The Nation Newspaper

Tag: recession

  • ‘Recession hindering insurance growth’

    Despite hope by insurance practitioners that the sector will grow this year, the recession may be a hindrance.
    Some stakeholders told The Nation that despite having knowledge of benefits of insurance, complained the economic recession may not allow them buy insurance policies.
    A banker, Wande Ayoade, said his confidence in insurance has increased, lamenting that the state of the nation’s economy has not allowed him to buy insurance policies.
    He said: “I’m aware that some insurance companies now settle claims promptly more than before but the hardship created by the state of the economy is too much.”
    He said he would have bought a health insurance policy because of its benefits but he could not afford it. He noted he also settled for third party motor insurance.
    “I can only afford a third party motor insurance. Insurance is a good thing and I believe in it. I don’t have a building, but if I have and also have enough disposable cash, I will insure it. I think the situation of the economy is not encouraging anyone to buy insurance because the majority of Nigerians are struggling to feed themselves and their families,’’ he added.
    Femi Alade, who works in a supermarket in Lagos, acknowledged the importance of insurance, but said he would not buy because he believed insurance is meant for the rich, adding that he entrusts his assets to God.
    A nurse, Miss Adijat Omotola, said insurance is not a priority for her, noting that the country is going through hard times. But for Taiwo Akinsanya, a civil servant, the operators of the industry need to do more on insurance awareness because many people don’t trust insurance companies.
    Akinsanya said he had been buying insurance for some time now and it had been worth it. ‘’I think a whole lot of Nigerians are not aware of insurance benefits, including the elites. I think the industry should do more advertisements if they really want more people to insure this year,’’ he added.

  • ‘Nigeria suffering leadership, not economic recession’

    ‘Nigeria suffering leadership, not economic recession’

    Senior Pastor of the Chapel of His Glory, Ado Ekiti, Rev Dr Kunle Salami, spoke with Odunayo Ogunmola on leadership failure in Nigeria, among other issues. Excerpts: 

    This is 18th edition of Family Life Conference. What has been the effect of the programme so far?

    The participants are excited. You can see them in the church happy because they know the good impact it has been on their families.

    The Bible says you will know the truth and the truth will set you free. The feedback we have every year is that their homes were liberated.

    What is your reaction to the Financial Reporting Council (FRC) Governance Code, which stipulates general overseers of churches must step aside after twenty years?

    Each church has its succession plan. For some of the general overseers, they would want to leave at the ages of 60 and hand over to some other persons. Some want to leave when they are dead.

    Even in America and Britain where the government supports the churches, they don’t force anybody to retire. They support churches over there because they believe that churches help to reduce crimes.

    Churches in Nigeria are not collecting anything from government but they see churches as money- making ventures. That’s why government is going after churches.

    It is totally uncalled for even whether churches have a succession plan or not. Death is inevitable. Pastors would die so why is government in a hurry? Anybody that steals God’s money would vomit it.

    What’s been done on the issue?

    The problem is that some people have a bad perception about the church. People at times are ignorant or economical about the truth.

    I minister in different parts of the world so I know what happens there. The problem with Nigeria churches is that the enemies are inside the churches.

    They don’t recognise anything that CAN say. They just feel that church pastors are becoming too powerful, forgetting that nobody can be too powerful for God.

    What is your take on Christians going into politics?

    I wholeheartedly support Christians going into politics because if Christians do not go into politics, the soul of politics will not be what it should be.

    In the early 80s in Oyo State, Christians were not joining the civil service because they felt the civil service was corrupt but now you have Christians who are Permanent Secretaries.

    If Christians feel politics is corrupt, it is the people who are there that are playing it. When the person is in politics and he doesn’t have a soul, he has sold his soul to the enemy. He is going to do anything he likes and be corrupt.

    So Christians ought to go there. The fact is that in Nigeria, there is a failure of leadership among the political class. My take is that if a governor does not pay salary, that governor has lost his leadership.

    If a president does not pay salary, he has lost his leadership. If you are president or governor and you are there for hundred days and nothing has changed, you should step aside.

    It’s a failure of leadership but the truth is not being told. Even journalists who have sympathy for a political party paint the picture of the party well.

    There is a failure of leadership in Nigeria. It is a criminal offence for any leader to owe salaries. In other parts of the world, any leader that owes for two weeks would be jailed.

    In Nigeria, people talk based on the type of political divide they belong to.

    With the economic downturn rocking the nation, how possible is peaceful existence in families?

    Men should be proactive. The men must have understanding of the time. The man is the breadwinner of the home. Therefore, he must not rely on one income.

    The main problem today is that people are looking just at the government. So when the salary is not paid by the government, everything is on a stand still.

    The individual does not understand that he’s a multi-talented individual. The average person has so many talents. Some psychologists said the average person has over eight hundred talents.

    A greedy person needs four streams of income to feed. If you are very greedy you need eight while extremely greedy needs sixteen.

