank of China (PBoC). This swap, the Committee noted, will ease pressure in the foreign exchange market by the reduction in reliance on a thirdcurrency for trade settlement between Nigeria and China. They further noted that this swap arrangement could be the basis for an expanded and mutually beneficial economic relationship between Nigeria and China.
2.0. The Overall Outlook and Risks
The macroeconomic environment that propelled the economy’s exit from recession has remained positive and is likely to continue in the near-term. Theexpectation was premised on speedy implementation of the 2018 budget, improvedsecurity, continued stability in the foreign exchange market as well as increase in crude oil production and prices. The Committee noted the downside risks to the outlook to include:the lateapproval and implementation of the 2018 budget;farmers-herdsmen conflict; weak demand and consumer spending associated with outstanding salaries and contractor debt; and the growing level of sovereign debt.
The outlook for inflation indicates continued moderation in the price level, even though the risks include huge liquidity injections that is expected to arise from the implementation of the proposed N9.12 trillion 2018FGN budget; expenditure towards the 2019 elections;monthly FAAC injections, approval and implementation of the proposed new national minimum wage,possiblyfinanceby a supplementary budget. These could impact aggregate demand and put pressure on domestic prices in the remaining months of 2018 and may dampen the gains already made by the Bank in stabilizing prices.
Staff forecasts, given the anticipated liquidity injections into the economy, indicates upward trending pressure on domestic prices from the second half of fiscal 2018. Consequently, the Committee advocates an orderly injection of the anticipated liquidity by the fiscal authorities to prevent a negative shock to prices that would derail the positive but fragile recovery so far achieved.
Given the CBN’s interventions, the current level of oil prices and developments in the global economy, we expect rates to remain stable in the foreign exchange market in the near-term. However, the bearish signs in the capital market associated with profit taking activities of investors, call for a careful calibration of policy so as to moderate the trend of capital outflows in an era of monetary policy normalization in the United States. This is given that there are already indications of severe attacks on the foreign exchange markets of some emerging economies.
Nevertheless, there is significant high level of uncertainties that could arise from the fiscal operations of government in the near term. Amongst these are: when the implementation of the 2017 budget will end;dwindling revenue projections; as well as the possibilities of full implementation of the 2018 Federal budget. Consequently, we expect a likely bunching of government spending in view of the late passage of the budget and government’s commitment to honour prior obligations. This could pose a serious challenge to the Bank’s price stability mandate.
Revenue is expected to increase in view of the favourable prices of crude oil and improvements in non-oil revenue, particularly taxes. In addition, production levels have also increased in recent times and this is expected to be maintained. However, the implications of a China-US trade deal on China’s oil imports from Nigeria remain unclear, especially as the US has included energy imports on the list of items for negotiation with China.
3.0. The Considerations of the Committee
The Committee expressed satisfaction on the positive outlook in the domestic economic environment as the real GDP grew for the fourth consecutive quarterby the first quarter of 2018 and the positive trend in the Manufacturing and Non-manufacturing Purchasing Managers’ Indices in the first quarter of 2018.It noted the continueddeceleration in headline inflation as well as stability in the foreign exchange market and therefore,called on the Bank to sustain the momentum in order to further subdue inflation and ensure growth. The Committee expressed satisfaction with the level of activities in the Investors’ and Exporters’ (I&E) window of the foreign exchange market.
The Committee further noted the overall upward growth momentum of the economy with key activity sectors returning positive growth.Despite the improving macroeconomic environment, the Committee noted that disruptions to the supply chains in major food producing states of the country remains a concern asfood prices remained sticky downwards. It also noted the potential adverse effect of the rising global inflation on domestic prices and therefore, urged the Government not to relent on curtailing the security challenges to advance controlling inflation to its historical path.
