The Nation Newspaper

Category: Special Report

  • How train passengers were attacked, kidnapped in Kaduna

    Journey by train has in the last few years saved a lot of people from the hands of dreaded kidnappers on the Kaduna-Abuja Express Way. But, the bandits who seem to have been overpowered by the security operatives on the road lately, have deviced new means of taking train passengers at the teminus. ABDULGAFAR ALABELEWE reports.

    The terminus of the Abuja-Kaduna train is located in Rigasa, the western outskirt of Kaduna metropolis and a distance of about 12 kilometers from the city centre.

    The railway station can be accessed from Kaduna city either through Rigasa community from the Bakin Ruwa junction of the Nnamdi Azikwe Express Way and through the link road connecting the train station to the Kaduna International Airport and Mando part of the city.

    For passengers arriving Kaduna through train, the link road is their shortest route if they are going to places like the Kaduna International Airport, Nigerian Defence Academy (NDA), Kawo, Unguwan Dosa, Malali and Unguwan Sarki parts of the metropolis, as well as those travelling further to Zaria, Kano and other North-Western states,while those connecting Rigasa, Unguwan Muazu, Kabala West, Kakuri, Sabo and Barnawa or travelling further to Kachia and Kafanchan are to use the Rigasa-Bakin Ruwa road.

    The Kaduna-Abuja train had gained popularity and became the safest means of travelling to and fro Abuja from Kaduna in the heat of banditry and kidnapping on Kaduna-Abuja Express Way, even though the journey by train is more expensive than travelling by road.

    However, following intense security operations on the express way, kidnapping had drastically reduced in recent times, as the perpetrators of the crime appeared to have been given a hot chase by the operatives. The gunmen have apparently spotted a new haven on the road linking the train station with Mando-Airport road.

    The bandits operated on the road twice within 24 hours interval last weekend, injuring many commuters and kidnapping a few others.

    The Nation gathered that the gunmen attacked vehicles conveying travellers, who just arrived at the railway station first on Friday night. But they succeeded only at injuring commuters and were unable to kidnap any passenger due to the prompt response of the security operatives, who repelled their attack.

    An eye witness at train station told our correspondent that the passengers came under gun attack around 9:00pm, shortly after they arrived in Kaduna.

    According to the source, who identified  himself as Haliru Musa, “Well, I was not there when they were attacked, but shortly after the attack, we rushed to the scene. By then, the kidnappers had run away.

    “It was around 9:00pm because the train arrived around few minutes to 9:00pm. And as usual, people pass through Rigasa road to Bakin Ruwa, but others depending on where they are going, pass through the airport road. We were here because I work here. Suddenly, we saw vehicles that had left the train station turning back and saying kidnappers were raiding.

    “I think it was those people that raised the alarm that made security to quickly move in and repel the attack. Because, we rushed to the scene too, but on getting there, the security men had succeeded in chasing the kidnappers away, but they were unable to arrest any of the gunmen.

    “So, contrary to reports we  heard, none of the passengers was kidnapped that Friday evening, but some people in the process of trying to run into the bush sustained injuries,” Musa said.

    However, barely 24 hours after the security agents repelled their attack, the dreaded kidnappers made a come back to attack another set of passengers on the same spot on Saturday night. Unlike the Friday night attack, some passengers were not lucky; they were whisked away by the attackers.

    Another source at the train station, Malam Auwal, told The Nation that, the attackers came more prepared on Saturday.

    “In fact, I would have been a victim. I come here to pick passengers by drop. So, that night, I got two passengers who said they were going to Mando, so because of what happened on Friday, I told them I will follow Rigasa road and they became angry that I  would be taking them a longer route.

    “They thought I was just trying to charge them high fare. Even after explaining what had happened on Friday to them, they told me there would not be any problem. At that point, I started suspecting that, the two gentlemen were soldiers, but I was still not comfortable taking them through that route because even if they were soldiers, they were at least not carrying guns.

    “They boarded another vehicle. I think they even passed before the attack. But, some people were not as lucky.

    “I got another set of passengers whom I took to Bakin Ruwa and quickly came back to see if I would get another set before closing finally for the day. But on getting to the train station, I saw a large crowd again. And when I asked what happened, they said people were attacked on the link road again.

    “From what people who escaped told us, about four people were kidnapped and some people were injured again,” he said.

    We, however, gathered that the family attacked were picked from the train station by their driver and he took the link road where they ran into the attackers, and in the process, three of the occupants of the vehicle were kidnapped by the gunmen.

    One of the occupants, a 30-year-old newly wedded groom (name witheld) was shot in the tigh.The groom’s stepmother, one of those kidnapped, was later abandoned at a river bank inside the forest, due to her inability to trek. The woman, who is diabetic, was just discharged from a hospital in Abuja, our correspondent learnt.

    A source close to the family told our correspondent that the kidnappers called the family to pick her at the river bank because she was sick and could not trek. “So, the family went there on Sunday and met her.”

    He also said that the kidnappers had demanded for N20 million ransom before they will release the remaining two victims.

    “As at this Monday morning, they called and demanded for N20 million and threatened that if the family fails to bring the money on time, they will take the victims to Zamfara.

    “Even as at this afternoon (Thursday), the kidnappers were yet to reduce the ransom for other victims in their possession. So, it is still N20 million they are asking for.

    “As for the man that was shot in the tigh, he has been operated in Abuja and the bullet has been successfully removed from his body and he is now responding to treatment,” said the family source.

    Meanwhile, a passenger, who arrived Kaduna around noon on Thursday on board the 10:00am train from Abuja, Mrs. Debby Maxwell, expressed fears that the kidnappers, who chased people from plying the road, are now waiting for them at the train station.

    According to her, “When I read what happened here at the weekend in the news, I was shocked to my marrow, because it could just be me. I travel on this train almost on a monthly basis, because my husband works in Abuja, while the children and I are here. I also work here as a nurse. So, when my husband is not coming, I go to Abuja.

    “The government should not allow this railway project to be spoilt by these bandits. We use to travel by road; we became scared of the bandits’ attacks on the road. Despite that it is more expensive to use the train, we are still using it, but the same kidnappers are now coming to meet us at the train station.

    “For me, I call this an attack on the train, because if you come by the train or you are going to Abuja by the train, you must follow either of these two roads to connect the station. Even though, I live in Barnawa, I have had reason to follow this link road before. That day, I came back from Abuja and normally, I make new friends anytime I travel by this train, so, a friend that I made that day lives somewhere in Kaduna North. Then, on getting to Kaduna, her husband came to pick her and she asked me to join them. And the husband followed Mando road, even though they still took me up to Central Market where I now boarded vehicle going to Barnawa.

    “So, if this attack is not curtailed, the bandits will one day dare the security and even invade the train station, just to send signals that even the train is not safe,” Mrs. Maxwell said.

    Another passenger, Usman Muhammed, said he had resolved not follow either the early morning or late night train again.

    “From the beginning, I had always known that the choice of Rigasa for this important train was wrong. Why not terminate the train at the large expanse of land between Air Force Base and 1 Division headquarters and see who will go and attack passengers there? But, when you choose to bring the station to the back of the town, then you must be ready to secure the passengers up to the town.

    “But, as for me, pending the time the security will be ensured, I will not board train that will bring me to Kaduna at night and I will not leave my house very early in the morning going to Abuja by train. I will make do with the afternoon trips for now,” he said.

    But, a train station official, who does not want to be quoted, said the station is fully secured, saying that the kidnappers were only lucky to have escaped bring killed by security operatives that Friday.

    “If you are a regular visitor to this place, you will see that the station is fully secured. And that road linking Mando-Airport road is usually manned by soldiers. The kidnappers themselves saw fire on Friday; that is why they could not kidnap anybody that day. In fact, some of them must have escaped with gun injuries.

    “So, I don’t even want to believe the narrative that it was the same set of kidnappers that came back on Saturday. But, all I can tell you now is that, that road is safe now,” he said.

  • 12 members of gang who kidnap kids for sale meet waterloo

    By Ebele Boniface

    • Syndicate sells stolen children  for between N250,000 and N450,000 each .
    • ‘Why we joined gang — Suspects  
    • ‘We didn’t know the babies we adopted were stolen’

    The operatives of the Inspector General of Police Special Intelligence Response Team (IRT) have smashed a child trafficking syndicate, which specialised in abducting little children from their homes and selling them off.

    According to  authoritative sources, 12 of the suspects have been arrested and  six of the abducted children rescued by the IRT operatives.
 The Nation gathered that  members of the syndicate in several states of the  country, including the Federal Capital Territory (FCT), Abuja, operated in several groups, one of which involved a couple, Ifeoma Ebony and Emmanuel Onyekwere, who went around the country stealing children and middlemen, who would buy the stolen children from the couple and in turn  sell to people in dire need of children.

    It was also disclosed  that Ebony, a mother of two, and her hubby, Onyekere, allegedly abducted several children from their homes in Abia, Enugu and Edo states who and sold them to their buyers some of whom were identified as Blessing Nwankwo, Chioma Nike and one Onwa, whose real names are yet unknown.  Each of the stolen children, we learnt, was sold for between N250, 000 and 450,000.

    They were said to have run into trouble after they allegedly stole two children from their parents at Tunga Maji and Gwagwa areas of Abuja respectively  and sold them to Nike for N300,000 each. The suspect’s day of reckoning began when the father of the child stolen at Gwagwa area of Abuja, identified simply as Olobo, reported the abduction of his child to the police and the Inspector General of Police, Mohammed Adamu, directed his operatives at the IRT, headed by Deputy Commissioner of Police, Abba Kyari, to go after the Abductors.

    A crack team of IRT operatives from the Abuja office were then detailed to crack the syndicate. The operatives set to work by first debriefing Olobo, who disclosed to them that Ebony and her husband, Onyekwere, rented an apartment in the compound where he(Olobo resides with his family. The couple, according to him, soon became close to his wife, who had a one-year-old baby.
He said one week after staying with them, Ebony, who pretended to be assisting his wife, carried her(his wife’s) child, deceived her that he wanted to go and  plait her hair and before they knew what was happening, Ebony and her husband had absconded with their daughter. 
Another source disclosed that based on the information which  Olobo provided  about the suspects, the IRT operatives launched  a man-hunt for the suspects whom  they trailed to Asaba, Delta State. They were promptly arrested. On being interrogated, they confessed to the crime and aided the operatives to  arrest  their alleged receivers, namely Nwakwor and Nike, who normally sold the abducted  children to people who needed them.  The source also identified other suspects arrested as Onyinye Benjami, Ngozi Okoli,  Nwokocha OkoliNdiya Kalu and Esther Ihiediwa.

    When confronted,  32-year-old Ifeoma Ebony, who hails  Ogbolafor area of Enugu State,  blamed her involvement in child abduction and trafficking on her inability to get a proper education.

    She said: “I didn’t attend secondary school because my father married two wives and he couldn’t send me to school because he has so many children he couldn’t take care of.

    “I was married off to an old man at a very young age  but the old man died two years  into our marriage. We had two children together.  With time, things became difficult for me and my children after the death of my husband. I took my children to my mother in the village and  travelled to Abuja and went into prostitution.

    “I spent seven years as a prostitute in Abuja. One of my friends then advised me to relocate to Oba town in Anambra State, deceiving me  that I would make more money doing prostitution in that town.

    I took the advice and relocated but one year into my stay, a girl known as Ogula  from Benue State told me that a nurse told her to look for someone to get her pregnant and whenever she put to bed,  that the child would be taken from her and she would  be paid.

    “I told her I can’t do such a despicable thing because I too have two children and I was not ready to get pregnant again. She then asked me to follow her to her village and when we got there, the girl then stole a girl child and gave her  to me. While I was leaving with the child, I was arrested by some security men  and I was taken to prison where I spent six months.  This incident was in 2017. While in prison, I met one Ada, who had finished serving her term and she gave me her number while she was leaving.  I called her when I was released and she gave me a job at her shop in Umuahia Abia State, where  she sells drinks.   One of her customers, known as Onwa, approached me and said he had contacts of people who could buy children between the ages of one and three.

