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Tag: AfDB

  • AfDB to fund $63m agric project

    AfDB to fund $63m agric project

    Africa Development Bank (AfDB) is making available $63 million to fund the Support for Agricultural Research and Development for Strategic Crops (SARD SC) programme, the Project Coordinator, Dr. Chris Akem, has said.

    Akem said the fund which is a five-year action plan, is targeted to foster food and nutritional security, as well as fight poverty in 20 countries of Sub-Saharan Africa.

    He spoke at a training programme on IAR4D and Innovation Systems Approach for SARD-SC Wheat Value-Chain yesterday, in Abuja.

    He said: “About $63 million has been approved for the SARD –SC project over a five-year period. They assured us that if the programme can be successful, they are ready to double agric research in Africa because they believe agric is the backbone of development,” assuring that the fund will be committed to research development on rice, wheat, cassava and maize.

    Among other objectives, he said the programme is aimed at generating new technology for the four crops, distribute the technology, and build infrastructure as well as efficient management of the project, saying, about 20 per cent yield increase is targeted from the four crops within the four years time frame.

    Akem urged stakeholders to deliberate effectively on how wheat production can be increased in the entire value chain to replace huge import of the commodity.

    Earlier, the Minister of Agriculture and Rural Development, Dr. Akinwumi Adesina, said the wheat value chain is expected to cover a minimum of 33,000ha in each of the wheat producing states.

    Adesina, who was represented by the Acting Permanent Secretary, Dr. Akinbolawa Osho, said about 7,500 improved seeds, would be distributed to the farmers in the selected states, adding that the programme is aimed at reducing wheat importation by at least, 50 per cent.

    He listed the selected states to include: Borno (Ngala and Kirnowa), Taraba (Gembu, Ngoroje), Adamawa (Dasin Hausa), Bauchi (Badel Jama’are, Misau), Jigawa (Hadejia, Chiyeko, Ringim), Plateau (Tahoss).

    Others are Kano (Kadawa, Bunkure, Alkamawa and Bagwai), Kebbi (Kebbi), Sokoto (Sokoto), Zamfara (Talata Mafara), Yobe (Gashua), Gombe (Balanga & Dadinkowa).

    The House of Representatives, is seeking implementation of the African Union Maputo Declaration, where 10 per cent of the country’s annual budget will be used to develop the agriculture sector.

    The lawmakers said until strong partnership is established with the Federal Government, funding of agricultural projects, especially Research and Development will be ineffective.

    The Chairman, House Committee on Agriculture and Rural Development, Alh. Mohammed Mungono and his Deputy, Alh. Munir Babba Dan, made the assertion at a training program on IAR4D and Innovation Systems Approach for SARD-SC Wheat Value-Chain, yesterday in Abuja.

    Munguno who accused former military administrations for inefficiencies in the budget allocations observed that it was imperative for the federal government to also diversify the economy and support the sector.

    “We want to increase national wheat production by 95 per cent, resulting in import reduction by 30 per cent through technology interventions across the value chain, with improved varieties, value addition, yield enhancing management practices directed at stimulating 30 per cent yield increase, 70 per cent income among 55,000 wheat Farmer household,” Adesina said.

    In his remarks, the Executive Secretary, Lake Chad Research Institute, Dr. O.G Olabanji, said the purpose of the training is to strengthen capacity of the stakeholders on the wheat value chain.

    He said the country spends about N635 billion on wheat imports, while it is capable produce it, saying he is hopeful that the country will be self sufficient in wheat production by 2015.

    Director General, International Centre for Agricultural Research in the Dry Areas (ICARDA), Dr. Mahmoud Solh, said the workshop was organized to support agriculture research for development and strategic crops funded by the AfDB.

  • FG vs. AfDB

    The federal government’s indignation at the African Development Bank AfDBs unflattering scorecard was perhaps expected. Having sunk so much energy into convincing Nigerians of its deft handling of the economy, its touchiness over comments remotely deemed to negate its exaggerated claims of performance should be understandable. Even at that, it seems that the Jonathan coterie of self-scorers barely read, not to talk of digest, what could in fact pass as a generous assessment by the continental finance institution.

