The Nation Newspaper

Category: Saturday Magazine

  • Our plans to rid Plateau, Benue, Borno, others of illegal arms – Ag. NATCOM DG

    Our plans to rid Plateau, Benue, Borno, others of illegal arms – Ag. NATCOM DG

    • Vows to nip criminal activities in the bud

    Acting Director-General, National Commission for the Co-ordination and Control of the Proliferation of Small Arms and Light Weapons (NATCOM), Otunba Adejare Rewane Adegbenro, speaķs about his organisation’s plans towards curbing insecurity and accessibility to arms in this interview with GBOYEGA ALAKA. He also speaks about his recent appointment as commissioner by the Switzerland’s Human Rights Commission.

    WHAT are NATCOM’s plans towards achieving its objectives?

    As we speak, a bill has been passed and we are waiting for President Bola Tinubu to put pen to paper. This will enable us actualise the dreams and aspiration of NATCOM, one of which is making sure weapons don’t go into the wrong hands. And when this happens, it means we are curbing crime to the barest minimum. It means Nigerians can sleep with both eyes closed because right now Nigerians can’t sleep due to high rate of insecurity. Take for instance the recent killings in Plateau State, Benue State and other parts of the country.

    There seems to be three factions of NATCOM. How does one separate the original from the fake?

    There are no factions. It is the creation of the media. Some people do not want NATCOM to come to fruition and they will do anything to thwart our sincere efforts and it is evident that they use the media. We have an individual parading himself as D.G. One even called himself interim D.G. You can verify. The former DG was duly removed from office by the council of commandants. And for the other one calling himself interim, what an illegality. These are interlopers, intruders who do not want the current administration to actualise its dream of putting an end to insecurity, because an enemy of NATCOM is an enemy of peace and security in Nigeria. With my specialty in security and with the blueprint of NATCOM, we will bring insecurity to its knees God willing.

    There is said to be another agency under the National Security Adviser (NSA) dealing with proliferation of light arms. Are you going to work in tandem with the agency or stand alone?

    You have to realise that there’s no monopoly of power. The office of the National Security Adviser is very big and it is saddled with a lot of responsibilities. The only way for the office to succeed is to delegate duties.

    Yes, there is a ‘Center for the Coordination and Control of Small Arms and Light Weapons under the office of the NSA. But we are coming as a commission in line with ECOWAS treaty to work in harmony with the center to fight the proliferation of arms in Nigeria. The NSA, Nuhu Ribadu, is very competent, intelligent and calm. You can attest to this when he was the EFCC chairman. Despite the litany of death threats, he was unperturbed. And since he assumed office as the NSA, he has hit the ground running. We are set to benefit from some of his underground works. We are coming on board to help him mediate a lot of problems concerning light arms, ammunition, pipeline vandalism and the likes. We are going to work with him; I mean the bill already made provision for that harmony.

    The NSA oversees all security agencies, so ours won’t be an exception. We will also tap from his wealth of wisdom. He is the first policeman that will serve as the NSA since the return of democracy. I trust Mr. President, who I have known since I was 16 and who is like a father to me to do well to this harmonisation and inter agency cooperation.

     You said you have known President Tinubu since you were 16 and he has been like a father to you. As a grandson of Pa Alfred Rewane, the then financier of NADECO, how capable do you think Tinubu is to restore the fortunes of the nation?

    There is nobody that can bring Nigeria out of this mess better than President Bola Tinubu. I call him the Jagaban of the world. I have learnt a lot from him. He inspires my doggedness, and I’m working day and night to ensure NATCOM comes into fruition. I am doing this for the love I have for my nation. Terrorism, banditry, kidnapping, assassination, arson, smuggling, etc can be ended in Nigeria.

    Talking about smuggling, NATCOM will work with the Customs. We will cross-fertilise ideas on how to better secure the porous borders and use sophisticated technologies that will tighten security at our borders. The borders are where illegal arms and ammunition come in through.

    We are also going to work hand in hand with the Nigeria Police, identifying dark spots in the smuggling of arms. Members of staff of NATCOM are ready to rid Nigeria of illegal arms in a bid to make the nation safe.

    Have you sought audience with key stakeholders?

    I have visited the wise men of the class of 99, and they kept asking where I was in that era. I told them I was acquiring knowledge. Part of the Class 99 is President Tinubu.  So to tell you the truth, the key stakeholders, too numerous to mention, are solidly behind me. They have read my blueprint and they gave their full approval.

    I have also consulted most of the former military heads of state and service chiefs and generals for a better understanding of what needs to be done and how well to effectively achieve results for the good of this nation.

    Can you elaborate on the Class of 99 you were talking about?

    If you cast your mind back to 1999, regardless of their affiliations or political parties, they all worked together in peace and harmony and moved Nigeria forward. The class of 99 is made up of all political parties, activists and politicians in that era that fought for the return of democracy. One of them is the Secretary to Government of the Federation, Senator George Akume. He is a superman. I take advice from him and he is in full support of NATCOM because he believes Nigeria can be safe again. All those illegal arms in Benue, Plateau, Borno, Zamfara among others will be mopped up and destroyed.

    Also, one of the wise men of 1999 is the former Governor of Ogun State, Aremo Olusegun Osoba. He is a man of many accomplishments. He is my godfather. Interestingly, my biological father is the godson of Chief Osoba’s first son, Olumide Osoba, who is currently in the House of Representatives. I’m learning from him as well. Then President Bola Tinubu, who I have known since I was 16.

    You talk passionately about fighting insecurity in the nation but there are many ways to skin a cat. Why NATCOM?

    Apart from poverty, another root cause is the proliferation of illegal arms and ammunition. Once we stop supplies and mop up the ones in circulation, we will instantly bring insecurity to a halt. Perhaps you didn’t know, my grandfather died by the bullet. People are killed every day unjustly with illegal weapons. Won’t I ensure there is proper mopping of arms?

    My intentions are sincere. I’m driven by the aspiration to see a Nigeria where people won’t have to secure their wards overseas. I’m with a sole purpose of facilitating a safe environment that will harbinger peace, prosperity and unity of Nigeria. The 9th Assembly led by Ahmed Lawan and Femi Gbajabiamila passed the bill after a meticulous perusal of the blueprint and wide consultation. What remains is the presidential assent. We are a donor organisation. We will generate our own funds. In other words, we are self-funded. Our establishment costs the government nothing. So, why not NATCOM?

    Sometime last year, the EFCC was looking for you.  What went wrong?

    It was down to a civil transaction that happened years ago. My name has been cleared and the ‘wanted notice’ withdrawn.

    There was another report last year about the court summoning you over alleged N2 billion judgement debt.

    I can tell you categorically that it was a false report. I wasn’t summoned by any court. No court or summon letter or any form of invitation from the court of law. If there was, I would have been charged for contempt. No one is bigger than the law. I am a law-abiding citizen. Anyway, my lawyers have taken that up. I will only urge the media to verify before publishing. All these reports are handiwork of some people who want to throw spanner in the wheels of NATCOM’s progress.

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    From a security expert’s point of view, why the Plateau insecurity and the recent kidnappings and shooting of policemen in Abuja?

    You can see why I said NATCOM has a lot of role to play in our security architecture. The recent upsurge in criminal activities is down to illegal weapons in the hands of wrong people. Don’t forget that NATCOM officials will be embedded in areas fraught with criminal activities and will proactively mop up all the illegal arms.

    We know where these illicit arms and ammunition are, and I can assure we will do the needful. I, Otunba Adejare, and my team cannot wait to hit the ground running. I promise that Nigerians will be able to sleep with their eyes closed. I promise the people of Plateau, Abuja, Borno, Benue among others that NATCOM will nip all criminal activities in their domains in the bud.

    How can the government boost the morale of the police for more effective performance?

    First of all, I would advise the current administration to increase their wages in terms of salary. Second, pay their pension and gratuity as and when due. Also, life insurance for our police officers will be welcomed. We have seen cases where the families of policemen were kicked out of the barracks. I will advise Mr. President to set up a committee and suggest possible ways to massively upgrade the welfare of our policemen.

    Lastly, Switzertland’s Human Rights Commission appointed you a commissioner, what does this portend for your course?

    Well, it was an honour done me. But it shows that whatever one does, there are those observing and recording the deeds. My activities over the years were what they assessed and they decided to co-opt me into their commission. As they say, the reward for hard work is more work. All I want is a peaceful nation for my dear nation. This is my course, this is my prayer and this is my aspiration.

  • Oscar Pistorius out on parole 11 years after killing girlfriend

    Oscar Pistorius out on parole 11 years after killing girlfriend

    Paralympian Oscar Pistorius was yesterday freed on parole from a South African jail, nearly 11 years after murdering his girlfriend Reeva Steenkamp.

    Officials confirmed Pistorius was “at home” yesterday morning, having served half of his more than 13-year sentence.

    Ms Steenkamp’s mother said she accepted the decision to release the former athlete – but added her family was the one “serving a life sentence”.

    In 2012, Pistorius became the first double amputee to run in the Olympics.

    Just six months later, he shot Ms Steenkamp multiple times through a toilet door in his house. The shooting and subsequent trials gripped South Africa and the world.

    Pistorius, now 37, later claimed he had mistaken her for a burglar during the night.

    Pistorius was eventually convicted of murder in 2015 after an appeal court overturned an earlier verdict of culpable homicide – or manslaughter.

    Under South African law, all offenders are entitled to be considered for parole, meaning early release under certain conditions, once they have served half their total sentence, which for Pistorius was finally set at 13 years and five months.

    Until his sentence expires in 2029, he will live under strict rules – confining him to the home for certain hours of the day, as well as banning him from drinking alcohol. He is also not permitted to speak to the media.

    In addition, Pistorius will be required to have therapy to help deal with issues around gender-based violence and anger.

    He is believed to have gone to live at the home of his uncle Arnold Pistorius in an upmarket suburb of the capital, Pretoria.

    While in prison, Pistorius drove a tractor in the grounds, worked in the library and cleaned inmates’ cells, according to legal documents cited by South African journalist Karyn Maughan.

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    Social workers and psychologists also wrote positive reports about him, she told the BBC’s Newsday programme.

    Friends say Reeva Steenkamp was kind-hearted and ambitious

    Ms Steenkamp’s mother, June, said in a statement that the family had “always known that parole is part of the South African legal system” and had “always said that the law must take its course”.

    Mrs Steenkamp said she welcomed the conditions imposed by the parole board, which “affirmed Barry and my belief in the South African justice system,” referring to her late husband.But, she asked: “Has there been justice for Reeva? Has Oscar served enough time? There can never be justice if your loved one is never coming back, and no amount of time served will bring Reeva back. We, who remain behind, are the ones serving a life sentence.”

    She added: “My only desire is that I will be allowed to live my last years in peace with my focus remaining on the Reeva Rebecca Steenkamp Foundation, to continue Reeva’s legacy.”

    Pistorius first went to prison in October 2014, shortly after his initial conviction. There was a period between 2015 and 2016 when he was released under house arrest before his conviction was changed and sentence lengthened.

    Pistorius’s lower legs were amputated when he was less than a year old due to a congenital condition – he was born with no fibulas, the smaller of the two lower leg bones. He subsequently relied on prosthetics and became a world-renowned athlete known as the “Blade Runner”.