    “I then informed one Chibuzor, who is a brother to Ada, who stole a child and we gave it to Onwa.He took the child away and refused to pay us our money. At that time, I  had already gotten a boyfriend known as Emanuel Onyekwere. Onwa then contacted me  three months later .

    “He pleaded for forgiveness and said he would pay me N500,000 for any child between the ages of one and two. My boyfriend,  Onyewkere, then went to his village and stole his sister’s two-year-old  child and we contacted Onwa, but this time, we followed him down to Enugu State, where the child was sold to an old woman driving a Toyota Camry and she  paid us the sum of  N250,000. Onwa warned us against  stealing children on the road because whenever we were   caught, we would be burnt.  He advised  that we should move  regularly  to  new areas,  rent an apartment and when we see a child, we should steal the child  and leave the area. So, we went to Akuke area of  Enugu and we rented an apartment; we succeeded in stealing two children between the ages of  two and four  from a guy known as Oyenka,  who maltreated me while I worked as a prostitute in Abuja.

    “Onyeka was a very rough guy when I knew  him in Abuja and  it was the police who chased him out of Abuja. Unfortunately, I ran into him in Enugu.  He was happy and  introduced me to his wife and we became friends.

    “I visit them regularly in their house and I became familiar with their children, Ada and Chinonso. I studied their terrain for three months and when I discovered that the coast was clear, I made away with the children  and sold them to Onwa for N450,000 each.

    “Then, Emmanuel and I relocated to Abuja and we rented an apartment at Tungamaji area of the city. We stole a woman’s child who was our neighbour. The woman left her child in my care while she went to the market and I and Emmanuel quickly packed our things and fled with the child. We then sold the child to one Chioma, who we met through Onwa, for the sum of N300,000.   We then rented another apartment at  Gwagwa area of Abuja. We  stayed for two weeks and I stole a one year-old baby and sold the baby to Chioma for N300,000. We then left Abuja and ran to Ipoba Hill area of Edo State and rented an apartment. There, we stole a child belonging to a sick woman, who could not pay proper attention to her child. The child used to come to our own compound to play. So, I stole the child, took her to Chioma, who paid us the sum of N300,000.  “We spent much of this  money on food, clothes and other frivolities. Before we were arrested, my boyfriend and I had decided to quit but  there was this woman known as Blessing who contacted us and requested for five children between the ages of one and two years.I gave her a bill of N2million and she paid instantly. Since we had decided to quit, Emmanuel and I used the money to rent a two-bedroom flat, furnished it and we removed our sim cards. So, Blessing couldn’t reach us anymore.  My children are between  17 and 16. If they are stolen I will not be happy,” she narrated, regretting her actions.

    On his part, Emmauel Oyekweer, 32, a native of Isialagwu North,  Abia State, said his quest to build a house for his mother prompted him to go into the business. “ I am a tailor”, he started.  “I am not yet married and I didn’t go to school.  It was Ifeoma, who I met where she was working as a prostitute,  who lured me into this business of stealing and selling off children. Things weren’t good for me and my family has no house in the village but she assured me that the business would fetch me money to build a house for my mother.  Then, I went to my village and stole my sister’s son, Victor, and we sold him to an old woman who accosted us at Holy Ghost  Church in Enugu State.  I pretended I was praying when we got to the church; I didn’t want anyone to notice what we were doing because the boy looked so much like me.  I was paid N250, 000.  People knew I was the last person seen with  the child  and they have been calling me to bring their child.  They have even threatened to kill me if I don’t bring back the child.  Onwa  then took me to a native doctor, who prepared fake charms for me that would make my people and he took the N250,000 I was paid for the child.  I then recruited one of my friends known as Aboy when we moved to Enugu State and he stole three children from his village and two from Enugu and we sold them for N900,000.  I stole a total number of eight children and I am crying because I can’t go to my village and all the money I made I can not to anything with it.  If not for this Ifeoma that got me into this business, I wouldn’t  have been in this mess.”

    Narrating her own story, Chioma Nick,  46-year-old divorcee, said she lost her marriage of 22 years because she had no child for her estranged husband. She got pregnant for a man she met in Ghana but her livid husband rejected it and sent her parking.  She said she got a male child from her Ghanaian lover and when her son grew up, he started asking for a sister. Then  she approached the child welfare office in Umuhaia so she could adopt a girl child.  She said she met a woman she identified as Mummy Ohabiam, who told her  that she would link her to a syndicate that could help her get children from a different source and all they needed to do was to perfect adoption papers from the welfare office;  “She told me the cost and I couldn’t afford it,  then I contacted one Mummy Idian Emeka, who had approached me earlier for  two children. She said: “After I got the link, I got two children from Ifeoma and  I sold them to Mummy Idian for N800, 000 and I got N200,000 as my share.  Ifeoma also sold four other children to me, which I sold to several people.  I have returned three and I am yet to get the last one.  I sold two of the four children to one to Mummy Onyiyechi, and they have been returned.  I sold one other  to Mummy Blessing and other one was sold to one  Monica.  Please, have mercy on me.  I will not do it again. All my colleagues in this business have all run away. Please have mercy on me, ” she pleaded.

    Blessing Nwankwo, a native of Beden area of Abia State, a nurse, who studied at the School of Health Technology, Aba, in her story, said: “I have worked in several hospitals and I have a maternity home. I have been trying to get approval and registration for my maternity home for a long time but I couldn’t get it.” “I went into buying and selling of babies through the  wife  of our catcheist, who had no child for a long time and she had been saving money for a child. I contacted Chioma, who brought a girl and the child that was one year old  and we paid her the sum of N550,000; but I took N800,000 from the catcheist’s wife and I made N300,000 as my profit.  Later on, Chioma brought Ifeoma to me and told me she (Ifeoma) owned a home in Enugu State and if I knew anyone who needed a child for adoption, I should contact her. I then contacted some of my relations and friends who were looking for children and they paid me the sum of  N2million for five children, with the promise that I will bring my relatives to Enugu to perfect adoption documents for the children after the payment had been done, but they disappeared when they got the money.  Their phone lines were switched off and I didn’t even know that Ifeoma had links with the first child that was sold to me. It was when I was arrested that I knew that the children were stolen.”

    Idian Kalu, 52, who hails from Abriba, Abia State, in her now confession said: “ I have four child children  and I  reside in Aba town. I have a friend who is barren and she was looking for a child and I promised to help adopt a child for her  at the welfare. Then, I linked her to Chioma, and she started coming to my house. She told me there was an old woman who had a home where we can adopt children. I indicated interest and she brought a child for me and I gave the child  to my sister who needed him and the sum of N550,000 was paid for the child, though I took N650,000 and I made N100,000 profit. That was in 2016.  But in 2017, Chioma called again and said two children, both girls, were available for adoption. I contacted people who had told me that they  needed them and I took the girls and paid Chioma the sum of N550,000 each,” she lamented.

  • ‘Economy still on path of recovery’

    The 2020 Economic Outlook released by the Nigerian Economy Summit Group (NESG) on Wednesday shows that Nigeria’s economy is going to go through some challenges, writes CHINYERE OKOROAFOR

     

    THE United States and Chinese governments are reaching a truce on their trade conflict. The feuding parties have embarked on a series of tariff exclusions to settle on a trade deal.

    The outcome of the settlement deal is one of the issues the Nigerian Economy Summit Group (NESG) believes will have an impact on Nigeria’s economy this year.

    It also listed other issues that will shape the economy to include the African Continental Free Trade Agreement (AfCFTA), which is slated to be effective from July 2020, electricity tariff hike, the Central Bank of Nigeria’s readiness to increase available credit to the real sector and the tension between the U.S. and Iran.

    While AfCFTA presents an opportunity for Nigeria to increase non-oil exports and dominate markets of other African countries, the Nigerian Electricity Regulatory Commission (NERC) has approved the increase in electricity tariff by distribution companies in Nigeria, thus increasing the cost of production in the economy with a welfare implication on the citizens.

    But, with the CBN set to increase the loan ratio to 70 per cent within the first quarter of this year, more credit will be available to the real sector.  However, the NESG warns, it could increase non-performing loans of banks.

    NESG argued in its outlook that the tension between the U.S. and Iran over a nuclear deal means uncertainty and unrest in the Middle East, a major region for the supply of oil.

    “This will have a significant impact on oil price movement and will positively affect Nigeria’s oil revenue,” NESG said.

    NESG Chief Executive Officer ‘Laoye Jaiyeola said: “The Nigerian economy is still on the path of recovery; however, at a slow momentum and high level of fragility. Real GDP expanded by 2.28 per cent in the third quarter of last year, averaging 2.17 per cent in the first three quarters of the year.

    “Inflation rate averaged 11.4 per cent but closed the year at 12 per cent following the effects of the land border closure. Exchange rate stability was sustained on the back of continued Central Bank of Nigeria’s interventions while the foreign exchange reserves depleted significantly due to dwindling inflows from foreign portfolio investors and moderating oil prices.

    “On the social aspect, the poverty situation worsened as growth remained non-inclusive-over 100 million people live in abject poverty. The weak linkage between economic growth and socio-economic impact persists as poverty becomes endemic.

    “In our Macro-economic Outlook for 2019, we concluded that growth in 2018 was anaemic and marred by rising economic and social exclusion. We, therefore, proposed an inclusive growth framework for Nigeria with emphasis on broad-based economic growth that delivers improved social welfare. The proposed strategies prioritised industry governance and social sector reforms.

    “To step up the inclusive growth narrative, our Macro-economic Outlook for 2020 takes a deep-dive approach to fixing Nigeria’s poverty problem through accelerated economic growth and job creation as a precursor to inclusive economic growth. Part I of the report reviews the Nigerian economy in 2019 and provides an outlook for 2020, which will be influenced by several events and policies such as the increase in Value Added Tax (VAT), implementation of the Africa Continental Free Trade Area (AfCFTA) agreement, movement in global oil prices, US-China trade wars, loan-to-deposit ratio and insurance companies’ recapitalisation, among others. Part II of the report examines how Nigeria can create significant number of jobs in the medium to long- term to lift millions out of poverty.”

    He continued: “ As we enter this new decade, the government, private sector and other stakeholders must rise up to the challenge, work together and hold one another accountable in delivering a sound future for our great country.”

     

    What the NESG said on Economy in 2019

     

    “It is the dawn of a new decade and many economies, including Nigeria, are working towards achieving sustainable goals amidst diverse complexities and uncertainties. Still on the path of recovery with economic growth at 2.3 per ent, the Nigerian economy remains highly fragile and vulnerable to oil price fluctuations, even as the structure of growth is still skewed towards a few sectors.

    At the wake of 2019, the economy faced a high level of uncertainty ahead of the general elections which later held in March last year. While several bold statements and policy proposals were made to stimulate the economy and provide jobs for the teeming populace during the campaigns, many of these promises are yet to be actualised. In our 2019 Macro-economic Outlook report, we noted that growth in 2018 was anaemic and thus strategies for steering Nigeria through the inclusive growth path needed to be rolled out. However, economic growth remains lethargic and non-inclusive.

    “During the year, fiscal authorities continued to grapple with the challenges of underperforming revenue. This was triggered by lower than expected oil revenues arising from oil production shortages, which was below the budgeted target of 2.3 million barrels per day (mbpd).

    “Efforts to improve non-oil revenues yielded positive results during the year with an improved collection of Company Income Tax, Customs Revenues and FGN Independent Revenues. On the business environment, Nigeria was ranked among the top 10 improvers in the 2019 World Bank Ease of Doing Business Rankings. Reforms in areas such as starting a business, dealing with construction permits and enforcing contracts propelled Nigeria to record significant jump from 145th in the previous year to 131st in the global rankings.

    “Unconventionally, monetary policy focused on maintaining exchange rate and price stability, and to a broad extent, supporting economic growth. In 2019, the Central Bank of Nigeria (CBN) continued to defend the currency through its intervention in the foreign exchange market. This is evident in the declining external buffers in the face of lower inflows of foreign investment albeit a stable oil price.

