The Nation Newspaper

Tag: Foreign

  • Why we abandoned foreign studies half-way, by Rivers students   

    Rivers State students, who were on scholarships abroad, but returned home on the order of the government to continue their studies in the country have decried the development.

    They wondered why it was during their time the government discontinued foreign sponsorships when their mates concluded their studies abroad.

    Former Governor Rotimi Amaechi’s administration began programmes encouraging Rivers youths to study outside abroad.

    Some of them have completed their studies and returned home; others stayed abroad for their Masters and Doctorate or work.

    But those offered admission to study abroad a year or two before Amaechi left office have been enmeshed in the state’s boiling politics.

    Governor Nyesom Wike said his administration had no money to pay for students on scholarships abroad.

    Instead, the governor said the students should return to Nigeria to continue their studies in local universities.

    Our investigation showed that many students have returned, following the government’s directive.

    In an interview in Port Harcourt, the state capital, Governor Wike said despite his decision to discontinue the fees of students abroad, his government cleared fees of those in final year.

    The governor said his government could not allow the students to suffer but would offer them opportunity to study in Nigeria.

    Our reporter spoke with some returnee students, who said the government’s discontinued payment of their fees forced them to abandon their studies and return home.

    According to them, they returned because their visas would not be renewed without payment of their school fees.

    The distraught students noted that the government’s failure to settle their allowances caused them hardship.

    One of the students, Fortune Anokuru, of Computer System Engineering at Nottingham Trent University, United Kingdom, said he was preparing for second year when news came that Rivers students on scholarships abroad should return home.

    He said students, who have not returned home, were doing menial jobs to survive.

    Fortune said: “We came back because we were unable to pay our fees, and the country made it compulsory that it would not renew student’s visa unless we paid our fees. The government has decided to discontinue paying our fees abroad.

  • Nigeria records 108% foreign portfolio deficit

    •Domestic investors regain confidence

    For every dollar brought into Nigeria this year, more than $2 has been taken out according to a report on foreign portfolio investment (FPI).

    A year-to-date report on FPI obtained at the weekend, indicated that Nigeria suffered a net deficit of 108 per cent in the first two months of the year.

    The FPI outflow worsened in February, as uncertainties persisted over Nigeria’s foreign exchange management.

    The report, coordinated by the Nigerian Stock Exchange (NSE), showed that FP outflow outpaced inflow by 108 per cent. The two-month report showed that foreign outflow totalled N58.20 billion as against foreign inflow of N27.95 billion.

    Total foreign transactions of N86.15 billion represented 42.8 per cent.

    Domestic investors, however, appeared to be stepping in to fill the gap left by the foreign investors. They invested N115.22 billion, representing 57.22 per cent of the total transactions, during the period.

    Monthly analysis showed that FP outflow totaled N31.84 billion as against inflow of N10.94 billion. In the same period last year, foreign outflow was N81.60 billion while inflow was N52.35 billion.

    In January, FPI report showed that foreign inflow stood at N17.01 billion as against outflow of N26.36 billion, representing a deficit of N9.35 billion.

    Total foreign transactions thus were N43.37 billion. Nigerian investors accounted for N40.73 billion or 48.43 per cent of the total turnover of N84.10 billion recorded during the period.

    In the comparable period of January last year, foreign investors appeared less edgy and there were more appetite for Nigerian equities, though the tinge of deficit was also evident then. Foreign inflow was N48.03 billion in January 2015 as against outflow of N51.08 billion. Total foreign transactions stood at N99.11 billion or 52.24 per cent of total turnover of N189.72 billion during the period. Domestic investors accounted for N90.61 billion or 47.76 per cent of total transactions.

    The FPI report further highlighted the downtrend that had marked foreign portfolio investments since 2014.

    The FPI report uses two key indicators-inflows and outflow to gauge foreign investors’ mood and participation in the stock market as a barometer for the economy.

    The NSE report is regarded as a credible gauge of FP’s investments in Nigeria as it coordinates data from nearly all active and major investment bankers, stockbrokers, custodians and other capital market operators.

    Foreign portfolio investment outflow includes sales transactions or liquidation of equity portfolio investments through the stock market while inflow includes purchase transactions on the NSE.

    The 12-month foreign portfolio investment report for 2014 shown that foreign portfolio outflow was N846.53 billion as against inflow of N692.39 billion in 2014, representing a net deficit of N154.14 billion.

    In 2013, total foreign inflow was N531.26 trillion compared with outflow of N510.78 trillion, leaving a positive balance of N20.48 billion.