    The details of the AfDB report are of course already in the public domain. To start with, I do not think the so-called report contains anything new or different that Nigerians are not already familiar with on the economy and its vulnerabilities.

    Let me however, attempt a summary of the main elements of the report. The report starts by acknowledging that the economy has been on a steady cruise hovering between 6.5 to 7 percent. That despite government’s best intentions to turn the tide in agriculture, the sector remains largely hobbled by lack of modernisation on one hand and poor linkage with manufacturing on the other. That unemployment, despite the impressive growth rates actually increased from 21% in 2010 to 24% in 2011; it attributes this to the fact that the sectors driving the economic growth are not high job-creating sectors. It gave the federal government credit for fiscal consolidation which has helped to contain the fiscal deficit below 3.0% of gross domestic product (GDP). So also is the tight monetary policy of the Central Bank of Nigeria (CBN) which kept inflation at around 12.0% in 2012. Over all, it projects a flattering picture of positive growth in the future.

    Indeed, it seems to me that only the Federal Government considers the AfDB’s presentation on the “enclave” economy of crude oil, which powers an annual 8.0% growth, (the corresponding figure for non-oil sector is -0.35%) while leaving youth unemployment at a monstrous 37 percent as anything but objective. Or more still – its prescription of the need to broaden the base of the economy through diversification, harnessing its potentials in agriculture, manufacturing and services to broaden the growth and to create employment and reduce poverty.

    It was therefore not sufficient that the lynch mob at the Presidency found the presentation disagreeable – it had to be passed off by Jonathan’s information minister Labaran Maku as containing “bogus claims and disingenuous innuendos” only because it dared to draw attention to the vulnerabilities of the economy. Coincidentally, the Minister of Finance Ngozi Okonjo-Iweala had only a week before in an interview with Thisday admitted the vulnerability to be real!

    Of course, the federal government counter-argument to the AfDB could only be revealing. First, it argues that the growth rate of the Nigerian economy projected at 6.7 percent this year would be the fastest on the continent. That, courtesy of the Jonathan administration’s transformation agenda, Nigeria remains the destination of choice for Foreign Direct Investment in Africa, over and above South Africa and Egypt. It awards it awards itself high marks for the recovery of the capital market, celebrates its “successful” realignment of the Lugardian Lagos-Kano rail lines; sings the high praise for the still-in-the-womb standard gauge rail lines from Lagos-Ibadan; Abuja-Kaduna; Warri-Ajaokuta-Itakpe; Abuja City Light Rail; etc.

    It goes on to celebrate the creation of 12,000 YouWin jobs; looks forward to another 80,000 more jobs by 2015. As for the SURE-P funded Community Services Scheme, it claims that 178,000 youths are already employed out of the 370,000 expected while the Graduate Internship Scheme is expected to place about 50,000 graduates across the country. Now, all of the above merely represent a fraction of the achievement which the administration claims it has in its kitty.

    Of course, you would be mistaken to imagine that the minister was not talking about a nation that spends an annual $11 billion – representing 35 percent of its entire budget- to import staple food for its population; an economy powered by generators and where basic manufactures are still sourced abroad. We are talking of an economy where more than 40 million are out work; where factory closures are more than start-ups, and where the only ‘productive’ activity going on is politics!

    While it seems that the poor grasp of the fundamentals of the economy by the likes of Maku is troubling enough, the greater danger is when officials choose to live in denial of the reality. Contrary to the picture often painted, the arithmetic of the economy is neither nor too complex to grasp. Excess crude means nothing more than surplus of earnings over projected receipts. You do not need experts from the World Bank to understand that it does not require special intelligence! The same with foreign reserves; it is growing because the nation is earning more – not consuming less!

    That the economy enjoys a semblance of macro-stability is simply a function of oil receipts.

    By the way, no one needs to look far to understand why all manners of portfolio investors are swooning on Abuja: it is precisely because the nation has enough reserves to guarantee safe exit for the investors whenever the bubble burst. What the like of Maku is yet to appreciate is that our present capacity to pay for imports remains dependent on oil prices holding steady. Even then, there are increasing signs that the economy is heading for troubling times as oil receipts dwindle due to theft and tumbling oil prices.