  • Neuroscience and the Nigeria Project: The Scholarship of Adesola Ogunniyi

    Neuroscience and the Nigeria Project: The Scholarship of Adesola Ogunniyi

    In this piece, I essentially celebrate the septuagenarian initiation of Professor Adesola Ogunniyi. And I do this specifically to appreciate the existential doggedness of someone who rose from a humble beginning to become one of the topmost neuroscientists on the continent. It is axiomatic for me that celebration and eulogies should not be delayed until a posthumous occasion. If a person has done well in conquering the anxieties of life and produced giant strides, it is too late to eulogize such persons after death except to consolidate their legacies. Prof. Ogunniyi is a giant in neuroscience, and he deserves accolades beyond wining and dining as we were treated to on the 9th of December, 2023. I also have a clannish interest. Prof. Ogunniyi is my clansman. And over the years, I have tasked myself with the responsibility to detail the achievements of those eminent figures who have embodied what I have called the Aáwé mystique. In this piece, I want to weave a narrative that connects this mystique with Ogunniyi’s strides in dementia research, and the policy implications of the connection between neuroscience and neurophilosophy.

    I have written about Aáwé being a small town built by little men with huge foresight on a future made strong by education. I will not speak to the confluence of geography, history and people that make Aáwé similar to other Yoruba towns, or the narratives of ancestral founding and apocryphal imaginaries that set the town apart. Aáwé began little, and remain small in terms of socioeconomic and political reckoning. And yet, Aáwé’s strength lies in the generational and communal investment that birthed great names that are the testaments to its resilience and progress. The smallness of Aáwé is displaced by its greatest achievement—the aggregation of its diverse indigenous pool into a developmental capital that propels continuous advancement in social, cultural, economic and political terms. Aáwé’s indigenous pool is made up of the expatriates abroad who invested in educational advancement and those, equally educated, who didn’t leave Aáwé town but are committed to its advancement. Those at home and abroad are equally sensitised to the urgency of community development which has been facilitated over time through the framework of social groups. Prof. Ogunniyi as an Aawe boy indeed has distinguished forerunners and I can mention a few namely, Rev. (Dr.) J. A. Adegbite, principal, Baptist Academy, Rev. (Dr.) S. T. Ola Akande, president and Secretary-General, Nigerian Baptist Convention, Prof. E. Latunde Odeku, the first African Neuro-Surgeon, Prof. Ojetunji Aboyade, the renowned economist, Chief A. O. Amoje, the business mongol, Prof. Olu Akinyanju, founder of the Sickle Cell Foundation of Nigeria, to name just a few

    Prof. Ogunniyi personifies that Aáwé mystique, the Aáwé dream that manifests in the greatness of education and enlightenment. And this began from the methodic and loving parenting he got from his federal civil servant father, Papa Samuel Oyedele Ogunniyi of Ile Olode Oke Bata, and mother, and a school teacher mother, Mama Margaret Oyedoyin Ogunniyi, also an Aawe indigene, who instilled the carry-over values of communal relations into the young Ogunniyi—discipline, godliness, contentment, respect, love for family and relations, and educational support. Though born and raised in Lagos, the young Ogunniyi benefitted from the Aáwé spirit of extended filial love and cultural beingness that gives the indigenes their personality, and tie them to their small town forever. According to him, his father almost always took them to Aáwé for communal connection and for holidays and festivities. The Awe Improvement Union had Baba Ogunniyi always in attendance, and in regular consultations over how the small town could keep investing in the greatness of its people. And Prof. Ogunniyi, the son, is one of the consequences not only of a home founded on a solid moral framework, but also of a sociocultural model of a town that takes it as an imperative to build the individual ad build the mind as an investment into human and social capital that reaches from the Aáwé town to the entire world.

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    Professor Ogunniyi had several shoulders to stand on, from those of his parents for character formation and deep spiritual and relational value to those of scrupulous mentors and role models right from schools to professional practices. From Fiditi Grammar School to Igbobi College, and from the University of Ife to a research portfolio in neuroscience, Prof. Ogunniyi had a total package in mentoring that inculcated character, values, academic excellence, discipline and a competitive spirit that still stands him in good stead wherever he finds himself.

    From biological sciences to medicine and onward to neuroscience, he was firmly within the professional cohort of mentors and the neuroscience pioneers: Professor Adeoye Lambo in neuropsychiatry, professor Latunde Odeku in neuroscience, Professor Benjamin O. Osuntokun in neuroepidemiology, Professor Ezekiel Caxton-Martins in basic neuroscience research, Professor Roger Makanjuola in psychiatry, and Professor Gabriel Osuide in neuropharmacological research. By the time he finally made a choice of neuroepidemiology, all these powerful figures and role model had already rubbed off their enormous global influence and scholarly commitment on him sufficiently to push towards becoming a force to be reckon with in dementia research in Africa. This is not a mean feat. Being at the forefront of not only a rigorous research regime but one that also initiates the framework for pathbreaking medical discovery points at the mind of a committed scholar who keeps withstanding the acute limitations of Nigeria’s postcolonial university and research facilities. Prof. Ogunniyi, like many others, diligently carried the enormous burden of postcolonial limitations and became eminent and preeminent in spite and despite that traumatic academic and research condition.

    Prof. Ogunniyi’s scholarship straddles medicine, neurology, neuroscience and neuroepidemiology. And this scholarship places him right in the frontline of innovative neuroscientific research in Nigeria. And this goes with the enormous burden of postcolonial limitations that attend such innovative research fields as neuroscience. But then, Prof. Ogunniyi is not one to run from challenges. All his life to this point, he has been taking on challenges and treading paths that had significantly shaped the frontiers of neuroscience in Africa. And he had indeed pushed the research boundaries of neuroepidemiology and dementia research to the critical juncture of becoming the first African to win the Bruce S. Schoenberg International Award in Neuroepidemiology in 1991, and from the American Academy of Neurology. And that award became a worthy salutation to the mentorship of Professor Schoenberg himself.

    Neuroscience is simply about the human brain and the nervous system, especially their function, structure as well as their disorders and degeneration. Prof. Ogunniyi’s neuroepidemiological research focuses on the epidemiological investigation into the incidence, prevalence, frequency and risk factors involved in the prognosis of neurological disorders. In his own words, his scholarship in dementia research carries the “burden of dementia and the risk factors including the association with hypertension, gene-environment interactions with regards to lipids and apolipoprotein E as well as the predictive value of weight loss in individuals with cognitive impairment.” 

    Neuroscientists are tasked with the fundamental objectives: first, to understand the brain, the nervous system and all its functional and degenerative dynamics; and second, to alleviate the possible neurological and psychiatric disorders from whatever conditions and circumstances. At a much deeper level for neuroscientists are the contextual ramifications of the neurological circumstances generated by developing countries in Africa, for instance. In fact, Africa provides enormous limitations and possibilities for neuroscientists that are not available in other contexts. Essentially, for me, Africa’s and Nigeria’s underdevelopment status has a huge significance for the mental and neurological disorders and neuro-degenerative diseases that are made possible for Nigerians, while also increasing the potentials for developing and finetuning neuroscientific and neurological expertise. It is within this context that we must place the pioneering breakthroughs in the scholarship of Prof. Ogunniyi and all those who broke the frontiers ahead of him in neuroscientific and neurological research.

    Prof. Ogunniyi’s scholarship however provides me with the opportunity to explore my fascination with neurophilosophy. I mean, beyond the exciting theoretical possibilities of linking the concerns of neurophilosophy to Ogunniyi’s neuroscientific research, what implications does that portend for health and medical research and practices in Nigeria? Before neuroscience and neurophilosophy was the philosophy of mind, and the fundamental reflection of Rene Descartes, the 17th century French philosopher. Descartes’ research instigated a whole lot of epistemological problems for western philosophy, post-Descartes. What is consciousness? What is mind? what is matter or body? What is the relationship between mind and body? Is the mind different and exist independent from the body? Can mental processes be explained in terms of a scientific account of physiological processes? Can freewill be understood in terms of physicalism? What about mental causation—the problem of whether or not mental processes can cause other mental or physical processes? Can physicalism explain self-identity over time?

    These questions have generated various responses and answers that engages with our perception of reality. Cartesian dualism, for instance, has been challenged by a simpler physicalist explanation that rejects the existence of non-physical entities in the understanding of the human person. But can a Christian be a physicalist, given the belief that humans are made up of body and soul? Is physicalism even compatible with freewill? In other words, if humans are solely explainable in terms of physical and physiological states and processes, in what senses can we say such an individual is free? All these questions anticipate a space for further engagement that generates interdisciplinary collaborations, like the recent one between the Institute of Neurosciences, University College Hospital and the Department of Philosophy, University of Ibadan.

    Indeed, a tantalizing question is the research implications of conceiving Adeoye Lambo, Benjamin Osuntokun, Adesola Ogunniyi, and others as neurophilosophers. What will constitute the neuro-philosophical implications of Ogunniyi’s frontline researches into neuroscience and specifically into dementia research?  How can we develop the preliminary outline of care ethics from Professor Ogunniyi’s research into the care for dementia patients? I see such a collaboration not just in terms of the interdisciplinary research that African scholars should be doing, but also in terms of the theoretical and intellectual leeway that African neuroscientists and philosophers can articulate especially in areas like neuro-philosophy, and the multiple implications it can have for sundry areas like neuro-administration! But from my perspective as an institutional reformer, I am concerned with another question: How does the disarticulated developmental and governance dynamics of a postcolonial Nigerian state affect the neurological state of an average Nigerian, elite or ordinary? I mean to ask: how does a demented state like Nigeria lead to the observation of neuro-degenerative consequences for her citizens? And more: how does this neuroscientific research influence institutional reform considerations?

    We can begin unraveling these questions at the base of neuro-administration by agreeing to a simple axiom: underdevelopment has psychiatric implications. Poverty, unemployment, infrastructural decay, underdevelopment and bad governance that have turned Nigerians into angry and bitter citizens always demanding for better quality of life without getting it. When the expectations of good governance are constantly being deferred by irresponsible governments, dementia becomes a possibility. The far-reaching implication is that neurological disorder is directly proportional to social disorder. And this is because the Nigerian leadership has lost touch with the imperative of the mental health of her citizens. and this in itself is also a neurological matter! For instance, there is a neurological disorder behind a politician or public official diverting public fund to private ends; or even one person stealing money meant for the commonwealth, and these questions can be expanded as wide as one’s imagination reaches.

    •Prof. Olaopa is chairman of the Federal Civil Service Commission.

  • 2024 budget: Navigating growth, debt dynamics and strategic priorities

    2024 budget: Navigating growth, debt dynamics and strategic priorities

    The National Assembly has recently approved the 2024 budget, incorporating significant adjustments to key parameters, including an augmentation of the budget size to N28.7 trillion. In this comprehensive analysis, Assistant Editor NDUKA CHIEJINA navigates the complexities of the 2024 budget, shedding light on the nuances of its various components and implications.

    The total budget size for the fiscal year 2024 has surpassed President Bola Tinubu‘s initial proposal by $1.8 billion, reaching $28.7 billion. This upward adjustment has sparked optimism, particularly fueled by the modification of the oil benchmark to $77.96 per barrel. However, this optimism is tempered by concerns about the sustainability of the budget, given the substantial deficit that exceeds $9 billion. 

    To finance this ambitious budget, a securitisation of N7.388 trillion through Ways and Means is planned, alongside potential borrowings amounting to $7.8 billion and €100 million. Noteworthy is the budget’s strategic focus on enhancing infrastructure and fostering development, evident in the increased capital spending allocation of N9.995 trillion. In a bid to prioritise efficiency and instill fiscal discipline, recurrent spending has undergone a reduction, now standing at N8.76 trillion. Within the budget allocations, considerable funds have been earmarked for critical sectors such as education, defense, police, health, and agriculture. This strategic distribution reflects a concerted effort to address key areas contributing to national development and well-being. As the nation steps into the fiscal year 2024, the budget serves as a financial roadmap with the potential to shape economic trajectories and fortify essential sectors.