    In earlier preview for the investment market in the year, the NSE had noted that uncertainty and volatility dominate forecast for the New Year and beyond as Nigeria struggles with commodity price shocks and the resultant impact on the Naira.

    “The downturn from 2015 has already continued into the New Year. Accordingly, we anticipate 2016 to be a challenging year for the capital market and the domestic economy,” NSE stated.

  • Why PFAs shun investments in foreign securities

    Why PFAs shun investments in foreign securities

    The Contributory Pension Scheme (CPS) has yielded N5.3trillion, but Pension Fund Administrators (PFAs) are shying away from investing contributors’ and retirees’ funds in foreign capital and money market instruments. Instead, pension funds in Retirement Saving Accounts (RSA) of active contributors and retirees are being invested in domestic shares and money market securities. OMOBOLA TOLU-KUSIMO writes on the reasons and implications of this development.

    For long, Nigeria’s Pension Fund Administrators (PFAs) have given foreign shares and money market securities a cold bath. They have restricted themselves from investing pension funds in Retirement Saving Accounts (RSA) of active contributors and retirees beyond the nation’s shores in foreign ordinary shares and money market securities. What they have actually done was to invest the N5.14 trillion funds accumulated under the Contributory Pension Scheme (CPS) in the domestic capital and money market instruments.

    This,according to The Nation’s findings, has been the case since the enactment of the Pension Reform Act (PRA) 2004. Although, the PRA 2014, which repealed the (PRA) 2004, allowed foreign investment, the National Pension Commission (PenCom) is yet to give PFAs the nod to invest the funds in foreign capital and money market instruments because of perceived lack of capacity by the PFAs and the need to encourage the use of the funds to solve Nigeria’s local problems, especially building of infrastructure.

    Besides, the Central Bank of Nigeria (CBN) Foreign Exchange (forex) policy, it was  learnt, has also frustrated move by the pension managers to invest in foreign assets. This is because access to forex to procure these foreign assets has been prohibited following the CBN’s June 23, 2015 circular excluding some imported goods and services from the forex market.

    Under the CBN circular, Eurobonds, foreign currency bonds and shares were number 40 on the prohibition list. But some experts, who spoke with The Nation, said by refusing to invest retirees and workers’ fund in foreign assets, the PFAs’ may have inadvertently denied contributors the opportunity of getting more returns on their investments.

    They pointed out, for instance, that investment in foreign assets is aimed at improving diversification, given the possibility of higher returns and meeting pension benefit payments in foreign currency. To them, it therefore, means that the pension managers are not maximising returns for contributors and retirees.

    A senior official at PenCom, who does not want his name mentioned, also said the situation has implications on retiree’s savings and investment. He pointed out that the primary objective of the Commission’s supervisory philosophy is to ensure safety of the pension assets and fair return on investment.

    He, however, noted that: “To allow foreign investment would require safe custody of the assets offshore and clear understanding of the foreign assets and investment climate. We need to build these capacities particularly the custody aspect of the assets.”

    The PenCOM official described as correct the position of some experts who said PFAs have continued to invest the bulk of pension funds in Federal Government securities and money market instruments relative to equities, leading to having investment portfolios that are too risk averse.

    “This is correct given the high volatility of the Nigerian stock market and the encouraging returns from the FGN securities and other fixed assets. This, however, was exclusively the investment decisions of the PFAs,” he said.

    But the PFAs appear hamstrung, despite the fact that the regulation allows them to invest the funds offshore. For instance, a Stanbic IBTC official, Mr. Melvin Awolowo, said going by the regulation of investment for pension fund assets, PFAs in Nigeria are allowed to invest in foreign denominated securities such as global depository receipts/notes and Eurobonds of Nigerian entities as well as private equity.

    “We believe that some PFAs in line with their investment strategy have invested in these foreign assets in the past,” he recalled. He, however, lamented that in recent times, access to foreign exchange to procure these assets has been prohibited since the CBN policy that excluded some imported goods and services from the Nigerian forex market. He said Eurobonds, foreign currency bonds and shares were number 40 on the CBN prohibition list.

    Awolowo said the implication of this is that PFAs, who plan to increase their stake in foreign assets, can no longer buy the foreign currency needed through official channels to pay for their investment. In other words, an investment in this asset class has been limited and it is no surprise that there is no investment in foreign securities.

    While confirming that it is true that PFAs are not investing retirees and contributors’ fund in foreign securities, the Managing Director, Premium Pension Limited, Mr. Wilson Ideva, noted that it is because everything PFAs are doing comes under regulation and the regulation does not allow them to place money market outside Nigeria.