    The second leg of the report is the aspect dealing with unemployment and poverty. The federal government, not surprisingly thinks it is doing enough on both counts. What have they done? It is unimaginable that the government thinks so much of the high-octane affairs in Abuja during which some 100 youths are presented with wheel barrows all in the name of job creation? Is that job creation?

    Let me end by praying that this revelry last; it seems to me that the nation is due for a shocker. Contrary to the AfDB’s prognosis, I do not even think that the prognosis is good. Soon enough, the reality would dawn on everyone.

  • AfDB used old data for assessment, says Fed Govt

    AfDB used old data for assessment, says Fed Govt

    Government yesterday hit back at the African Development Bank (AfDB), saying its statistics was at variance with the present realities in the country.

    The AfDB, in its latest report, wrote off Nigerian economy, saying its statistical growth did not translate into job creation or poverty alleviation. It said unemployment rose from 21 per cent in 2010 to 24 per cent in 2011.

    But yesterday, Minister of Information Labaran Maku in a statement, said Nigeria remains the highest destination for Foreign Direct Investment (FDI) inflows into Africa over and above South Africa and Egypt.

    According to him, this is a direct result of the fundamental reforms being implemented under President Jonathan’s Transformation Agenda.

    He said the AfDP based its report on 1996-2010 statistics which is behind time and does not reflect the real achievements/results of government’s tackling poverty and unemployment in Nigeria in the last three years.

    The AfDB report, the minister added, presented poverty, inequality and unemployment in Nigeria without the appropriate and illuminating global context.

    The minister added that Nigeria was recently honoured for meeting the Millennium Development Goal (MDG) of reducing people living in absolute hunger by half well ahead of the 2015 target set by the United Nations.

    Maku said the report failed to capture all the holistic measures put in place to address the economy which include job creation, health reform, power reform and Poverty.

    He said:”We are confident that these measures which were not covered by the AfDB report, have contributed significantly to reducing poverty and inequality in the country.”

    “The AfDB report based on 1996-2010 statistics is therefore behind time and does not reflect the real achievements/results of this administration in tackling poverty and unemployment in Nigeria in the last three years. “

    He added: “This government has undertaken significant policy reforms targeted at addressing the challenges identified in the report. These policy interventions have contributed positively to turning things around beyond the picture painted in the report.

    “Poverty is a national challenge that transcends the whole country cutting across party divides. In reality, the responsibility of fighting poverty does not rest solely with the Federal Government. States and Local Governments share in this responsibility too. State governments hold the key to fighting poverty in their states. Dealing with poverty as a partisan phenomenon would be trivialising the problem. All hands need to be on deck to fight poverty. Federal Government efforts are mainly at the policy level, while actual projects/programmes are carried out by the states. In spite of this, Federal interventions to reduce poverty have taken place in Agriculture; Health; Education; Housing; Communication Technology; Works; Transportation and other sectors of the economy.

    “The AfDB report presents poverty, inequality, and unemployment in Nigeria without the appropriate and illuminating global context. Yet, these three challenges have increasingly become global issues, which policymakers around the world are grappling with everyday. For example, South Africa’s unemployment rate and Gini Coefficient, which measures the dispersion in income and wealth among individuals, is 26% and 0.63, respectively, compared to Nigeria’s 24% and 0.45.”

     

  • AfDB commends Nigeria’s ports reform

    AfDB commends Nigeria’s ports reform

    The African Development Bank (AfDB) said Nigerian Ports Reform Policy and its economic partnership with ECOWAS and European Union have enhanced its export drive.

    The bank said in a book, the African Economic Outlook, on Thursday in Abuja, that Nigeria’s export to African countries currently stood at 11 per cent of its total exports.

    This notwithstanding, the bank said Nigeria had yet to tap into the huge potentialities in the region for growth, economic diversification and integration.

    The News Agency of Nigeria quoting the bank report said that the West African market provided a tremendous opportunity for the country’s financial sector.

    The bank also observed that inflation rate, escalating budget deficits in some countries, rising wage bills and increasing domestic interest payments, among others, had hindered full monetary integration of the ECOWAS member states.

