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Tag: recession

  • Recession: Is the economy really looking up?

    Recession: Is the economy really looking up?

    Opinions are divided as to whether the assurances by the Central Bank of Nigeria (CBN) that the almost comatose economy will be in a rebound by the second quarter is indeed a reality or yet another forlorn hope. Ibrahim Apekhade Yusuf in this report examines the contending issues

    Since the word recession crept into the nation’s lexicon last year, things have literally not been the same again as virtually every interaction revolves around it whether in formal or informal circles.

    Of course, one organ of government that has been on the hot seat since this whole brouhaha about recession started is the Central Bank of Nigeria (CBN). Which is just as well. As to be expected, apex bank has continually given assurances of better days ahead in the face of the lingering recession.

    Promises upon promises?

    Speaking at a public forum recently, the CBN governor had at the end of the first quarter expressed optimism that the present economic recession in the country would end by the end of June this year, based on what he described as emerging positive economic indicators.

    According to Emefiele, one of such indicators is the downward trend in the parallel market as regards the value of Naira against the dollar which has appreciated from as high as N525 per dollar to between N370 and N380 currently.

    “I think it’s an opportunity for me to say that we are going to continue this intervention because the reserve looks very good.  As I speak to you, our reserve stands at above $31 billion and that provides us enough firepower or ammunition to be able to defend the currency and we will do so with all intensity to ensure that foreign exchange is procured by everybody.

    “We have started to see a downward trend, even in prices of goods and commodities and you must have also observed that inflation is also trending downward as confirmed by NBS.

    “We are very much optimistic that by the end of the second quarter or latest third quarter this year, we should be out of recession that we are in right now.”

    He assured that the downward trend in the parallel market in favour of the Naira would be sustained by the CBN through its needed interventions and in particular, through the policy of willing buyer and willing seller basis.”

    Subsequently, the CBN had in its report on the performance of the economy, as it affects the manufacturing sector in the second quarter stated that the sector achieved a lot in terms of improved means including importing needed raw materials and other factors.

    The report stated that the Purchasing Manager’s Index (PMI) which measures the size of the nation’s manufacturing sector, rose to 52.9 point-index at the end of June, 2017 and is expected to improve further in the next quarter.

    According to the statistics, the increase in performance of the sector was much noticed in the month of May, with a record valued improvement of 52.5 per cent.

    For instance, the bank maintained that the evidence that Nigerian economy is on its path of growth is the fact that 12 of the 16 sub-sectors had also reported improved performance in the period under review.

    Some of the sub-sectors include: computer & electronic products; paper products; plastics & rubber products.

    Others are primary metal, transportation equipment, petroleum & coal products, appliances & components, textile, apparel, leather & footwear, furniture & related products.

    Electrical equipment, food, beverage & tobacco products and fabricated metal products also made the list.

    The report further stated: “Composite PMI, above 50 points indicates that the manufacturing/non-manufacturing economy is generally expanding, while below 50 points indicates that it is generally declining.”

    MAN not in the same page with CBN

    However, a cross section of the operators in the sector said, though there were some relative improvement in some areas, including scarcity of dollars in the past two to three months of the year under reference, challenges have continued to confront the sector.

    The Chairman of A-Z Aluminium Company Nigerian Limited, Chief Rufus Okolanwan, said until the purchasing power of the consumer is enhanced, drawing conclusion, which creates impression of growth in the sector is hasty.

    “What sense does it make for manufactured goods to be lying in the warehouse because inflation is making it impossible for buyers to go for them, whereas the authorities would come up with statistics indicating growth in PMI?

    “But the authorities are not saying anything on the high interest rate regime, which is still debarring manufacturers from expanding their production lines.

    “No economy that discourages the real sector from having access to loan facilities witnesses actual growth,” the chairman said.

    Supporting this view, Mr. Clement Anyahie, a director with the Manufacturing Association of Nigeria (MAN) said until there is a single digit in both the interest rate and inflation rate, the expected growth in the economy would not be achieved in recorded time.

    To Anyahie, government has listened to MAN on the aspect of making dollar accessible to the manufacturers, but the question of reducing multiple taxations in the system is still an issue that has not yet been addressed.

    Like MAN, Dr. Austin Nweze, political economist and Faculty member of Pan Atlantic University, Lagos, and Prof. Jonathan Aremu hold the view very strongly too that it is not yet Uhuru for the economy.