Members of the Committee were satisfied with the progress made with the implementation of the Economic Recovery and Growth Plan,but were concerned on the effect of delay in the passage of the 2018 Appropriation could derail the programmeand urged the Federal Government to sustain its implementation to further accelerate theeconomic recovery thusfar achieved. The Committee urged the Government to set the machinery for the effective implementation of the 2018 budget to further stimulate the economy.It also encouraged the Government to sustain current efforts at boosting tax revenue generation notwithstanding the increase in crude oil and other commodity prices. The MPC, however, noted the potential effects of expansionary fiscal budget of 2018 and the liquidity impact of rising FAAC distribution,following increase in the prices of crude oil as well as thebuild up in election related spending towards the 2019 general elections.
The Committee took note of the improved performance of deposit money banks and observed thatthe relatively high levels of non-performing loans in the industry was moderating and urged Government to promptly settle outstanding contractor arrears as earlier promised. The Committee commended the effort of the Bank inachieving the positive outlookfor the industry and advice the Bank to intensify efforts to further improve banking sector soundness.It called on the Bank to sustain its monitoring apparatus to ensure compliance with existing prudential regulations andearly detectionand management of emerging vulnerabilities. Also, it similarly encouraged the Bank not to relent in ensuring that liquidity continues to flow from the banking sector to the real sector to further strengthen economic recovery and employment generation.
4.0. The Committee’s Decisions
The Committee critically evaluated the policy options in terms of developments in the international and domestic environments, noting in particular progress made in stimulating output growth, including stability in the foreign exchange market increase in the level of foreign exchange reserves,and sustained deceleration in therate of inflation.
The Committee considered the forecast of high liquidity injection in the second half of 2018, upward pressure on prices, driven largely by substantial expansionary fiscal policy, which will arise from the late passage of the 2018 appropriation bill, outstanding balance from the 2017 budget and the pre-election expenditures.Thus,tightening would ensure themop-up of excess liquidity.Mindful that despite the moderation in inflation, the current inflation rate is still above targeted single digit and that real interest rate only turned positive in the review period. The objective of the policy stance therefore, would be to accelerate a reduction in the inflation rate to single digit to promote economic stability, boost investor confidence, and promote foreign capital flows with complementary impact on exchange rate stability.
Conversely, the Committee believes that raising interest rate would, however, depress consumption and increase thecost of borrowing to the real sector. Moreover, such policy would make deposit money banks to re-price their assets.
In reviewing the choice of loosening, the Committee evaluated the potential impact of stimulating aggregate demand throughlower cost of credit.Nevertheless, the Committee deliberated on the effectiveness of the choice at a time when liquidity injection had been forecast to rise tangentially in the second half of the year. The outcome therefore, would most likely exacerbate inflationary pressure, cause higher pressure on the exchange rate as demand for forex increases and return real rate into negative territory as nominal interest rate fall lower than the inflation rate. Owing to the poor transmission mechanism as a result of structural rigidities, the reduction in the MPR may not necessarily transmit to lowering market lending rate onaccount of the high cost of doing business. The Committee further noted that loosening could worsen the current account balance through increase in importation, margin lending, lowering of risk evaluation in accessing loans which will drive up loans and likely increase in NPLs with potential negative consequence on the stability of the banking industry. The cost of liquidity management would also rise considerably.
The Committee, while arguing for a hold,observedthat the downside risk to growth and upside risk to inflation appears balanced as growth is improving while inflation is moderating. Maintaining the current policy stance would sustain gradual improvements in both indices. It was noted that there is need to see how all the components of GDP would evolve in the second quarter of 2018 in order to gain greater clarity on the direction of monetary policy.In summary, the predominant argument for a hold at this time is to await more clarity on the evolution of key indicators i.e. the passage and implementation of the budget, economic activities, and traction in fiscal policy in 2018.
Overall, the Committee was convinced that the economy needed a new impetus of increased lending by the banking system and would work with the Bank to adopt innovative ways to encourage the deposit money banks (DMBs) to adopt innovative ways to accelerate credit growth, including a reduction in the policy rate when conditions for such a decision arise. The MPC noted that at single digit inflation and higher reserve levels, the risks associated with a policy rate reduction under conditions of wavering foreign capital inflows and an unstable oil market, including other severe uncertainties, could be better managed to deliver macroeconomic stability in Nigeria. In consideration of the foregoing, therefore, the Committee decided by a vote of 8members to retain the Monetary Policy Rate (MPR) at 14.0 per cent alongside all other policy parameters. One (1) member,however,voted to increase the MPR by 50 basis points.