    One has to do other things that would bring in money. Every man must feed his family otherwise it’s a failure of leadership. Leadership is making things happen.

    What can you say about the prevailing economic recession?

    It’s a leadership recession, not economic recession. Everybody has to remove the barrier between themselves and money. We like to coin phrases for problems that could be solved.

    Why is Nigeria still grappling with corruption?

    In the United States, Obama has handed over to Trump. He’s going to be earning $290,000 as pension. As American President, Obama was earning $430,000.

    A senator in Nigeria earns N29 million. There would be problem in Nigeria if the greater amount of our money is being used to take care of somebody. Somebody who’s a governor, his salary is permanent till he dies.

    Every four years, a new car must be bought for him. 50 percent of the revenue of this nation is used to take care of capital expenditure. How can the nation move forward?

    We want to borrow $39.9 billion but the greater part of that amount of money would be used to service salaries and some other things. So when are we going to pay the money when it is not used for things that are productive? It’s a failure of leadership so recession will continue.

    Why are there so many evil prophecies around?

    It’s a precarious situation in Nigeria. The Bible has already said people are going to prophesy at the end time. The fact remains that God has not given a prophet the leeway to direct the life of individual.

    Every car going has its head lamp. You don’t need a prophet to tell you the direction of your life. We are the ones giving power to those who want to say evils over us.

    Even the person that is not a prophet claims he’s a prophet during this end time because one of the ways you can feed is to say you are a prophet.  Many of them armchair prophets unfortunately and that is the truth.

  • How Nigeria can get out of recession, by Tambuwal

    How Nigeria can get out of recession, by Tambuwal

    Sokoto State Governor Aminu Tambuwal spoke with reporters in Sokoto, the state capital, on the economic recession and challenges of governance in the Northwest state. ADAMU SULEIMON was there.

    The last administration promised to improve the welfare of religious and traditional rulers in the state. Why haven’t you done much in that regard?

    First of all, this government respects traditional institutions and since we came on board, we have accorded them the respect they deserve. They play important roles in efforts to sustain peace and security, and in a larger sense, they promote religious and communal harmony. Because of their place in our history, we know we cannot do anything less for them. But, you will agree with me that our financial situation since we came on board has been precarious. Government has cut back on much expenditure, and has prioritised areas of needs for the whole state. I am happy that our traditional rulers have understood clearly what we are faced with and they have not pressured us to continue with the policy of fixing their palaces when there are more competing needs in our hospitals, primary healthcare centres, agriculture, education, youth, women empowerment among others. Similarly, if you look into the number and importance of projects we met on ground and the pressure to complete them, what we did is the best for the state. We have inherited about 30 large and important projects from the last administration, and we are working hard to complete all of them and put them to use for the benefit of the citizens. These are projects that we have to complete as allowing them rot away will lead to wastage of funds earlier expended to start these projects.

    Our philosophy has been to take these gradually, depending on availability of funds, and complete them before delving into new ones. That policy has served us well in the last two years and we are happy to put them to use. What you may not be aware is that many of those projects for traditional rulers were to be executed from the joint accounts with the local government councils. But at the moment, many of those councils cannot carry out any meaningful project outside payment of salaries. We have severally bailed them out from the state government to enable them meet their obligations to workers. In such situations, I don’t think they are buoyant enough to embark on building and repairs of palaces.

    There are complaints that many of the council workers don’t get their salaries on time, what is responsible?

    We have carried out verification exercise to determine the correct number of workers in each of the 23 local government councils of Sokoto state. What we met on ground was beyond reason because the strength of the workforce in our local governments is twice more than that of Kano that has 44 local government areas. We felt this is not sustainable. We are continuing with the biometric verification to ensure that only genuine workers remain in the schedule of payment, and they will be paid according to their levels. We must do this to sanitise the system and ensure ghost workers or absentee workers do not find sanctuary in the local government system.

    Few days ago, you dissolved the management team of the state Board of Internal Revenue. Why? What is the current IGR figure for Sokoto state?

    For almost two years, we gave the dissolved team the necessary incentive and support to improve internal revenue base of the state, but they haven’t done that. If you recall, I have stated publicly that we would take action to ensure better performance in revenue generation. After a review of their performance, we decided to bring in new persons to reposition the board. As for the figures, since we came on board, the monthly IGR for Sokoto ranges between N340 to N400 million. When I spoke to the ministry of finance, I was told that the previous administration received up to N500 million monthly. My argument is that this figure they are giving us is meager. What we deduct monthly as PAYE from civil servants alone, should be in the range of this figure, so what happened to other revenue sources? The new team has been mandated to put in place a new framework which will boost performance and improve revenue figures.

    With this new target, are we seeing tougher measures against members of the public who are not paying tax?

    We are fully aware of the economic situation in the country, especially survival of businesses and the harsh conditions they are operating in at the moment. We will put that in consideration in pursuing what is due for the government. I am saying this because as leaders, we need to be clear about our intentions. Whenever we ask people to make sacrifices, we must reassure them that it is for common good. So, we are telling the people that whatever they pay to government as tax, will be applied judiciously for the benefit of all the people of the state.