    He stressed that this can only be done when the regulation permits them. “We know where we are coming from. It was a situation where pension was seen as a big problem hence, the need for regulation to be tough to ensure that we do not go outside the bounds. So, for now, the guideline does not allow us. So, we can’t do it,” he said.

    On maximising returns for contributors, Ideva said people need to understand that the country needs the funds more than the outside. “We have huge infrastructure gap. We have roads, rail, and education among other areas that we need to bridge the gap. Everywhere you go you will see that the country is crying for funding. We need to use the pension assets to develop Nigeria first instead of taking the funds to people, who are already developed and help to drive their cost of funds,” he added.

    Beyond PFAs’ perceived lack of capacity and patriotic sentiment that appeared to have encouraged the use of the funds to bridge Nigeria’s wide infrastructure gap, CBN’s forex policy is also a pain in the neck of PFAs.

    Apparently taking a swipe at the forex policy, which he believes has implications for investment of pension fund, an Actuarial Scientist and Chartered Insurer, Dr. Pius Apere, admonished the regulator, PenCom, to exercise the requirements of Section 87 (2) of PRA 2014 to protect pensioners’ exposed future loss by the forex policy.

    He noted that Section 87 (2) of the Act provides that a PFA may invest the pension funds in units of any investment outside Nigeria within the categories of investments set out in Section 86. Section 85 of PRA 2014 provides that the safety and maintenance of fair returns on the amount invested are the main investment objectives of the PFAs operating under the CPS. The regulator, PenCom issues from time to time, regulations and guidelines on investment of pension funds and assets in order to achieve the investment objectives.

    Sections 86 and 87(1) of PRA 2014 specifies the types of financial assets and instruments pension funds can be invested in, either in Nigeria or outside by PFAs, while Sections 88 and 89 of the same Act place restrictions on assets and or securities pension funds cannot be invested in.

    Subject to the subsisting CBN forex rules, PenCOM may seek approval of portfolio limits for investment of pension fund or assets outside Nigeria from the appropriate authorities.

    Meanwhile, PenCom summary as at end of October 2015 showed that only Closed Pension Fund Administrator (CPFA) Funds was invested in foreign ordinary shares and foreign money market securities, while it showed the concentrated investment of the funds in Treasury  Bills and Federal Government Bonds. The funds are largely invested in equities and bonds including state government Securities, Corporate Debt Securities, Supra-National Bonds and Local Money Market Securities.

    The CPFA Funds are mainly Defined Benefits final salary pension schemes. Section 51 of PRA 2014 requires that new employees of sponsor companies with CPFAs shall join the CPS and open RSAs. Thus, CPFA Funds are closed to new entrants after the enactment of PRA 2014, which means that membership of CPFA Funds, is likely to decline over time.

    For instance, in October last year, 13.97 per cent amounting to N719, 240m of the Total Pension Fund Assets. N5, 149,652m was invested in CPFA Funds. Out of the total CPFA Funds, 9.78 per cent was invested in both foreign ordinary shares and money market securities totalling N70, 313.58m, while 9.93 per cent, 45.35 per cent and 17.12 per cent were invested in ordinary shares, FGN securities and Real Estate Properties in the domestic market, respectively.

    In the latest report of last October, total assets under the CPS rose to N5.14t. The summary noted that 56.28 per cent of the money totalling N2.8t, was invested in Federal Government of Nigeria bonds, while 10.27 per cent or N528.76b was invested in treasury bills. A total of N514.28b, which is about 9.9 per cent of the total pension assets, was invested in domestic ordinary shares within the period under review.

    According to the figures, 10.41 per cent or N535.90b was invested in local money market securities, while 4.08 per cent totalling N209.87b, was invested in real estate properties. Similarly, N162.03b or 3.15 per cent and 3.05 per cent or N156.877b of the growing funds was invested in state government securities and corporate debt securities, respectively.

    The operators invested about 0.42 per cent each, amounting to N21.5b and N21.8b in open/close end funds and cash and other assets, while 0.34 per cent or N17.3b and 0.22 per cent or N11.55 billion were invested in private equity funds and supra-natural bonds, respectively.

    Apere, who is also Deputy Managing Director of Linkage Assurance Company Plc, said the basic investment principles of pension schemes are to minimise the risk of failing to meet the liabilities of pension schemes, having considered the nature, term, currency and certainty of the liabilities, and also to maximise the investment return within an acceptable level of risk.

    He said based on this, every PFA needs to invest the employees’ contributions prudently, having considered the individual circumstances in terms of risk profile. He reiterated that the CBN’s forex policy has effect on only the CPFA funds because of the investment in overseas financial instruments mainly ordinary share purchase.