     The revisions made by lawmakers to the 2024 budget, particularly the adjusted exchange rate and other key parameters, present a nuanced scenario with potential implications for the Nigerian economy. The noteworthy increase in the exchange rate from N750 to N800 per USD suggests that lawmakers anticipate higher export earnings from government-owned enterprises (GOEs) due to a weaker naira, potentially enhancing government revenue. This adjustment reflects the prevailing economic conditions, aligning with the devaluation observed in both the official and unofficial markets. A weaker naira could attract more foreign investment and remittances, contributing to potential positive impacts on the economy.   

    However, there are likely implications from this exchange rate adjustment. Inflation may ensue as the costs of imported goods and services escalate, potentially impacting the overall cost of living for citizens. On the flip side, the global affordability of Nigerian exports might rise, potentially bolstering export volumes and earnings. While the exchange rate adjustment is a notable change, maintaining other parameters such as oil production, price, and GDP growth introduces additional complexities. Achieving the 1.78 million barrels per day (mbpd) production goal could be challenging due to current production issues and OPEC quotas, which may impact budget revenue. Similarly, the set US$77.96 benchmark for oil prices could face challenges amid global economic uncertainties and oil price fluctuations, potentially leading to budget deficits.

     Achieving the 3.88 percent growth, as sanctioned by the National Assembly, hinges on the effective implementation of the budget and favorable economic conditions. However, both external and internal factors present potential hindrances. The alterations made to the original budget proposal, especially the revised exchange rate, introduce a mix of opportunities and risks, shaping the economy’s response. Several factors will influence the outcome, including the efficiency of revenue collection, prudent allocation, and effective debt management. These elements are pivotal for securing favorable outcomes and ensuring the intended growth. External influences, such as shifts in oil prices and global economic downturns, will play a significant role in determining the performance of the 2024 budget.

     Moreover, public trust in budget administration is a crucial component for sustainable economic progress. The modifications made by lawmakers to the 2024 budget underscore the complexities of economic policymaking, raising questions about their potential effects. Vigilant monitoring of budget execution and its economic impacts, coupled with a readiness to adapt to unfolding circumstances, remains imperative in the coming year.

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    Growth versus debt

    The decision to securitise Ways and Means in the 2024 budget carries both potential benefits and challenges. Ways and Means, a form of borrowing from the Central Bank of Nigeria (CBN) to address temporary funding gaps, has led to a substantial strain on the CBN’s balance sheet, accumulating a debt of N23.7 trillion. The proposed securitisation involves converting this debt into long-term bonds, which would then be sold to investors in the capital market. This strategy aims to provide fiscal breathing room for the government while alleviating the burden on the CBN.

     Securitisation offers several potential advantages. It has the potential to lower interest rates, enhance fiscal transparency, and reduce immediate repayment pressure. By transforming short-term debt into long-term bonds, the government can spread out its obligations and minimize the strain on its financial resources. However, securitisation also presents challenges. While it eases immediate fiscal pressures, it adds to the overall debt burden of the government. This necessitates the development of clear and credible long-term debt repayment strategies to ensure sustainability. Successful implementation relies on attracting sufficient investors at favorable interest rates, underscoring the importance of continued commitment to fiscal discipline and economic reforms. Additionally, the 2024 budget outlines an increased reliance on government-owned enterprises (GOEs) for revenue as another strategy. This approach demands improved performance and governance within these entities to effectively contribute to the revenue stream.

     The effectiveness of securitisation in the 2024 budget depends on the specific terms of the bonds, transparency, and accountability measures. Continuous monitoring of its impact on the Central Bank of Nigeria (CBN) and the overall economy is crucial for informed decision-making. Prudent management and the implementation of effective long-term debt strategies, alongside revenue generation from government-owned enterprises (GOEs), will ultimately determine the success of this fiscal policy. Commendably, the prioritisation of capital spending in the 2024 Nigerian budget, especially the increased allocation to infrastructure projects and development, aligns with Nigeria’s National Development Plan. Investing in critical infrastructure has the potential to stimulate economic growth, create jobs, and enhance the quality of life for citizens. However, the success of these investments is contingent upon addressing challenges and mitigating associated risks.

    Effective implementation and accountability stand out as critical factors in the success of infrastructure investments. Project selection should be driven by rigorous cost-benefit analyses and developmental needs rather than political considerations. Robust measures must be in place to prevent corruption and streamline procurement processes. The shortage of skilled personnel within government agencies poses a potential obstacle to project execution and quality control. To avoid mismanagement and public distrust, it is essential to establish adequate oversight mechanisms and ensure public access to relevant information. Diverse perspectives should be considered in this process. Some may express concerns about potential neglect of other critical sectors like education and healthcare. Striking a balance between infrastructure investment and human development is key to achieving comprehensive national progress. Additionally, questions may arise about the sustainability of increased capital spending in light of the government’s high debt burden. Therefore, maintaining fiscal discipline and exploring alternative financing mechanisms, such as public-private partnerships, are important considerations.

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     To ensure the success of capital spending, key recommendations include strengthening project selection and evaluation processes, implementing robust anti-corruption measures, investing in skills development within government agencies, enhancing public participation and information sharing, and exploring innovative financing models and revenue diversification. Adopting a holistic approach that addresses these aspects will contribute to the effective and sustainable implementation of capital projects in Nigeria. The government’s commitment to good governance, transparency, and accountability will ultimately determine the effectiveness of prioritising capital spending. If done right, these investments can fuel long-term economic growth and development in Nigeria.

    Nigeria’s oil revenue dependency in the 2024 budget

    A staggering 41.9 percent of Nigeria’s 2024 budget relies directly on oil revenue, signifying that nearly half of the government’s income is contingent on crude oil sales. This heavy reliance poses significant concerns for several reasons. Oil prices notoriously fluctuate based on global economic conditions, political instability, and supply chain disruptions, rendering oil revenue unpredictable. This volatility makes effective government planning and budgeting challenging.

     Oil, being a finite resource, poses a risk of depletion. Heavily depending on it jeopardizes future income sources, potentially threatening the country’s long-term economic sustainability. In addition, over-reliance on oil exposes the economy to uncontrollable shocks, such as oil price slumps or global recessions, amplifying economic vulnerabilities. Recognising these risks, the federal government has prioritised revenue diversification for years, aiming to reduce dependency on oil and explore alternative income streams. Key initiatives include: investments in agriculture, manufacturing, tourism, and the tech industry seek to expand these sectors and generate additional revenue.

     Strengthening tax administration and expanding the tax base emerges as a pivotal strategy to boost domestic income, fostering diversification beyond oil in export sectors. This multifaceted approach aims to fortify foreign exchange earnings and reduce dependence on volatile oil revenue. Despite concerted efforts, the progress in diversification has encountered obstacles such as corruption, bureaucratic inefficiencies, and inadequate infrastructure, hindering the growth of non-oil sectors. The high political risk and economic uncertainty have also deterred foreign investment, restricting capital inflow into alternative sectors. An aspect less frequently discussed is the resistance from powerful entities within the oil industry, who may actively oppose diversification efforts that challenge their economic dominance.

     The persistent reliance on oil revenue remains a significant vulnerability for Nigeria’s economy and long-term development. Urgent action is needed to accelerate diversification by addressing these underlying challenges and creating an environment conducive to the growth of non-oil sectors. This strategic shift will not only enhance economic stability but also reduce susceptibility to external shocks, fostering a more sustainable future for Nigeria.

    The N9.18 trillion deficit in the 2024 budget

    The N9.18 trillion budget deficit in Nigeria’s 2024 budget carries profound implications for the economy in the coming year, reflecting government borrowing to bridge the revenue-expenditure gap. This deficit adds to the existing debt load, currently accounting for around 38 percent of GDP. Excessive debt poses the risk of diverting funds from critical areas such as social services and infrastructure, potentially diminishing credit accessibility for businesses. Economic vulnerability increases, rendering the economy susceptible to external factors like rising interest rates or global recessions.

     Inflationary pressures are a significant concern associated with government borrowing, as it can strain the money supply, potentially causing inflation. This inflationary impact can affect citizens’ purchasing power and business profitability, while investment uncertainty may erode confidence in the economy, discouraging long-term planning. Another potential consequence of the 2024 budget deficit is the risk of crowding out private investment. Government borrowing, in this scenario, competes with private businesses for financial capital, limiting access to funds for businesses and potentially stalling economic growth.

     However, managed prudently, deficit spending has the potential to inject funds into the economy, stimulating demand and potentially leading to accelerated GDP growth. Increased investments in critical infrastructure and social sectors could yield long-term benefits and generate employment opportunities. The deficit underscores the urgency of diversifying the economy away from oil dependence. This diversification could increase revenue from non-oil sectors, enhance economic resilience to oil price fluctuations, and create new job prospects across diverse sectors.

     The success of managing the deficit depends on the government’s approach to borrowing, whether it’s done domestically or externally, impacting interest rates and inflation. Effective management and utilization of borrowed funds are crucial to prevent waste and corruption. External factors such as a global economic slowdown or geopolitical tensions can significantly influence the economy and budget outcomes. While the deficit as a percentage of GDP (3.88%) is lower than in previous years, maintaining fiscal discipline is crucial to prevent a continuous upward trend in deficits. The allocation of spending, particularly in sectors like infrastructure and education, will significantly impact the deficit’s long-term effects. Vigilant monitoring and adjustments are critical to mitigate risks and maximize potential benefits for sustainable economic growth in the new year. The Nigerian government’s borrowing plans and the utilisation of Ways and Means concerning the 2024 budget deficit pose a complex dilemma with multifaceted considerations, involving trade-offs and risks shaped by various factors.

    Arguments for and against borrowing

    Financing critical infrastructure through strategic borrowing plays a crucial role in fostering investment in essential sectors like roads, power grids, and transportation. This approach stimulates economic growth, job creation, and enhances productivity, competitiveness, and living standards. Strategic borrowing, especially during economic downturns, can provide a temporary stimulus, helping mitigate recessionary effects and supporting economic recovery when alternatives like tax hikes or spending cuts are not viable.

     However, arguments against borrowing highlight concerns about adding to existing debt, questioning its sustainability and potential adverse effects such as higher interest payments, resource diversion from social services, vulnerability to economic shocks, and credit downgrades. Increased borrowing may strain the money supply, potentially leading to inflation, reducing citizens’ purchasing power, and impacting business costs and investment confidence. Specific concerns arise with the reliance on Ways and Means, which can burden the Central Bank of Nigeria and potentially impede its ability to maintain monetary policy stability and manage inflation. Historical concerns about transparency and accountability in managing Ways and Means increase the risks of misuse and corruption. While Ways and Means is intended as a temporary financing mechanism, excessive reliance on it can create instability and jeopardize fiscal sustainability.

     The government’s borrowing plans and use of Ways and Means require a nuanced assessment of risks and benefits based on economic conditions, budget allocations, and debt management strategies. While borrowing can offer advantages for infrastructure and economic stimulus, responsible management, fiscal sustainability, debt reduction, and revenue diversification measures remain crucial for long-term stability. Transparent public finance management is essential for trust-building and responsible economic governance.

    What the experts say

    The 2024 budget, recently approved by the National Assembly, presents a mixed scenario of promise and concerns for Nigeria’s economic landscape. The positive aspects include increased spending on infrastructure and a targeted focus on key sectors such as education and security, indicating a commitment to addressing critical needs. However, the significant concern arises from the substantial budget deficit and the reliance on debt to finance government activities. The expanding deficit raises questions about the sustainability of the budget, as it contributes to the already substantial national debt. Cautious optimism is warranted, as excessive debt levels can divert funds from essential areas, potentially limiting credit accessibility for businesses and making the economy more vulnerable to external shocks.

     The success of the 2024 budget hinges on effective management, transparent utilization of borrowed funds, and a commitment to fiscal discipline. Striking a balance between strategic borrowing for crucial investments and ensuring long-term economic stability will be crucial for navigating the challenges and opportunities presented by the budget. Vigilant monitoring and adjustments, along with proactive measures to diversify revenue sources and stimulate economic growth, will be essential in realizing the positive potential of the budget while mitigating risks associated with the deficit and reliance on debt.