    How will you review the performance of the  2016 budget?

    I’ve spoken about this during the presentation of this year’s budget, and in fact when I assented to the budget law a few days ago. Taking a holistic view of the performance of the budget, I feel we can do more. That is why we started this year by making necessary changes in the personnel that drive the budget process, as can be seen from what we did at the board of internal revenue. We will continue to improve the system because time is not on our side. What I’m promising the people is that the performance of the 2017 budget will be better than that of 2016 in terms of implementation, while even distribution of resources will be ensured. We will start new projects across the state, with much emphasis placed on rural areas.

    At the meeting of the Northern Governors Forum recently, you agreed to improve the security situation in your states. how far have you gone in that regard?

    We discussed many areas of cooperation, for example agriculture, education and the likes. As for security, we agreed to share intelligence and this has been paying off. Take for instance issues of castle rustling; because of renewed onslaught by security agencies and the inter-state collaboration among all the states, this problem has reduced. We still have few scattered instances, but we are working to tackle that as well. This cooperation is extending to cases of kidnapping, armed robbery, civil unrest and the likes. So the more we collaborate the better for us as states, and the better for our citizens.

    What’s the way out of the recession for the country?

    Experts have called on the Federal Government to inject more money into the system. Personally, I believe creating job opportunities, especially through the construction industry, and injection of more money into the economy, remain a sure way out of the current recession in the country. Ask any Economist about the way out of recession, and I am sure they will inform you that massive construction efforts, backed by release of funds, will create jobs whose multiplier effects will jumpstart the economic barometer. As Speaker of the House of Representatives, I’ve had reasons to disagree with many of the policies of the last administration of President Goodluck Jonathan which we felt were inimical to the overall development and well-being of the people. Many thought we were raising the alarm because we had personal hatred for him. That is not the case. I had nothing personal against the former President. The recession we are currently facing was as a result of the way the economy was mismanaged, largely, by the Jonathan administration. What is the way out? I’ve said we need to inject money into the system and create employment opportunities for the people. And one way to do that is to engage in massive construction projects. It is part of the reason why we encouraged the Federal Government to disburse the funds from the debt relief for states to kick-start activities at regional level. Similarly, we’ve read how immediate-past President of the United States of America, Barack Obama, used this strategy of massive construction works to take America out of economic challenges. So, construction projects alone will create a lot of jobs which will benefit the economy. We all know that Nigerians are not happy and are running out of patience, but they should be more patient. It is very easy to destroy but to rebuild the economy takes time.

  • Economy going out of recession, says Fed Govt

    Economy going out of recession, says Fed Govt

    The recession is receding, the Federal Government said yesterday.
    Proof: the about eight-fold over subscription of the government’s Eurobond (orders in excess of US$7.8 billion compared to a pre-issuance target of US$1bn).
    Besides, the oversubscription, the government believes, has confirmed the confidence level of the international investment community in Nigeria’s economic reform agenda.
    A report in Issue 23 of Aso Villa’s Newsletter, Government at Work, released on Monday, also gave 11 other reasons why the government believes that the economy is on its way out of recession.
    After two consecutive quarters of negative growth, according to the newsletter, the non-oil economy witnessed in Q3 2016 a modest return to positive territory at 0.03%.
    It attributed this marginal growth to the continued good performance of agriculture and solid minerals, two sectors prioritised by the Federal Government.
    According to it, agriculture grew by 4.54% in the quarter; crop production is at nearly 5% – its highest since the first quarter of 2014.
    Growth in the solid mineral sector, the newsletter said, averaged about 7%.
    The second reason why the government believes the economy is recovering is the Anchor Borrowers Programme (ABP) of the Central Bank of Nigeria, which it said substantially raised local rice production in 2016 (yields improved from two tonnes per hectare to as much as seven tonnes per hectare, in some states) and produced a model agricultural collaboration between Lagos and Kebbi states.
    Thirdly, it said that the Fertiliser Intervention Project (which involves a partnership with the Government of Morocco, for the supply of phosphate) is on course to significantly raise local production, and bring the retail price of fertiliser down by about 30 percent.
    Another reason given by the government is the taking off of the newly established Development Bank of Nigeria (DBN), with initial funding of US$1.3bn (provided by the World Bank, German Development Bank, the African Development Bank and Agence Française de Development) to provide medium and long-term loans to MSMEs.
    The newsletter states: “A new Social Housing Programme is kicking off in 2017. The ‘Family Homes Fund’ will take off with a 100 billion naira provision in the 2017 Budget. (The rest of the funding will come from the private sector).
    “More than N800 billion  has been released for capital expenditure in the 2016 budget, since implementation started in June 2016. This is the largest ever capital spend within a single budget year in the history of Nigeria. These monies have enabled the resumption of work on several stalled projects – road, rail and power projects – across the country.”
    The government also gave the implementation of the Social Investment and Empowerment Programme (SIP) as a reason for growth of the economy.
    All the four components of the SIP, it noted, have now taken off.
    The newsletter described the SIP as the largest and most ambitious social safety net programme in the history of Nigeria, with more than 1 million beneficiaries so far: – 200,000 N-Power beneficiaries, 23,400 Government Enterprise and Empowerment (GEEP) Scheme beneficiaries, 1,000,000 Homegrown School Feeding Programme (HGSFP) beneficiaries, and ongoing Conditional Cash Transfer (CCT) payments across nine pilot states.
    It said: “Strategic Engagements with OPEC and in the Niger Delta have played an important part in raising our expected oil revenues. Already, Nigeria’s External Reserves have grown by more than $4 billion in the last three months.
    “Collaboration with China, proceeding from President Buhari’s April 2016 visit, has unlocked billion of dollars in infrastructure funding. Construction will begin on the first product of that collaboration, a 150km/hour rail line between Lagos and Ibadan, in Q1 2017.
    “The National Economic Recovery and Growth Plan (NERGP), the Federal Government’s medium-term Economic Plan, is due for launch in February 2017, and will chart a course for the Nigerian economy over the next four years (2017 – 2020).” it stated