    The policy’s impact on the industry, according to him, include but not limited to exposure to currency risk unless it is hedged for a fee, resulting in volatile returns from overseas investments due to the devaluation of the naira. There is also the risk of inability to invest new contributions from existing employees and or funds injected by sponsors to bridge funding gaps as determined by the actuarial valuation of the schemes in overseas assets in order to meet future pension liability payments in foreign currency. This is because of the extra cost to be incurred in order to obtain foreign currency outside Nigeria’s forex market.

    Apere said the impact also include sales of foreign assets of pension schemes to meet expected pension liability payments in domestic currency and to realise higher returns because of the devaluation of the naira.

    “The CBN forex policy has also created uncertainties in the domestic capital market, which would lead to volatility of market value of domestic equities and hence, have a second order effect on pension fund investment,” he added.

  • ‘Nigeria’s stability an incentive for foreign direct investment’

    ‘Nigeria’s stability an incentive for foreign direct investment’

    Mrs Vera Nwanze, Country Manager, Philip Morris International, discusses her company’s entry into Nigeria and why the Nigerian economy has greater global appeal. She shares these and more with OLATUNDE ODEBIYI.

    Why has PMINTL Nigeria Limited entered the Nigerian market at this time?

    There is global recognition of the economic growth opportunities in Africa. On the heels of its near-record economic growth over the past decade, and growth prospects relative to the developed economies, international investments have poured into the continent. As you know, Nigeria became Africa’s largest economy in 2014, a testament to the changes in vision, governance and leadership since the return of democracy in 1999 which has driven reforms in key sectors of the economy and made the Nigerian market more attractive to global investors, like PMI.

    Given that you were here before and now making a re-entry, can one expect that you would be in Nigeria for the long haul and why?

    We have made a strategic decision to invest for the long term.  Our goal is to become a contributor to the development of the agricultural sector, and to be a partner to add value to the economy

    Kindly clarify how your company would be adding value to Nigeria’s economy in diverse ways.

    As the leading tobacco company, we think we can help foster employment opportunity in the manufacturing, distribution and trade sectors, and contribute to government revenue. We also believe that our entry into the market will foster competition and consumer choice, which is good for economy, innovation and ultimately for the state.

    There were allegations of illegal entry made in some national publications against PMINTL Nigeria Limited last September. How do you react to this?

    These allegations are false. PMINTL Nigeria Limited was legally incorporated in December 2014, and as stipulated by the laws in effect, we sought and received approval to operate in Nigeria from the Standards Organisation of Nigeria, The Nigerian Customs Service and The Ministry of Finance. We have also begun engagement with other relevant government agencies including Consumer Protection Council, Nigerian Investment Promotion Council and the Federal Ministry of Health. As the local affiliate of the world’s leading Tobacco company, we are guided by the same principles and exacting standards that govern the global operations of our parent company, Philip Morris International. We strive to be transparent in our governance practices and policies and responsive to our shareholders, while managing the company for long-term success.

    You have mentioned PMINTL’s plans for investment in Nigeria’s Tobacco Industry but your factory is in Senegal, not Nigeria. Why is this so?

    PMINTL Nigeria Limited is a part of a global organisation. It is common for manufacturing plants to be located in a given country to serve as a regional commercial base. PMI has been present in Senegal for over 20 years, and our affiliate in Senegal serves as the regional hub of PMI’s operations in the West African sub-region. The brands we have introduced into Nigeria are imported from Senegal, under the ECOWAS Trade Liberalisation Scheme, as part of our market entry strategy that would be in place for an initial phase until we move into the next level of our investment in Nigeria, which includes local manufacturing arrangement.

    The ECOWAS Trade Liberalisation Scheme might be pivotal for the establishment of a common market and regional integration, but could deny the Federal Government of Nigeria revenue from import duties and levies. How do you explain this seeming discrepancy and your company’s strategy to boost Nigeria’s economy?

    It is up to the ECOWAS countries and their governments to decide on a trade liberalisation scheme that protects their national interests, while helping to boost the economy and trade within the region.  PMINTL Nigeria will comply fully with the legal provisions of the Treaty as they apply in all the markets in the ECOWAS sub-region, where our operations touch. However, since cigarettes fall under the category of excisable products in Nigeria, PMINTL Nigeria Ltd is fully compliant with the excise tax rates applicable to the importation of cigarettes. We have already paid and we will continue doing so.

    Your company entered Nigeria just as the National Tobacco Control Bill was signed into law. What is PMINTL Nigeria’s stand on regulating the industry?