Consequently, the MPC voted to retain the:
(i) MPR at 14.0 per cent;
(ii) CRR at 22.5 per cent;
(iii) Liquidity Ratio at 30.0 per cent; and
(iv) Asymmetric corridor at +200 and -500 basis points around the MPR.
President Muhammadu Buhari addresses the Service Chiefs and Ministers during the Breaking of Ramadan Fast with Service Chiefs and Ministers at the State House in Abuja today, May 22. Photo By Sunday Aghaeze. [myad]
Just take the phrase: “impending” in the title above with a pinch of salt. I use the word because in politics as in life, things happen – as seemingly absolute situations become redeemable and what originally appears impossible could be the catalyst for fresh opportunities. Otherwise, the truth is that the ruling Nigerian political party, the All Progressives Congress is already imploding, it has in fact imploded; the party is in the throes of a debilitating illness. The implosion began almost as soon as the party assumed power in 2015. The APC emerged as a special purpose vehicle – composed almost entirely from second hand, used groups from the CPC, the ACN, APGA, ANPP, and a break away faction of the PDP, known as new PDP (nPDP) – even if there was nothing new about it, with the sole objective of taking power from the then ruling Peoples Democratic Party (PDP), and the then incumbent President Goodluck Jonathan.
Pro-APC persons described the APC as a child of necessity. They were convinced that 16 years of being in power had made the PDP complacent, arrogant and that its members had lost focus. They also argued that the Jonathan government needed to be changed by all means possible. Political coalitions often work when for one reason or the other, the ruling party loses either credibility or legitimacy, and the coalition gains the support of the people but the extent of the coalition’s success depends on its level of preparedness for office, and the quality of consensus among the partners. The APC coalition is not the first in the history of Nigerian politics, but it is perhaps the most impactful- even if driven by hate speech, populist propaganda and mass hysteria and hypnotism. It was a question of politics meeting with the public mood, and an unstoppable moment anchored on the symbolism of a strong man coming to “rescue” Nigeria. The electorate that bought into this narrative and turned it into votes is today full of regrets.
The APC began to unravel from day one, particularly at the centre. It took the government that emerged about six months to put a cabinet together, and almost two years to make some other critical appointments. Members of the coalition struggled for space, influence and power among themselves, and almost immediately, there were issues over the choice of the leaders of the National Assembly. The drama of the choice of the Senate president and the Speaker of the House of Representatives left many power brokers out in the cold. If there was any power sharing formula among the partners, somehow this was ignored by the CPC arm of the coalition led by the President, all made worse by the domination of the levers of government by CPC and Buhari loyalists. Non-Fulani members of the APC soon began to sound as if they had been attacked by a band of imported herdsmen. Party members including Governors and Senators, and party officials expressed frustration openly.
In less than three years, some of the bitterest criticisms of the party have come not from the opposition but from within the party itself: Timi Frank perpetually complaining about party processes, Shehu Sani and other Senators from Kaduna State at loggerheads with their State Governor, personality conflicts in virtually every state, most notably in Adamawa, Imo, Kano, Rivers and Lagos state, Governor Ortom of Benue openly accusing the Federal Government of negligence, Governor El-Rufai, Asiwaju Bola Tinubu and Senator Shehu Sani at various times sounding notes of warning, Senator Dino Melaye assuming the role of an in-house critic, and members of the ACN and the nPDP alleging that they have been used and dumped. The APC wing of the National Assembly is divided among its ranks, and has posed more threat to the Executive arm of government than the opposition. The APC is also the biggest challenge to its own promise. In 2015, the party promised to tackle three main issues: security, the economy and corruption. It has since found itself in the uncomfortable situation of disowning some other promises it made. It even took more than two years to launch an economic blueprint. The party over-promised and under-delivered.