  • Recession, religion and quest for bread and butter

    SIR: I have never been so worried and scared of the critical dimension that religion is assuming in negatively affecting the health and indeed the totality of our national life. This is even more so with the events going on across the country where almost everyone is caught in the frenzy of defending the faith he or she professes.

    And whereas the issues affecting our national development are by far different and unrelated to who each and every Nigerian prays to for his or her salvation, some religious fanatics, across board appear to be assuming that the God they serve has become so weak that they have to fight for him.

    Today, we are embroiled in a war of attrition in which those on the vanguard of discord are employing the instrument of religion to set the people against themselves. The range from the ravaging Boko Haram in the North-east, to the killings in Agatu, Southern Kaduna, Mbatse in Nassarawa Eggon, herdsmen attacks in various parts of the country and other retaliatory attacks.

    How do we interpret the corrosive verbal exchanges among religious leaders currently going on? How do we guarantee the impartiality of the security agencies in the midst of this religious brouhaha? And more importantly, how does our individual faith guarantee stable electricity, employment, stable and prosperous economy, educational advancement of our country and its people, reliable transportation system, eliminate kidnapping, armed robbery, terrorist bombings, poverty, corruption, etc.

    Does it matter the religious or ethnic identity of a president or minister, governor or a legislator, if we can have stable electricity, good road networks, gainful employments stable economy and the like? Should it matter to an average Nigerian if our socio-economic and political problems are solved by a leader of any religious persuasion?

    If one of the reasons people pursue religious belief is to seek justice, religious leaders in Nigeria should come together as a pressure group to influence government to administer justice to all segments of the nation.

    In that way, we may be assisting government to curtail the rising wave of criminality; whether in Borno, Kaduna or the Niger Delta. The senseless killings and the attendant reprisals under the guise of defending one’s religion or other economic purposes cannot and will not propel development in Nigeria.

    As it stands today, poverty does not discriminate between Muslims and Christians. The problem of development confronting the Nigerian Christian in Calabar is not different from those facing the Nigerian Muslim in Gusau. Across the nation, the imperative for overall development is more than ever compelling and religion is by no means one of the solutions to the problems confronting our country today.

    The time to seek urgent solutions to this religious tension is now. I recommend that Muslim and Christian leaders undergo a tour of the various states to prevail on the faithful to embrace a more cautious practice of their faith with absolute tolerance and accommodation of others.

    On the whole, government must engage all religious leaders to reiterate its assurances and commitment to the secularity of the Nigerian state, without giving room for any side to be suspicious of its intentions.

    Nigerians, like the Koreans must learn to love their country by downplaying religious sentiments and extolling the virtues of nationalism, patriotism and upholding the spirit and letters of our National Anthem.

     

    • Samson Osagie, Esq.

    University of Abuja.

  • Recession over soon, says Ag. President Osinbajo

    Recession over soon, says Ag. President Osinbajo

    Acting President Yemi Osinbajo yesterday reassured Nigerians that the economic hardship brought about by the recession in the country will soon be over.
    Series of protests for and against government policies were held in some parts of the country on Monday.
    In a statement titled “We are committed to engagement with our people, & fixing the economy”, which was personally signed by Osinbajo, he commended the Inspector General of Police, Ibrahim Idris, and his officers for handling the protests with professionalism and respect for the rights of citizens.
    He said: “We are committed to a continuous engagement with our people to explain government policies, receive advice and criticism.
    “Cabinet Ministers have gone round 8 States so far holding town hall meetings, the most recent was yesterday in Ilorin. There will be more of such meetings in the other States that are yet to be visited.
    “With complete focus on improving the economy every day, the recession will soon be history.”

