The Nation Newspaper

Tag: GDP

  • Public schools for civil servants

    The House of Representatives is considering pushing a bill that would compel civil servants and politicians in public office to enrol their wards in Nigerian public schools. It is quite an interesting thought which I fear, unfortunately, will not get anywhere.

    Chairman, House Committee on Finance Hon Jibrin is optimistic the bill will do better in the lower chamber of the national assembly than in the Senate, where it once did not pass the second reading. He believes public schools will fare better if civil and public servants are forced to enrol their wards there.

    It is an ideal, which would have worked well if it were possible. This is because the civil servants and public office holders, especially those in the senior levels take time to select good private schools for their wards. Their views are also respected by the management of these schools who make sure they do not fall short of parents’ expectations. They do not patronise schools that have buildings with cracked walls, fallen roofs, and windowless classrooms; or where the libraries are empty of books and the laboratories are so ill-equipped that they use stoves as Bunsen burners. If their wards come home without being taught, or with unmarked home works they would march to school to demand that the teacher be sacked. In some cases, this happens. Despite the huge amounts they spend on fees, many of these parents still support the school to finance various projects – including purchasing school buses; endowing buildings, or even endowing scholarships.

    If this kind of attention and care are transferred to public schools; if there are more parents asking questions about what is happening in our schools and insisting that wrong practices are corrected, then public schools would be transformed.

    However, it is unlikely that the House of Representatives will succeed in pushing this bill. We have not been able to get our lawmakers to reduce their salaries and other allowances which makes them the highest paid in the world. At N30 million ($189,000) per annum, The Economist magazine reported last month that they earn 116 times more than the Gross Domestic Product (GDP) per person in Nigeria. Unfortunately, they do not even admit they earn too much.

    If they cannot reduce their salaries and plug waste so that there is judicious use of our scarce national resources for the common good, we should not dream that a law to make civil servants patronise public school can ever see the light of day.

     

    Failings of the police

     

    “The Police is your friend,” we are told. We see this statement on billboards and hear police chiefs say it on television. I can still remember Sergeant Pat Osifo, a Police Officer attached to the Family Support Unit of the Isokoko Police Station in Agege, telling primary school pupils the same thing last month at a Health Education counselling seminar. She told them that they should be free to report to the police if sexually abused. She said the matter would be immediately taken up and the child protected.

    She was not the only one who spoke at the seminar organised by the Agege Local Government Education Authority. Other speakers also urged the pupils not to endure abuse. Dr Josephine Effah-Chukwuma, Executive Director, Project Alert on Violence Against Women, in particular, underscored the need to name and shame child rapists. “We must protect our children but we must name and shame the perpetrators; we must stop this,” she had said.

    However, how will people confidently report child rape cases, if they do not see successful prosecution of rapists? The incidence of child rape reports has been on the rise in the past few months. Last month alone, rape cases were reported in the papers almost on daily basis. While we have made appreciable progress in bringing child rapists before the law, there are also attempts at cover ups which are disheartening and cause serious setback.

    Last week, a mother raised alarm that a middle-aged man who raped her nine-year old was walking free after reporting to the police. She said she was surprised when the IPO handling the case told her she (the officer) was going on leave so the case would stall. On the other hand, the child abuser said he had been to the police and they told him to go. He even said only God can judge whether he is guilty. Yet this man repeatedly abused the young girl.

    Any of the pupils that attended the seminar would have been confused hearing that the police put the nine-year old girl’s case in the cooler. It is contrary to what they were told – to report anybody that abuses them; and even report on behalf of others.

    No matter the status of a child abuser, the police must not be involved in cover up of any sort. Children who are abused suffer psychological trauma which in most cases affect their academic performance and self esteem – not to mention their health. The damage takes time to heal. In some cases the child may never heal if she does not get the support of the family or other people or institutions to overcome the trauma. Cover ups of rapists should not be tolerated. It is our children we must protect, not the rapists.

     

  • ‘Insurance sector records growth’

    The insurance sector recorded improvement in the past few years as its contribution in the ratio of premium to the nation’s Gross Domestic Product (GDP) increased from 0.5 per cent to 0.7 per cent.