    “In desperation to tame the dwindling reserves, the CBN prioritised hot money in the interim as it limited Open Market Operation participation to foreign investors and deposit money banks. Furthermore, in the first quarter of last year, the Monetary Policy Rate (MPR) was reviewed downwards by 50 basis points to 13.5 per cent aimed especially at driving real sector growth. In the spirit of growth, the CBN increased the loan-to-deposit ratio twice, first to 60 per cent and second to 65 per cent.

    “These moves are reshaping the interest rate environment and pushing credit to the private sector. In a bid to strengthen self-sustainability and curtail smuggling of goods, the government closed the Seme Border. This was later extended to all land borders in the country. The closure truncated the single-digit inflation target of the CBN with inflation rate reaching 12 per cent in December last year.

    “However, even with the price effects, both the fiscal and monetary authorities were in unison regarding the potential medium to long-term gains of this policy; this, in effect, propelled the surge in the domestic production of some food items such as rice and poultry products. The policy action of closing the borders, which came some months after signing the African Continental Free Trade Area (AfCFTA) agreement, raises doubts as to Nigeria’s commitment to the trade deal and the country’s ability to take advantage of the opportunities it presents.

    “Nigeria needs to do more in attracting real investments into key sectors of the economy. Although investors’ sentiment improved as overall foreign investment inflows into the economy increased relative to the previous year, data from the National Bureau of Statistics show that 70 per cent of foreign inflows in 2019 were portfolio investment. The concerns about lower foreign direct investment inflows, nevertheless, continue to linger,” NESG said.

    The report added: “The review of the macro-economic indicators and the various policies stance in 2019 suggests that the Nigerian economy remains vulnerable to external shocks with dwindling reserves, rising debt levels and tardiness in growth response to impetus.

    “Towards the close of 2019, Fitch, a rating organisation, downgraded Nigeria from Stable to Negative in their recent outlook revision, emphasising the increased vulnerability of the economy to disruptive macro-economic policy risk, rising debt profile in light of constrained revenue, inflationary pressure and complexity in CBN’s unconventional regulatory measures.

    “This, therefore, calls for comprehensive and coherent economic and social policies that address economy-wide challenges and build resilience over time, even as the government’s plan – the Economic Recovery and Growth Plan (ERGP) – elapses in 2020. Such policies must prioritise accelerated and inclusive growth founded on the deliberate effort at ensuring overall macro-economic stability that instills confidence in the economy creates jobs and reduces poverty in the decade ahead.”

     

    2020: What to expect

     

    The group said the signing of the 2020 Budget in December was a good omen. It said it was the first time in over 14 years the budget was signed before the budget year begins.

    “The 2020 Budget is themed ‘Sustaining Growth and Job Creation’ and also represents the largest spending plan of the Federal Government in a single year. Early passage of the budget is expected to result in improved capital spending, which is much-needed to stimulate economic growth and facilitate the delivery of infrastructure across the country. With oil price expected to stay above the budget benchmark of $57 per barrel in 2020, Nigeria has an opportunity to grow the excess crude oil account, improve external reserves and meet its oil revenue target to fund the 2020 Budget,” it said.

    It observed that the government would have more money with the passage of the Finance Bill which would result in an increase in VAT from 5 per cent to 7.5 per cent in the year. The government, it added, is also considering other avenues of raising non-oil revenues such as the proposed communication tax, online tax, excise duty on carbonated soft drinks and toll charges.

    “It is expected that the introduction of these taxes and charges will improve non-oil revenue; however, the challenge for fiscal authorities is levying several taxes and charges on an economy that is recovering with economic growth still low at 2.3 per cent. This could, therefore, have unintended negative effects on growth either through reduced consumer spending or reduced margins for businesses. Revenue drive should, therefore, be implemented with caution going into 2020.

    “Inflationary pressure will remain high in 2020 on the basis of the continued closure of land borders, the introduction of taxes and other charges directed at consumers and businesses as well as sustained pressure on businesses arising from an infrastructure deficit, poor power supply and high cost of credit, among others.

    “Given these concerns, monetary policy is expected to remain tight in the year, although the CBN will continue in its effort to provide financial support and direct incentives to local businesses in order to stimulate local production and reduce the country’s ever-rising import bills.

    “The heightened tension between the US and Iran as well as OPEC’s commitment to control supply in order to sustain higher prices will stiffen oil price in 2020. In order to take advantage of the increase, Nigeria will need to implement reforms in the oil and gas sector to attract large investments into the upstream sub-sector and ultimately shore up oil production. The leadership of the National Assembly has made commitments to focus on the Petroleum Industry Bill in 2020 and progress in the industry will largely depend on the speed of passage of the industry-wide legislation,” it said.

    The coming on board of the Dangote Refinery, the report said, will influence activities in the economy in this decade.

    “The 650,000 barrels per day refinery is expected to meet Nigeria’s fuel requirements and produce about 35,000 direct and indirect jobs. At the moment, mineral products including petrol account for 30 per cent of imports; this figure is expected to reduce in the coming years as the refinery becomes operational, conserving foreign exchange.

    “As the refinery comes into the stream, the output of oil refining which is currently categorised under the manufacturing sector as well as exports of petroleum products will significantly increase; even as transport and logistics within Nigeria will be impacted. Efforts are therefore required to upgrade infrastructure leading to the refinery to allow for easy and efficient traffic management,” it said.

    It identified rising population, rapid urbanisation, the advancement of technology as complex challenges which will influence the future of work and skills. Rising population and urbanisation, it said, will create significant pressure on food, jobs, infrastructure, social amenities and human capital.

    “The onus, therefore, is on policy makers to be spontaneous and proactive in dealing with these challenges, adopting innovative and home-grown strategies to deliver accelerated growth and enable the creation of sustainable jobs and reduction in poverty across the country.

    “Incentivising private sector investments into strategic sectors as well as repositioning government towards becoming efficient and effective are crucial interventions that need to be implemented in the new decade to ensure that Nigeria is not left behind in the league of fast-developing nations,” NESG said.

    Certainly, 2020 is a year to watch closely!

  • Making the Lagos’ ban on okada, tricycle work (1)

    The ban by the Lagos State government of okada and tricycles on 11 local government roads on Monday has laid to rest government’s position on the matter. ADEYINKA ADERIBIGBE writes on how the policy can be sustained.

    Kehinde Majekodunmi (not real name), checked his watch and saw it was noon. There was no way he could meet his 2:00 p.m. appointment at his Broad Street office from Agbado, a border town with Ogun State. The only option he had was to board a commercial okada, which he does often and from his phone, he punched his destination and takeoff point.

    Pronto one came, he donned his helmet and in minutes they were off. He made his office by 1.50 p.m. That was barely an hour 50 minutes on the ride. Price N2,500. But he doesn’t have to pay the rider directly. By paying through the app, he saved some N800, paying only N1, 700. Life couldn’t be better, as he went in for his crucial meeting.

    If Dehinde was lucky, Abraham Bashiru and his rider were not. They escaped death by whiskers on the Jonathan Coker Road, College, Ogba last week. The rider almost ran into a trailer when a lone driver of a saloon car, opened the door of his car almost hitting Abraham’s rider when he made to overtake him, sandwiching him between the car and the trailer. He swerved, missed running under the trailer and crashed into the road median. Both sustained various degrees of injury.

    Much for the second instance than the first, stakeholders and experts in the transportation sector had always urged the government to take a stand on okada and tricycle operation.

    Over the years, motorists would agree, okada operators have constituted themselves into a huge menace on the road, messing up government’s transportation master plan by their ubiquitous presence on the road.

    A transportation expert and founder of Safety without Borders, Patrick Adenusi said okada and tricycles are meant only for rural transportation. Sadly, however, their operators have transformed into the main transportation alternative for travelers such as Dehinde, who dashes through traffic to avoid the nightmare that goes with regular means of transportation.

    According to  Adenusi, there is no better time than now that government must put its foot down to give a direction where the state is headed as regards transportation plan.

    For him, government’s indecisiveness has caused serious distortions to the state’s transportation plans, giving the okada and tricycle operators the ground to mushroom.

    Before and after 2012

    Since 2015, the two and three wheeler forms of transformation have almost taken over the transportation space with the various transportation unions setting up various control units from where operators are milked and cash ferreted to oil the pockets of pliable officials and security operatives who look the other way and allow them unfettered access to operate on the roads.

    The scenario between 2015 till date was akin to the milieu in which they operated long before 2012. By that year, government enacted the Lagos State Traffic Law, which seemed to put them in check, restricting their operation from some 477 roads throughout the state.

    Section 16 of the law, as well as schedule 2, not only prescribed the type of motorcycles permitted to operate on the state roads, but spelt out the various fines the chief of which was the immediate impoundment of any okada that contravened the law.

    The law at the time also helped to stem the tide of road robbery and okada accidents as all general hospitals had dedicated wards for okada accident victims.

    However, the gains were reversed when enforcement stopped in 2015, succumbing to obvious pressure of the gaps in public transportation options available to the motoring public and the maddening gridlock that makes the state road network a nightmare.

    Before 2012, the engine capacity of okada operating across the state was lower than 100cc. The law stipulated the engine capacity of okada allowed on the state roads to be 200cc.

    However, the last five years have seen the massive proliferation of 200cc okada by small firms. They latched on the lacuna of section 16 of the law, which was left untouched in the Lagos Traffic Law 2018 (as amended), and started a technology enhanced transportation business with supposedly approved capacity okada.

    Such firms as the Metro Africa Xpress, better known as Max.NG floated the Maxokada, which was quickly copied by other players such as Gokada and the latest entrant into the hike-based okada business Oride, which has over 5, 000 okada shuttling Lagos metropolis alone and has stretched their tentacles to Oyo, Ogun and Edo states. These okada ply all routes, bridges and highways. To edge out competitors, one of them recently floated an express ferry shuttle.

    They are regarded as the Uber alternative and most members of the public find them useful in dire circumstances.

    Dean of the School of Transportation Studies, Lagos State University (LASU), Ojo, Prof. Samuel Odewunmi described these okada operators as the new saviours on the road.

    At a transportation summit last year, Odewunmi acknowledged that though they were undesirable and ought not to be encouraged as a form of transportation, but closing eyes totally to them would be tantamount to denying the indices of the sector. He canvassed that the government should permit them to exist until it is able to bridge the supply gap that could cut off the needed oxygen.

    For a man living in Badagry axis, the okada have been Odewunmi’s saving grace several times. But it may not be for much longer.

    Last Monday, the state government issued a directive, banning the okada and tricycle on all roads in 11 local government areas and on about 40 bridges.

    The order came barely after eight months after Governor Babajide Sanwo-Olu at his inauguration assured the state that he would come up with a solution to the okada menace in the state.

    Only last month after a security meeting, the government declared that it was yet to come up with a solution to the okada issue.

    All that changed on Monday. According to the government, okada operation would become illegal in six local government areas and nine local council development areas. It will also be illegal on 10 major highways across the state.

     

  • Collapsed highways…X-raying Fed Govt, Dangote, NLNG deal

    The deal between the Federal Government and private firms to fix collapsed highways raises hope of a superb road networks across the country, writes ROBERT EGBE.

    July 2018. It was a month Godwin Efiko remembers well.

    For one week – 11th till 19th – the Abi, Cross River State-born driver slept in his container-laden Mac Truck on the Mile 2 section of the Oshodi-Apapa Expressway, inward Tin Can Island/Apapa.

    “I joined the queue at Second Rainbow Bus Stop on a Wednesday morning and I was there till the next Wednesday night,” he told The Nation.

    The 35-km Apapa-Oshodi Expressway, stretching from Lagos’ biggest port in Apapa that Efiko spoke of, is one of the best places to start if one wants to get an understanding of Nigeria’s baffling road infrastructure challenges.

    It is one of the many roads, including the Enugu-Onitsha Highway, Lagos-Ibadan Expressway, Minna-Suleja Expressway, critical sections of which collapsed, after being abandoned for decades by successive government.

    They caused nightmare traffic for motorists and residents and took a heavy toll on businesses and government revenue.