    It commended Nigeria’s effort aimed at encouraging local manufacturing, insisting that the major challenge to manufacturing was poor trade network and infrastructure within the region.

     

  • AfDB eyes $1.5b bonds

    AfDB eyes $1.5b bonds

    The African Development Bank (AfDB) is planning to raise $1.5 billion in local-currency bonds in Nigeria and Zambia to finance infrastructure projects.

    This became exigent as emerging-market bond yields rise on speculation the Federal Reserve will reduce economic stimulus.

    The AfDB, which gives money to African governments for projects in areas, such as roads, ports and energy, is completing the planned size of the medium-term note programmes and is in talks with authorities in the two countries, Olivier Eweck, financial technical services manager in the bank’s treasury department, said in a statement.

    “Before the end of the month we would have made up our minds on the numbers,” he said.

    The Nigerian issues may be worth as much as $1 billion and the Zambian debt may reach the kwacha equivalent of $500 million,” he said.

     

  • Nigeria owes World Bank, AfDB, others $5.336b

    Nigeria owes World Bank, AfDB, others $5.336b

    EIGHTY per cent of Nigeria’s $6.67 billion external debt owed to multilateral institutions, The Nation has learnt.

    These global organisations are the World Bank Group, International Fund for Agricultural Development (IFAD), African Development Bank Group (AfDB), Arab Bank for Economic Development in Africa (ABEDA), International Development Bank (IDB) and Economic Development Fund (EDF).

    Report from FSDH Securities Limited indicated that the Exim Bank of China, which constitutes 11.3 per cent of the debt stock, was the next biggest creditor to the country; 8.51 per cent of the debt is owed to other unnamed creditors.

    The debt statistics, which is for the first quarter of this year, represents an increase of 2.20 per cent from $6.54 billion in December 31, 2012, but constitutes about 2.49 per cent of the nation’s Gross Domestic Product (GDP).

    Data from the Debt Management Office (DMO) shows that Nigeria’s total debt stock (addition of external and domestic debts) as at March 31, 2013 stood at N7.53 trillion, representing a decrease of 0.29 per cent from the December 31, 2012 figure of N7.55 trillion.

    A breakdown of the debt stock shows that external debt accounted for 13.79 per cent of the total debt stock at N1.03 trillion while domestic debt stock accounted for 86.21 per cent of the total debt stock at N6.49 trillion. The total public debt stock in the country is estimated at about 18.04 per cent of the GDP.

    FSDH Securities Limited’s forecast GDP and debt stock for Nigeria in the next three years shows that the debt position is sustainable. “Our revised debt-to-GDP forecast for 2013 is 18.79 per cent. The country’s economic managers need to ensure that all debts contracted are used for productive projects to improve the welfare of the citizenry,” it said.

    DMO puts the country’s domestic debt stock to GDP is estimated at 15.55 per cent. The breakdown of the total domestic debt stock by instrument type  shows that the Federal Government of Nigeria Bonds accounted for N3.82 trillion, representing 58.84 per cent; Nigerian Treasury Bills (NTBs) accounted for N2.34 trillion, representing 36.01 per cent and Treasury Bonds (TBs) accounted for N334.56 billion, representing 5.15 per cent.

    FSDH also expects the Nigerian bond market to deepen further through fresh corporate and municipal issues and FGN bonds reopening. Consequently, it said there is a need to balance maturity, liquidity and market depth in order to maintain a robust bond market.

    The firm noted that the debt to GDP ratio is acceptable as it is below the applicable critical limit of 40 per cent for countries in Nigeria’s economic peer group. “This means that Nigeria’s debt portfolio has wide fiscal sustainability space. There is a commitment by the Federal Government to ensure that the total debt stock does not exceed 25 per cent of GDP,” it said.

    It however, said that the total debt analysed excludes the debt that arose from the Asset Management Corporation of Nigeria (AMCON) bond issues, which banks are supposed to contribute 0.5 per cent of their total assets for 10 years to redeem.