    We were fully aware that the National Control Bill was being discussed at the National Assembly as we sought our registration. We strongly believe that proper regulation of tobacco products is essential to ensure that adult smokers are aware of the harmful effects of smoking, that tobacco products are not made available to minors, and that legitimate companies can compete on a level-playing field with clear rules.

    What do you consider to be the volume of the illicit tobacco trade and how can governments across the world curb the menace?

    Available statistics from different sources estimate the size of the illicit tobacco trade to be between 10 percent and 12 percent of the global cigarette market. This is alarming not just because of the income it denies various governments and the world economy but growing concerns that such income is further employed to support other illegalities. Contraband cigarettes deprive governments of billions in tax revenue yearly, while consumers lose because they often end up buying fake products of poor quality that are not subject to any regulatory scrutiny or quality control procedures by manufacturers. Around the world, PMI undertakes a broad series of measures to fight illegal cigarettes, to ensure our brands are protected and consumers get the genuine product they expect. We support strict regulations and enforcement measures to prevent all forms of illicit trade in tobacco products, including tracking, tracing, labelling, recordkeeping requirements, and where appropriate, implementation of strict licensing systems. We are also working with a number of governments around the world on specific agreements and memoranda of understanding to address the illegal trade in cigarettes. We are planning to meet with all relevant authorities in Nigeria, in particular with Nigerian Customs Service, to present our tools and know-how to foster cooperation in addressing illicit trade together.

    There are allegations that tobacco companies are migrating from developed economies like Europe and America to evolving ones like Africa to avoid stringent legislations. How true is this in the case of your company?

    PMI is present in both developed and developing countries, with products sold in more than 180 markets. Partial or total bans on tobacco advertising, marketing and promotion have been in place around the world for many years. These rules are not, as many people mistakenly believe, limited to the EU and other developed countries. In fact, broad-based tobacco control policy is common throughout the world today, including for example in Algeria, Brazil, Chile, Egypt, Gambia, Kazakhstan, Malaysia, Senegal, Thailand, Turkey and Ukraine. Wherever we do business we comply with local tobacco regulations. In addition, we adhere to a set of strict, internal marketing practices which not only guide our compliance with the laws, but also require in some cases that we take proactive steps beyond what is required by local law. We believe that creation of the National Tobacco Committee will help to establish a level playing field for all operators in tobacco market as well as to provide clear and rigorous enforcement of the law.

    What is your take on the outlook of the Nigerian economy?

    Presently, one of the major attractions of the Nigerian economy to global investors to my mind is the stability that has been bestowed on it by the sustenance of democratic governance. International businesses and investors want to flow with stable policies. For a country that endured long spell of military intervention in governance from independence in 1960 with civil rule lasting barely six years from that date to find herself under unbroken civil leadership since 1999 is remarkable. Civil rule promises stability and so long as that is guaranteed, global investors would be attracted. And so long as leading investors from across the world are attracted to any economy, it will continue to witness growth.

    What does the future hold for the Philip Morris business in Nigeria?

    We are optimistic about the prospect of our business in Nigeria. We are currently focused on building our business organization, hiring local talents and strengthening our infrastructure and ties with our counterparts in the tobacco value chain. We are here to invest and we are here to stay.

  • Gains of Buhari’s foreign trips, by Fed Govt

    Gains of Buhari’s foreign trips, by Fed Govt

    The Federal Executive Council (FEC) yesterday said President Muhammadu Buhari’s foreign trips  were good for the country as they aimed to woo more investment for Nigeria.

    Some Nigerians have lamented the series of foreign trips by the President.

    Minister of Information Lai Mohammed, who briefed State House correspondents after the FEC meeting, presided over by President Buhari, said the President’s trips were necessary to get Nigeria back in the community of nations.

    He said Nigeria almost became a pariah state under the administration of ex-President Goodluck Jonathan.

    Mohammed was with the Minister of Environment, Amina Mohammed and Minister of State for Environment, Ibrahim Usman.

    He said: “You do not run a country by being isolated and the presence of the President in many of these fora is important because, before now, we were almost a pariah state and the two things that have been driving investments away from this country is terrorism and corruption.

    “One thing that nobody can fault this President on is his determination to fight these two ills. Mr President’s presence in these fora is crucial  to the economy back home. What I mean by Nigeria being a pariah state is that before now the level of corruption was high. Nobody was ready to risk his investment in Nigeria.

    “The cost of doing business was so high that most international businessmen didn’t want to come here. Who is coming to invest in a country where there is insecurity? These are the twin problems that Mr President has addressed in nine months.”