    History of bad roads

    Nigeria’s road networks have traditionally, or at least for decades, been very poorly maintained. Only a limited number of the 195,000 km networks are also tarred.

    The Infrastructure Concession Regulatory Commission notes that about 32,000 km of the 195,000km are federal roads while 31,000 km are state roads. Of this number, only about 60,000 km are paved leaving 135,000 km of road untarred. A large proportion of the paved roads are in bad conditions due to poor maintenance.

    READ ALSO: Govt trains LASTMA officials in occupational, health safety

    Why the roads are in bad shape

    In 2009, a senate ad-hoc committee on transportation, led by Mr Heineken Lokpobiri, prepared a report detailing how a former works minister and then leader of the ruling Peoples Democratic Party (PDP), Tony Anenih, allegedly mismanaged billions of naira meant for the rehabilitation and construction of Nigerian roads.

    The report blamed Anenih, now deceased, and his successors in the ministry, for the poor state of the country’s highways during the period and called for their prosecution.

    Lokpobiri is now Minister of State for Agriculture and Rural Development.

    The report, which took the ad hoc committee 18 months to produce, was listed for debate – three times in a row – by the Senate but was never considered on the floor of the upper chambers.

    The transport probe report showed how, in 10 years (1999 to 2009), through multiple contract inflation frauds, connivance between contractors and government officials, some N645 billion was spent on 4,752 kilometres of the road; shortchanging the government of N49 million on each kilometre of road worked on, amounting to approximately N233 billion.

    The committee said the report contained details of what was one of the nation’s largest portfolio of official scams at the time.

    The committee said ministers and other senior officials of the ministries of transportation and Finance between 1999 and 2009 awarded multiple contracts for the same roads and paid for unapproved contracts.

    According to the report, between 1999 and 2009, the ministry of transportation gave contracts for the construction and rehabilitation of 11, 591 km roads at a cost of N1.008 trillion – about N87 million per km.

    During the same period, only 41 per cent of the roads were worked on, after close to 64 per cent of the contract value was paid.

    In the 10-year period, work was done on only 4,752 kilometres of roads for N645.8 billion, at a very high cost of N135.8 million per kilometre, defrauding the government N49 million on each kilometre.

    “There was no commensurate value for funds expended on the roads from 1999 to 2009,” the committee said.

    But corruption and years of neglect are not the only sources of the problem.

    Poor federal and state budgetary allocations to roads have also been the norm. In 2018, the Federal Government budgeted about N138.8 billion for construction and rehabilitation of roads. In the same year, N159.5 billion was budgeted for road repairs.

    Last year, the figures were even lower. The sum of N124 billion was proposed for road construction while N103.3 billion was budgeted for the repair of the federal roads across the country. Even at that, hardly will half of the sum be released eventually.

    There has also been the problem of explosive growth in vehicular numbers in the country, worsening pressure on the roads.

    A National Bureau of Statistics / Federal Road Safety Corps (FRSC) report estimated Nigeria’s vehicular population at about 11.8 million at the end of 2018, compared to 11.6 million in the corresponding period of 2017.

    It was not always this high. In 1983, for instance, there were just about 150, 000 vehicles in the country. But population growth boosted demand for vehicles. This spurred a rapid influx of imported second-hand vehicles into the country through official and unofficial borders.

    Role of private capital

    Experts have long understood that for Nigeria to get the roads back in shape, a new way of approaching the problem is required.

    The Director-General, Infrastructure Concession Regulatory Commission (ICRC), Mr Chidi Izuwah told the News Agency of Nigeria (NAN) on September 7, 2017, that Nigeria needed to borrow a leaf from abroad and harness private resources.

    Izuwah said: “Private capital and management expertise will help in this area as has happened in Malaysia, India and South Africa.”

    He noted that Nigeria’s investment in road and rail remained low and had led to the continued underdevelopment of the country, adding to joblessness and poverty.

    Izuwah gave examples of successful and lucrative PPP operations in the country, especially the concessioned Apapa-Lagos container terminal, which had led to the de-congestion of the ports.

    It also led to reduced congestion surcharge from 525 dollars to 75 dollars, saving the Nigerian economy an estimated 200 million dollars a year.

    “We no longer hear about Wharf rats or thieves who made containers from our ports vanish into thin air easily in years gone by,” he added.

    Hope rises as Federal Government wades in

    But things are changing.

    President Muhammadu Buhari has made infrastructure development one of the cornerstones of his second term development agenda, and, in partnership with the private sector, it is yielding fruit.

    The Dangote Group kicked-off construction work on the Apapa-Oshodi Expressway in 2018 as part of a deal with the Federal Government that would see the company enjoy a 10-year tax rebate worth $201m (N72.9 billion).

    This is the first attempt to rehabilitate the ever-busy road since it was first completed in 1978.

    A project to rebuild the road in 2013 costing $441 million stalled in 2015.

    During an inspection of the work last month, the president of the industrial conglomerate, Alhaji Aliko Dangote, said the expansion of the road from Apapa Port to Ojota, will be completed this year.

    The road will last for 40 years, he added.

    According to Dangote, the congestions at the ports as a result of the gridlock cost the company about N25 billion in revenue between 2017 and 2019 financial year.

    On the visit to the site with Dangote, Minister of Works and Housing, Babatunde Fashola said the completion of the road would bring businesses flocking back to the area.

    “Once the economy of Apapa returns, all the clearing and forwarding, shipping, newspaper companies and all others doing business will resume fully and the economy will bounce back,’’ Fashola said.

    Executive Order No. 007

    The Apapa-Oshodi Expressway deal was made possible following the 10-page Executive Order No. 007 signed by the President on January 25, 2019.

    It is known as the “Companies Income Tax (Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme) Order, 2019”.

    It is described as a Public-Private Partnership intervention to enable the government to leverage private sector funding in a manner that creates value for money through private sector discipline.

    The Order is accompanied by an 11-page Regulation made up of First Schedule on the Administration and Operation of the Scheme while the Second Schedule contains a sample MoU for eligible road projects.

    The Scheme will be in force for 10 years from the date of commencement of the Order. Completion of each road project shall be between 12 to 48 months.

    Benefits for firms

    Participants in the Scheme shall be entitled to tax credits for the project cost incurred including a single uplift equivalent at the prevailing CBN monetary policy rate plus two per cent. The uplift shall not constitute taxable income in the hands of a participant or beneficiary. Costs incurred on roads under the scheme are not eligible for any other allowances or tax relief.

    Eligible participants are companies or corporations established under any law in force in Nigeria. This includes a pool of companies operating through a Special Purpose Vehicle registered with the Securities and Exchange Commission as an infrastructure Fund and Institutional Investors such as Pension Fund Administrators.

    The President explained it further during the signing of the order.

    He said: “Through this scheme, companies that are willing and able to spend their own funds on constructing roads to their factories or farms, will recover their construction costs by paying reduced taxes, over a period of time.

    11 states, 19 roads, 794.4 kilometres

    The government identified 19 roads covering about 794.4 kilometres across 11 states, under the pilot phase of the scheme.

    Aside from Dangote, firms that will partner the Federal Government on the scheme are Lafarge Africa, Unilever Nigeria, Flour Mills of Nigeria, Nigeria LNG, and China Road and Bridge Corporation.

    The roads

    Some of the projects to be handled under the scheme are the construction of Ashaka-Bajoga Highway in Gombe State; reconstruction of Dikwa-GambaruNgala Road in Borno State; reconstruction of Bama-Banki Road in Borno State; rehabilitation of Sharada Road in Kano State; rehabilitation of Nnamdi Azikiwe Expressway / Bypass, in Kaduna State; reconstruction of Birnin Gwari Expressway in Kaduna State; reconstruction of Birnin Gwari-Dansadau Road in Kaduna State; reconstruction of Makurdi-Yandev-Gboko Road in Benue State; reconstruction of Zone Roundabout-House of Assembly Road in Benue State; reconstruction of Obajana-Kabba Road in Kogi State; reconstruction of Ekuku-Idoma-Obehira Road in Kogi State; construction of AdaviEba-Ikuehi-Obeiba-Obokore Road in Kogi State; rehabilitation of Lokoja-Ganaja Road in Kogi State; Ofeme Community Road Network and Bridges in Abia State; rehabilitation of Obele-Ilaro-Papalanto-Shagamu Road in Ogun State; reconstruction of Sokoto Road in Ogun State; reconstruction of Apapa-Oshodi-Oworonshoki-Ojota Road in Lagos State; construction of Bodo-Bonny Road & Bridges across Opobo Channel in Rivers State, and the rehabilitation of Benin-Asaba Road in Edo State.

     

  • Savouring local rice boom

    If local rice manufacturers have their way, Nigeria’s borders should remain closed. Stakeholders in the rice value chain are smiling to the bank as a result of the partial border closure, writes SINA FADARE

     

    PLAYERS in the rice value chains have cause to smile in the last few months because of the partial closure of the borders to stop Nigerian markets being saturated with some imported goods, particularly rice.

    In the past, the country was a dumping ground for various agro-allied products, a situation that discouraged commitment to home-grown agricultural enterprises.

    Despite the desperate actions of smugglers in their nefarious trade to smuggle a lot of agricultural products into the country, the security agencies were equal to the task and did expose some of their shady deals.

    The economic advantage derived from the action has encouraged President Muhammadu Buhari to declare in his recent visit to London that there was no going back on his decision.

    According to him, he would not watch youths being destroyed through cheap hard drugs, and compromised security caused by unbridled influx of small arms.

    “When most of the vehicles carrying rice and other food products through our land borders are intercepted, you find cheap hard drugs and small arms, under the food products. This has terrible consequences for any country,” he said.

    On time frame for re-opening the borders, President Buhari said it would not happen till the final report of a committee set up on the matter was submitted and considered.

    “We will get things sorted out. Our farmers, especially those who grow rice, now have a market, and are happy, and we are also concerned about hard drugs and weapons.

    All over the world, majority of the advanced economies had one time or the other, embarked on a stringent economic policy such as closing their borders in order to discourage turning their country into a dumping ground.

    “Japan, at a time, employed this method ditto the United States of America (USA). That was why two years ago, former Ebony State Commissioner for Information, Senator Emmanuel Onwe cried out that something drastic should be done in order to protect the growth of rice value chain in the country.

    Onwe, who is a big-time rice farmer lamented that “smuggling is a serious challenge to the sustenance of the current agricultural revolution in the country. Not only that rice is being smuggled, virtually everything is being smuggled. And this is killing the excellent agricultural policy of the Federal Government.

    He said: “The porosity of our borders and the lackluster control of the ingress of smuggled food products and the egress of smuggled petroleum products are strangulating the already sterile economy.”

    At present, it’s obvious that the trend has changed as the Central Bank of Nigeria (CBN) Anchor Borrower Scheme was enunciated as an elixir for dwindling fortunes of Nigerian.

    The scheme, which was launched by President Buhari in 2015, was designed to empower the farmers and ensure food security.

    According to the Director, Corporate Affairs of the CBN, Mr. Isaac Okoroafor, over 2.5 million farmers have benefited from the scheme in about 17 agricultural commodities.

    Corroborating Okoroafor’s assertion, the Chairman of Rice Farmers’ Association of Nigeria, (RIFAN), Niger State branch, Mr. ldris Abini pointed out that the closure of the borders has given them hope and with the boom in rice production locally, the President should sustain the policy.

    He said: “The border closure was a right decision because it is already enhancing wealth creation among farmers as consumers are beginning to patronise our local rice.”

    Abini, who expressed optimism that with the current report from all their members throughout the country, the policy would succeed as the government was providing the enabling environment for agriculture to thrive by supporting farmers with inputs and implements.

    “The Federal Government has demonstrated this through the CBN Anchor Borrowers’ Scheme which allows farmers to access more loans even when previous ones have not been fully repaid,” he said.

    Corroborating Abini’s view, the Chairman of RIFAN in Kebbi State, Alhaji Muhammad Augie noted that there was a mission before the border was closed and the situation on ground indicates that the mission has been accomplished.

    “Now, a lot of people who ordinarily will not patronise our rice have been doing so since they want to be relevant in the market and get something doing. In the process, farmers now sell their rice with ease,” he said.