    The Commissioner for Insurance, the National Insurance Commission (NAICOM), Fola Daniel, disclosed this during the opening of the commission’s Northcentral Zonal office in Ilorin.

    He said the sector’s gross premium income increased from N157billion in 2010 to N250billion last year, which resulted to an increase in the ratio of premium to GDP.

    Speaking on other achievement recorded, he said companies with foreign equity increased from three to 10, generating substantial foreign direct investment.

    He added that there was also an increase in local capacity for oil and gas risks from 10 per cent to 48 per cent while the commencement of implementation of Section 50 of the Insurance Act 2003 on ‘No Premium, No Cover’ has improved financial assets of operators.

    He said: “The sector recorded increase in the number of policyholders from 500,000 in 2010 to 1,500,000 in 2012 and collaborated with PENCOM to develop the annuities market.

    “These are all the outcome of efforts by the Commission which is already being felt in the industry and by extension, the economy following the massive sensitisation campaigns across the country.

    “The campaign was to further educate and inform the public about insurance, build confidence and grow the gross premium income.”

    The commissioner noted that the Governing Board of the Commission in 2011 approved the establishment of three additional Zonal Offices to be located in Ilorin, Port-Harcourt and Maiduguri as part of the mandate to deepen insurance penetration and awareness in the country.

    These locations, he said were carefully selected owing to their strategic economic importance and relevance to the growth and development of insurance in the respective zones noting that the Ilorin branch will serve the entire Northcentral zone.

    We are making arrangements to commission the Southsouth and Northeast Zonal offices, he added.

     

  • ‘Cost of malaria to Nigeria’s GDP is 6%’

    A Professor of Zoology at the University of Ilorin, Uade S. Ugbomoiko, has put the yearly cost of malaria to Nigeria’s Gross Domestic Product (GDP) at between one and six per cent.

    The economic costs of parasitic diseases are significant, creating an ugly development that has a heavy toll on productivity, Ugbomoiko said.

    Ugbomoiko, who spoke in Ilorin, Kwara State capital, while delivering the university’s 134th inaugural lecture, noted that foreign investment could reduce the GDP by as much as 20 per cent or more by the next decade in some sub-Saharan African countries.

    The lecture was entitled: “That we may lay siege.”

    He said: “In Sub-Saharan Africa, hundreds of millions of people are afflicted with these parasites, and more than a quarter of the affected population has one or more infections occurring simultaneously.

    “The advocated health for all by 2020 in the face of the government complacency and lack of funding, in an environment where the gap between the rich and poor widens daily is likely to be a mirage without concerted efforts to change behavioural activities that cause the bulk of human parasitic diseases.

    “It is high time the government saw the occurrence of ancient parasitic diseases in the present century as a social defect and formulate appropriate political will to address them. To achieve a qualitative and holistic control of these parasites, we must evolve a broad-based strategy that will combine good planning, policy consistency with a strong progressive refinement guidelines supported by strong framework for its implementation.

    According to him, technology and chemotherapic strategies in disease control will ameliorate the growing threats of infectious animals, but are unlikely to provide what is needed to control parasitic diseases in Africa.

    Said he: “Improving the health of the poor is therefore not through technology alone, but by ensuring that the basic needs of all are met through intervention that is emancipatory in action. Therefore, the option of behavioral change that will cost nothing to the government and the concerned individual will successfully complement disease control efforts.”

  • World Bank forecasts promising economic outlook

    World Bank forecasts promising economic outlook

    THE turmoil which attended the global economy as a result of the lingering recession has eased and growth is firming up, despite ongoing contraction in the Euro Area, says the World Bank in the newly-released Global Economic Prospects (GEP) report.

    The Brentwood Institution, however, said the pick-up in developing countries will be modest because of capacity constraints in several middle income countries,

    According the world body, global GDP is expected to expand about 2.2 percent this year and strengthen to 3.0 percent and 3.3 percent in 2014 and 2015.

    Developing-country GDP is now projected to be around 5.1 percent in 2013, strengthening to 5.6 percent and 5.7 percent in 2014 and 2015, respectively.