  • BoI targets $500m AfDB facility

    The Bank of Industry (BoI) has concluded arrangement to secure $500 million loan from the African Development Bank (AfDB) to expand its lending capacity, The Nation has learnt.

    Also, the bank demands 10 per cent equity contribution from prospective borrowers to enhance their commitment to the loans.

    BoI’s General Manager, Operations, Joseph Babatunde, made this known at the weekend during a media workshop organised by the bank in Lekki, Lagos.

    He said the AfDB would extend $200 million facility to the Nigeria-Export-import (NEXIM) Bank, adding that one of reasons for the delay in securing the loan was because the lender (AfDB) was awaiting the Federal Government’s sovereign guarantee. “We have already secured the needed approvals for the loan aside getting a sovereign guarantee,” he said.

    Babatunde said rates for such loans are always at small margin above the Nigeria Interbank Offered Rate (NIBOR), adding that it will be a moving rate, rotating around NIBOR, and will be at single digit.

    “It is not going to be at high interest rate because it is international borrowing. But I can assure you it will be at a single digit rate,” he said.

    Babatunde also hinted that BOI had secured government approval to increase its capital base from current N250 billion to N750 billion, adding that the Central Bank of Nigeria (CBN) and Federal Ministry of Finance constitutes its major shareholders.

    He said the AfDB loan will soon be ready, adding that the delay in securing the fund had also stalled plans by the firm to honour its financial pledge to the entertainment industry.

    He however, said the BoI had in its own, extended over N1 billion facility to the subsector.

    The manager also explained why majority of prospective borrowers never secure loans from the bank. He said many of such requests do not meet the specified criteria with critical information such as formal application letter, completion of questionnaire, report of feasibility study, performa invoice of machinery and equipment from the sources indicated in the feasibility, prices and sources of raw materials, among others are usually missing.

    He said once these conditions are met, the legal documentation of the part of the bank does not take long time while approval and disbursement of such loans usually happen within two weeks.

    Also, supervision and monitoring of such loans follow while tenure ranges from five to 15 years depending on terms of the loan and cash flow.

  • Nigeria, others to benefit from AfDB’s platform

    Nigeria, others to benefit from AfDB’s platform

    Investors in the capital market are set to benefit from a new era of transparency and accountability arising from enhanced information flow and dissemination of relevant data under the Open Data Platforms initiative recently launched by the African Development Bank (AfDB).

    Nigeria is one of 20 African countries selected for coverage by the Open Data Platform.

    According to AfDB, the “Open Data Platform” programme is part of the AfDB’s recently launched Africa information highway initiative aimed at ‘improving data management and dissemination in Africa’.

    This development according to a statement from AfDB, is a great boost to the efforts of the Securities and Exchange Commission (SEC) under the helmsmanship of the reform minded Arunma Oteh and other securities regulators in the region to increase transparency and provide investors with critical data for informed investment decisions.

    It said :”The Open Data Platform is a user-friendly tool for extracting data, creating and sharing own customized reports, and visualizing data across themes, sectors and countries in tables, charts and maps. Through the Open Data Platform, users can access a wide range of development data on African countries from multiple international and national official sources. The platform also facilitates the collection, analysis and sharing of data among countries and with international development partners. The platform offers a unique opportunity for various users, such as policymakers, analysts, researchers, business leaders and investors around the world, to gain access to reliable and timely data on Africa.

    “Users can visualize time series development indicators over a period of time, perform comprehensive analysis at country and regional levels, utilize presentation-ready graphics or create their own blog, and share their views and work with others, thereby creating an informed community of users.”

    AfDB added : “Once implemented, the Open Data Platform will be used by African countries for all data submission flows to the AfDB and possibly other international development partners, including the International Monetary Fund (IMF), EU Commission, World Health Organization (WHO), UN Food and Agriculture Organization (FAO), African Union Commission (AUC) and UN Economic Commission for Africa (ECA). This initiative presents a unique opportunity for African countries to take the lead in implementation and promotion of international statistical standards across all countries in the region and in enhancing the quality of the data disseminated by African countries.”