    In a telephone chat with The Nation, Augie noted that since Nigerians now consume the local rice, the farmers are now doubling their efforts in order to meet the market demand. There is sufficient rice to eat locally throughout the year.

    He further explained that rice farmers numbering 80,000 in the state have the opportunity to access the CBN anchor programme which has assisted them to remain operational despite the challenges facing them.

    “Most of the farmers are small-scale farmers who, on their own, cannot afford some of the inputs. But with the anchor programme, they receive these inputs.  During the dry season they were opportune to access fund from the apex bank to do their farming and with the situation on ground we are getting good yields,” he said.

    Augie further said though what is being produced is being consumed locally, the future is bright all things  being equal, even as he noted that in the next two years if the Federal Government sustains the laudable programmes, the country can grow rice for export.

    Giving an insight into the danger of consuming a product you do not know how it was made and packaged, the Customs boss, Col. Hameed Ali (rtd) during a stakeholders’ meeting, explained that the closure of the border was not to hurt anybody but to protect the interest of the country.

    He said: “Our interest is to make sure that our country is secure, the well-being of our people is ensured and our economy is secure. The step we have taken is in the interest of Nigeria; the step is not to hurt anybody but to protect our own interests as a nation.”

    He lamented that “we are consuming expired foreign rice and when it causes cancer, we begin to look for who to blame. What they do is that they polish the rice, re-bag them for unsuspecting consumers. That is what we eat.”

    Shedding more light on why the country is not in a hurry to re-open the border, the CBN Boss, Godwin Emefiele said in order to consolidate its current economic gains, the borders have to remain closed for a while so that smuggling of goods from these countries which undermines Nigeria’s economy would stop.

    Emefiele pointed out that “we are not saying that the borders should be closed in perpetuity, but that before the borders are re-opened, there must be concrete engagements with countries that are involved in using their ports and countries as landing ports for bringing in goods meant for local consumption, it is understandable.”

    He explained that before the closure of the borders, the Rice Processors’ Association of Nigeria had  nothing less than 25,000 metric tons of milled rice which they could not sell due to saturation of the market with imported rice from Republic of Benin, adding that just after a few weeks of closure of the border, all the rice were sold.

    The CBN boss said the closure of the border has brought good tiding to the Nigerian economy.

    “So, when you asked what the benefit of the border is closure on the economy of Nigeria, I just used two products – poultry and rice. The benefit is that it has helped to create jobs for our people, it has helped to bring the integrated rice milling that we have in the country back into business again and they are making money.

    “Our rural communities are bubbling because there are activities because rice farmers are able to sell their paddy. The poultry business is also doing well, and also maize farmers who produce maize from which feeds are produced are also doing business. These are the benefits,” he said.

  • Banks, FinTechs struggle for banking space

    There seems to be a taciturn conflict in the banking space with the entrance of technology-based or enhanced outfits such as FinTech, Bigtech, E-Bay and other platforms. FinTech, for instance, is a technology-enabled innovation in financial services that could result in new business models, applications, processes or products with an associated material effect on the provision of financial services, writes MOSES EMORINKEN

     

    IN time past, FinTech (financial technology) companies concentrated only on leveraging digital innovations to proffer solutions in the finance space. Currently, they seem to be gnawing beyond their turf as they now carry out some typical banking operations such as payments, deposits and lending, among others.

    More revealing is the unabashed gain of momentum by BigTech companies such as Amazon, eBay, Google, Uber, Apple and Samsung and others, that have stretched their offerings beyond the expected lanes of their businesses, to begin to carry out typical banking operations such as funds deposit, loans and payments, among other operations.

    With these uprising trends in the financial space, there remains a huge hanging question–will traditional banks keep up the pace, partner with these FinTech and BigTech companies, or faze out of the scene with little contributions to the banking/money space?

    This was the crux of the conversation that traversed among policy makers, financial experts; the NDIC and finance journalists at the seminar for finance correspondents, organised by the Corporation, last year.

    Financial Stability Board defines FinTech as technology-enabled innovation in financial services that could result in new business models, applications, processes or products with an associated material effect on the provision of financial services.

    The last statement ‘…associated material effect on the provision of financial services,’ means that it has an impact on data privacy, consumer protection and the way FinTechs are supposed to respond to regulatory authorities such as the Nigeria Deposit Insurance Corporation (NDIC), Central Bank of Nigeria (CBN) and Securities and Exchange Commission (SEC), among others.

    BigTech, on the other hand, are large globally active technology firms with a relative advantage in digital technology.

    It is interesting that technological disruption is having all forms of impacts (both positive and negative) on the finance industry. Some stakeholders seem to believe that technological innovations will lead to new and better products and services for customers. However, payment services seem to be the most affected and disrupted by technology, followed by customer management and retail lending.

    Banking is gradually and will be diametrically different as the years unfold, as FinTech and BigTech companies are increasingly stepping on banks’ traditional territory.

    According to the 22nd Geneva Report on World Economy, “BigTech and FinTech are increasingly competing with banks, but in different ways. banks are likely to see FinTechs as technology partners and as competitors. BigTechs, on the other hand, are less likely to be seen as partners.

    “Technological disruption challenges not only the business models of banks but also the existing models of regulation. Financial stability, competition and data protection remain the three over-arching goals of financial regulation. The challenges range from cloud computing and artificial intelligence, to activity-based regulations, takeover legislation and data ownership and privacy,” it said.

     

    FinTechs’, BigTechs’ contributions to financial inclusion

     

    Critical players in the finance sector describe this year as a defining one for the significant achievement of financial inclusion, especially among those in the rural areas. That is, by this year, 80 per cent of Nigerians should have unhindered access to financial services.

    What is interesting is that FinTechs seems to be the greatest contributor and driving force for this target. Whether the target will be achieved remains a conjecture.

    Although the NDIC’s primary mandate lay in the effective supervision of insured banks, timely payment of insured deposits and the implementation of a robust and efficient failure resolution regime, the Corporation, alongside other regulators such as the CBN, SEC, NAICOM and others, is at the vanguard of championing the course for financial inclusion in the country.

    In the financial inclusion strategy of the Central Bank of Nigeria (CBN) in 2012, it was realised that only two per cent of adults had access to credit, while only 21.6 per cent and 24 per cent had access to payment services and savings accounts respectively.

    However, two years ago, the CBN released an exposure draft of the Financial Inclusion Strategy Refresh. It was discovered from the report that one of the major reasons we failed as a country to meet the 2012 financial inclusion strategy was the lack of appropriately regulated level playing field for FinTechs.

    This explicitly shows the critically important role FinTechs play to ensure holistic and exhaustive financial inclusion.

    Mobile banking has become the most democratised form of banking operations in funds transfer and withdrawals, as more and more people find it most convenient to make and receive payments via their mobile phones and other related gizmos, instead of going through the arduous process of queuing endlessly in banks. FinTechs and BigTechs have made it easier to do this owing to their innovative digital platforms and services.

    According to the Deputy Director, Research Department, NDIC, Dr. Kabir Katata, examples of FinTechs are credit cards, mobile payments, cloud computing and blockchain, and others. It is important to us because it helps the depositors and those who need to have access to financial services easier, faster and cheaper. That is why we are keen on enhancing financial inclusion.

    “FinTech promises to help achieve the efforts by the CBN in terms of financial inclusion, supported by the NDIC and other agencies.”

    He further added: “It can also help Small and Medium-Scale Enterprises (SMEs) get access to credit, enhance competition, as well as increase the resilience of the financial system if it is done right. If it is not done right, then we have a big problem”.

     

    Challenges banks face from the entry of FinTechs, BigTechs

     

    The threat to banks’ extinction is not a recent phenomenon. However, with the flurry of disruptions in the banking space, experts are forced to ask: Is this the beginning of the end of the banking system, as new technologies seem to be changing the way individuals and businesses use financial services in general, particularly banking services?

    In some cases, specific demographics, especially the millennial, are moving away from traditional depository institutions, into contemporary banking and FinTech platforms.

    The Geneva report on World Economy noted: “Two-thirds of millennial Americans moved $24 billion through the mobile P2P platform Venmo in the second quarter of last year.

    “BigTech firms are challenging incumbent banks, but in a different manner than FinTechs. Big- Tech firms are gaining significant traction in the provision of financial services in some markets, particularly in China, and are becoming active in other regions, including Africa, India, Indonesia and Latin America.

    “BigTech firms have large and developed customer networks established through, for example, e-commerce platforms or messaging services. Their collection of proprietary data and use of technology, increasingly including advanced practices such as AI and machine learning, allows these firms to gather significant information on their users to help tailor their offering to individual customers’ preferences.

    “BigTechs have the potential to become dominant through the advantages afforded by both of these features – their collection of valuable data and their large, established networks (BIS, 2019). While FinTech firms initially did not interact directly with consumers, Big Tech’s aim is to enhance the interaction with the user or consumer.”

    For example, Amazon lent $1bn to SME in 2017, while Art Financials of China had $5bn in outstanding loans at the end of 2017, primarily to SMEs. As at last year, Amazon had given out $5bn to SMEs; now they are battling court order to start accepting deposits.

    Dr. Katata said: “It is also important to understand that FinTech is broad. For instance, there are banks that exist only digitally, where you open an account and carry out transactions online; consumer protection is through e-mails; customer services through e-mails and phone calls, among others. FinTech has made this possible.

    “We also have what amazon is doing. The fear of Amazon is the beginning of wisdom. They have put out a lot of book stores out of business; anywhere they touch, they disrupt, amass and move on.

    “We have applications such as open banking where you can have different deposit rates. For a long time in most of the developed economies, you will see that FinTechs have access to customers’ data through Application Programming Interfaces (APIs), so that you can have the rates and comparison sites. There is also cloud computing, artificial intelligence – where customers can chat and inquire about banking services, while the respondent on the other end is not human but artificial intelligence algorithm.

    Godwin Emefiele

    “Distributed Ledger Technology (DLT) is one of many transformative new technologies that will shake future financial services infrastructure and should be seen as part of the toolbox. The beauty of the DLT is in biometrics, which we already have in the Bank Verification Number (BVN).

    “BigTech companies such as Amazon, Ali Baba and Uber also offer some financial services because they use their platforms to offer services. For example, riders use O-Pay, which collects BVN and also gives loans.

    “However, we need to know the sponsors and promoters of O-Pay because they are encroaching”.

    He further added: “On cloud computing, if you want to set up a new bank, you don’t need to set up a huge data centre or a huge IT department. All you need to do is go to Microsoft and other related companies and set up everything, then you are up and running.

    “Although several banks are developing in-house financial technologies, however, we mostly import these technologies, which are offered by Google and others.

    “The reason it seems as though the CBN and NDIC are slow in adopting or validating a FinTech is that when you develop something today, there is that small issue that it has to be tested and we need to know the company before they start to collect people’s money or data. When operators say regulators are slow, perhaps, because there are processes involved.

    “Another problem with the regulation of FinTech is that when you are trying to understand what they are doing, they don’t want to explain to you; you cannot be licensed without being understood.”

     

    New generation disruptors on the horizon

     

    FinTechs are among the fastest-growing technology companies in the country. In 2019, FinTech firms raised over $120 million in funding. Already, some of these companies are top players in the world.

    “According to a report by PwC in 2016, showing which part of the financial sector is likely to be most affected by FinTech over the next five years: It shows that consumer banking is first, followed by fund transfer and then investment banking and SME banking. Truly, their effects have been far-reaching.

    “Money transfer and payments have been disrupted the most, even in Nigeria. In Nigeria, it is the payment that is most affected by the disruption in the banking space. The guideline and circulars released by the CBN have been very instrumental in guiding the space.

    “According to PwC 2017 survey, what drives FinTech is their data analytics and Artificial Intelligence,” said Dr. Katata.

    Among the top players in the FinTech space are Interswitch, Flutterwave, O-Pay, Paystack, Branch and TransferWise, among others.

    There is the overarching concern for the security of funds as cyber hacking has become the order of the day, making banks and other financial institutions invest heavily in protecting their customers’ funds and data against exposures to unethical hackers.