  • College provost advises FG on recession

    The Provost of Abia State College of Education (Technical), Arochukwu; a former World Bank Consultant and former Abia State Commissioner for Finance, Dr. Philip Ntoh, has asked the federal government to conduct a more in-depth study of the Nigerian environment and look inwardsin order to apply the best economic strategy needed to bail the economy from recession.
    He also advised the government to engage more experts in order to tackle the nation’s present economic woes.
    Ntoh used the occasion of the inauguration of the newly elected executive of the school’s Students Union Government (SUG) on Wednesday, led by Comrade Mba Kelechi Mathew, to warn that the institution will not hesitate to expel any student who engages in any anti-social behavior such as cultism, examination malpractice and rape.
    He explained that the school adopted the policy of zero –tolerance for cultism and examination malpractice so as to turn out graduates who will be the true leaders of the state and Nigeria in the future.
    He also noted that a conducive learning environment has been created for the students to excel, especially with the engagement of quality lecturers, newly renovated hostels and other facilities.
    Ntoh noted that when he assumed office a year ago, the school was without public power supply while the hostels and the entire environment were rundown, but expressed happiness that the situation had changed for the better.
    According to him, through the deliberate and sustained innovation policy of developmental framework, evolved by the new management, ASCETA was now attracting more students’ enrolment.
    He told them that with the affiliation of the college to Michael Okpara University of Agriculture, Umudike, students can now do a straight four year degree courses, including the acquisition of relevant skills.
    Dr. Nto disclosed that for the first time since the inception of the college, the present management has started the issuance of certificates to graduates of ASCETA.
    He urged the students to take advantage of those positive changes and work towards excelling in their academics with the assurance that their certificates will be issued to them upon graduation.
    He thanked the state governor, OkezieIkpeazu, for his commitment to the massive development of the school, pledging that the institution would continue to maintain enviable learning standard.
    Earlier, while swearing the students in, the Deputy Provost, Dr. Sam Iheonunekwu, enjoined them to respect the rules of the school and protect the interest of students.

    In his remark, the SUG President, Mba Kelechi Mathew, pledged the loyalty of the students to the management and promised that they will work hard to justify the confidence reposed on them by the students.

  • Recession: Where to invest in 2017

    Recession: Where to invest in 2017

    The economic recession notwithstanding, experts are optimistic that there are lots of opportunities for business growth and development in 2017, especially in strategic areas of investment like agriculture and agro-allied venture, stock market, real estate, among others. In this report Ibrahim Apekhade Yusuf and Bukola Aroloye examine some of these businesses

    Not a few Nigerians can deny the fact that the biting cash crunch exacerbated by the parlous state of the economy in the last few months has been a source of concern to many.

    But even though the economy seems to be heading south in a manner of speaking, experts are optimistic that there is room for a complete turnaround for those willing and ready to take the plunge.

    Interestingly, majority of the economic and investment experts who spoke with our correspondents all seems to agree in unison that one of the lucrative businesses to venture into in the year is agriculture across its value chain whether in production and processing in plants and livestock.

    Want to be a millionaire? Agriculture is it!

    According to some economic watchers, agriculture is the next revolutionary industry in Nigeria where millionaires are currently being made. Nigerians both home and oversea are beginning to wake up to the huge potentials in agribusiness, a sector hitherto neglected over the years due to the discovery of oil. Now that the oil is drying up, people are beginning to look into other sectors of the economy, especially agriculture to create wealth.

    Lending credence to the foregoing, an agriculture expert, Mr Jide Afolabi said: “This business is making average Nigerians rich. It is so lucrative that even outsiders are coming in to invest in the business in Nigeria. And why not, in a country of more than 150 million people, what would you expect?  Take poultry farming for instance, if you start with 1,000 birds and manage your poultry farm properly, when the turnover on investment begins to come, you will be making millions.”

    Speaking further, Afolabi said: “Snail farming is one of the choice animal farming for many reasons. It is a low capital investment with high yield and the market is big. There are few people currently doing this – and most of them are doing it in a very low scale. If someone invests heavily in snail farming, he is sure to make good money in millions within a year.”

    Rice remains the most consumed food staple in Nigeria and billions of dollars goes into importation of this product yearly from China and Thailand because the local farmer are unable to meet up the demand due to poor funding and limited knowledge.

    Thankfully, many state governments, who hitherto went cap-in-hand to Abuja to collect monthly allocation, have since begun to look inwards. Osun state for example, which is an agrarian state, is one of such states that are developing their agriculture resources.

    Osun state governor, Rauf Aregbesola in a statement issued by his media aide, Mr Semiu Okanlawon, said that the only panacea to the current economic crisis in the country was for every government to rise to the occasion and look for alternative means by exploring the abundant potential in agriculture. According to him, only agriculture can rescue the nation from the economic recession currently being experienced as a result of oil glut and the activities of the Niger Delta militants.

    “Nigeria’s enduring economic recovery will materialise only when the country revitalises its investments in agriculture and make it a venture that attracts the bulk of the most productive segment of the population,” Aregbesola maintained.