     Economist Dr. Wahab Balogun, in a conversation with The Nation, provides insights into the intricacies of the recently approved budget and raises caution about potential pitfalls. Dr. Balogun acknowledges the positive aspect of increased allocations, especially for capital projects, considering it a welcome move. He emphasises the significance of investing in infrastructure as a crucial driver of economic growth and an improvement in living standards. The acknowledgment of the importance of capital projects aligns with the broader economic consensus that strategic investments in infrastructure can stimulate economic activity, create job opportunities, and enhance overall prosperity. Dr. Balogun’s perspective adds weight to the understanding that while there are positive elements in the budget, careful consideration and monitoring are essential to avoid potential challenges. This includes ensuring effective utilisation of funds, maintaining fiscal discipline, and addressing any risks associated with the budget implementation. Balancing the positive aspects with vigilant oversight will be instrumental in realising the intended benefits of the increased appropriations.

     However, he expresses concern about the widening deficit, exceeding $9 billion. “A deficit of this magnitude is unsustainable in the long run,” he cautions. “The government must prioritise efficient revenue generation and implement credible debt management strategies to avoid a fiscal crisis.” The securitisation of the N7.388 trillion Ways and Means, while providing temporary relief to the Central Bank, is not a long-term solution, Dr. Balogun stresses. “The focus should be on structural reforms that reduce reliance on overdrafts and promote fiscal discipline,” he advises. The increased allocation to the education sector, including N850 billion for basic education, finds favour with Dr. Balogun. “Investing in human capital is vital for achieving sustainable development,” he says. “An educated and skilled workforce is the backbone of any thriving economy.”

     However, he expresses concern about the balance in sectoral allocations. “While security is undoubtedly important,” he asserts, “significant allocations to defense and police must be weighed against investments in social sectors like healthcare and agriculture.” The National Assembly’s proactive role in revising the budget is commended by Dr. Balogun. “Their scrutiny and adjustments reflect their commitment to ensuring the budget aligns with national priorities,” he says. “However, effective oversight and transparency in budget implementation are crucial to ensure the allocated funds are utilized efficiently and for their intended purposes.” Dr. Balogun concludes by highlighting the challenges and opportunities ahead. “Inflationary pressures and global economic uncertainties pose risks to the budget’s projections,” he warns. “Diversification of the economy beyond oil dependence, strengthening tax administration, and tackling corruption are essential for boosting revenue and ensuring long-term economic stability.”

      Overall, Nigeria’s 2024 budget presents a complex picture. While its focus on infrastructure and human capital development is commendable, the sustainability of the deficit and reliance on debt raise concerns. Prudent financial management, efficient resource allocation, and sustained economic diversification will be key to translating the budget’s aspirational vision into tangible outcomes for the Nigerian people.

    On his part, Mr Gbolade Idakolo, Managing Director/CEO SD&D Capital Management Limited stated that the “budget as passed by the National Assembly is insensitive looking at the additional N1.2 trillion added to the budget and the increase of additional $1.8 billion in the NASS budget. “Commendably,  Defence,  Education, Police, Health and Social welfare got the lion share of the budget. If properly implemented, these would increase security lift people out of poverty and cater for the decay in our educational system. The budget assumption of N800/$1 is realistic. However, deficit funding for over $9billion with our debt servicing of about N8.7 trillion are major challenges that could affect proper implementation of the budget. Following the footsteps of the past administration the President Tinubu has sort for and gotten approval for additional loans $7.8billion and €100m to fund the budget” he said.

  • ‘Even crawling babies were not spared by our attackers’

    ‘Even crawling babies were not spared by our attackers’

    • Survivors of carnage relive ordeal
    • ’How my two hands were cut off in process of self defence’
    • My entire 21 relatives were wiped out, says victim

    Heaps of lifeless bodies and injured victims are the pathetic sights that confront a visitor to the scenes of the victims gathered by the search and rescue team set up by the communities attacked by gunmen in Plateau State. Many of the bodies of the about 140 victims of the ugly incident were those of innocent children.

    “The children were too innocent to be attacked by anyone for any reason. The only reason to kill such innocent children in a war situation is if genocide was the target of the attackers. So there is no doubt that the killings were purely genocide,” said Joshua Mangut in Bokkos.

    Instead of the merriment, bliss and exchange of love that usually characterises Christmas and the Yuletide, many Plateau communities including Ndun, Ngyong, Murfet, Makundary, Tamiso, Chiang, Tahore, Gawarba, Dares, Meyenga, Darwat and Butura Kampani are left to agonise over the death of their loved ones.

    Usually, from the 24th of December in such Christian communities, the mostly Christian families would have gathered all the foodstuffs and drinks they would need for the celebration of Christmas. This time, however, they were denied the opportunity to enjoy all that they had prepared for themselves.

    As the people were about to go to bed in the hope of waking up to another Christmas day, the gunmen struck.

    One of the victims, a 65-year-old housewife named Rebecca Maska, said: “We were in the house in Darunwat, Barkin Ladi Local Government Area, preparing to celebrate Christmas.

    Read Also; Tinubu is determined to end reign of terror in Southeast – Shettima

    “We had finished frying our meat and I started washing the rice and had parboiled it to make my cooking the next morning faster.

    “After that, I set out to have a bath before going to bed. When I had finished bathing, I entered the room to dress up. Then I heard the sound of gunshots that moved rapidly close to the church.

    “One of our little sons told me that we should get out and run. We ran into the next compound, which was a traditional ruler’s house, to hide there.

    “Before we knew what was happening, the Fulani marauders had gained entry into the palace. We escaped through the back door and headed into the bush. We then hide in a place close to a river.

    “Before I realised was happening, a marauder behind me greeted in Fulani and shot me in the thigh. I shouted and fell down, and was left in a pool of blood while my children fled in different directions.

    “At that time, I could not stand up, and there was nobody to help me. I was there for more than three hours. That was when my son called the soldiers and told them that her mother was in the bush.

    “That was when the soldiers came to my rescue and rushed me to a nearby hospital in Barkin Ladi where I was revived. But the bone is fractured.”

    But many other victims in Darunwat were not as lucky as Rebecca as 17 of the villagers were killed in cold blood and were eventually buried in a mass grave on Christmas day.

    One of the villagers, Silas Malang, said: “Mourning and burying loved ones on a Christmas day is the most painful experience in my life. My family had prepared a meal for the next day, but we never ate the meal.

    “When the gunmen struck, we spent the night in the bush, and from our hidden place we keep hearing sounds of gunshots till dawn. It was a war we never prepared for.

    “By the time we returned home from the bush, the house we left behind was already in ruin, including our Christmas meal. Now we are in an IDP camp.”

    Freedom Alfred, a 12-year-old boy seen at the IDP camp in Bokkos, said amid tears: “I heard the sound of gunshots and was hiding to escape been killed.

    “In the process, one of the tall Fulani marauders shot me in the arm. I started pleading with them not to kill me, but they did not heed my plea as they continued to beat me and wanted to machete me.

    “I fell down and pretended to be dead. Then they abandoned me and left.”

    Another survivor, a 34-year-old from Barkin Ladi, Mascan Nanpan, told The Nation that the gunmen that invaded the communities were more than 500.

    Nanpan said: “Those that surrounded our village alone were more than 200, and it was difficult to escape. It was God that saved me.

    “I sat down and later decided to enter the room and locked myself in. On arrival, they forced the door open.

    “Immediately, they entered and called my name, and asked if I’m the one that work in so and so place. I pleaded with them that I was sick. The next thing they did was to machete me and vowed that I must die.

    “On lifting the cutlass up and trying to cut my neck, in self defence I raised my right hand and it was cut off. Still in the process of defending, they cut off the second hand too.

    “They also broke my two legs, and I pretended as if I was dead.

    “Still not satisfied, they inflicted cuts on every part of my body until they felt that I was dead. Then they set the bed ablaze.

    “When they saw that I still did not move, they concluded that the bastard was dead.

    “I can recognise two of them. But three of them came to carry out the operation. The two are well known faces.”

    A 45-year-old Febi Moses Chirang, who is the only survivor from his family, told The Nation that he lost 23 members of his family during the attacks.

    He said: “Most of the victims are the aged and children who were too weak to run. We saw them with guns, tall and light complexioned.

    “They came from the top hill of Josho. At the time I saw them, I came out from the house to pick firewood. When I saw them, I quickly called the attention of our father that some strange faces were descending from the hill top of Josho.

    “Then our father saw them. But before they knew what their mission was, the Fulani marauders had started shooting. They went straight to where the women and children were hiding and killed 21 of them. Some injured ones are being hospitalised in Bokkos and JUTH. All my relatives have been wiped out; about 21 of them.

    “Nobody knows the mission of the attackers. Our home has been destroyed and we are now in a camp.

    A more chilling experience was narrated by an expectant mother, Mrs Ruth Bulus, who lost her two children and husband and now lives in an IDP camp.

    She said: “When the killers entered our compound there was confusion and everyone was running for their lives.

    “My husband and I ran in different directions. It was needless to wait for anything.

    “The next day, I was told they saw my husband’s corpse in the bush, and later I heard that they saw my children’s massacred bodies.

    “Our house was completely burnt down. We could not remove a pin from it.

    “I don’t know where to return to after this camp.”

    Cases of displaced expectant and nursing mothers are many at the IDP camps. It was such situation that moved the Vice President, Ibrahim Shettima, to apologise over the failure of federal government to protect the victims from attacks.

    Shettima also said that President Bola Ahmed Tinubu was deeply saddened by the tragedy and shared in “this unspeakable sorrows that have shattered the joy of Christmas across the country.”

     He said: “When one community bleeds, the entire country feels the pains.

    “The pains we feel now transcend ethnicity and religion, geography or politics. Each of us here knows the pains of losing one or two loved ones.

    “Burying a member of a family is rear experience and indescribable nightmare.

    “We cannot really assuage your pains. What has happened to you is a funeral to the entire nation.

    “Our hearts bleed along yours my dear brothers and sisters from Bokkos and Barkin Ladi.”

    The VP added: “We came to power promising to uphold the sanctity of everyone’s life, and now is to assure you that these inter-community violence that has persisted on the Plateau for the past decade will never persist under our watch. We will harness all our resources to bring those responsible to justice.

    “We will not rest untill we are able to prevent the recurrences of this heinous acts.

    “Your blood and your tears stain our collective conscience. Why it may seemed that we have failed you in your time of need, while it may seemed that you are all alone, I assure you that this government, especially president Bola Ahmed Tinubu, is here to protect you.

    “This government is here to deliver justice. We believe that justice is our collective foundation for our unity and our healing.

    “Our dear brothers and sisters in Plateau State, we appeal to you to resist the temptation to succumb to the poisonous rethorics of hatred towards your fellow citizens as we pursue justice and ensure your security.

    “These violence persist due to the dangerous practice of testing criminals as ambassadors of their groups, and where the law is taking into their hands where protection fails.

    “This is not the case now. This is a solemn promise I’m making on behalf of President Bola Ahmed Tinubu.

    “Please accept our condolences. Please accept our deepest apologies, because we won’t rest until you access justice and until you accept it.”

  • Lagos begins fulfilling promise to address water challenges

    Lagos begins fulfilling promise to address water challenges

    • Communities get help 25 years after
    • We’ll soon complete projects across state – LWC MD

    When we published a report few weeks ago about water challenges in Lagos State and how depraved business people were latching onto the opportunity to flood the state, Lagos Island in particular, with all manners of packaged water, the Lagos State government assured that it was working hard to end the challenges of lack of access to potable water in the state.