    Growth in Brazil, India, Russia, South Africa and Turkey has been held back by supply bottlenecks. While external risks have eased, growth in these countries is unlikely to reach pre-crisis rates unless supply-side reforms are completed.

    In China also, growth has slowed as authorities seek to rebalance the economy. Looking at broader region-wide trends, the East Asia & Pacific region is expected to grow by 7.3 percent this year; Europe & Central Asia by 2.8 percent; Latin America & the Caribbean by 3.3 percent; Middle East & North Africa by 2.5 percent; South Asia by 5.2 percent; and Sub-Saharan Africa by 4.9 percent.

  • ‘6.5 % GDP growth forecast not achievable’

    ‘6.5 % GDP growth forecast not achievable’

    The expected economic growth of 6.5 per cent predicted by the Bureau of Statistics may not be achieved, an economic advisory group, has said.

    In a report, the Resources and Trust Company (RTC) Advisory and Strategic Group, an independent economic advisory body, said the economy is not expected to achieve much growth because of certain challenges.

    “The economy is forecast to grow by 6.5 per cent in the second quarter. Economic growth will probably slow down after and this may be caused by the massive insecurity in the Northern area; scarce credit to SMEs and the private sectors, as well as the poor oil sector output growth,” it said.

    It said the major positive maybe the conclusion of power sector privatisation, which portends short term efficiency gains, and medium to long term sector transformation.

    It said the negative remains insecurity, especially the devastating effect on output from the Northern and the dampening effect on investment. Other significant negatives, according to the reports, are the outstanding PIB and downstream oil sector deregulation plus expenditure of N2 trillion yearly on wasted oil subsidies.

    It said though the administration will advance policy in significant areas, such as agriculture, housing, transportation, education and other infrastructure, it will be distracted by the increasing focus on the 2015 election.

    The reports said the non-oil sector has been affected by the incidence of flooding, as well as muted consumer demand, adding that the Infrastructural challenges will hampered manufacturing.

    The reports said a larger estimated economy would most likely boost interest in Nigerian stocks, especially goods companies looking to unlock the consumer potential of the country.

    It says:”It will also improve Nigeria’s debt to GDP ratio, currently around 16 percent. But Nigeria’s tax revenues, seen as woeful for a country of this size, will look even smaller.

    “Foreign aid donors may also find it harder to justify giving support to Nigeria if it becomes a middle-income state.

    Despite roaring growth rates, 61 percent of Nigerians – or 100 million people – still live in absolute poverty.

    “It is very clear that middle-income is growing, it is very clear that consumption is improving. The major problem is ensuring that this is broad based”.

     

  • Import bill declines to $35.4b

    Nigeria’s import bill declined by 43 per cent to $35.4 billion in the last one year, Renaissance Capital (RenCap), an investment and finance firm has said. In a report obtained by The Nation, the firm said the import bill is equivalent to 13 per cent of the Gross Domestic Product (GDP) last year.

    It said the decrease in imports was across all categories as machinery and transport equipment, Nigeria’s biggest import segment, declined 63 per cent, following modest growth of two per cent in 2011. This, it said, showed a slowdown in fixed investment and growth.

    Nigeria’s trade surplus, it said, surged 75 per cent to $105.9 billion, which is 39 per cent of GDP, based on data released by the National Bureau of Statistics (NBS) trade data. This, it said, largely explains the increase in the current account surplus to 7.5 per cent of GDP in September 2012 as against 3.6 per cent in 2011.

    “We expect revisions to the import numbers. We find it odd that while imports declined across all categories, unspecified imports swelled 600 times to $12 billion in 2012. Unspecified imports surged from less than one per cent of total imports in preceding years to 31 per cent in 2012.

    “We are likely to see a significant revision of imports by categories as seen in the downward revision of the errors and omissions’ negative balance in the 2010 balance of payments. While the eventual revised total import bill will still show a decline, in our view, the extent of the year on year decreases are likely to narrow as a larger share of the unspecified items are identified post-revisions.

    “A slowdown in oil earnings growth largely explains the decline in total exports earnings growth to 14 per cent in 2012 as against 44 per cent in 2011. We think the oil earnings’ growth slowdown to nine per cent in 2012 as against 48 per cent in 2011 was largely due to a flat Bonny Light crude oil price of.”