It is possible to argue that differences and contestations are part of the democratic process and that this is the only way political parties can grow. Except that in this case, the conflicts are not ideas-based, even members of the APC themselves have no idea what the party really stands for, but they all seem so sure of their personal ambitions, hence the obvious lack of order and coherence. Knowing this to be so, President Muhammadu Buhari, who is also the leader of the party, had set in motion a reconciliation process, and appointed Asiwaju Bola Tinubu to lead it. This has not worked as Tinubu soon found himself in the heat of acrimony with the party Chairman, Chief John Oyegun and some of his own former protégés.
The extent of this implosion became more evident during the party’s recent state congresses. Parallel congresses were held in more than 10 states, there were reports of boycotts, violence and general confusion. Given the tone and nature of the conflict, it seems obvious that the APC is a victim of its own lack of three things – internal democracy, originality and sincerity of purpose.
It is a familiar scenario. The APC leadership should learn from the example of the PDP and how that party lost the 2015 general election. The first major crisis faced by the PDP was the failure to manage the exit of the five Governors in 2013, and the subsequent mischief over the 2015 campaign process. Powerful forces within the party for their own selfish reasons caused disaffection among members particularly at the grassroots level. Internal democracy was frustrated at all levels by those who regarded themselves as powerful Abuja forces, the same drama that is now being played out in the APC. The PDP went into the 2015 elections, as a divided party, with fifth columnists among its ranks. The APC now faces the same challenge. The nPDP wing of the APC has already served what looks like a quit notice. There are cases in court. The usual attitude is for those who emerged triumphant in the state congresses to insist that whoever wants to leave the party should do so. It was this same attitude that messed up the PDP.
Failure has taught the PDP a bitter lesson: the party is only now just in the process of reinventing itself. It is ironic for example that the same PDP in the face of likely crisis in Ekiti state recently ended up having a peaceful party primary, with the defeated congratulating the winner and promising to work for the good of the party. In Kaduna state, the PDP also put up an impressive performance in the recent local government elections. It is important however that the PDP does not begin to see the crisis within the APC as its own gain. It still has a lot to do to convince the electorate that it can be taken serious again. In 2014, PDP strategists worked on the permutation that the APC, being a community of strange bedfellows would soon fall apart to the advantage of the PDP. It was a bad strategy which did not work then and which is also not likely to work in 2019. As things stand, the APC appears as desperate for power today as it was in 2014, and those who have sworn that the Buhari government cannot be replaced would do as much as they did last Saturday, to impose their will on the Nigerian people. Politics remains warfare in Nigeria because it is the surest ticket to power, cheap money and easy life. For the Nigerian politician, winning is therefore everything.
If anyone thought 2015 was a major turning point in Nigerian politics, the 2019 general elections may even prove to be more eventful, and while the PDP may not fully resurrect, the APC may suffer worse fate, paving the way for Nigeria’s new beginning…
II. Lessons from the Royal Wedding
I could not resist the temptation to watch the royal wedding between Prince Harry and Meghan Markle. The symbolism of the event was too compelling to be ignored – a Windsor marrying a bi-racial lady, a divorcee, an American and an actress, from an obviously dysfunctional background. When King Edward VIII chose to marry an American divorcee, Wallis Simpson in 1936 – the British royalty kicked, the government and the Church demurred. the public was scandalized. Edward VIII followed his heart. He abdicated. The British monarchy has been much transformed since then. Queen Elizabeth II presides over a modern, if not post-modernist monarchy; by granting the enabling order for the wedding of Prince Harry and Meghan Markel, the Queen dug a hole through the walls of race and prejudice and offered hope. A future English prince or princess would end up having black cousins, aunties and uncles!
This symbolism was most felt at the wedding ceremony- with an all black cast of the Kingdom choir, wearing natural hair, buns and African hairstyles singing “Stand by Me”, Sheku Kanneh-Mason on the cello, and an impassioned sermon delivered by Bishop Michael Curry of the US Episcopal Church. Curry practically took Chicago to London, as he sermonized about the power of life, the fire of love, slavery…. Martin Luther King. I wouldn’t have been surprised if he had asked the congregation to stand and sing a chorus or if he asked whoever wanted to give his or her life to Jesus Christ to step forward and be blessed…Bishop Curry’s performance will be long remembered.