    Fielding questions on the update on the 2016 Budget, he said Ministries, Departments and Agencies (MDAs) have been going to defend their budgets at the National Assembly.

    According to him, the budget would soon be passed.

    Speaking further on the President’s trips, Amina Mohammed said Mr. President has a Vice President and a cabinet to handle issues whenever the President is out of the country.

    She said: “The cabinet stays with the Vice President here as much as possible to try to address those challenges you are talking about on a daily basis.

    “But the investment that we make with the President’s travel is worth the investment we are getting from those visits. We hope to see the President going out and advocating for this country to get more investment so that we can take everyone out of poverty. That is what is important. We see it as an investment with a return worthwhile,” she stated.

    They earlier said the two issues discussed in FEC were the report on the Conference on Climate Change in France between November 30 and December 12, 2015, and the benefits of the foreign trips by the President.

  • Rangers to wrap up transfer of foreign players

    Rangers to wrap up transfer of foreign players

    • Enugu side suspends Hebem for improper conduct

    Enugu Rangers have until February 1 to wrap up transfer formalities for the foreign players in their team before the expiration of the FIFA transfer window if they are to have their International Transfer Certificate sent that will make them eligible to play in the new Glo Premier League season.

    Presently, the Flying Antelopes are having their pre- season in Benin City with four Togolese and three Ghanaian training with them and after impressing the technical crew, head coach, Imama Amapakabo has authorised their purchase.

    The Media Officer of the club, Foster Chime told SportingLife that Rangers management has been going round to source for funds to meet up with the FIFA transfer deadline of Monday.

    He said Rangers are confident of securing the services of the players from their current clubs in Togo and Ghana before the expiration of the transfer window.

    Meanwhile, Rangers have suspended one of their players, Maurice Elete Hebem for gross indiscipline and improper conduct and the player has been told to vacate the club’s Benin camp until the technical crew revisits his case again in the near future.

    Chime told SportingLife that the club’s head coach, Amapakabo said he decided to  suspend the player so that he doesn’t serve as a negative influence on the other players in camp.

  • ‘Foreign exchange imbalance affecting power firms’

    The imbalance in the foreign exchange regime, occasioned by the falling rate of naira, is taking its toll on the operations of new power investors, the Chairman, Egbin Power Plc, Mr. Kola Adesina, has said.

    He said the power distribution companies (DisCos) are spending more money than before to buy equipment abroad, because  the naira is falling at abysmal rate.

    While speaking at a stakeholders’ meeting in Lagos, Adesina said the problem facing the naira has made it difficult for power firms  to survive, since they depend on Original Equipment Manufacturers(OEMs) in their   production.

    He said: “When we bought Egbin Power Company when the sector was privatised in 2013, naira was sold for N159 per dollar. At a point, the value of naira reduced further as it was sold for N179 to a dollar, and later N196 to a dollar at the official window. The situation was worse at the black market where dollar is sold for N220 and above. This is not without its attendant consequence on operators in the sector.’’

    According to him, spare parts used in the industry can only be procured in dollars, stressing that the development is having far-reaching effects on the performance of the operators.

    Adesina said despite the fiscal problem, among others, facing the sector, and the economy, Egbin Power has weathered the storm to record some successes.

    He said the achievements included increased megawatts (Mw) of electricity, thereby making the turbines functional, among others.

    Adesina said the recent one was the dedication of 220 megawatts of electricity to Lagos, by Egbin. He said this would not have been possible without the support of the Vice President Yemi Osinbajo.

    “When we choose to dedicate the 220 megawatts to Lagos, the Vice President, Osinbajo stood by us,” he added.

  • Assessing Nigeria’s afro-centric foreign policy

    No country is an island on its own.  Although some countries have vast resources, they still require a form of relationship with other to aid the fulfilment of their own national interests. The notion of independence and sovereignty truly exists, but no state can exist in complete seclusion from all other states. Every politically independent nation is an actor in the global arena and arrays certain measures of power and influence in order to achieve interests favourable to its citizens, promote the cachet of the country and also aid growth and development in the country. National interests continue to remain a major determinant of a nation’s foreign engagement. I always like to make reference to the definition of K.J Holsti who defined foreign policy as the conscious behaviour of a nation state towards the external environment. Foreign policy refers to those goals, objectives and aspirations a country seeks to achieve in another country while expecting the promotion of its own national interest would be the resultant effect of the achievement of those goals and also the strategies put in place to achieve those goals.