  • Budget deficit ‘falls to 1.85% of GDP’

    Budget deficit ‘falls to 1.85% of GDP’

    Nigeria’s budget deficit is set to fall to 1.85 percent of gross domestic product in 2013, the director general of the budget office said on Thursday.

    President Goodluck Jonathan approved a 4.99 trillion naira budget last month for 2013, after it was passed by the National Assembly, ending two months of disputes over the spending plans.

    “There’s has been a trending downwards of the fiscal deficit,” Reuters quoted Budget Office Director- General, Bright Okogwu, as saying to journalists in Abuja.

    “We have a deficit of about 1.85 percent of GDP. I think this is very good going.”

    Nigeria’s revenues from oil production usually exceed spending and the surplus is deposited into the Excess Crude Account (ECA), which means the deficit is to some extent artificial – it can usually be financed from the country’s own savings.

    But the balance in the ECA has been steadily increasing over the past year which, combined with a lower nominal deficit, suggests Nigeria is saving more of its oil windfall – a key objective of finance minister Ngozi Okonjo-Iweala.

    That objective put her in conflict with the national assembly, whose members wanted to free up more spending for projects and their constituencies.

     

  • ‘ICT can contribute 15% to GDP’

    THe contributions of the information communications technology (ICT) sector to the Gross Domestic product (GDP) should jump from 5.6 per cent to about 15 per cent by 2015, Executive Vice Chairman, National Communications Commission (NCC), Dr Eugene Juwah, has said.

    He spoke at the Broader Way seminar organised by equipment manufacturer, Huawei, at the Mobile World Congress in Barcelona.

    Juwah traced the growth in the country’s communications industry and submitted that good programmes and strategies would put Nigeria on a faster lane in broadband deployment and development.

    Regretting a dearth of infrastructure in the sector, which affected projections and growth, Juwah canvassed a synergy between the government and the private sector in infrastructure funding and build up to stimulate demand and competition.

    He said the licensing of 2.3GHz would be concluded this year and that it would stimulate more competition in the industry.

    Juwah said he had been developing a broadband concept, which would encourage the government to give incentives to service providers that would take services to far-flung areas.

    In fact, such incentives would influence a reduction in the cost of bandwidth and, expectedly, put bandwidth in the hands of those who would need it, but are unable to afford it, he added.

    On the infrastructure, he advocated equal focus on the wireless and wired technologies.

    He appealed to equipment manufacturers and suppliers to roll out products that can harmonise and encourage the two technologies.

    Putting people at the centre of the business, almost all the experts at the forum said competition should not only focus on prices, but also on services and quality.

    Speaking in another forum, Dr Hamadoun Toure, whose tenure at the International Telecommunications Union (ITU) has witnessed ground-breaking developments in the ICT sector, including the digital migration, hailed the transformation in the telecoms sector, which is driving profound changes in sectors and helping countries to meet millennium development goals (MDGs), among others.

    For instance, the digital economy allows anyone, anywhere play an active role in global issues and value chain, Toure said.

    He was excited about ICT growth in Africa, a continent that has become an honey pot for mobile growth, and specially commended Nigeria for a good regulatory framework by the Juwah-led team, which has increased mobile phone growth in Africa’s most populous nation.

    Toure was particularly excited that Africa is part of this inclusive technology that has given voice to the voiceless and allows even the ordinary folks in rural areas to participate in global discourse and share useful information.

    He hailed manufacturers for turning the phone into some multi-purpose devices saying: “It is no longer a phone but multi-purpose devices.”

    With these devices, people are able to share information and bounce them around the world.

  • RenCap: Oil shut down to widen budget deficit

    The three-week shutdown of oil production in October over floods will have negative impact for revenue collections and could expand the 2013 budget deficits, analysts at Renaissance Capital (RenCap), an investment and research firm, have predicted.

    It said in an emailed report that the budget was premised on oil production of 2.48 million barrel per day (mbpd), which means the budget deficit will exceed the targeted 2.85 per cent of Gross Domestic Product (GDP).