    According to Nweze all the so-called positive being witnessed are smokescreens. “Everything happening now is artificial. It’s just some kind of manipulation to pretend that all is well. All is not well with the country politically, economically and socially in every facet of Nigerian life.”

    Pressed further, he s aid: “That the prices of some commodities are coming down doesn’t really mean we’re getting things cheaper because the purchasing power is gone. Any situation where the purchasing power of the people is low, the people will need to make choices. The market is about demand and supply. What we’ve is that the supply is heavy and the demand is low and the demand is low because of the low purchasing power. Those that have money are afraid to bring it out because of the body language of the government on corruption. Investment everywhere is about confidence.”

    Aremu, who is professor of International Economic Relations, Covenant University believes that the economic managers need to do a lot to galvanise growth in the key commanding heights of the economy.

    The renowned economist, who noted that many developing countries like Nigeria today, have balance of payments difficulties to fulfil the planned targets of development, emphasised that there is need to establish infrastructure like power, irrigation, transport, etc. and directly productive activities like iron and steel, chemicals, electrical, fertilisers, etc.

    Regrettably, he said, “Nigerian economy is currently facing extremely difficult times after having been hit by converging adverse developments, some due poor governance others due to declining fortune from oil revenue. In the past, the Nigerian economy has proven resilient in times when economic circumstances have suddenly changed. While the economy’s flexibility is now being tested, an adequate policy response would help to revamp growth, enabling companies to expand investment and create new jobs. To this end, the domestic in- coming administration should aim at quickly restoring the economy to balance and laying out the foundations for a sustainable recovery. This includes stabilising the exchange rate and inflation, and also implementing a decisive fiscal consolidation programme.”

    Besides, he said, “We must take measures to restore the credibility of the CBN. Best-practice policies should be adopted in terms of communication, independence, governance and monetary control. Even more importantly, the conduct of monetary policy should be decisive and the incoming government should respect the independence of the CBN. A suitably modified inflation-targeting framework can act as an effective nominal anchor for monetary policy and Naira should be allowed to be determined at the market rate without further subsidy.

    The collapse of the oil price and the consequent dwindling of economic activity in the country, he lamented, “Puts public finances of the in a dire situation. An aggressive fiscal consolidation programme should be quickly implemented along the monetary policy recommended here. This will involve significant tax increases and spending cuts, with the latter playing an increasing role over time. We also must adopt a new fiscal framework emphasising spending control and medium-term sustainability, by requiring public agencies to make up for any over expenditure in the following years and giving public-sector managers greater autonomy and accountability in deciding how to achieve their objectives.”

     

  • Fed Govt hires tech giants to end recession

    Fed Govt hires tech giants to end recession

    Nigeria is hiring United States (U.S.) technology giants such as Oracle and Microsoft as the government invests more to save costs and fight corruption.

    An initiative led by Redwood, California-based Oracle has enabled the government to remove 50,000 so-called ghost workers, or fake entries, from the payroll, according to a presidency statement June 29. That followed Oracle’s decision to open an office in Abuja, the capital, in May. Other companies interested in taking on more work in Nigeria include IBM Corp. and Sweden’s Ericsson AB, according to Yusuf Kazaure, managing director of state-owned Galaxy Backbone, which provides technology services to the government.

    Galaxy Backbone’s budget has increased by 30 per cent this year to N4 billion ($12.7 million), Kazaure said in a phone interview . State funding for the company will probably increase at a similar annual rate for the foreseeable future, he said. Nigeria is investing 50 per cent more on information communications technology (ICT) infrastructure this year, totaling about N41billion, according to budget data.

    Africa’s most populous country is seeking to recover from its worst economic downturn in more than two decades and is using technology to improve government revenue collection and attract investment. The continent’s biggest oil producer is ranked 136 out of 167 countries on Transparency International’s 2016 Corruption Perceptions Index, a placing that may improve if the government is able to simplify processes such as the awarding of state permits, according to Hakeem Adeniji-Adele, director of public sector work at Microsoft Nigeria.

  • Recession: What S/Africa and Nigeria must learn

    If the rest of Africa expects Nigeria and South Africa to chart a pathway and provide some sort of economic leadership, they would have to look elsewhere for the time being. Africa’s two biggest economies, with a combined Gross Domestic Product (GDP) of nearly $800 billion are both in recession at the same time, for the first time ever in the modern history of the continent.

    The time of arrival at this recessive destination may be different for both Nigeria and South Africa, but the navigation patterns bear a striking resemblance. The combined forces of corruption, public finance profligacy and in the case of South Africa, political instability, have stripped both countries of veneer of economic growth over the last one decade.