    In 2016, cyber thieves looted over $100 million from Bangladesh’s Central Bank. Sometimes we hear that Microsoft website has been hacked, Cisco is having issues, among other issues. Cyber risk always exists in as much as you are online. Banks suffer from operational risks and critical infrastructure.

    There is, therefore, the need for financial institutions, their customers and everyone dealing and trading with FinTechs, BigTechs, to pay extra attention to how they use and give up their data, passwords etc., in the process of carrying out a transaction. Data privacy is crucial!

  • Angélique Kidjo’s fourth Grammy award

    Our Reporter

     

    BENINESE ace singer Angélique Kidjo won her fourth Grammy award at the 62nd Grammy Award. The ceremony, acclaimed to be world’s most prestigious music honours, held on Sunday night at the Staples Centre in Los Angeles, United States.

    Nigerian Afro-fusion singer Damini Ogulu, better known as Burna Boy lost the Best World Music Album trophy to Kidjo, whose grandmother is Nigerian.

    The highly coveted Best World Music Album is an honour presented to recording artists for quality albums in the world music genre at the Grammy.

    Burna Boy was nominated for the category for his ‘African Giant’ album alongside Altin Gun (Gece), Bokante and Metropole Orkest Conducted By Jules Buckley (What Heat), Nathalie Joachim With Spektral Quartet (Fanm D’ayiti) and Angelique Kidjo (Celia).

    The Grammy Award nominees are albums containing at least 51 per cent playing time of new vocal or instrumental World Music recordings.

    Kidjo, now  with her fourth Grammy win overall in the category, is a 59-year-old singer-songwriter, actress and activist noted for her diverse musical influences and creative music videos.

    She is known for her hit songs “Agolo”, “We We”, “Adouma”, “Wombo Lombo”, “Afirika”, “Batonga” and “Celia”, which clinched the fourth Grammy for her and  was  named “Africa’s premier diva” by Time magazine in 2007.

    During her acceptance speech, Kidjo dedicated the award to Burna Boy and celebrated a new generation of African artists coming up to represent the continent.

    “This is for Burna Boy,” she said, lifting up her award to cheers, and declaring the “African Giant” as part of the new generation of African musicians that are changing global perception of Africa and its music.

    “Four years ago on this stage, I was telling you that the new generations of artists coming from Africa gonna take you by storm and the time has come,” Kidjo said.

    A Nigerian, as Sikiru Adepoju is the only Nigerian to have won a Grammy.

    Adepoju won it in 2009 with the “Global Drum Project” a collaborative album with Mickey Hart, Zakir Hussain and Giovanni Hidalgo.

    Burna Boy in 2019, won Best International Act at the 2019 BET Awards, and was also the Apple Music’s Up Next artist.

    The Annual Grammy Awards ceremony, now in its 62 edition, recognises the best recordings, compositions, and artists of the eligibility year.

    Billie Eilish 18-year-old American singer and songwriter, swept the top awards of the 2020 Grammy, winning Album of the Year, Record of the Year, Song of the Year and Best New Artist.

     

     

    COMPLETE LIST OF WINNERS

     

    RECORD OF THE YEAR

    “Bad Guy,” Billie Eilish

    ALBUM OF THE YEAR

    “When We All Fall Asleep, Where Do We Go?,” Billie Eilish

    SONG OF THE YEAR

    “Bad Guy,” Billie Eilish O’Connell and Finneas O’Connell, songwriters (Billie Eilish)

    BEST NEW ARTIST

    Billie Eilish

    BEST POP SOLO PERFORMANCE

    “Truth Hurts,” Lizzo

    BEST POP DUO/GROUP PERFORMANCE

    “Old Town Road,” Lil Nas X featuring Billy Ray Cyrus

    BEST POP VOCAL ALBUM

    “When We All Fall Asleep, Where Do We Go?,” Billie Eilish

    BEST ROCK PERFORMANCE

    “This Land,” Gary Clark Jr.

    BEST ROCK SONG

    “This Land,” Gary Clark Jr., songwriter (Gary Clark Jr.)

    BEST ROCK ALBUM

    “Social Cues,” Cage the Elephant

    BEST ALTERNATIVE MUSIC ALBUM

    “Father of the Bride,” Vampire Weekend

    BEST METAL PERFORMANCE

    “7empest,” Tool

    BEST R&B PERFORMANCE

    “Come Home,” Anderson .Paak featuring André 3000

    BEST R&B SONG

    “Say So,” PJ Morton, songwriter (PJ Morton featuring JoJo)

    BEST URBAN CONTEMPORARY ALBUM

    “Cuz I Love You (Deluxe),” Lizzo

    BEST R&B ALBUM

    “Ventura,” Anderson .Paak

    BEST TRADITIONAL R&B PERFORMANCE

    “Jerome,” Lizzo

    BEST RAP PERFORMANCE

    “Racks in the Middle,” Nipsey Hussle featuring Roddy Ricch and Hit-Boy

    BEST RAP SONG

    “A Lot,” Jermaine Cole, Dacoury Natche, 21 Savage and Anthony White, songwriters (21 Savage featuring J. Cole)

    BEST RAP ALBUM

    “Igor,” Tyler, the Creator

    BEST RAP/SUNG PERFORMANCE

    “Higher,” DJ Khaled featuring Nipsey Hussle and John Legend

    BEST COUNTRY SOLO PERFORMANCE

    “Ride Me Back Home,” Willie Nelson

    BEST COUNTRY ALBUM

    “While I’m Livin’,” Tanya Tucker

    BEST JAZZ INSTRUMENTAL ALBUM

    “Finding Gabriel,” Brad Mehldau

    BEST LATIN POP ALBUM

    “#Eldisco,” Alejandro Sanz

    BEST LATIN ROCK, URBAN OR ALTERNATIVE ALBUM

    “El Mal Querer,” Rosalía

    BEST AMERICANA ALBUM

    “Oklahoma,” Keb’ Mo’

    BEST SONG WRITTEN FOR VISUAL MEDIA

    “I’ll Never Love Again (Film Version),” Natalie Hemby, Lady Gaga, Hillary Lindsey and Aaron Raitiere, songwriters (Lady Gaga and Bradley Cooper)

    PRODUCER OF THE YEAR, NON-CLASSICAL

    Finneas

    BEST MUSIC VIDEO

    “Old Town Road (Official Movie),” Calmatic, video director; Candice Dragonas, Melissa Larsen and Saul Levitz, video producers (Lil Nas X and Billy Ray Cyrus)

    BEST COMEDY ALBUM

    “Sticks & Stones,” Dave Chappelle

    BEST MUSICAL THEATER ALBUM

    “Hadestown,” Reeve Carney, André De Shields, Amber Gray, Eva Noblezada and Patrick Page, principal soloists; Mara Isaacs, David Lai, Anaïs Mitchell and Todd Sickafoose, producers (Anaïs Mitchell, composer and lyricist) (Original Broadway Cast)

    BEST INSTRUMENTAL COMPOSITION

    “Star Wars: Galaxy’s Edge Symphonic Suite,” John Williams, composer (John Williams)

    BEST ARRANGEMENT, INSTRUMENTAL OR A CAPPELLA

    “Moon River,” Jacob Collier, arranger (Jacob Collier)

    BEST ARRANGEMENT, INSTRUMENTS AND VOCALS

    “All Night Long,” Jacob Collier, arranger (Jacob Collier featuring Jules Buckley, Take 6 and Metropole Orkest)

    BEST RECORDING PACKAGE

    Chris Cornell, Barry Ament, Jeff Ament and Joe Spix, art directors (Chris Cornell)

    BEST BOXED OR SPECIAL LIMITED EDITION PACKAGE

    “Woodstock: Back to the Garden – The Definitive 50th Anniversary Archive,” Masaki Koike, art director (Various Artists)

    BEST ALBUM NOTES

    “Stax ’68: A Memphis Story,” Steve Greenberg, album notes writer (Various Artists)

    BEST HISTORICAL ALBUM

    “Pete Seeger: The Smithsonian Folkways Collection,” Jeff Place and Robert Santelli, compilation producers; Pete Reiniger, mastering engineer (Pete Seeger)

    BEST ENGINEERED ALBUM, NON-CLASSICAL

    “When We All Fall Asleep, Where Do We Go?,” Rob Kinelski and Finneas O’Connell, engineers; John Greenham, mastering engineer (Billie Eilish)

    BEST REMIXED RECORDING

    “I Rise (Tracy Young’s Pride Intro Radio Remix),” Tracy Young, remixer (Madonna)

    BEST IMMERSIVE AUDIO ALBUM

    “Lux,” Morten Lindberg, immersive audio engineer; Morten Lindberg, immersive audio mastering engineer; Morten Lindberg, immersive audio producer (Anita Brevik, Trondheimsolistene and Nidarosdomens Jentekor)

    BEST CONTEMPORARY INSTRUMENTAL ALBUM

    “Mettavolution,” Rodrigo y Gabriela

    BEST GOSPEL PERFORMANCE/SONG

    “Love Theory,” Kirk Franklin, songwriter (Kirk Franklin)

    BEST CONTEMPORARY CHRISTIAN MUSIC PERFORMANCE/SONG

    “God Only Knows,” Josh Kerr, Jordan Reynolds, Joel Smallbone, Luke Smallbone and Tedd Tjornhom, songwriters (For King & Country and Dolly Parton)

    BEST GOSPEL ALBUM

    “Long Live Love,” Kirk Franklin

    BEST CONTEMPORARY CHRISTIAN MUSIC ALBUM

    “Burn the Ships,” For King & Country

    BEST ROOTS GOSPEL ALBUM

    “Testimony,” Gloria Gaynor

    BEST WORLD MUSIC ALBUM

    “Celia,” Angelique Kidjo

    BEST COMPILATION SOUNDTRACK FOR VISUAL MEDIA

    “A Star Is Born,” Lady Gaga and Bradley Cooper

    BEST SCORE SOUNDTRACK FOR VISUAL MEDIA

    “Chernobyl,” Hildur Guonadottir, composer

    BEST NEW AGE ALBUM

    “Wings,” Peter Kater

    BEST AMERICAN ROOTS PERFORMANCE

    “Saint Honesty,” Sara Bareilles

    BEST AMERICAN ROOTS SONG

    “Call My Name,” Sarah Jarosz, Aoife O’Donovan and Sara Watkins, songwriters (I’m With Her)

    BEST BLUEGRASS ALBUM

    “Tall Fiddler,” Michael Cleveland

    BEST TRADITIONAL BLUES ALBUM

    “Tall, Dark & Handsome,” Delbert McClinton and Self-Made Men + Dana

    BEST CONTEMPORARY BLUES ALBUM

    “This Land,” Gary Clark Jr.