The wedding was orderly, simple, classy and elegant. The bride carried herself with grace and dignity – not even a trace could be seen of the pressure that had been piled on her, a few days earlier, by her father who was not too sure if he would attend or not, and her uncouth half-brother and half-sister who chose her moment of glory to bring out dirty family linens. She had to walk alone half the way, before Prince Charles took her arm and walked her down the aisle – without giving her away, though.
The guests arrived according to schedule, and every one knew where to sit. I did not see anyone running up and down trying to greet people, and generally seeking attention. The Queen and Prince Phillip did not come late, not even for a second. The Queen carried her own bag and she didn’t have a retinue of noisy courtiers attending to her. In Nigeria, “big men and women” routinely arrive late to their own events, usually so noisily. All the celebrities at the royal wedding did not have barrel-chested bodyguards. I was at a wedding event in Lagos recently, the comperes – Ali Baba and IK Osakioduwa – spent so much time begging uniformed bodyguards to allow their bosses to be human for once. Nobody listened. At another event, Bisi Olatilo kept assuring every one that no VIP at the event will come to any harm. He was ignored. Six gun-wielding policemen accompanied one state Governor into the hall and they stood behind him throughout! When he was invited to the stage to make a speech – they followed him!
Social events are thus, indeed, iconic. They reflect a people’s level of socio-economic and cultural development. The church service in London was solemn. There was nobody shouting “Amen” and “Halleluyah somebody” on top of their voices. The church did not solicit for offerings or donations. There were no politicians hugging the limelight. Heads of State were not invited. Some of the richest persons in the world would have been glad to be in attendance, but only a few were called. Ha, I forgot: there were no photographers running up and down, sweating and disrupting proceedings, pushing their cameras in people’s faces, with flashy, blinding lights – photographers can be such a nuisance at Nigerian events!
When you attend most weddings in Nigeria, so much flesh is also often on display: from the bride to her bridesmaids, there is usually a nudity competition – bare legs, bare boobs, with some of the latter even threatening to break loose. This at a point became such a serious problem that some churches now inspect wedding gowns or offer specifications. No wedding is complete these days around here without heavy make-up either. You could run into a lady whose wedding you once attended and not recognize she was the one. In an attempt to be beautiful by force, every Nigerian bride engages the services of a make-up artist, and when the make-up is done, you’d think the bride is taking a role in a movie.
Nigerian weddings provide an opportunity for the guests to show-off and steal the show. Some people even go to weddings, to as they say, network, or advertise their new wardrobe, or dance crazily, some even end up dressing better than the groom and the bride. The wedding of the Duke and Duchess of Sussex provided good lessons in taste, etiquette, elegance and the triumph of love. I enjoyed the wedding very much – on television of course.
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The Impending Implosion Of APC, By Reuben Abati
Pro-APC persons described the APC as a child of necessity. They were convinced that 16 years of being in power had made the PDP complacent, arrogant and that its members had lost focus. They also argued that the Jonathan government needed to be changed by all means possible. Political coalitions often work when for one reason or the other, the ruling party loses either credibility or legitimacy, and the coalition gains the support of the people but the extent of the coalition’s success depends on its level of preparedness for office, and the quality of consensus among the partners. The APC coalition is not the first in the history of Nigerian politics, but it is perhaps the most impactful- even if driven by hate speech, populist propaganda and mass hysteria and hypnotism. It was a question of politics meeting with the public mood, and an unstoppable moment anchored on the symbolism of a strong man coming to “rescue” Nigeria. The electorate that bought into this narrative and turned it into votes is today full of regrets.
The APC began to unravel from day one, particularly at the centre. It took the government that emerged about six months to put a cabinet together, and almost two years to make some other critical appointments. Members of the coalition struggled for space, influence and power among themselves, and almost immediately, there were issues over the choice of the leaders of the National Assembly. The drama of the choice of the Senate president and the Speaker of the House of Representatives left many power brokers out in the cold. If there was any power sharing formula among the partners, somehow this was ignored by the CPC arm of the coalition led by the President, all made worse by the domination of the levers of government by CPC and Buhari loyalists. Non-Fulani members of the APC soon began to sound as if they had been attacked by a band of imported herdsmen. Party members including Governors and Senators, and party officials expressed frustration openly.