    For the average Nigerian and South African currently bearing the brunt of the reckless economic decisions and financial mismanagement of those entrusted with power, endless debates and analysis offer little or no reprieve.

    Nigeria slipped into recession in Q2 2016, a year after the historic election that produced Muhammadu Buhari, a former military leader and staunch anti-corruption advocate, as President. Buhari’s predecessor, a former governor from the oil-producing Niger Delta, presided over what observers say is one of the most corrupt regimes in the history of the country.

    Corruption has proved to be a recalcitrant encumbrance to the development of Africa’s most populous nation. A recent report by Chatham House, London, puts the amount stolen from Nigeria’s treasury between 1960 and 2014 by corrupt public officials at $400 billion.

    South Africa is not without its own corruption challenges, even if the amounts involved are not as staggering as the ones in Nigeria. Diversion of public funds by politicians and public officials away from service delivery into private pockets is rife. President Jacob Zuma for example is alleged to have diverted R246 million of public funds to upgrade his private home.

    Since 2009, South Africa has dropped 17 places on Transparency International’s Global Corruption Perception Index, 34 places since 2001. Between R25 billion and R30 billion is lost to loopholes and imbalances in government procurement processes each budget year according to a 2011 report by Willie Hofmeyer, former head of the Special Investigation Unit.

    Economic analysts did not foresee Africa’s most industrialized economy going into a recession this year, but they should have. South Africa’s GDP contracted 0.3 percent in the last quarter of 2016, and its government needed to initiate short-term reforms to stem the tide. Instead, President Jacob Zuma fired the country’s finance minister, further compounding the political turmoil with economic uncertainty already prevalent in the country.

    The ill-guided and mistimed ousting of Pravin Gordhan, who was in London meeting with investors and South Africa’s economic partners, sent the Rand tumbling against the US dollar. The erstwhile economic minister is credited with stabilizing South Africa’s economy since his appointment in December 2015 after President Zuma had sacked two other finance ministers within a month.

    Gordhan is a vocal critic of corruption in state-owned companies and is thought to have clashed with Zuma over the operations of enterprises owned by the South African government. Most of South African state-owned enterprises (SOEs) have been operating at a loss over the years, and the bailouts required to keep them insolvent have been a massive strain on the economy. In 2015 alone, the South African government spent nearly 10 percent of its total annual budget in servicing debts and paying money to help these companies.

    State-owned national carrier, South African Airways, reported a R1.5 billion loss for the 2015/2016 financial year, after losing R5.6 billion the year before. The airline is being kept in the skies with R20 billion by the South African government – money that should be put to good use elsewhere.

    It is a similar story with state-owned regional airline, South African Express, and low-cost carrier, Mango. Both companies reported huge losses in the 2015/2016 financial year, and the year before that. Indeed, over the past 10 years, these three airlines, South African Airways, South African Express and Mango, have made a combined R35 billion in operational losses and state bailouts.

    The unhealthy obsession of the South African government with SOEs transcends airlines. Broadbrand Infraco needed a R500 million from the government to sustain its operations in 2015 and has consistently made losses since 2010. Passenger Rail Agency of South Africa ran into a R600 million loss in 2015, and R1.2 billion in the year before that. South African Post Office posted a loss of R1.4 billion in 2015. PetroSA however takes the cake for the biggest ever loss incurred by a state company in the history of South Africa with R14.5 billion.

    As Africa’s largest oil producer, Nigeria has little infrastructure to show for the hundreds of billions earned from crude oil sales over the years. Humongous sums have been lost to questionable subsidy regimes that should never have existed but for gross incompetence and corruption. The nation’s petroleum minister recently revealed that $65 billion was spent on petrol and kerosene subsidies between 2011 and 2015. That amount is higher than the GDP of Kenya, and much of it ended up lining private pockets while the masses still bought fuel at higher prices.

    To get out of recession and return to the path of economic growth, both Nigeria and South Africa will have to implement key reforms in departure from the archaic and unprofitable way of running government. Nigeria’s Vice President Yemi Osinbajo, had to publicly reject the offer of a new official residence at the cost of N7 billion. While that is commendable, the offer should never have been on the table to start with.

    Malusi Gigaba, South Africa’s fourth finance minister in less than 18 months, and his Nigerian counterpart, Kemi Adeosun, are faced with the task of convincing their respective governments that recession provides an opportunity to turn a new leaf in public expenditure.