    Upon independence in 1960, Nigeria began her external relations as a sovereign state with her emergence as the 99th member of the United Nations. The Nigerian foreign policy has gone through different processes of transformation right from independence. Nigeria since 1960 has shown a sign of being a pillar that can support other African countries. Nigerian foreign policy from Tafawa Balewa’s administration (1960-1966) has expressed some basic directions and focus: principle of non-alignment, principle of non-intervention, Africa as the centrepiece, policy of good relationship with other states, inter alia. Nigeria was very keen about ending colonialism and racism on the African continent. Even with the limited resources and unlimited wants in Nigeria, Nigeria was very influential in anti-apartheid and decolonization struggles in Africa. Right from independence, Nigerian foreign policy has been experiencing changes, and not a total replacement of the foreign policy. Nigeria has always shown a great commitment to dealing with African states in her foreign policy. Nigeria has always been treating issues concerning Africa with keen interest. Nigeria has been showing her concern for issues of African interest and development. Nigeria is being referred to as the giant and the big brother of Africa. The Murtala/Obasanjo government is often regarded as the golden era of Nigerian foreign policy. During these administrations, daring decisions were taken to fast track the independence of Zimbabwe, Angola and Namibia. The obnoxious apartheid regime in South Africa was seriously frowned against. On February 8, 2007, Nigeria initiated Co-prosperity Alliance Zone (COPAZ) with Togo and Republic of Benin which was aimed at promoting economic cooperation and friendship and reducing marginalization in Africa. Ghana was later co-opted. Nigeria also hosted the second black Festival of Arts and Culture (FESTAC) which was an Afro-centric project that expressed Nigeria’s Afro-centric Foreign policy stand. Nigeria was a key actor in the formation of the Organization of African Unity (OAU) in 1963 that later became the African Union (AU) in 2002 and the Economic Community of West African States (ECOWAS) in 1975. Nigeria is one of the major contributors to the Africa Union and ECOWAS. The role of Nigeria in peace-keeping operations in Africa cannot be over-emphasized. Good examples are the peace-keeping missions in Liberia and Sierra Leone. More often than not, when countries talk about foreign policy, the first thing that they focus on is their domestic interest. In Nigeria however, when speaking of our foreign policy, we speak about our national interests and African interests.

    Nigeria has been an influential actor in Africa; all the good things Nigeria has done in favour of Africa stand as investments. However, when one invests, one would expect a return on investment. This is hardly the case with Nigeria when speaking of her Afro-centric foreign policy. I would like to begin with the xenophobic attacks in South Africa in 2015. Various Nigerians were displaced as a result of this attack. Some Nigerian businesses and shops in Johannesburg and Durban were burnt and looted. Hundreds of Nigerians were displaced in Jeppes town near Johannesburg. Nigeria had to recall her High Commissioner from Johannesburg. This was a painful occurrence as Nigeria is a country with African interest at heart and that was what the country got back. South Africans cannot pretend to forget the key roles Nigeria played in anti- apartheid movements in South Africa. Nigeria was the chairman of the United Nations Special Committee against Apartheid for over 20 years. The committee was responsible for the international campaign against apartheid. The first world conference for action against apartheid was hosted in 1977 in Lagos, Nigeria. Some Nigerians have also been maltreated in Gabon and Equatorial Guinea. When the Organization of African Unity was created, it took a whole decade before a Nigerian leader was accorded the honour of serving as the chairman of the OAU. The first three leaders were from Ethiopia, Egypt and Ghana respectively. Nigeria, the largest African shareholder was out-manoeuvred over the presidency of the African Development Bank in 1995 and 2005. Another basic example is the recent cash crunch that hit ECOWAS. Nigeria has been one of the major financiers of the organization, and Nigeria has remained committed to the strategy of economic integration at the regional level. Nigeria has various current and impending issues to deal with, most countries of ECOWAS failed in their payment obligations and the organization began to dwindle and they left the financing of the organization to majorly Nigeria, Ivory Coast and Ghana with Nigeria being the largest contributor. In the past, Ghana adopted some stringent over-taxation economic policies that were meant to limit the economic presence of Nigerian businessmen in the country in an indirect manner. It is pertinent to mention in 2009 during the election of Nigeria as a non-permanent member of the United Nations Security Council, which would be for two years, from the beginning of 2010 to the end of 2011, Sierra Leone, Togo and Liberia voted for themselves even though they were not candidates, neither were they listed for the election. They stood against the candidature of Nigeria indirectly. It would have cost them nothing to vote for Nigeria. Sierra Leone and Liberia are countries Nigeria has helped most especially in peace support operations, so where is the return on investment here?