    BEST FOLK ALBUM

    “Patty Griffin,” Patty Griffin

    BEST CHILDREN’S ALBUM

    “Ageless Songs for the Child Archetype,” Jon Samson

    BEST SPOKEN WORD ALBUM (INCLUDES POETRY, AUDIO BOOKS AND STORYTELLING)

    “Becoming,” Michelle Obama

    BEST REGIONAL MEXICAN MUSIC ALBUM (INCLUDING TEJANO)

    “De Ayer Para Siempre,” Mariachi Los Camperos

    BEST TROPICAL LATIN ALBUM

    “Opus,” Marc Anthony

    “A Journey Through Cuban Music,” Aymée Nuviola

    BEST REGIONAL ROOTS MUSIC ALBUM

    “Good Time,” Ranky Tanky

    BEST MUSIC FILM

    “Homecoming,” Beyoncé Knowles-Carter and Ed Burke, video directors; Steve Pamon and Erinn Williams, video producers (Beyoncé)

    BEST COUNTRY DUO/GROUP PERFORMANCE

    “Speechless,” Dan + Shay

    BEST COUNTRY SONG

    “Bring My Flowers Now,” Brandi Carlile, Phil Hanseroth, Tim Hanseroth and Tanya Tucker, songwriters (Tanya Tucker)

    BEST TRADITIONAL POP VOCAL ALBUM

    “Look Now,” Elvis Costello and the Imposters

    BEST ENGINEERED ALBUM, CLASSICAL

    “Riley: Sun Rings,” Leslie Ann Jones, engineer; John Kilgore, Judith Sherman and David Harrington, engineers/mixers; Robert C. Ludwig, mastering engineer (Kronos Quartet)

    PRODUCER OF THE YEAR, CLASSICAL

    Blanton Alspaugh

    BEST ORCHESTRAL PERFORMANCE

    “Norman: Sustain,” Gustavo Dudamel, conductor (Los Angeles Philharmonic)

    BEST OPERA RECORDING

    “Picker: Fantastic Mr. Fox,” Gil Rose, conductor; John Brancy, Andrew Craig Brown, Gabriel Preisser, Krista River and Edwin Vega; Gil Rose, producer (Boston Modern Orchestra Project; Boston Children’s Chorus)

    BEST CHORAL PERFORMANCE

    “Duruflé: Complete Choral Works,” Robert Simpson, conductor (Ken Cowan; Houston Chamber Choir)

    BEST CHAMBER MUSIC/SMALL ENSEMBLE PERFORMANCE

    “Shaw: Orange,” Attacca Quartet

    BEST CLASSICAL INSTRUMENTAL SOLO

    “Marsalis: Violin Concerto; Fiddle Dance Suite,” Nicola Benedetti; Cristian M?celaru, conductor (Philadelphia Orchestra)

    BEST CLASSICAL SOLO VOCAL ALBUM

    “Songplay,” Joyce DiDonato; Chuck Israels, Jimmy Madison, Charlie Porter and Craig Terry, accompanists (Steve Barnett and Lautaro Greco)

    BEST CLASSICAL COMPENDIUM

    “The Poetry of Places,” Nadia Shpachenko; Marina A. Ledin and Victor Ledin, producers

    BEST CONTEMPORARY CLASSICAL COMPOSITION

    “Higdon: Harp Concerto,” Jennifer Higdon, composer (Yolanda Kondonassis, Ward Stare and the Rochester Philharmonic Orchestra)

    BEST DANCE RECORDING

    “Got to Keep On,” The Chemical Brothers, producers; Steve Dub Jones and Tom Rowlands, mixers (The Chemical Brothers)

    BEST DANCE/ELECTRONIC ALBUM

    “No Geography,” The Chemical Brothers

    BEST REGGAE ALBUM

    “Rapture,” Koffee

    BEST IMPROVISED JAZZ SOLO

    “Sozinho,” Randy Brecker, soloist

    BEST JAZZ VOCAL ALBUM

    “12 Little Spells,” Esperanza Spalding

    BEST LARGE JAZZ ENSEMBLE ALBUM

    “The Omni-American Book Club,” Brian Lynch Big Band

    BEST LATIN JAZZ ALBUM

    “Antidote,” Chick Corea and the Spanish Heart Band

     

     

  • How border closure has helped Nigeria

    Last Monday in London, Ghanaian President Nana Akufo-Addo made another case for Nigeria to reopen its land border to unrestricted West African trade. Should it? ROBERT EGBE examines how the closure has helped the country

     

    YOU would have thought Abuja or Accra was a more likely venue than London to discuss West African matters with Nigeria, but Ghanaian President Nana Akufo-Addo was not going to let an opportunity of being in the same place with President Muhammadu Buhari pass him by.

    Last Monday on the sidelines of the just concluded United Kingdom-Africa Investment Summit 2020 in the British capital, Akufo-Addo implored Buhari to reconsider Nigeria’s border policy.

    The Ghanaian leader requested a reopening of the closed borders, which, he said, was adversely affecting his country’s economy.

    “The Nigerian market is significant for certain categories of business people in Ghana,” Akufo-Addo said.

    It was not the first time Ghana would be seeking a reversal of the policy. Last October, the country’s Minister of Foreign Affairs and Regional Integration, Ms Shirley Botchwey, Minister of Trade, Allan Kyerematen and Ghana’s Acting High Commissioner to Nigeria, Mrs Iva Denoo had, visited Abuja to plead with Nigeria to reopen the borders with Benin Republic.

    They were under pressure from pressure groups in their country, such as the Ghana Union of Traders Association (GUTA).

    Effects of border closure

    Immediately after the border restriction, hundreds of businessmen and their container-laden trucks were stranded at major points of entry into the country, especially at Seme and Idiroko. Importers found it hard to bring in rice, chicken, turkey and a number of others into the country.

    Besides closing the borders, government also launched the ‘Exercise Swift Response,’ a joint border security exercise, to enforce the border closure.

    Ghana may not share a border with Nigeria, but Akufo-Addo’s concern about the border measures was not for nothing.

    An October 2019 report by Ghana Times says Nigeria ranks fourth among the top ten export destinations for Ghana, in the Economic Community of West African States (ECOWAS) to which Nigeria belongs.

    Since last August 21 when Nigeria restricted the movement of goods across its land borders in a bid to tackle smuggling, much of the ECOWAS states’ economies have been disrupted.

    The decision has caused an economic shock, especially in Benin, Niger and Cameroon which share boundaries with Nigeria and also as far afield as Ghana, Cote d’Ivoire and others that export to Africa’s most populous country.

    The effects of the closure have been felt across all spheres of West African markets, not only in Nigeria, but also by traders elsewhere.

    A 2018 World Bank estimate suggested that 80 per cent of imports into Benin are destined for Nigeria.

    Rice traders in Benin Republic cities of Cotonou and Seme, for instance, have been hard hit. It was a common secret that until the closure, they mostly smuggled their goods into Nigeria, through porous Nigeria-Benin borders.

    The border closure has also been said to have affected rice-production in some major Asian countries.

    Neighbours’ case against Nigeria’s border measures

    Nigeria’s neigbours have it all figured out. In their view, the border restrictions are illegal. Period.

    They and some experts argue, for instance, that the measures are in breach of the 44-year protocol on the free movement of goods, services and people established by the ECOWAS.

    Under the ECOWAS Protocol, member states committed to the establishment of a common market, including “the liberalisation of trade by abolition, among Member States, of customs duties levied on imports and exports, and the abolition, among Member States, of non-tariff barriers in order to establish a free trade area…”

    There is also the reasoning that the border closure is inconsistent with Nigeria’s multilateral commitments, including the African Continental Free Trade Area (AfCFTA), which Nigeria signed last August.

    They also contend that as a member of the World Trade Organization (WTO) since 1995, Nigeria is bound to comply with similar commitments at a multilateral level.

    Fed Govt: Neighbouring countries are to blame

    In its defence, the Federal Government has accused some of Nigeria’s immediate neighbours of not doing enough to curb the smuggling of illegitimate goods into Nigeria.

    The government said some of the countries consistently failed to comply with the various agreements on transit of persons and goods, including the ECOWAS transit protocols and the ECOWAS Trade Liberalization Scheme (ETLS).

    Responding to questions on the matter last December, Information Minister Alhaji Lai Mohammed said: “Discussions on doing legitimate trade between Nigeria on one hand, and Benin and Niger on the other, started in 2005. The discussions have led to MOUs in 2005, 2014, 2015, 2016, 2017 and 2018, all designed to facilitate free movement of goods manufactured in their respective countries and work out the modalities through the Ministers of Trade of both countries for the realization of these objectives.

    “It is worth noting that there has never been legitimate transit trade between Nigeria and the two countries (Benin and Niger). For clarity, the ECOWAS protocol on transit demands that when a transit container berths at a seaport, the receiving country is mandated to escort same without tampering with the seal to the border of the destination country. Unfortunately, experience has shown that our neighbours do not comply with this protocol.

    “Rather, they break the seals of containers at their ports and trans-load goods destined for Nigeria from the original container to trucks. In most cases, five containers loaded onto one truck and duty paid as one truck.

    “This improper trans-loading of transit goods makes it impossible to properly examine such goods, resulting in the importation of illicit goods, including arms and ammunition, without being detected. Because goods are not examined, misclassification and a resultant loss of revenue become the ultimate consequence of this illegitimate transit trade.

    “As we speak, we have ships loaded with rice waiting to discharge (in Benin) and the target market is Nigeria (for Christmas). We have (MV Africana Jacana with 40,000 metric tons of rice, MV Zilos with 20,000 mts and MV Sam Jarguar with 45,000 MTS and others.”

    Why border measures are necessary

    But border closure in Africa is not unusual. Earlier this year, Sudan closed its border with Libya and the Central African Republic, and Kenya suspended cross border trade with Somalia—both for security reasons.

    Rwanda also briefly closed its border with the Democratic Republic of the Congo following Ebola outbreaks.

    The Federal Government identifies smuggling as the basic reason for its decision.

    Smugglers bring in rice, tomatoes, poultry, and illicit weapons, and illicitly export cheaper, subsidised petrol from Nigeria to its neighbours.

    President Buhari raised some of these issues in Nigeria’s defence during his conversation with the Ghanaian President.

    Buhari told Akufo-Addo that dangerous hard drugs were also being freighted into the country through the land borders.

    He said: “When most of the vehicles carrying rice and other food products through our land borders are intercepted, you find cheap hard drugs and small arms, under the food products. This has terrible consequences for any country. It is regrettable that the partial border closure is having negative economic impact on our neighbours, but we cannot leave our country, particularly the youths, endangered.”

    He said Nigeria had remained the biggest victims of the influx of small arms into the Sahel region which also affects other countries like Mali, Chad, Burkina Faso and Niger.

    Buhari said a committee was working on the issue, adding that the borders would remain partially shut until all the issues are sorted out.

    He added: “We will get things sorted out. Our farmers, especially those who grow rice, now have a market, and are happy. We are also concerned about hard drugs and weapons. Once the committee comes up with its recommendations, we will sit and consider them.”

    The President’s observation is supported by facts.

    According to the Major Oil Marketers Association of Nigeria some 10-20 per cent of Nigerian fuel is smuggled abroad.

    In March 2018, a report by the Civil Society Legislative Advocacy Centre (CISLAC) described Nigeria as West Africa’s illegal arms king.

    It noted that Nigeria accounts for about 70 per cent of illegal small arms in the region.

    A report, ‘CrimeJust: Fact Sheet Nigeria’ published by (CISLAC), said porous borders paves ways for free flow of arms in and out of Nigeria.

    It was said to also contribute to increasing number of violent conflicts, constant human and drug trafficking which remain a challenge to authorities within and outside Nigeria.

    Government efforts to control the situation from within alone have not been fully successful.

    When Inspector-General of Police (IGP), Ibrahim Idris on February 21, 2018 directed the recovery of prohibited firearms, ammunition and weapons in the country, 6,527 firearms were recovered.

    They included 671 AK-47 rifles, 594 pump action guns, 70 English Barreta pistols, 71 single and double barrel guns, 92 machine guns, one anti-air craft gun and 5,028 locally made guns, enough to start a small war.

    Gains of border measures (for Nigeria)

    Among other benefits of the closure, are a higher import revenue, lower domestic fuel consumption, curbing of arms smuggling for terrorism and banditry, reduction in the smuggling of goods and illicit drugs, reduction in illegal immigration and increased rice production by local farmers.

    At a meeting with the National Assembly’s Committee on Finance and National Planning, last year, Comptroller General of the Nigerian Custom Service, Hammed Ali, praised the initiative. He said that it had opened unexpected economic doors to Nigeria.

    “There was a day in September that we collected N9.2 billion… it has never happened before,” he said.

    The Minister of State Petroleum Resources, Timipre Sylva, also indicated that there had been a significant drop of eight million litres in fuel consumption, evidence of immense smuggling of petroleum products aided by Nigerian security personnel.

    The entries of rice, cars, and chicken products with so many other goods and services that originate from neighboring African countries have also reduced drastically.

    These and more fueled the Federal Government’s decision to keep the borders closed until the neighbours get their acts together:

    To keep the momentum, the Federal Government also commissioned a joint task force comprising customs, immigration, police and the military to keep unrelenting check on the borders.