    Nigeria has made some progress in improving the ease of doing business and creating an enabling environment for investors and business owners. More needs to be done. The 2017 budget, expected to be financed largely through loans, contains too many frivolous items gulping funds that should be ploughed into developmental projects.

    The appetite of the South African government for controlling enterprises that are best operated by private ventures will have to be curbed. The cost of running government remains high at the detriment of the economy. Investors’ confidence, eroded in no small measure by the abrupt removal of the former finance minister, has to be regained.

    Size matters, a combined GDP and population of nearly $800 billion and about 230 million people, matter to the rest of Africa. But if size is not put to good use, it becomes a burden. The highest unemployment rate in the history of South Africa, and nearly 10 million out-of-school children in Nigeria are handwritings on the wall for this fact.

    South Africa in particular must watch out for the effects of the political wrangling bound to get worse around the leadership tussle in the ruling African National Congress, ANC and the 2019 general elections. While the feelers indicate Nigeria may be getting out of the recession soon, the country must understand that it cannot build a thriving economy based on the rules of the past. Africa’s largest countries and by far its most important economic hubs must do better to help move the country in the direction of economic freedom and prosperity.

     

    • Omojuwa is editor of AfricanLiberty.org.

  • Recession: Experts seek OPS partnership for sustainable growth

    With the bitter pill of recession still biting hard, experts have suggested the need for the organised private sector to support the critical sectors of the economy.

    The cross section of experts spoke at the third Nigerian Stock Exchange (NSE) & Bloomberg Chief Executive Officers (CEO) Roundtable held in Lagos at the weekend.

    Tagged: ‘Innovating out of Nigeria recession: Exploring new paradigms for Nigeria’s economic growth’, the event drew experts accross key disciplines.

    Firing the first salvo, Dr Doyin Salami, a Senior Lecturer at the Lagos Business School said that the federal government needed to partner with the private sector for private capital to get the country out of recession and for sustainable growth.

    He said that the country had hit the bottom in terms of recession but its sustainability would depend on private sector involvement for private capital to ensure infrastructure development.

    Salami stated that coming out of recession was not the major thing but growing rapidly and sustainability were the key things.

    “If Nigeria grows less than three per cent, it means that per capital income is still very low,” he said.

    Speaking on Economic Roundup, Salami said that Nigeria needed to diversify revenue base to strengthen economic growth and recovery.

    The economist said that government must review minimum wage in line with the present realities, adding that consumers were under significant pressure due to shrinking salaries and wages.

    He said that the last minimum wage was done in 2011, adding that workers had lost significant 50 per cent going by the challenges in the economy.

    Salami stated that government needed to deal with youth unemployment to increase productivity, noting that the biggest challenge of the country was unemployment and productivity.

    Dr Demola Sogunle, the CEO Stanbic IBTC Bank, said that banks non-performing loans grew massively with an average above 20 per cent in 2016 due to the recession.

    Sogunle said that massive impairment caused by devaluation of the naira, foreign exchange illiquidity eroded capital of some banks in the 2016 financial year.

    Sogunle said that the industry resorted to rationalisation, right sizing and other strategies to reduce cost.

    He stated that the industry was tending toward digitisation to reduce cost, adding that banks could not afford to roll out branch networks.

    Ms Funke Opeke, the CEO Main One, said that recession slowed down investment in the telecommunication sector.

    Opeke said that the industry was unable to approach the market for foreign exchange for importation of equipment needed for efficient and effective service delivery.

    She stated that the industry tried to drive operational efficiency out of the existing assets.

    Mr Andrew Alli, the President and CEO Africa Finance Corporation (AFC), said that economic contraction affected project development in the country.

    Alli said that there had not been many large scale projects in Nigeria in the last few years because of economic contraction.

    Mr Oscar Onyema, NSE CEO said that the country needed to position itself to maximise the opportunities in the recovering economy.

    Onyema said that policy makers should address foreign exchange policies and double taxation to ensure ease of doing business.

    He stated that the exchange would continue to provide the needed platform for economic growth and development.

  • Recession hindering my zeal to deliver dividends of democracy – Tambuwal

    Recession hindering my zeal to deliver dividends of democracy – Tambuwal

    Gov. Aminu Tambuwal of Sokoto State said the current recession in the country had hindered his zeal to deliver more dividends of democracy to the people of the state.

    Tambuwal stated this in Sokoto on Sunday at the quarterly stakeholders’ meeting of All Progressives Congress (APC) Party in the state.