    The flooding also led to increase in food index. As anticipated, food inflation rose to 10.2 per cent due to a shortage in supply as the flooding delayed the harvest for some crops like cocoa, beans and pepper. Also, transporting harvested products to the markets has become more difficult and expensive as most of the roads are now impassable.

    It said the impact of the decline in core inflation far outweighed the rise in the food index, the largest contributor to the consumer price index, leading to an overall ease in headline inflation for September.

    President Goodluck Jonathan recently presented the proposed 2013 budget to the National Assembly. The budget is a plan of the intended revenues and expenditures for the country. It is also a tool for macroeconomic management that could help promote fiscal prudency and foster growth in the economy.

    RenCap said the 2013 budget is similar to the Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper sent to the National Assembly for approval. However, while the budget has a span of one year, the MTEF is a strategic document designed for a period of three years.

    The budget highlights showed an aggregate expenditure of N4.92 trillion, representing an increase of 4.7 per cent from the 2012 expenditure of N4.7 trillion, while total revenue is put at N3.89 trillion, an increase of 9.3 per cent from the 2012 revenue of N3.56 trillion.

    However, indicators in the proposed 2013 budget that demonstrate the commitment to fiscal prudence are the reduction in fiscal deficit to 2.17 per cent of GDP from 2.85 per cent (N1.15trn) in 2012, which is within the threshold stipulated by the Fiscal Responsibility Act, 2007.

    There was also reduction in domestic borrowing by 2.3 per cent to N727 billion, from N744 billion in 2012, to ensure that debt stock remains at a sustainable level.

  • CBN: Nigeria’s real GDP to exceed $245b

    CBN: Nigeria’s real GDP to exceed $245b

    Nigeria’s Gross Domestic Product (GDP) averaged $245 billion in October, and has the potential to assist the country realise her Financial System Strategy, 2020, Head, FSS2020 Programme Management Office, Oluwatoyin Jokosenumi, has said.

    Jokosenumi, who spoke at the Nigeria Electronic Fraud Forum (NeFF), in Lagos, said Nigeria is a critical contributor to the sub-Saharan Africa economic performance, adding that Nigeria remains the second largest economy in Africa, after South Africa.

    He said Nigeria’s real GDP constitutes over 60 per cent of ECOWAS countries GDP, stating that 29 of the 50 biggest Sub-Saharan African companies (with the exception of South Africa) with capital base exceeding $1 billion, are Nigerian companies.

    Jokosenumi hinted that with strong external reserves of about $42.6 billion, as at October 31, and Monetary Policy Rate 12 per cent, the Nigerian economy has something to cheer despite some critical challenges affecting it.

    He added that international rating of Cash Adequacy Ratio (CAR) of about 21 per cent for Nigerian banks, makes the country a strong and consistent growing economy by International Monetary Fund’s standard.

    He said the foundation for growth was laid from 2000 on the back of a series of key reforms and fiscal tightening regime adopted by government.

    He said the creation of the Debt Management Office, Fiscal Responsibility Act, and the current efforts at fiscal consolidation, among others, are positive steps taken by government to achieve improved economic indices in the country.

    He said the Pension Sector Reforms, which grew pension assets from zero to $15 billion in 2011, banking sector reforms, which moved total assets of $16.7 billion in 2002 to $109 billion in 2010; telecoms reforms, which increased phones from 500,000 lines in 2001 to 85 million lines are good outing for the economy.

    He said the growth of total accumulated pension fund contribution to N2.83 trillion as at August, 2012 is also geared towards achieving FSS 2020 vision for the country.

    He cited critical areas of modernisation and growth drivers nearly completely untapped in the economy to include about $218 billion worth of financial intermediation opportunities within the financial services sector, which include real estate expected to hit $166 billion, Pensions $38 billion, Insurance $11 billion and mobile money worth $3.8 billion in 2020.

    Also, potential size of power sector by 2020 is targeted at $218 billion, agriculture $87 billion, infrastructure $40 billion and Oil and Gas $12 billion as against their current relative position of $7.9 billion, 15 billion, $7 billion and $5.5 billion.

    He said 20 per cent of the estimated $38 billion pension funds could attract multiples to catalyse entry of experts and well priced funds into the real estate and mortgage sectors of the country.