    The government’s statement, though sounded like the usual tongue in the cheek response of state actors to media inquiry, but recent completion of Abesan water works in Alimosho local government area of the state where the people had suffered water challenges for 25 years showed that the government is walking its talk and may by so doing end the business of killer water merchants. INNOCENT DURU reports.

    For the past 25 years, the residents of Abesan Estate, the largest estate in Lagos State and environs had grappled with the challenges of having clean and potable water.

    The water sources, wells and boreholes are polluted by petroleum products sipping into them from burst pipes.

    Consequently, the people could not use the water and had to travel many miles to buy water which they weren’t sure of its fitness for consumption.

    But the people heaved a sigh of relief recently when the state government revived and recommissioned the moribund the Mosan Okunola water works at Abesan Estate.

    Elated by the development, the traditional leader of Fatade area of Alimosho, High Chief Kamorudeen Amao said: “We thank God for what the Lagos state government has done. I am very happy that they have intervened in our situation. Our prayer is that God will give them the grace to maintain it.”

    The water plant will provide two million gallons of water per day for the people.

    Prior to the revival of the water plant, Chief Amao said: “We have been having water challenges for the past 25 years. Petrol sipping into the ground was affecting our water.  When we fetch water from our boreholes, it is petrol that we would get from it. The polluted water was affecting our people.

    “Personally, each time I bathed with it, I always had challenges with my skin. There have been reported cases of skin irritation by people using the water. Instead of using the water, we would rather travel some distances to fetch water.”  

    Asked how well they trusted the water they were going to fetch, Chief Amao said: “We still cannot vouch for the water we were fetching from other places. We just have to make do with what we have. We buy that water because we feel that it is somehow good when you drink it.”

    The traditional leader of Baruwa, Alhaji Halid Baruwa was also gladdened by the intervention of the state government.

    Read Also; FULL LIST: All past Ondo governors dead except Mimiko

    “We thank God for what the Lagos State government has done with this project,” he said as he went down memory lane to relive the hardship they had suffered as a result of not having access to clean water.  

    “Our water was polluted by petrol since 1998. We were always buying water. As retired civil servants, we were buying water using the meager pensions we are receiving.

    “We can’t tell how good the water we were buying was because we had no opportunity of carrying out laboratory test on them. There is no any form of treatment for the water the water that the federal government provided for us, we were told is not fit for human consumption because of the iron content.”

    Speaking at the re-commissioning of the project and flag off of reticulation extension in Baruwa area of Alimoso Local Government area of the state the General Manager of Lagos Water Corporation (LWC), Engineer Mukhtaar Tijani expressed joy that the project saw the light of the day in spite of challenges facing the corporation. His words: “I stand before you today with great joy and enthusiasm as we gather to witness a significant milestone in the provision of potable water to our communities. Before delving into the details of the Abesan Mini Waterworks project, let me briefly speak on some of the challenges faced by the Lagos Water corporation today.

    “Lagos, with its status as one of Africa’s most densely populated cities, serves as Nigeria’s economic hub, boasting a population of over 21 million inhabitants. The Lagos Water Corporation (LWC), tasked with providing potable water in the state, has encountered hurdles over the years, including aging infrastructure, energy shortages, and operational limitations.

    “In response to these challenges, the state government, under the leadership of our Governor Mr. Babajide Olusola Sanwo-Olu, took proactive measures to revitalize and reposition the Lagos Water Corporation.

    I must express our gratitude for the unwavering support from Governor Sanwo-Olu and the Hon. Commissioner of Environment and Water Resources, Mr. Tokunbo Wahab. With their support we have embarked on several initiatives that will reposition the corporation for operational and commercial efficiency, such as:

    ●             On-going emergency Intervention on Adiyan Phase I, Iju and Akute Intakes, which when completed will increase the plants (Adiyan & Iju) capacity utilization.

    ●             On-going Rehabilitation of Isashi Waterworks and extension of Reticulation to LASU & Iba Estate

    ●             On-going internal restructuring of the operations of Lagos water Corporation.

    ●             On-going addition of 70MGD Adiyan Phase II Water Treatment Plant Project, which when completed will serve almost 3million of the State population with impact to the following areas (Ipaja, Ayobo, Idimi, Ikotun, Isolo, Kirikiri, Amuwo, Ajegunle, Apapa, Agege extension and boost supply to already served Lagos metropolis).

    These Initiatives when concluded will significantly contribute to our goal of providing potable water to the residents of Lagos State.”

    Continuing, he said: “Now, let’s shift our focus to the reason we are here today, the Abesan–Baruwa Water Supply Scheme. Recognizing the immediate need to address water supply challenges in the Abesan Housing Estate, the Lagos Water Corporation embarked on a targeted approach to solve this problem in the most efficient manner possible.

    “Two key water sources, Mosan Okunola 2MGD Waterworks in Abesan Estate and the Adiyan Phase I Waterworks, supplied water to this area. Knowing that Adiyan Phase I waterworks is currently undergoing rehabilitation and will be unable to operate at optimal capacity until the conclusion of the rehabilitation, we shifted our focus to the non-operational Mosan Okunola Plant. The restoration of the plant became a priority for us. The extensive rehabilitation work done on the plant includes but is not limited to the rehabilitation of existing electro-mechanical infrastructure such as pumps, drilling of new boreholes, and power equipment upgrades including a new transformer and earthing system.

    “I am pleased to announce that through the hard work and collaborative efforts of the contractor Aquadrill Nigeria Ltd and the project team led by Engr Lawal of LWC, the operational capacity of the Mosan Okunola 2MGD Waterworks has been successfully restored. In addition to this, the 5km reticulation network around the estate is now energized, as we have carried out significant repairs to the pipe network over the past 6 weeks and as we speak we have over 5 metered customers receiving water from this water treatment plant in Abesan Estate.

    “At the Abesan Estate Gate on Ipaja Road, we have connected this water treatment plant to the Baruwa community who has suffered significant ground water issues in recent times.  The successful linkage of the Mosan Okunola Plant with Baruwa community now allows us to supply water to specific areas, including Baruwa compound, Taiwo close, Fatade Road, Sule Street, Oyewole Street, and Pipeline Road. Looking ahead, we plan to extend the pipe reticulation within Baruwa, covering approximately 3km. This expansion will positively impact areas such as Asalu Lawal Street, Ajibola Street, Remilekun Street, Odubakin Street, Adebanjo Street, Kareem Street, and more.”

    The MD went on to appreciate the host community, saying: “I want to extend my gratitude to the residents of Abesan and Baruwa for their input and cooperation during our test running phase, where valuable feedback was received and leakages were reported by residents, we most especially appreciate individuals like Mrs. Shola, Mr. Sakaraya, Mr. Remi, and others for their contributions. Special thanks to the Baale of Baruwa Community for his support during the network linkage implementation. We could not have done it without all of you.

    “I am going to conclude this speech by calling for the cooperation and collaboration of the residents of Abesan and Baruwa. I call on you to reconnect to Lagos Water Corporation services and ensure prompt payment of your water bills. To incentivize this, we are offering fifty (50) free house connections on a first-come, first-serve basis. We assure you that our operational team will promptly address leakages and customer requests, ensuring continuous supply of quality, potable water to the community.

    “A heartfelt thank you to our partners, including the Federal Ministry of Environment and Water Resources, USAID, WaterAid, Resilient Water Accelerator, and others. Your continued support is invaluable. We also seek your support for the timely completion of the pipe reticulation extension within Baruwa.

    To our esteemed principal, Governor Babajide Sanwo-Olu, today’s achievements were made possible through the internal revenue generated by LWC. With your continued support, we pledge to achieve even more and remain steadfast in delivering on Mr. Governor’s THEMES+ Agenda.Thank you all for being part of this success story, and we look forward to a future of improved water supply for Lagos State.”

  • No respite for troubled naira as dollar scarcity persists

    No respite for troubled naira as dollar scarcity persists

    The Nigerian naira is currently navigating one of the most challenging periods in its more than five-decade history, plummeting to a disheartening new low of N1,250/$ in the parallel market. This alarming situation paints a bleak picture of an uncertain future, demanding immediate and decisive action to rectify. In response to the crisis, the Central Bank of Nigeria (CBN) has taken notable steps, including the removal of restrictions on cryptocurrency accounts, thereby facilitating more dollar-based transactions. Furthermore, the CBN has dismantled restrictions that previously hindered 43 items from accessing foreign exchange at official windows. While these measures represent essential interventions, they underscore the critical necessity for addressing the core issue at hand—the pressing need to bolster dollar liquidity. The ongoing forex crisis is centered around the scarcity of dollars and it is imperative to devise strategies that will inject much-needed liquidity into the market. Assistant Business Editor COLLINS NWEZE writes

    Kareem Mustapha, a currency speculator, found himself on the brink of unexpected fortune while preparing for the Suri prayer. A WhatsApp message from his business partner, Abubakar Idris, on December 28, revealed that the naira was commanding an exchange rate of N1,250/$ in the parallel market. Mustapha, interrupting his prayer, hastened to the vault where he stored $100,000, verifying its presence. Recognising the opportune moment, Mustapha promptly contacted five of his most trusted aides. In a swift strategic move, he distributed $20,000 to each of them, instructing them to exchange the funds for naira. The unfolding scenario marked a significant turn of events, and Mustapha, seizing the moment, aimed to capitalise on the favourable exchange rate to augment his financial position. “I made N50 extra on every dollar sold because I bought at N1,200/$,” he disclosed.

     The entire transaction unfolded rapidly, concluding within a mere three hours due to the overwhelming number of manufacturers, importers, and various end-users of foreign exchange (forex) eagerly seeking to acquire the greenback. In this intense environment, Kareem Mustapha managed to generate a substantial N5 million profit. Mustapha is just one of the multitude of currency speculators strategically capitalising on the shortage of forex supply, heightened demand pressures, and the rationing implemented by the Central Bank of Nigeria (CBN). This situation creates an opportunity for speculators to exploit the prevailing fear, panic, and market volatility. The tactics employed by these speculators not only contribute to the challenges of the forex market but also exacerbate the difficulty in achieving a convergence of local currency rates, as they manipulate parallel market exchange rates in contrast to official rates.

     The naira is exchanging at $887/$ on the Investors’ and Exporters’ (I&E) Window- official market, but in the parallel market where a large part of the demand is settled, the local currency is facing the highest level of volatility in its over 50 years’ history where it has met series of devaluations and adjustments based on market realities. It was not only devalued by over 60 per cent in the last 18 years but in 2001 alone, its value was slashed 27 per cent. If one thinks that the 2001 debacle was worrisome, the naira has exceeded that loss, as it has depreciated by nearly 40 per cent this year alone. The local currency first hit double digits in 1991, moving from N9.9 to N17.2/$ the following year. That constituted a significant 73.7 per cent change. Thereafter, a continuous slide ensued, attaining triple digits in 2000.

     Although it was considerably stable between 2000 and 2003 (below N120/$), the recent adverse global capital flows especially to developing economies and drop in oil prices, among other factors, have culminated in the current low of N1,300/$ at the parallel market. As that was not enough, the naira woes worsened after the CBN in June unified all exchanges rates into the I&E window. The policy shift saw the apex bank collapse exchange rates – the International Air Transport Association (IATA) rate, parallel market rate, Interbank Exchange Rate and Bureaux De Change (BDC) rate – into the I&E window. By that singular move, dollar applications for medicals, school fees, Business Travel Allowance/Personal Travel Allowance, and Small and Medium Enterprises (SMEs) are processed through the I&E window – where rates are determined by market forces.

     The policy implementation immediately saw the naira devalued from N461/$ to N750/$ at the official market. Subsequently, the naira lost more strength as demand for dollar soared in the face of declining supply. According to data published by the National Bureau of Statistics (NBS), Nigeria attracted $23.9 billion as foreign investments in 2019. By 2020, the figure declined to $9.6 billion. It declined again in 2021 to $6.7 billion and once more to $5.3 billion in 2022. This implies a decline of $18.6 billion during the four-year period.