    “We have everything we need to be a great agricultural nation. Let us undertake a survey to know where each state has comparative advantage over others.  The situation at present requires that we do everything humanly possible to awaken the huge potentiality of our agricultural sector,” Aregbesola said.

    The governor also said that the state would continue to invest massively in agriculture in making the state the food basket of the nation. He also charged the state agriculture officers to redouble their efforts toward transforming the state from peasant, rural and subsistent agricultural to a modern, industrial and commercial agricultural state.

    Expectedly, President Muhammadu Buhari  has assured that the federal government will sustain concrete measures to diversify the economy by devoting more resources to agriculture in the 2017 budget.

    The president made this known in a statement issued in Abuja recently by his Senior Special Adviser on Media and Publicity, Malam Garba Shehu. According to the statement, Buhari, who was speaking to reporters in Nairobi, Kenya, on the margins of the sixth Tokyo International Conference on African Development (TICAD VI), said that African countries had a lot to learn from Japan on developing agriculture. He said already, Nigeria had started an aggressive farming programme that entailed organising farmers into cooperatives in the second and third tier of government.

    “We intend to put more resources in our 2017 budget, especially in the procurement of machinery for land clearing, fertilizers, pesticides and training of less-educated farmers as farm extension instructors. “We have already registered some success this year in a number of states; we identified some 13 states that will be self-sufficient in rice, wheat and grains before the end of 2018.

    “We are very positive that soon we will be able to export these food products. “We are also lucky that the farming season in the northern part of the country has been very good and we are expecting a bumper harvest this year,’’ he said.

    Opportunities in real estate

    Besides farming, other possible area of investments to lookout for is real estate, especially now that the prices are crashing due to biting economic crunch, experts have suggested.

    According to Olusanya Gbenga, a Business Development Manager in one of the realtor companies, over the last decade, population size in major cities has increased as a result of business opportunities, investments, urbanisation and job opportunities.

    Due to this increase, there is shortage of suitable accommodation available which causes competition and also a hike in rental and sale value and price of properties which in the end has made such cities among hottest and most promising places in the world for real estate investment, he said.

    “When you buy or build a house and decide to rent it, that property starts to bring in income, monthly, quarterly or yearly depending on what agreement you have with your tenants. Due to the growing inflation in the economy, rental prices are always on the rise and higher rent prices mean more income for you, the property owner. When compared to other investment options, the income from real estate is the steadiest and there is also little or no risk of loss. The income from real estate investment is steady, predictable and allows you plan better.”

    According to Sewa Wusa, Head of Research at Sterling Capital Ltd, many Nigeria entrepreneurs are at that point where they evaluate their various money generating vehicles to see which performed well. While enumerating possible investment avenues, he said, though bonds are not a popular investment vehicle especially among brick and mortar business owners, this doesn’t make them less valuable.

    Specifically, he said: “Bonds are actually a profitable route to investing going into 2017. However there are a couple of things to note before dipping your feet in this pool.  The first thing to note is that before investing in bonds you’ve got to have a clear and objective financial strategy. This is important for those just going into business for themselves. As with all things money, there is need for you to clearly outline the path the funds to be invested will take and what your expected yield turn out to be.”

    Speaking in an interview with The Nation, Mr Jide Ogunleye, Managing Director, Denaro Properties Ltd and Treasurer, Real Estate Developer Association of Nigeria (REDAN), noted that the real estate business in Nigeria has not even started, despite the recession, despite the inflation and lost in value of investment real estate business in Nigeria is a safeguard. “Due to the current financial crisis, the continent presently finds itself into folks are in desperate need to pay bills and maintain liquidity. This is the right time to acquire a landed property. The benefit of investing in landed properties is the fact that their value is certain to appreciate over time.”

    Stocks, bonds, shares still a good buy

    For those who have patient capital, the money and capital markets is someplace they can invest whether on the short, medium to long term.

    According to Dayo Ademola, a financial analyst, “A lot of people are waiting for the stock market to recover, smart investors have now found bond markets as a ready instrument to apply their investment funds. Since this investment instrument is the safest it has become a darling of many, including banks and investment outfits and insurance companies. No wonder most of the issued bonds are oversubscribed.

    “Waiting for the stock market to recover before you apply your fresh capital investment is like staying under water for hours and still expecting breathing to take place. Your cash will have a battle with inflation to survive. Bonds are instrument that most successful investors use as a good source of returns on investments for their financial fortunes, especially in troubled times.”

    Echoing similar sentiments, speaking at a public forum at the weekend, a team of economists and financial analysts led by the Managing Director of Afrinvest West Africa Ltd, Ike Chioke said technical analysis indicates that the market will trigger a rebound even in the absence of fundamental drivers as soon as market actors perceive prices to have reached its long term support level or bottomed out.

    The experts also said there is a bourgeoning opportunity in the mining sector which is currently on the Federal exclusive list of the Nigerian constitution, implying that exploratory activities in the sector are carried out by the federal government.