    Alhaji Mohammed also noted that since the closure in August, the monthly import revenue, instead of recording a decrease, has increased by 15 per cent. He noted also that the consumption of fuel has dropped by 30 per cent due to reduced smuggling of petroleum products to neighbouring countries.

    Mohammed added: “It is important to note that 95 percent of illicit drugs and weapons that are being used for acts of terrorism and kidnapping in Nigeria today come in through our porous borders.

    “However, since this partial closure, these acts have been drastically reduced. Our conclusion is that the arms and ammunition these terrorists and criminal elements were using no longer gain access into the country. In addition, the importation of the drugs which affect the well-being of Nigerians have equally been reduced.”

    Corroborating his views, Director-General of the Department of State Services, Yusuf Bichi, agreed that the closure of the Nigerian land borders had helped reduce arms smuggling.

    He said in spite of the criticisms trailing the closure from some West African countries, the “closure of our borders so far has succeeded in checkmating not only smuggling of goods that are illegally brought into the country, even firearms and then checkmating the movement of people that are likely to undermine the security of this country.”

    The Comptroller, Nigerian Customs Service (NCS), Oyo/Osun Command, Abdullahi Zulkifli, concurred with the assertion. He said the closure of the land borders by the Federal Government had reduced smuggling of illegal arms and ammunition into the country.

    The Federal Government said the closure of the land borders also comes with economic gains for the country. It stated that the Nigeria Customs Service now generates up to N8 billion daily from N4.5 billion daily it was generating before the closure and the joint border patrol.

    The border has also been a blessing for local rice farmers and businessmen trading in rice.

    Stakeholders’ position

    Some stakeholders have backed the border closure.

    Minister of Agriculture and Rural Development, Alhaji Sabo Nanono, for instance, noted that the closure has increased the demand for local rice, fish, chicken and textiles.

    A News Agency of Nigeria (NAN) report quotes him as saying: “In the southern part of this country, people do not eat foreign rice anymore. In fact, you can perceive the aroma in the milling plants as opposed to the ones imported into the country that do not even add value to your health, that is not even nutritious.”

    Chairman, Senate Committee on Agriculture, Abdullahi Adamu, said the border closure was a right move.

    “It is one of the few occasions that Nigeria has stood up to protect the interest of Nigerians. Yes we believe in good neighbourliness, but if we continue to listen to the cries of people who are shedding crocodile tears about the border closure, we will not be able to ensure that we develop policies deliberately to protect the interest of people that we are to protect.”

  • Controversy over VAT proceeds, rise in goods’ prices

    The 2019 Finance Bill has been signed into law. But, implementing the law and navigating the delicate routes of balancing revenue generation to deliver on infrastructure, health and education and tackling the hard reality of the consequences of increasing the Value Added Tax (VAT) might prove a hard nut to crack. Assistant Editor NDUKA CHIEJINA reports on what to expect in the coming days and months.

    In 1993, the Federal Government introduced Value Added Tax (VAT) to replace Sales Tax for the purpose of increasing the revenue base of government and make funds available for developmental purposes that will accelerate economic growth.

    The VAT was adopted in 1994 and prospective VAT payers, including manufacturers, wholesalers, importers, suppliers of taxable goods and services were required by decree No 102 of 1993 to register with the Federal Inland Revenue Service (FIRS) which centrally administers VAT.

    The goods and services exempted by the decree are those that bother on people’s welfare and whose requirements are necessary for improving human development. These include medical and pharmaceutical products, basic food items, educational materials, agricultural services and equipment, etc.

    The former Minister for Budget and National Planning, Udoma Udo Udoma, and the immediate past Executive Chairman of the FIRS, Babatunde Fowler, hinted during an interactive session with the National Assembly in March 2019 that VAT rate was likely to go up. According to them, this was to enable the government to fund the new minimum wage of N30, 000 per month approved by the National Assembly.

    After the immediate backlash, the FIRS subsequently clarified that the intention was to increase compliance rate and not tax rates, but suggested that Nigerians should be ready for a VAT rate increase by the end of 2019. Potentially, this means an increase of about 50 per cent will raise the current standard VAT rate of five per cent to 7.5 per cent.

    The VAT is considered beneficial to the Nigeria economy. For Nigeria to attain its economic growth and development she must be able to generate enough revenue in order to meet her expenditures in term of provision of social amenities and government’s running costs. If more goods and services are taxed, the revenue base of the country will increase and increase revenue means that the tax base will have to be grown.

    Under the new law, the effect of the VAT increase on taxpayers would be managed by introducing a VAT exemption threshold for businesses with a turnover of less than N25 million per annum and by expanding the list of VAT exempt items to include educational items and other basic commodities.

    The additional revenue generated from VAT would be used to fund healthcare, education, and infrastructure projects.

    VAT and the States

    In 2017, the then Minister of Finance, Mrs. Kemi Adeosun, remarked that 87 per cent of Nigeria’s VAT comes from four states and the Federal Capital Territory (FCT), while only 13 per cent comes from 32 other states in the federation.

    According to Adeosun, Lagos has the highest VAT collection, amounting to 55 per cent of Nigeria’s VAT. The FCT is second place with 20 per cent, while six per cent came from Rivers; five per cent from Kano and one per cent from Kaduna.

    Seventeen per cent of the total sum that goes into the Federation Account comes from VAT collected across the country. To put things in perspective, the average VAT collection in the past six years is about N900 billion. The revenue is shared 15 per cent to the Federal Government, 50 per cent to States and 35 per cent to Local Governments; four per cent cost of collection to FIRS.

    According to PricewaterhouseCoopers (PwC), the government believes it will generate on average an additional N450 billion annually.

    “Less four per cent cost of collection to FIRS, all 36 states will get 18 billion per month, translating to an average of N500 million per state. Since Lagos, FCT, Rivers, Kano and Kaduna generate 87 per cent of VAT revenue, they also share a big chunk of VAT revenue, meaning that the financially disadvantaged states will get much less than N500 million monthly,” PwC said.

    Speaking on the controversial sharing of VAT proceeds by states, Partner/Head of Tax and Corporate Advisory Services at PwC, Mr. Taiwo Oyedele, told The Nation that “This has been an issue because, in principle, consumption tax (another name for VAT) is a state tax.

    “It will start getting to a point that every state will collect their VAT and keep it instead of this central collection that is now shared because there is no way you are going to share it that it’s going to be equitable.

    “You find that some states are collecting more on what they are sharing and some are not contributing a lot, but they are sharing more than what they contribute. So, like the personal income tax, our legislation is done at the centre, but the collection is done by several states.

    “So, I will recommend that Nigeria needs to get to a point where we re-enact the Value Added Tax Act so that the federal law will be administered by each state so that everybody should collect their VAT and keep it.”

    Continuing, Oyedele said: “Because I think at this point now, going from 1993 when the law was introduced, this is 2020. States now have a better capacity, even technology to be able to administer their VAT. But before we are able to do that, I will agree with you that the sharing formula is not equitable.”

    The other complication of the VAT increase, the tax expert noted, is how to decentralise consumption so that the VAT goes to where the customer is rather than where the service provider’s headquarters is.

    He said, for instance, that MTN is all over Nigeria, but its head office is in Lagos. “So, when they (MTN) pay VAT, does it mean that it is VAT for Lagos? So, that can also be a complication. How do you decentralise consumption so that the VAT goes to where the customer is rather than where the service provider’s headquarters is?”

    Due to its market size, Lagos State was top in terms of VAT revenue in the first six months of 2018. For instance, Lagos VAT revenue receipts between January and June 2018 averaged N8.033 billion monthly, up from the average of N6.38 billion in the first six months of 2017. This was significantly higher than Kano’s. Nasarawa, Bayelsa, Gombe and Ebonyi trailed the pack.

    “It is evident in our analysis that many states lack the formal structures for the payment of VAT. 29 of 36 states got less than N1 billion monthly, despite huge difference in population, PwC noted.

    The multinational professional services firm further noted that since “All things are never equal, especially when it comes to tax, an increase in the VAT rate will inevitably impact on consumption and VAT compliance. The combined effect will reduce the expected revenue.”

    On their part, State governors expressed support for the Finance Bill, which called for an increase in VAT from five per cent to seven per cent.

    Vice-Chairman of the Nigerian Governors Forum (NGF) and Sokoto State Governor Aminu Tambuwal once argued at the NGF monthly meeting in Abuja that, “We are in support of that bill. We are in support of what will definitely improve revenue generation for the Federal and State Governments.

    According to him, “We are appealing to those who don’t have a proper understanding of the context of the bill to kindly have a rethink and reflect on the quantum of work that is ahead of us as a country and as states.”

    He noted that State Governments needed a lot of resources to improve infrastructure, to invest in education, health and virtually every sector of the national life. “So, there is an urgent need for more revenue for Nigeria. We appeal that we should show more understanding with the Federal Government in that regard,” Tambuwal said.

    Effects of the VAT increase on consumers

    Oyedele in his chat with The Nation stated that the new VAT rate will definitely affect the prices of goods and services except that it’s going to affect different items and different people.

    “Some items will go up in terms of their prices because of the VAT and some will remain unaffected; some that were even liable to VAT before are now included in the exempted, which means their prices should actually go down.”

    Overall, Oyedele noted that it’s a mixed impact. He said, for example, that bread which before now was liable to VAT is now no longer liable to VAT. “We have airtime, for example, which is something that everybody consumes so, the price of airtime will go up because of the higher VAT.

    “Whereas when we look at something like flour or like yam, it was exempt before and it is still exempt now, but the prices remain the same. So, that is the analysis I can provide,” the PwC tax expert said.

    The Registrar/Chief Executive, The Institute of Business Development (IBD), Dr. Paul Ikele, also said the VAT increase will directly impact consumers, but the severity will depend on which population group they belong; whether they are in the low, the middle or the high-income group.

    “Who are the consumers of those value-added tax elements?” he asked, pointing out that “If they are selective consumers whose income is high such that they can close their eyes and pay back without direct effects such as hotels, premium services like those flying first-class and other luxury items and services, those groups have no problem.

    “But if the goods are goods which you and I go to the same market and buy, of course, the sellers, the producers will want to put that value-added on the price they are offering so that they can equally pay to the government.”

    The IBD boss emphasized that when the government begins to take VAT from every goods and service that every person requires, of course, it will lead to increase in the cost of producing those goods and services because VAT is tax paid on the point of purchase.

    He said it also means, by extension, that those producing such goods or providing such services will have to increase their prices to make up for their cost of production, which they will pass on to consumers.

    Citing Digital Satellite Television, DSTv, for instance, Ikele said once the service provider increases its price, the number of subscribers reduces, and then the service provider looks at another way of recouping.

    According to him, this kind of situation was responsible for why there are very high tax avoidance and tax diversion in the country.

    The IBD chief also told The Nation that although, VAT is a good thing for the government, the issue of proper management and control of the proceeds from the VAT increase remains. “With the VAT increase, there should be a special account for it so that government can use it to support particular projects and then the whole country will see it and people will applaud it,” Ikele advised.

    He also said the government put the cart before the horse when it increased VAT rate from five per cent to 7.5 per cent without putting in place adequate infrastructure to boost the nation’s productive base.

    “There are lots of infrastructure challenges. And Nigeria is a growing economy; government cannot just come up with any direct or indirect collection of revenues without putting in place adequate infrastructures such as roads, electricity and other utilities,” Ikele said.

    Other experts said that beyond the expected boost in revenue, there will be other unintended consequences including higher inflation and interest rate hike. Besides, people may generally become poorer; seeking to expand the VAT net while also increasing the VAT rate at the same time is a conflicting strategy.

    Before the passage of the Finance Bill, some scholars have argued that Nigeria can make twice as much from VAT at the current rate by reforming the law, expanding the net and ensuring a robust administration rather than by increasing the rate.

    This should include a review of VAT waivers, better policing of the border to improve import VAT collection, a framework for VAT on imported services and the digital economy.

    According to the experts, contemplating an increase in VAT rate now is bad timing and inconsistent with current economic reality. They also noted that in any case, the likely increase in revenue will not be sufficient to pay the new minimum wage.