    Rather from this illustration, we can point out a great loss on investment.

    In conclusion, one can like to regard the Afro-centric foreign policy of Nigeria as being mundane as some or most of these countries hardly express their gratitude towards the effort Nigeria is making. The returns from the sacrifices made cannot be compared. Despite Nigeria’s commitment to ensure good relations with African states, some of these states have continued to behave in such a manner that is offensive to Nigeria’s interests. As a result, there has been a continuous polarization in views about the continued relevance of Nigeria’s Afro-centric foreign policy. Nigeria is not really being appreciated although the gains these African states enjoy make them acknowledge Nigeria’s leadership role. It is as if Nigeria is being used by these countries just to get what they want.

    • Iyiola, is a student of International Relations, Landmark University Omu-Aran Kwara State.

  • Foreign reserves drop below $30b

    The nation’s foreign reserves dropped to below $30 billion for the first time in five months, putting more pressure on the Central Bank of Nigeria’s (CBN’s) bid to defend the naira and avoid devaluation.

    Gross reserves slipped to $29.92 billion on November 30, the first time they have fallen below $30 billion since July 13, according to data from the CBN.

    They have fallen by 20 per cent since the end of June 2014, when Brent crude prices began a more than 60 per cent plunge, hammering Nigerian finances.

    The foreign exchange reserves fell to $30.04 billion by November 26 from $30.10 billion the month before. The reserves were down 18.6 per cent on the year from $36.9 billion in the same period last year.

    Also, the reserves fell to $30.13 billion by October 27, down 0.84 per cent from a month ago, the CBN data also showed. The fall in reserve reflects the sale of dollars by the central bank to defend the naira currency which has been hit by the plunge in oil prices.

    The dollar reserves have been hit by a plunge in crude prices and the central bank’s decision to defend the currency.

    “With the oil price remaining low, the pressure isn’t dissipating,” said Ikechukwu Iheanacho, who manages N40 billion ($202 million) of stocks and bonds for Lagos-based Chapel Hill Denham Securities Ltd. “It raises questions about how long the central bank can continue defending the naira.”

    The naira has been all but fixed at 197-199 per dollar since early March after Governor Godwin Emefiele restricted bank access to foreign exchange, even as other major oil exporters such as Russia, Colombia and Angola let their currencies weaken.

    In June, Emefiele stopped importers of about 40 items, including toothpicks and glass, from obtaining dollars.

    Emerging-market investors including Aberdeen Asset Management Plc, AllianceBernstein and Investec Asset Management have sold Nigerian bonds and stocks this year to avoid what they see as an inevitable devaluation, which would cause losses on their holdings in foreign-currency terms.

     

  • Ambode woos foreign investors in Malta

    Ambode woos foreign investors in Malta

    Lagos State Governor, Akinwunmi Ambode stepped up his government’s campaign for direct foreign investment in the state at the just concluded Commonwealth Business Forum in Malta.

    He used the forum to invite investors to take advantage of the numerous investment opportunities that abound in the state.

    Ambode spoke on Wednesday at the Forum in Malta, an event which attracted over 1,200 business leaders from 80 countries.

    Lagos was the toast of many investors, as the Special Session hosted by the state government had prospective investors from several countries in attendance.

    Ambode, who was accompanied by a contingent consisting of Commissioners and a Special Adviser from the State Executive Council, intimated investors to various investment opportunities in Lagos State.

    He said: “The strong team I have here with me is a statement of our commitment to facilitating business in Lagos for investors. With the establishment of the Office of Overseas Affairs and Investment, the government will eliminate whatever bottle-necks may want to frustrate investors.

    “This Office is a one-stop- shop that will handle all your needs and ensure that there are no obstacles hindering investors who come to our state,” he stated.

    Mark Simmonds of the Commonwealth Enterprise and Investment Council, who anchored the Lagos State-sponsored session, said he was very impressed with the interest shown in Lagos, adding that this was a strong indication that the state is not just an investment destination but an emerging economic hub.

    There were representations from the Kingdom of Nepal, Kuwait, Malaysia and Malta.

    Lord Jonathan Marland, Chairman of the Commonwealth Enterprise and Investment Council, commended the Lagos team for its role and contribution to the forum.

    Earlier, Ambode had delivered a keynote address at the Plenary Session of the Forum titled, ‘The Commonwealth, the EU, and the Global Economic Cooperation: A One Way Ticket.’charged all nations on global economic cooperation stating that “whether you are in the EU, in the Commonwealth or whatever other organization out there, the only true common wealth we all have is to ensure a healthy financial and economic global order through economic cooperation.”