    Steps to stabilise the naira

    The CBN never stood idly watching the naira slide into oblivion. The regulator took certain stringent measures, including imposing some currency control measures to save the naira. Part of the ongoing move to stabilise the naira was the CBN lifting of a ban on transacting in cryptocurrencies. It instead that global trends had shown a need to regulate such activities. The regulator had in February 2021 barred banks and financial institutions from dealing in or facilitating transactions in crypto assets, citing money laundering and terrorism financing risks. Subsequently, the Nigeria’s Securities and Exchange Commission (SEC) in May last year published  regulations for digital assets that signalled the country was trying to find a middle ground between an outright ban on crypto assets and their unregulated use.

     CBN Director, Financial Policy Regulation, Haruna Mustapha, this month announced regulation of the activities of virtual asset service providers (VASPs), which include cryptocurrencies and crypto assets. The latest rules spell out how banks and financial institutions (FI) should open accounts, provide designated settlement accounts and settlement services and act as channels for forex inflows and trade for firms transacting in crypto assets. Mustapha, however, warned that banks and other financial institutions were still prohibited from holding, trading or transacting in cryptocurrencies on their own account. The next was CBN’s lifting of forex restrictions on 43 items from accessing dollars from official window and promise to intervene in the forex market from “time to time.” Items affected include rice, cement, palm kernel, meat and processed meat products, poultry, soap, and cosmetics among others. It said: “As part of its responsibility to ensure price stability, the CBN will boost liquidity in the Nigerian Foreign Exchange Market by interventions from time to time. As market liquidity improves, these CBN interventions will gradually decrease.

    Read Also: Will 2024 be the year of the naira?

    FX scarcity opens local substitutes’ option

    While awaiting the liquidity boost in the system, many Nigerians and businesses developed survival skills to beat dollar crunch. Michael  Olatunde, a Lagos-based banker  has passion for attending weekend parties. The party time has for years remained the best part of his weekends, relieving him of the stress associated with his banking job. Olatunde was so fond of the party souvenirs that he created space in his four-bedroom apartment where he keeps the gifts. But on November 20 during a wedding reception held in Surulere, Lagos, he had a surprise souvenir gift that cannot be kept in his apartment for long. He was one of the over 200 guests that received unripe plantains shared as souvenirs at the wedding reception. Like Olatunde, many other guests were surprised at the souvenir choice while a few others were simply excited. “It is not new that souvenirs are a part of parties. Celebrants gift their guests all kinds of gifts, ranging from plastic bowls, jotters, umbrellas, soap, matches, and in recent times, power banks, boxes, phones among others. Never have I seen them share unripe plantains,” he said.

     But what Olatunde failed to understand was the emerging trends in the economy where people are going for substitutes for  items that require dollars to be imported. The move is not only to save cost for party organisers given the rising rate of inflation which has raised prices of goods and services, but to conserve foreign exchange as foreign capital inflows to the economy dropped. Commercial banks are also turning down payment requests from customers paying business partners abroad with naira debit cards. They are now asking customers paying clients abroad to do so in the currency of the beneficiary’s country, not in naira. The practice differs from the previous one where lenders debited the naira accounts of customers at the prevailing exchange rate and remitted dollar equivalent to the offshore beneficiary’s account.

    Views from stakeholders

      Murega Mungai, the Trading Desk Manager at AZA, a global forex trading firm, has expressed his perspective on the ongoing depreciation of the naira. According to Mungai, this depreciation is likely to persist unless there are regulatory sanctions imposed on illegal forex dealers, particularly exporters who neglect to remit export proceeds to government coffers, as mandated by the Central Bank of Nigeria’s (CBN) Foreign Exchange Manual. The CBN’s Foreign Exchange Manual outlines the requirement for exporters to repatriate export proceeds to Nigeria, a measure designed to support the naira and stimulate economic growth. However, adherence to these guidelines by involved parties has been lacking. Adding to the challenges, persistent dollar demand pressure stems from importers stocking up for New Year sales. Faced with difficulties sourcing from the official market, these importers redirect their demand to the parallel market, exacerbating the strain on the naira. Additionally, shipping and airline companies have faced accusations of withholding much-needed dollar earnings by not remitting export proceeds, further contributing to the complex dynamics impacting Nigeria’s forex situation.

     Despite the Central Bank of Nigeria’s (CBN) ongoing efforts, including weekly dollar sales to banks, the substantial demand backlog from manufacturers and foreign investors, estimated at $5 billion, remains a significant source of pressure, contributing to a volatile situation in the forex market. Dr. Ayo Teriba, the Managing Director of Economic Associates, has expressed reservations about the unification of exchange rates and highlighted two key components of forex reforms that require attention before such unification can be considered. Firstly, Dr. Teriba emphasized the need to acknowledge that the primary challenge in the forex market is related to a shortfall in supply. Addressing this issue entails implementing measures to enhance both market and regulatory transparency. By doing so, the market can become more resilient, providing a foundation for addressing the existing supply-demand imbalance. In summary, the call for caution in rate unification is coupled with a recognition that addressing the supply-related challenges and enhancing transparency in market operations are crucial prerequisites for stabilizing and improving the overall functioning of the forex market.

     He said: “Just like what you have when there is food shortage. You need to open your grain reserves to boost supply and prices will adjust. We expected new government to put certain measures in place before unification. If a doctor wants to perform surgery that would require loss of blood on a patient, it will be wise to get blood from a blood bank ready before the surgery,” he advised.

     Teriba said government should look at ways to boost dollar supply including allowing foreign investors to take equity fin national assets to raise dollars that would boost naira. He also called for a competitive forex market, where everyone  is on a level playing field. “Aside the banks, other players in the market, including bureaux de change operators should have equal access to the market. Banks are not licensed to trade forex, but the CBN has given them that role, and excluded BDCs that have the right license for the transactions. There should be freedom of entry and exit for even Fintechs to play in the market, and every dollar earned will add to the market liquidity,” Teriba advised. 

    The Economic Associates boss said the CBN operates with so much opacity, and it is difficult to see what the regulator is doing. “The lack of transparency in the market is not fair to the BDCs. The government will do well to restore regulatory integrity including ensuring that any CBN staff with BDC license is identified and sanctioned because of conflict of interest,” he said.

    Former Registrar, Chartered Institute of Bankers of Nigeria (CIBN), Dr. Uju Ogubunka, said Nigeria’s trade balance has been weakened by its inability to produce and earn forex. He said Nigeria must find new ways to boost production to earn more dollars and boost foreign reserves.  Ogubunka, who is also the President, Bank Customers Association of Nigeria, said aside boosting production, there is need to tackle insecurity to allow farmers go to their farms. He said such effort will help increase crop yields and bring more dollar earnings for the economy that will ,firm up the local currency.

     According to him, insecurity and the political uncertainty are delaying several corporate investment decisions that would have brought in more dollars to the economy. Gwadabe said there was need to encourage market participants to source forex from independent windows to boost liquidity. According to him, exchange rate unification can only thrive where the market participants are given enabling environment and all players treated fairly and equally for the sake of transparency.

    Former Executive Director, Keystone Bank, Richard Obire said the weakness of the Naira over time has been caused by two broad issues linked to the quality of leadership and governance. He listed the first as Nigeria’s our heavy and skewed outward oriented  consumption of goods and services. Examples are our decades long substantial bills for food and energy imports. The second, he added, is the massive corruption driven capital outflows which in turn severely damages our capacity to produce at scale to fully engage our large population to create widespread prosperity.

     On ways to strengthen the naira, he advised that in the short-term, there is need to find non-market damaging ways to increase the supply of hard currencies and reducing the demand for same. According to Obire, right pricing for remittances and frictionless processes for their use by recipients should see the volumes growing again. He said that insecurity hampering food production needs to be tackled with a sense of urgency and effectiveness. “Priority should be given through deploying pragmatic incentive programs to drive  up the volume of food products for domestic consumption and industrial use to reduce our food import bill. All government consumption expenditures requiring the use of hard currencies should be suspended indefinitely, starting now. In the long term, only a strong economy will produce  a stable currency. To achieve this will require addressing the fundamental structural defects in our political-economy hampering an accelerated transition from an outward consumption oriented economy into a mainly balanced production driven one,” he said.

     Nigeria Country Representative, European Organisation for Sustainable Development, Jide Akintunde,  said once the CBN implemented the forex unification policy, the exchange rate of the naira moved from N461/$1 to around N750/$1 in the I&E Window. Since then, the naira has continued to lose value on both the official and parallel markets. He said the long-term causes of the weakening of the naira have been the dip in productivity in the economy, poor market governance, and outright corruption. “In my view, except these three issues are addressed, Nigeria would never be able to harness the benefits of a market exchange rate and manage its risks. It is possible to begin to address these issues immediately, and with that stability in the exchange rate would be archived over the medium- to long-term,” Akintunde said.

     Managing Director, Financial Derivatives Company Limited, Bismarck Rewane, said it is expected that the benefits of the forex reforms will crystalise later. In emailed note to stakeholders, he said: “Exchange rate management goes beyond exchange rate unification. It must address issues surrounding market structure, easy access and adequate supply. This means effectively dismantling forex rationing, administrative controls, and reviewing import restrictions.”

     Despite its numerous setbacks, Rewane said the current exchange rate framework is expected to increase transparency in the forex market, reduce exchange rate misalignment and transaction costs, and buoy investor confidence. Other analysts insisted that Nigeria’s current managed floating exchange rate regime combined features of both the fixed and flexible exchange rate. A lightly managed floating exchange rate regime is advocated given that the exchange rate becomes determined essentially by demand and supply forces. This would allow the CBN to intervene occasionally to moderate excessive fluctuations, which are prone in developing countries, including Nigeria. As these policy implementations to save the naira are sustained, the expectation of many Nigerians is that the local currency bounces back to command the respect of both local and foreign investors.

  • Hit by mass exit of companies, Nigeria’s FDI, job drive totter

    Hit by mass exit of companies, Nigeria’s FDI, job drive totter

    Citing Nigeria’s challenging macroeconomic environment, multi-national company Procter and Gamble (P and G) recently announced its decision to exit Nigeria and transition its operations to an import-only model. This came barely four months after the same headwind forced pharmaceutical and biotechnology giant GlaxoSmithKline (GSK) to vote with its foot, prompting renewed fears that without urgent and significant improvement in the ease of doing business to halt the mass exodus of local and foreign companies from Nigeria, the road to opening the floodgate of investments to grow the economy and create jobs remains long and arduous. Assistant Editor CHIKODI OKEREOCHA reports.

    President Bola Tinubu and his economic managers, including operators in diverse sectors and Nigerians generally must be disconsolate. The frenetic speed with which companies in Nigeria, especially multinational corporations, are either shutting down, divesting or relocating to other business and investment jurisdictions, apparently because of the country’s challenging macro-economic environment, must have been a devastating blow, a nightmare of sort, perhaps.

     This is particularly so for the President, who, since his inauguration on May 29, has never hidden his resolve to reposition Nigeria as an investment destination of choice, and has been in search of countries and investors willing to do business or invest in Nigeria, including incentivising investors by easing stringent business policies that discourage investment.

     Many industry operators and experts see the gale of mass exit of companies from Nigeria as a threat to the gains so far made by the administration in rekindling the enthusiasm of local and foreign investors in doing business in Nigeria. It means that the drive for economic growth and job creation, including a pushback on poverty, which is critical to the achievement of the administration’s Renewed Hope agenda, has come under serious threat.

     In other words, the current administration’s renewed push to open the floodgate of local and foreign investments to grow the economy and create jobs has suffered a major setback. It also means, by extension, that Nigerians who had hoped that with more foreign and local companies operating in Nigeria, a significant dent would be made on the country’s embarrassing unemployment rate and ultimately, curtailing the socio-economic consequences of joblessness may have had their hopes dashed.