    “In our view, removing mining from the exclusive list will give the State governments the impetus to explore and develop their respective natural resources and also possibly foster interstate alliances. Likewise, this could possibly provide an avenue for States to boost their Internally Generated Revenue and will in the long run reduce dependence on revenue allocation from the federal government.”

  • ‘Breaking walls of segregation is panacea for recession

    ‘Breaking walls of segregation is panacea for recession

    MILD RED Studios and The Edge Studio proprietor Nkechi Nwosu-Igbo, is an advocate of proactive partnership  between corporate bodies and artists.  Nwosu-Igbo, who is also the curator of the art exhibition segment of Lagos Book and Art Festival (LABAF), discusses with EVELYN OSAGIE, art-based solution for recession and the festival.

    What solution is art offering in this New Year, given the recession experienced last year?
    The solution that the arts have to offer is what we, as artists and our arts, have been saying for so many years that: “your voice must be heard”. The world is waiting for your message, whether as an artist or not. If you bring your knowledge and I bring mine, we can work hard and make this a better place. It is, however, funny how we treat history, historic monuments, culture and our arts. Imagine last year, a house that was more than 160 years old was knocked down in Lagos and nobody spoke up? We were all in our houses, talking. Should UNESCO tell us first that the house is a master piece before realising that it should not be knocked down? I am happy that more Nigerians are beginning to talk. But the arts and the artist(e)s have been speaking out on those issues even before the recession. And as always no one cared to listen.
    Was it what informed the choice of the theme of the exhibition?
    Yes. The theme, Who will blink first? is a known expression. In the face of terrorism, recession and anything you are facing, we are asking: “Who will give in first? When somebody is being oppressed, facing trying times, the question is “Who will blink first?” Although we are all suffering now and undergoing a tough time as a nation, will that make us stop being who we are and, suddenly, become criminals? The question to all of us is: “Who will give in first?”
    Even though, the exhibition has closed, the message is evergreen because art is timeless. As I have said before, our arts, not just at last year’s LABAF, are calling us to be the Voice. You don’t have to be an artist, writer, famous person, or need a stage to have a voice. We should stop appointing someone to be our voice, but be the voice. Let’s do our part, play our role in our corners and shine where we are. We should stand against abuse and social ills. Even in caring for children, you are changing the world. Whatever small thing you do in your neighbourhood is changing the world.
    How has been the experience curating LABAF’s art exhibition these past years?
    These eight years have been amazing; although it is not an easy task calling the artists, giving them themes and ideas, and producing the works. But the response each year has always been great. As a festival, we always add a diary behind the catalogue, so the experience remains fresh in their minds until the next edition. Last year’s exhibition was special. The depth and pain expressed in last year’s was also quite different. And the response was great: many were moved by the works maybe because of the general feeling. For the artists involved, they said they felt they were coming from a personal place. Jelili was arrested, locked up and sent to prison earlier in the year. He wasn’t even around at the time, but immediately I gave him the title, he went to work. The experience fired his muse. He stood his ground against those oppressing him and he did not allow the circumstance to bring him down and he was released. His resilience and courage is also a lesson for us in such times, and suit the theme perfectly.
    I noticed the colours of red and white were dominant in all the works. Was it deliberate?
    Red represents the theme that runs throughout each artist’s works. But it wasn’t planned. It just shows the general feeling. I have always worked with red. Red represents pain. For Jelili, it represents anger. And you can also see the earthen theme on his frames and so on, especially in Aderemi’s works. Instead of using original frames, he chose wood, something that would show the earth. You’d also see earth colours on Jelili’s – on the head of his figures, the stones on the floor.
    What was your installation about?
    My installation was a mix of diverse media, entitled: I will huff and puff and blow your house down. It was drawn from ‘terrorist’ wolf that was disturbing the three pigs. The fairytale as a title signifies a social class system where the powerful keeps taking and taking. The shovel and the bucket represent the houses and the things we build around them that prevent us from moving forward. And I am saying, it’s time for you to knock them down. The cups turned upside in the exhibition are not a good omen. Cups are supposed to be turned up to take in liquid. But when they are empty and then turned upside down, it means one has finished drinking, doesn’t want more and wants to leave the space. I am saying that when you feel empty, turned down, that recession is biting so hard and you have nothing to offer, there’s no way you can know till you open yourself up. When you open up that is when opportunities will come to you. Don’t hide yourself or build the walls of segregation around. Breaking down those walls will help one to overcome recession. Tell yourself I am going to reach out; I am not going to riot or do unimaginable things because there is recession. When we start to realise that we have more in common, that is the only time we would start healing, and start reaching out to help one another. Only then will opportunities come to you because challenges help us show our true self. You can never know what you have to offer or what your neighbour has to offer if you don’t reach out.
    How do you select your artists at LABAF? Because the way I see it, it is almost as if you recycled some of them…
    Usually, apart for the steady LABAF family members, I am expected to bring in other artists within the year that have done very intense work that would match our theme. So, we sent out invitations and made our pick. Some years, we may feature eight or nine artists. But not last year. We featured the steady five. Because the schedule was pretty tight for me – I had travelled for a long time. So I went for people that not only have what it takes but those I know could deliver because of the short notice. I have worked with those guys for a long time. I’ve been with Jelili for 17 years at LABAF. Aderemi joined us so many years ago.