    The initiative, which is expected to be extended to the rest of the continent by July 2013 goes a long way in positioning Africa to participate in the global economy. It will be of immense service not only to the governments and policy makers, but particularly so to investors home and abroad. In Nigeria, the National Bureau of Statistics (www.nigerianstat.gov.ng) has received wide acclaim for facilitating timely data dissemination.

  • World Bank, AfDB, others advocate coordination on global devt

    World Bank, AfDB, others advocate coordination on global devt

    Leaders of the African Development Bank (AfDB), European Bank for Reconstruction and Development, Inter-American Development Bank, International Monetary Fund (IMF), and the World Bank Group have pledged close collaboration to support development and growth.

    In a statement, the institutions said there is need for coordinated efforts to achieve the Millennium Development Goals by 2015, which aim to end poverty and hunger, increase access to education and health care, improve gender equality, and ensure environmental sustaina-bility.

    “Nothing could be more important than ensuring young people get the right start in life. We aim to make 2015 the year in which children no longer negotiate access to basic education, mothers to the most basic health care, households to water and sanitation, or girls to the most fundamental opportunities for schooling, work, or voice in their communities. And we aim to ensure these gains are permanently sustained in the post-2015 era” Donald Kaberuka, President of the African Development Bank said.

    Also, the leaders pledged strong support for and collaboration with the UN-led process of defining the Post-2015 Development Framework. They voiced support for an approach that integrates concepts of economic, social and environmental sustainability. Noting that even recent gains in social indicators are at risk in the absence of a long term financing plan, leaders pledged to work together to develop options for long term investment to strengthen the foundations of growth.

     

     

     

  • AfDB blames National Assembly for non-release of $700m SMEs loans

    The African Development Bank (AfDB) has explained the rationale for delay in the release of the $700 million (N108 billion) loans for small and medium scale enterprises (SMEs). It blamed the delay on what it called technical hitches and the National Assembly.

    In 2011, AfDB approved $700 million for the development of SMEs in Nigeria. It also provided loans to the Bank of Industry (BoI) and NEXIM Bank two weeks ago following the signing of an agreement. The loans were given in two tranches of $500 million to BoI and $200 million to NEXIM for distribution to the qualified SMEs.

    AfDB’s representative in Nigeria Dr Ousmane Dore told The Nation that the loans arrived late because the National Assembly did not approve it in time.

    He said: “This is a sovereign-guaranteed (Federal Government-backed) credit lines. In this case, the credits must be approved by the parliament. So, it was one of the loans that had to wait for the approval of the National Assembly before it can be released.

    “We are trying to work out some conditions guiding the release of the loans.These are technical issues relating to the capacity of the beneficiaries to pay back the loans. Some negotiations need to be done to ascertain whether the banks have the capacity to undertake the risks of collecting the loans. This is important to ensure that confidence between the AfDB and Nigeria is intact.”

    Dore said the board of the AfDB has since approved the loans, adding that the technical issues must be sorted out before the cash is released to the would-be-beneficiaries.

    According to him, the bank is lifting its operational goals to employment generation to foster the growth of the continent. This, he said, is evident by the decision of the bank to approve and release the $700 million loans promised the operators of small and medium scale enterprises in the country.

    He said AfDB has set up loans for capacity building in some countries, including Nigeria, adding that the loans are sovereign guaranteed.

    The AfDB, he said, looks at the conditions attached to sovereign- guaranteed loans, before it releases the loans to the beneficiaries. He added that the loans are given to people at a considerable terms to ensure flexible mode of payments.

    He berated banks for not providing enough funding for the agricultural sector, adding that the sector plays a critical role in the economy. The agricultural sector, he said, is poorly funded, and as such cannot deliver expected results.

    “If you look at the overall credit in the economy, only two per cent goes to a sector like agriculture identified as one of the strongest contributors to the Gross Domestic Product(GDP). The Federal Government can work towards improving the scheme. I think the government has some schemes on that,” he added.

    He said the AfDB has dedicated loans for the growth of the power sector, stressing that infrastructural development is of major priority to the institution.

    The bank has medium-term projects in Nigeria, with a gestation period of four years.The projects spanning road construction, transportation, water, irrigation, among others, aimed at meeting the nation’s infrastructural challenges.