In less than three years, some of the bitterest criticisms of the party have come not from the opposition but from within the party itself: Timi Frank perpetually complaining about party processes, Shehu Sani and other Senators from Kaduna State at loggerheads with their State Governor, personality conflicts in virtually every state, most notably in Adamawa, Imo, Kano, Rivers and Lagos state, Governor Ortom of Benue openly accusing the Federal Government of negligence, Governor El-Rufai, Asiwaju Bola Tinubu and Senator Shehu Sani at various times sounding notes of warning, Senator Dino Melaye assuming the role of an in-house critic, and members of the ACN and the nPDP alleging that they have been used and dumped. The APC wing of the National Assembly is divided among its ranks, and has posed more threat to the Executive arm of government than the opposition. The APC is also the biggest challenge to its own promise. In 2015, the party promised to tackle three main issues: security, the economy and corruption. It has since found itself in the uncomfortable situation of disowning some other promises it made. It even took more than two years to launch an economic blueprint. The party over-promised and under-delivered.
It is possible to argue that differences and contestations are part of the democratic process and that this is the only way political parties can grow. Except that in this case, the conflicts are not ideas-based, even members of the APC themselves have no idea what the party really stands for, but they all seem so sure of their personal ambitions, hence the obvious lack of order and coherence. Knowing this to be so, President Muhammadu Buhari, who is also the leader of the party, had set in motion a reconciliation process, and appointed Asiwaju Bola Tinubu to lead it. This has not worked as Tinubu soon found himself in the heat of acrimony with the party Chairman, Chief John Oyegun and some of his own former protégés.
The extent of this implosion became more evident during the party’s recent state congresses. Parallel congresses were held in more than 10 states, there were reports of boycotts, violence and general confusion. Given the tone and nature of the conflict, it seems obvious that the APC is a victim of its own lack of three things – internal democracy, originality and sincerity of purpose.
It is a familiar scenario. The APC leadership should learn from the example of the PDP and how that party lost the 2015 general election. The first major crisis faced by the PDP was the failure to manage the exit of the five Governors in 2013, and the subsequent mischief over the 2015 campaign process. Powerful forces within the party for their own selfish reasons caused disaffection among members particularly at the grassroots level. Internal democracy was frustrated at all levels by those who regarded themselves as powerful Abuja forces, the same drama that is now being played out in the APC. The PDP went into the 2015 elections, as a divided party, with fifth columnists among its ranks. The APC now faces the same challenge. The nPDP wing of the APC has already served what looks like a quit notice. There are cases in court. The usual attitude is for those who emerged triumphant in the state congresses to insist that whoever wants to leave the party should do so. It was this same attitude that messed up the PDP.
Failure has taught the PDP a bitter lesson: the party is only now just in the process of reinventing itself. It is ironic for example that the same PDP in the face of likely crisis in Ekiti state recently ended up having a peaceful party primary, with the defeated congratulating the winner and promising to work for the good of the party. In Kaduna state, the PDP also put up an impressive performance in the recent local government elections. It is important however that the PDP does not begin to see the crisis within the APC as its own gain. It still has a lot to do to convince the electorate that it can be taken serious again. In 2014, PDP strategists worked on the permutation that the APC, being a community of strange bedfellows would soon fall apart to the advantage of the PDP. It was a bad strategy which did not work then and which is also not likely to work in 2019. As things stand, the APC appears as desperate for power today as it was in 2014, and those who have sworn that the Buhari government cannot be replaced would do as much as they did last Saturday, to impose their will on the Nigerian people. Politics remains warfare in Nigeria because it is the surest ticket to power, cheap money and easy life. For the Nigerian politician, winning is therefore everything.