     While these fears are not new, having been a recurrent feature in the Nigerian business and investment community, the fact that two major global brands were forced to join the inexhaustible list of companies that have shut down operations in Nigeria, under the current administration made such fears more pronounced; it also speaks to the urgent need for significant improvement in the ease of doing business in Nigeria to halt the depressing trend.

     Procter and Gamble (P and G) was the latest global brand whose decision to pull out of Nigeria gave these fears more traction. The world’s largest personnel care and household products company, makers of brands such as Pampers and Gillette, among others, recently announced its decision to exit Nigeria and transition its operations to an import-only model. This is despite boasting an overall portfolio valued at $85 billion, with Nigeria contributing $50 million in its net sales business.

     P and G, an American consumer goods company, which started operations in Nigeria in 1992 with the acquisition of the Richardson Vicks manufacturing plant in Ibadan, Oyo State, also manufactures Always, a popular brand of sanitary pad. It also manufactures and distributes brands of detergent (Ariel), fragrances, alkaline batteries, toothbrushes (Oral-B) and shaving sticks.

     But after about 21 years of operations, P and G pulled out of Nigeria and said it was transitioning to an import-only model. The company’s Chief Financial Officer (CFO), Andre Schulten explained at the Morgan Stanley Global Consumer and Retail Conference in New York, that its decision to exit Nigeria was driven by the difficulty of operating as a dollar-based organisation in the country’s challenging macroeconomic environment.

     However, Nigeria is not the only country hit by P and G’s current restructuring. Argentina is also affected.

     Schulten said: “The other reality that arises in some of these markets (i.e. Nigeria and Argentina) is that it gets increasingly difficult to operate and create US dollar value. So, when you think about places such as Nigeria and Argentina, it is difficult for us to operate because of the macroeconomic environment.

     “So with that in mind, we are announcing a restructuring programme with the intent to adjust the operating model and adjust the portfolio to ensure that we maintain the portfolio discipline that has brought us to this point. The restructuring programme will largely focus on Nigeria and Argentina. We’ve announced that we will turn Nigeria into an import-only market, effectively dissolving our footprint on the ground in Nigeria and reverting to an import-only model.”

    Read Also: UK govt pledges more FDI in Nigeria

     But the restructuring programme does not come cheap for P and G. According to Schulten, the company could incur charges anywhere between $1 billion and $1.5 billion after-tax from restructuring its operations in Nigeria and Argentina, two markets where the business has been problematic for them.

     He, however, noted that the latest strategic decision will help the company to focus on markets that have the highest potential, adding that compared to its overall portfolio worth $85 billion, the company does not anticipate any material impact on the group’s balance sheet from a sales or profitability standpoint.

     P and G’s exit from Nigeria came barely five months after British drugmaker GlaxoSmithKline Consumer Nigeria Plc. (GSK) also made known its decision to shut down operations in Nigeria after over 51 years and resort to third-party distribution to serve customers in the West African market.

    GSK, maker and distributor of Panadol and another portfolio of loved and trusted brands such as Sensodyne, Andrews, Macleans, Voltaren, Otrivin and Horlicks, in Nigeria, equally attributed its “strategic choice” to cease operations in Nigeria to unfavourable macro-economic dynamics including forex volatility, being a dollar-denominated organisation.

     Founded on June 23, 1971, with a head office in Ilupeju, Lagos, and a manufacturing site in Agbara, Ogun State, GSK operates in the consumer healthcare and pharmaceuticals segments. While its healthcare segment includes nutritional healthcare, oral care, and Over-The-Counter (OTC) medicines, its pharmaceutical segment offers anti-bacterial, vaccines, and prescription drugs.

     However, the exit of GSK and P and G added to the long list of companies, both local and foreign, that have either shut down, divested or relocated to other business and investment jurisdictions considered cost-friendlier than Nigeria.

     Some notable brands whose relocations and divestments from Nigeria have continued to cause industry ripples among members of Nigeria’s business community and the authorities because of the obvious impact on consumers and the economy include the 2006 relocation of the factories of two of Nigeria’s leading tyre manufacturers, Michelin and Dunlop to Ghana.

     Both companies, at that time, cited epileptic electricity supply in Nigeria as a major reason. Also, six of Nigeria’s automobile assembly plants have since disappeared from the landscape. They include Peugeot Automobile Nigeria Limited, (PAN), Kaduna; Volkswagen of Nigeria Limited, Lagos; Anambra Motor Manufacturing Limited; Steyr Nigeria Limited, Bauchi; National Truck Manufacturers, Kano; Fiat Production; and Leyland Nigeria Limited, Ibadan.

     The situation in the textile industry is no less depressing. For instance, Kano, hitherto the hub of the textile industry in Nigeria, is currently a ghost of its former self. As of 2018, 232 manufacturing plants out of the 338 that existed in Sharada/Challawa and Bompai Industrial estates in Kano City have shut down.

     Between 1999 and 2009, 38 major textile companies closed down in Nigeria, according to the Nigerian Textile Manufacturers’ Association. And there is hardly any sector in Nigeria that has not witnessed a mass exodus of companies from the country. Each of the companies employed thousands of Nigerians. And all the tiers of government also raked in huge revenue in taxes, levies and other charges from these companies.

      Why companies are leaving Nigeria

     Difficulty in sending back U.S. dollars outside Nigeria, by dollar-denominated companies, is not the only factor responsible for the mass exodus of companies from Nigeria. Rather, companies, both local and foreign, are being forced out by the myriad of binding constraints in Nigeria’s operational and fiscal environment.

     For instance, as the Chief Executive Officer (CEO) of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, puts it, the increased mass exodus of companies from Nigeria “is a reflection of the increasingly difficult operating environment for investors, especially manufacturers.”

     While noting that the macro-economic environment has been challenging, Dr Yusuf said: “Structural issues are impeding competitiveness, poverty is constraining affordability of products by consumers, the influx of Asian products into the Nigerian market is a manufacturer’s nightmare and foreign exchange market illiquidity and associated distortions is a major source of frustration for most investors.”

     According to the former Director-General of the Lagos Chamber of Commerce and Industry (LCCI), losses declared by many firms recently were a manifestation of the impact of exchange rate risk. He said typically, firms with huge foreign exchange obligations are very vulnerable in a volatile macroeconomic environment and exchange rate risks are very high because of Nigeria’s weak balance of payment position.

     Yusuf said the revaluation of foreign exchange liabilities amid the reforms in the forex market would predictably result in current outcomes for companies with significant foreign exchange obligations. “It is a question of crystallisation of exchange rate risk. It is quite predictable,” he stated.

     The Director-General of Nigeria Employers’ Consultative Association (NECA), Mr Adewale-Smatt Oyerinde, in a statement titled “Rising Rate of Business Divestment, Capital Flight and Business Closure in Nigeria–NECA Raises the Alarm” described the recent trend of business relocations and divestments from Nigeria as “unfortunate.”

     He said over the last decade, the private sector had been adversely affected by various policy thrusts of government, and that many of these policies were anti-growth, ill-timed or not well thought out, while others were not in alignment with the country’s economic realities.

     The NECA D-G said in more complex cases, the private sector witnessed an era of policy clashes and contradictions, and regulatory and legislative strangulation of businesses, which left many companies without a clear path for planning and decision-making. Operational costs have also increased astronomically, heaping more woes on many companies.

     The consequences of years of wrong policy choices, according to Oyerinde, have been manifest. “As expected, divestment, capital flight and outright closures have become the ‘new normal’ within the business community. This is one of the chief reasons why the unemployment rate continues to soar with the consequential rise in crime and other security issues,” he said.

    Oyerinde expressed fears that as a large number of Nigerians become unemployed when businesses cease operations either by divestment or a move to other more profitable and hospitable environments, the country inadvertently loses income from taxes, even as social investment is hindered and poverty continues to hold sway.

    For the Director-General of LCCI, Dr Chinyere Almona, the mass exit “critically reflects on the country’s poor ranking on the ease of business measures, which the chamber has constantly spoken about.” She said factor cost, as an integral element of the profit equation, is viewed with utmost seriousness by business people such that in the face of rising costs, businesses will likely search for cost-friendlier locations.

     Dr Almona said the Chamber views the situation with grave concern, and expressed regrets that “despite presenting international businesses with the largest market on the Continent, Nigeria still suffers from worrying economic slow-down decisions, which are often provoked by the rising cost of doing business, exposed by epileptic power supply, and weak infrastructural backing, among others.”

    Giving more details about why companies are closing shop and relocating from Nigeria, the President of the Manufacturers Association of Nigeria (MAN), Otunba Francis Meshioye said power crisis, high interest, smuggling, coupled with the unpredictability of the country’s foreign exchange rate before it was recently unified were contributory factors.

     The MAN President also said multiple taxations and levies imposed on manufacturers by the various levels of government, including the high cost of funds and lack of long-term credit, among other factors have become too heavy for most manufacturers to bear.

     Meshioye described the mass exodus of companies from Nigeria as “a very concerning development that should be stopped given Nigeria’s unrivalled leadership role as the hub of industrial production in West Africa.”

     The National President of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Mr. Dele Kelvin Oye corroborated the MAN President’s assertion on the need to stop the trend, considering that the development has dealt a heavy blow to the manufacturing sector.

     Oye’s idea of halting the trend is for the government to work collaboratively with the private sector to develop policies that will stimulate economic growth and create job opportunities in the country, pointing out that with the right policies in place, Nigeria’s economy can be revitalised and the country can become a hub for business and investment in Africa.

     The NACCIMA boss said while the Bola Tinubu-led administration had commendably set Nigeria on a long-term path to economic progression, the adverse effect on certain sectors of some of its economic policies has been an issue.

    “In particular, the sudden rise in the price of petrol and abolition of the official Naira rate has caused a significant backlash, eroding the already earned income and trading capital of several multinational companies that had established their previous earnings based on the official naira rate at the time,” he said.

     He stated that as a result, there has been a steady exodus of multinational companies and the collapse of several local companies, resulting in significant job losses and economic damage.

     Oye, therefore, urged the government to urgently review the short-term impact of its economic policies as it relates to commitments already concluded for remittances/raw materials by the affected companies/businesses to reverse the trend of companies leaving Nigeria.

     He also pushed for the prioritisation of investment in infrastructure and power supply and the provision of tax incentives to encourage businesses to invest and remain in Nigeria.

    More manufacturers’ exit likely, MAN warns

     Bad as the gale of mass exodus of companies from Nigeria is, the Manufacturers Association of Nigeria (MAN) has warned that more manufacturers and businesses are likely to leave the country after P and G’s exit unless the government addresses the challenges confronting manufacturers in the country.

     The Director-General of MAN, Segun Ajayi-Kadir gave this depressing prediction when he appeared on Channels Television’s Sunrise Daily. On the programme, which was monitored by The Nation, he expressed sadness over P&G’s exit from Nigeria and called for proactive steps to remove bottlenecks in the sector’s performance and sustainability.

     Ajayi-Kadir’s words: “Obviously, we received it (P and G exit) with sadness, but it is not totally unexpected and more may happen because there is no doubt that we operate in an environment that is challenged. Manufacturing in any economy is a strategic choice; the government has to make up its mind whether it wants its country to be an industrialised one.”

     He said once that decision is taken “you have to do all that is needed to remove the binding constraints that limit the performance of that sector. Nigeria has not done so and that is why you can see there are closures. I think it is news because it is P and G, it is news because it is GSK, it is news because they have been in the country for a very long time, but several others have died quietly and for reasons that are avoidable.”

     Ajayi-Kadir, however, said there is a lesson to be learnt from the multinationals’ departure from Nigeria. According to him, the development presents a chance to support domestic producers more than international investors because they are more resilient and likely to remain against all odds.