  • Recession: recovery constrained by oil, dollar paucity

    Recession: recovery constrained by oil, dollar paucity

    Nigeria’s economy may struggle to rebound from its worst slump in 25 years unless President Muhammadu Buhari can end an armed conflict in the nation’s oil-producing region and fix a currency policy that’s blocked investment.

    Pipeline attacks in the Niger Delta cut oil production by a third last year, slashing government revenue, while central bank intervention and trading restrictions that prop up the value of the naira have stymied trade and investment. A more favourable oil and foreign-currency environment could help the economy expand, analysts say. The International Monetary Fund (IMF) estimates gross domestic product (GDP) contracted 1.5 per cent last year.

    “It’s oil prices and production from the delta that will determine growth. When monetary authorities floated the naira, they expected fiscal policies that attract investment and boost activity. But that didn’t happen, and as a result no one has confidence in the float,” Chief Executive Officer of Time Economics Ltd., Ogho Okiti told Bloomberg on phone.

    Lower oil output and global crude prices, and a shortage of foreign currency needed to import everything from food to factory inputs sent the economy into its deepest slump in more than two decades last year.

    The Central Bank of Nigeria (CBN), battling inflation at an 11-year high, has rebuffed Finance Minister, Mrs Kemi Adeosun’s calls to cut record-high interest rates to boost the economy and has pledged to continue measures to manage the currency.

     

    Dollar shortage

    While the CBN scrapped a naira peg of 197 to 199 to the dollar in June, it has intervened to hold the currency at around 315 since August. That compares with a rate on the parallel market of almost 500 to the dollar. The apex bank has also blocked importers of 41 items from accessing forex from the interbank foreign-currency market.

    The Chief Economist at Exotix Partners LLP, London, Stuart Culverhouse believes the step will improve the fortunes of the naira. He said: “We expect the economy to recover, in part because oil-price falls and oil-production declines are behind us. The extent of recovery will depend on normalising the FX situation which is still a constraint on the economy.”

    A shortage of dollars needed to repatriate profits forced some airlines to reduce flights to Nigerian destinations, while in manufacturing, investors, including Africa’s richest man, Aliko Dangote, have held back expanding some of their businesses. Some manufacturing outfits have also shut down because of the dollar shortage pandemic.

    Head of Africa Macro Research at Standard Chartered Plc in London, Razia Khan, said liberalisation of the forex market is not on the card by the CBN.

    “There are no imminent plans for further FX liberalisation. FX will continue to be rationed, with key sectors being prioritized,” he said.

     

    Fitch revises credit

    outlook

    Fitch Ratings Ltd. downgraded the outlook on Nigeria’s credit assessment to negative because of concerns that foreign currency shortages will constrain the non-oil economy. Fitch puts the nation’s debt is rated B+, four steps below investment grade.

    Fitch Ratings said: “We expect a limited economic recovery in 2017, with growth of 1.5per cent, well below the 2011-15 annual growth average of 4.8per cent. The non-oil economy will continue to be constrained by tight foreign exchange liquidity. Inflationary pressures are high with year on year CPI inflation increased to 18.5per cent in December. Access to foreign exchange will remain severely restricted until the CBN can establish the credibility of the Interbank Foreign Exchange Market (IFEM) and bring down the spread between the official rate and the parallel market rates. The spot rate for the naira has settled at a range of N305-N315 per USD in the official market, while the Bureau de Change (BDC) rate depreciated to as low as N490 per USD in November 2016. In an effort to work with the CBN to help the parallel market rates converge with the official, BDC operators subsequently adopted a reference rate of N400 per USD. However, dollars continue to sell on the black market at rates of well above N400.

     

    Budget delay

    The agreement by the Organisation of the Petroleum Exporting Countries (OPEC) and non-OPEC member countriesto cut production has helped increase oil prices. Based on the fact that productions in Nigeria and Libya have been greatly constrained, OPEC exempted the two countries.

    CCBN governor, Godwin Emefiele, has warned the boost may be short-lived, and its effect is diluted by lower output. Nigeria produced an average 1.45 million barrels a day (bpd) in December after militant groups sabotaged pipelines, compared with capacity of 2.2 million bpd, according to data compiled by Bloomberg.

    Brent crude oil for March settlement gained as much as 55 cents, or one percent, to $55.63 a barrel on the London-based ICE Futures Europe exchange. The price has jumped 75 percent over the past year.

    Any repeat of last year’s five-month delay in implementing the budget would also likely scupper a rebound. Buhari has proposed boosting investment in power, rail, roads and ports to target as much as 2.5 percent growth.