If anyone thought 2015 was a major turning point in Nigerian politics, the 2019 general elections may even prove to be more eventful, and while the PDP may not fully resurrect, the APC may suffer worse fate, paving the way for Nigeria’s new beginning…
II. Lessons from the Royal Wedding
I could not resist the temptation to watch the royal wedding between Prince Harry and Meghan Markle. The symbolism of the event was too compelling to be ignored – a Windsor marrying a bi-racial lady, a divorcee, an American and an actress, from an obviously dysfunctional background. When King Edward VIII chose to marry an American divorcee, Wallis Simpson in 1936 – the British royalty kicked, the government and the Church demurred. the public was scandalized. Edward VIII followed his heart. He abdicated. The British monarchy has been much transformed since then. Queen Elizabeth II presides over a modern, if not post-modernist monarchy; by granting the enabling order for the wedding of Prince Harry and Meghan Markel, the Queen dug a hole through the walls of race and prejudice and offered hope. A future English prince or princess would end up having black cousins, aunties and uncles!
This symbolism was most felt at the wedding ceremony- with an all black cast of the Kingdom choir, wearing natural hair, buns and African hairstyles singing “Stand by Me”, Sheku Kanneh-Mason on the cello, and an impassioned sermon delivered by Bishop Michael Curry of the US Episcopal Church. Curry practically took Chicago to London, as he sermonized about the power of life, the fire of love, slavery…. Martin Luther King. I wouldn’t have been surprised if he had asked the congregation to stand and sing a chorus or if he asked whoever wanted to give his or her life to Jesus Christ to step forward and be blessed…Bishop Curry’s performance will be long remembered.
The wedding was orderly, simple, classy and elegant. The bride carried herself with grace and dignity – not even a trace could be seen of the pressure that had been piled on her, a few days earlier, by her father who was not too sure if he would attend or not, and her uncouth half-brother and half-sister who chose her moment of glory to bring out dirty family linens. She had to walk alone half the way, before Prince Charles took her arm and walked her down the aisle – without giving her away, though.
The guests arrived according to schedule, and every one knew where to sit. I did not see anyone running up and down trying to greet people, and generally seeking attention. The Queen and Prince Phillip did not come late, not even for a second. The Queen carried her own bag and she didn’t have a retinue of noisy courtiers attending to her. In Nigeria, “big men and women” routinely arrive late to their own events, usually so noisily. All the celebrities at the royal wedding did not have barrel-chested bodyguards. I was at a wedding event in Lagos recently, the comperes – Ali Baba and IK Osakioduwa – spent so much time begging uniformed bodyguards to allow their bosses to be human for once. Nobody listened. At another event, Bisi Olatilo kept assuring every one that no VIP at the event will come to any harm. He was ignored. Six gun-wielding policemen accompanied one state Governor into the hall and they stood behind him throughout! When he was invited to the stage to make a speech – they followed him!
Social events are thus, indeed, iconic. They reflect a people’s level of socio-economic and cultural development. The church service in London was solemn. There was nobody shouting “Amen” and “Halleluyah somebody” on top of their voices. The church did not solicit for offerings or donations. There were no politicians hugging the limelight. Heads of State were not invited. Some of the richest persons in the world would have been glad to be in attendance, but only a few were called. Ha, I forgot: there were no photographers running up and down, sweating and disrupting proceedings, pushing their cameras in people’s faces, with flashy, blinding lights – photographers can be such a nuisance at Nigerian events!
When you attend most weddings in Nigeria, so much flesh is also often on display: from the bride to her bridesmaids, there is usually a nudity competition – bare legs, bare boobs, with some of the latter even threatening to break loose. This at a point became such a serious problem that some churches now inspect wedding gowns or offer specifications. No wedding is complete these days around here without heavy make-up either. You could run into a lady whose wedding you once attended and not recognize she was the one. In an attempt to be beautiful by force, every Nigerian bride engages the services of a make-up artist, and when the make-up is done, you’d think the bride is taking a role in a movie.
Nigerian weddings provide an opportunity for the guests to show-off and steal the show. Some people even go to weddings, to as they say, network, or advertise their new wardrobe, or dance crazily, some even end up dressing better than the groom and the bride. The wedding of the Duke and Duchess of Sussex provided good lessons in taste, etiquette, elegance and the triumph of love. I enjoyed the wedding very much – on television of course.