     The MAN D-G said: “The big ones that are exiting are those multinationals and I think this will send a clear signal to the government that regrettable as it is, it should guide future actions. We need to be strategic in what we promote. So, what this means is that if you have a challenged local manufacturer, he is not likely to go anywhere.

    “That is why we are saying that foreign direct investment is excellent, it has led to phenomenal improvement in the performance of the manufacturing sector for so many economies, but it should come secondary to empowering the local investor, the existing manufacturers because that is what is enduring. Though it is regrettable, it is not unexpected, and I think unless we take clear redefined measures, many more will happen”

     Worried by the exit of companies from Nigeria and determined to halt the trend, President Tinubu, a fortnight ago, begged multinational companies operating in Nigeria not to leave the country, saying that his administration was determined to remove all bottlenecks to the smooth running of their businesses.

     The President, who spoke to a visiting delegation of the management of Shell Group, led by its Global Integrated Gas and Upstream Director, Ms Zoe Yujnovich, at the State House, Abuja, added that there is no obstacle too big to be removed to make Nigeria a safe-haven for large-scale investments.

    “We are very focused on resolving all investment-related issues. No bottleneck is too difficult for us to remove in our determined march toward making Nigeria the African haven for large-scale investment in all key sectors. We need each other,” Tinubu said.

     However, the preponderance of opinion by industry operators and members of the business and investment community is that business and investment decisions are not based on sentiment but on bountiful Return on Investment (RoI), which must be encouraged by putting the right systems and structures in place.

     According to them, making the business environment conducive and attractive for local and foreign direct investment by improving the security situation in the country and addressing infrastructure, particularly electricity, which accounts for over 40 per cent of manufacturers’ cost of production, for instance, will reverse the trend, not begging.

     Will the government working collaboratively with the private sector develop policies to enhance the ease of doing business in the country and hopefully, pull the breaks on the exit of more companies, local and foreign, from the country? Will it address the aforementioned binding constraints forcing companies to see exit from the country as a compelling option?

     Will Nigeria, despite its huge market and over 200 million population, continue to watch while neighbouring West African countries, particularly Ghana, become the sub-region’s preferred investment destination? Time, they say, will tell.

  • Sub-Saharan Africa’s first In-Vitro Diagnostics factory launched in Lagos

    Sub-Saharan Africa’s first In-Vitro Diagnostics factory launched in Lagos

    Colexa Biosensor Limited, a subsidiary of Codix Pharma Limited, has made an audacious move to transform Africa’s Healthcare system and provide better health expectancy with the commissioning of the first In-Vitro Diagnostics (IVD) Factory in Sub-Saharan Africa and the unveiling of OnPoint Blood Glucose Meter and Strips duly evaluated, approved, and registered by the National Agency for Food and Drugs Administration and Control.

      The official opening ceremony held at the company’s office in Ilupeju, Lagos, serves as a springboard to different health issues in Africa. This flagship product addresses the prevalence of diabetes in Africa by manufacturing blood glucose meters and strips for millions of people living with the disease to help in combating the disease and raising awareness on early detection and management to aid recovery and wellness. With an installed capacity of 3.6 million packs and an opportunity to scale up to 10.8 million packs annually, the company is poised to meet local demand and export, starting with its subsidiaries across West Africa.

     The Executive Chairman of Colexa Biosensor Limited, Mr. Sammy Ogunjimi, stated that with the firm’s focus on Africa and with Nigeria as its base, it aims to extend its solution throughout Africa and the world and contribute its efforts to correcting the deficit in the balance of trade and to raising the volume of exports to improve the foreign exchange situation. He said, “We aim to localise and backward integrate to reduce our dependence on imports and this factory is the first step towards achieving that goal. We are happy to announce that this factory has received two Quality Management System certifications-1st the ISO 13485:2016 (IVD) Certificate, and the ISO 9001: 2015 (process) certificate. We have also received a successful independent comparative evaluation of OnPoint BGM with the market gold standard through the Medical Laboratory Science Council of Nigeria (MLSCN). Colexa Biosensor Limited will provide direct employment for over 700 staff and several more indirectly.”

        The Coordinating Minister of Health and Social Welfare, Professor Muhammad Ali Pate, reiterated the commitment of FG to patronise local manufacturers of healthcare products and ensure the prevention of spending the country’s short supply of foreign exchange on importation of pharmaceutical products that can be produced locally. “Our President, Bola Ahmed Tinubu, sees it as unacceptable that 99 per cent of medical devices and more than 70 per cent of our generic pharmaceutical equipment in Nigeria are imported. The Federal Government will purchase locally manufactured diabetes test kits because we know that diabetes is a very significant cause of morbidity in our country,” he said.

      The Chairman of the occasion, Prince Julius Adewale Adelusi-Adeluyi, a former Minister of Health, urged the government to ensure an environment that enables companies like Colexa Biosensor to thrive and remain sustainable. Some of the ways he proposed that the government can support them include the patronage of the products and total removal of import duty on pharmaceutical manufacturing equipment, raw materials, and accessories, rather than having to apply for Import Duty Exemption Certificate (IDEC) each time, which sometimes take up to two months. In her goodwill message, the Director General of the National Agency for Food and Drug Administration and Control (NAFDAC), Prof (Mrs.) Mojisola Adeyeye spoke about the attainment of Maturity level 3 by NAFDAC as a major opportunity that would ensure that quality products from Nigeria are accessible and acceptable to African Countries. She hailed Sammy Ogunjimi and Lekan Asuni for their vision of ensuring that the country can meet its local consumption of IVD products.

  • Lagos agripreneurship as model for women and youth empowerment

    Lagos agripreneurship as model for women and youth empowerment

    Despite Nigeria’s agricultural potential, the country lags at 109th out of 125 countries on the 2023 Global Hunger Index, grappling with an army of unemployed youths and pervasive food insecurity. In response, Lagos charts a transformative course with the Lagos Agripreneurship Programme, a beacon of hope for the country. In this special report, Associate Editor ADEKUNLE YUSUF delves into the programme’s multifaceted approach, from government investments to youth empowerment, and its potential to reshape Nigeria’s agricultural landscape for sustained growth and prosperity.

    Despite Nigeria’s considerable agricultural potential, it is disheartening to note that thcountry ranks 109th out of 125 countries in the 2023 Global Hunger Index. The streets in many parts of the country are teeming with beggars, and there is a pervasive sense of restlessness among an army of unemployed youths. In the face of these challenges and the persistent issue of food security, it becomes imperative to heed Alex Haley’s timeless advice: “Find the Good and Praise it.” Urgently, there is a need to encourage individuals, especially political and corporate leaders, to amplify their efforts in uplifting our society.

     In this context, it is noteworthy to applaud the commendable strides being made in agricultural productivity that have given rise to a new generation of vibrant agro-entrepreneurs in Lagos State. The recent exponential growth in government investments in the agricultural sector has led to its inclusion in the State Development Agenda.

     The state government firmly believes that a decisive strategy to combat poverty in the country involves active engagement in agriculture, thereby transforming the nation into a proficient producer of social, environmental, and economic wealth. Leveraging its coastal geography, the emphasis naturally gravitates towards the development of aquaculture.

    In line with his role as a social engineer, Governor Babajide Sanwo-Olu’s conviction regarding the imperative to involve the youth as potential agents of change for themselves and their communities led to the inception of the “Lagos Agripreneurship Programme (L.A.P).” This programme stands as a testament to the commitment of the government in channeling the energy and potential of the youth towards sustainable agricultural practices, ultimately contributing to the socio-economic advancement of the state.

     Leveraging its immense potential for innovation and meaningful participation in the agricultural sector, Lagos is actively exploring the “Lagos Agripreneurship Programme (L.A.P)” as a catalyst. This initiative aims to ignite the interest of the youth segment within the state’s population in food production activities. The programme strategically addresses challenges that hinder the full engagement of women and youth in agriculture, seeking to create an environment conducive to their active involvement.

     Initiated by the administration of Sanwo-Olu in 2019, the Lagos Agripreneurship Programme (L.A.P.) is conceived as a social intervention endeavour. Its primary objective is to empower women and youth in agriculture through training, employing modern agricultural techniques and practices. The programme stands as a testament to the administration’s commitment to harnessing the potential of the younger generation for the advancement of agriculture and the overall prosperity of Lagos.

     The Lagos Agripreneurship Programme (L.A.P.) draws inspiration from Israel’s Arava International Centre for Agriculture Training (AICAT) programme, embodying the core principle of learning by doing. This innovative initiative combines practical training on an advanced and modern farm, theoretical studies, and communal living, offering participants a distinctive and immersive experience throughout the four-month training period. The programme unfolds in two phases: a one-month on-site training at the Lagos State Agricultural Training Institute (ATI) in Araga, Epe. During this phase, participants receive comprehensive training in Poultry, Aquaculture, Vegetable Value Chains, E-Agric, and Agribusiness. The state government generously covers participants’ accommodation, meals, training materials, and safety kits. Subsequently, the programme transitions into a three-month internship and mentorship phase, where participants engage with select agro-allied companies and farms. Since its inception in 2019, the programme has successfully trained a total of 3,000 participants. This accomplishment underscores its effectiveness in providing practical knowledge and skills to aspiring agripreneurs, contributing to the growth and sustainability of the agricultural sector in Lagos State.

    As a crowning achievement of the agricultural policy, performance evaluations mark the conclusion of the training phase, assessing participants across all value chains to gauge comprehension and incentivize hard work. The Ministry of Agriculture has further enhanced the programme by introducing a reward system, recognizing top-performing participants for grant support and granting them the opportunity to utilise the ministry’s production facilities at the Lagos Food Production Centre, Badagry, and the Agricultural Training Institute, Araga, Epe, as agribusiness incubation parks. Additionally, the Ministry’s Extension Agents provide extension and technical support services to ensure the sustainability of the projects.

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     Under the Sanwo-Olu administration, this program serves as a powerful tool for job creation, transforming previously unemployed youth into employers of labour. The focus on youth is strategic, acknowledging their significant representation among the unemployed and their potential as a large, untapped workforce. Beyond being a positive narrative, the programme unfolds as a meaningful and sustainable initiative, laying the foundation for long-term economic and social benefits.

    The programme not only provides a livelihood for the youth but also serves as a pathway for them to achieve their life goals. In fact, the current government has tirelessly generated numerous job opportunities. For those interested in seizing these opportunities, Lagosians between the ages of 18-35 for males and 18-40 for females still have the chance to enroll in the one-month intensive agricultural training. The enrollment process is accessible at www.lagosagric.com, offering a gateway for individuals to acquire valuable skills and contribute to the growth of the agricultural sector while building a sustainable future for themselves.

     The objective of the Lagos State Ministry of Agriculture is to elevate the Agricultural Training Institute in Araga, Epe, into a pre-eminent regional scientific research and development center. This transformation aims to foster collaborative partnerships with the private sector, development partners, and nations, working collectively to advance sustainable practices in crop cultivation and animal husbandry. The envisioned centre will play a pivotal role in imparting critical knowledge to the regional farming community, elevating product quality, and unlocking new markets.

     The envisioned development of the Agricultural Training Institute in Araga, Epe, as a leading regional scientific research and development center holds the promise of enhancing the quality of training provided to participants. It not only signifies an elevation in the educational landscape but also opens avenues for student exchange programmes.

    In essence, the Lagos Agripreneurship Programme emerges as a pivotal catalyst, offering a viable path for unlocking the vast potential within the agricultural sector. It stands as a model that could be replicated on a national scale, presenting a pragmatic solution to reversing the trends of food insecurity and unemployment, particularly among the significant youth population in the country. The programme showcases a strategic approach that, if adopted comprehensively, has the potential to reshape the agricultural narrative and contribute significantly to the socio-economic development of the country.