    “We came with the zeal to work, but the unfortunate situation we found ourselves, has slowed us down.

    “Yet, we have been promptly paying salaries and other workers’ entitlements, as well as pensions and gratuities.

    “We have also completed most of the inherited projects; some are ongoing, while we have initiated additional projects.

    “The present administration will not abandon any projects, which would be evenly spread across the state,” the governor said.

    Tambuwal commended the existing cordial relationship between the three arms of government in the state, and also lauded the sustained support of members of the party, as well as the generality of the people of the state.

    He solicited for sustained prayers for President Muhammadu Buhari to get better and come back to the country to continue with the good work he had started.

    Also speaking, Sen. Aliyu Wamakko (APC-Sokoto), stressed the need for the sustained unity of the party, as well as that of Nigeria.

    The Chairman of the party in the state, Alhaji Suleiman Danmadamin-Isa, said that the meeting was aimed at brainstorming on developments in the party at the state level.

    NAN reports that the meeting was attended by the National Vice Chairman, North West, Alhaji Inuwa Abdulkadir, Speaker, State House of Assembly, Alhaji Salihu Maidaji, national and state assemblies’ members, among others.

  • South Africa slips into recession

    South Africa slips into recession

    South Africa has entered recession for the first time in eight years, data from Statistics South Africa showed Tuesday.

    Data from Statistics South Africa in Pretoria showed the first quarter contraction was led by weak manufacturing and trade.

    The data showed that South Africa’s economy contracted by 0.7 per cent in the first three months of 2017 after shrinking by 0.3 per cent in the fourth quarter of last year

    The worst performing sector was trade, catering and accommodation, which contracted by 5.9 per cent, while manufacturing – one of the key sectors – fell by 3.7 per cent.

    Standard Chartered Bank’s Chief Africa Economist Razia Khan said the “awful” data showed weakness where it was not expected.

    Analysts said the contraction suggested high unemployment and stagnant wages were dragging down South Africa’s long-resilient consumer sector.

    “The slowdown in first quarter was due to much worse results from usually stable consumer-facing sectors that had been the key drivers of growth in recent years,” Capital Economics Africa economist John Ashbourne said.

    Political instability, high unemployment and credit ratings downgrades have dented business and consumer confidence in South Africa and the rand extended its losses against the dollar, while government bonds also weakened.

    Pressure on President Jacob Zuma, including from within the ANC, has risen since a controversial cabinet reshuffle in March that led to downgrades to “junk” status by S&P Global Ratings and Fitch.

    Zuma has denied any wrongdoing over the allegations.

    Corruption allegations escalated when local media reported this week on more than 100,000 leaked emails they say show inappropriate interference in lucrative tenders.

    “Our economy is now in tatters as a direct result of an ANC government which is corrupt to the core and has no plan for our economy,” Mmusi Maimane, the leader of the opposition Democratic Alliance said.

    South Africa’s Treasury said it would work to finalise policies critical for boosting confidence and economic growth.

     

  • South Africa slips into recession

    South Africa slips into recession

    South Africa has entered recession for the first time in eight years, data from Statistics South Africa showed on Tuesday.

    Data from Statistics South Africa in Pretoria showed the first quarter contraction was led by weak manufacturing and trade.

    The data showed that South Africa’s economy contracted by 0.7 per cent in the first three months of 2017 after shrinking by 0.3 per cent in the fourth quarter of last year

    The worst performing sector was trade, catering and accommodation, which contracted by 5.9 per cent, while manufacturing – one of the key sectors – fell by 3.7 per cent.

    Standard Chartered Bank’s Chief Africa Economist Razia Khan said the “awful” data showed weakness where it was not expected.

    Analysts said the contraction suggested high unemployment and stagnant wages were dragging down South Africa’s long-resilient consumer sector.

    “The slowdown in first quarter was due to much worse results from usually stable consumer-facing sectors that had been the key drivers of growth in recent years,” Capital Economics Africa economist John Ashbourne said.

    Political instability, high unemployment and credit ratings downgrades have dented business and consumer confidence in South Africa and the rand extended its losses against the dollar, while government bonds also weakened.

    Pressure on President Jacob Zuma, including from within the ANC, has risen since a controversial cabinet reshuffle in March that led to downgrades to “junk” status by S&P Global Ratings and Fitch.

    Zuma has denied any wrongdoing over the allegations.

    Corruption allegations escalated when local media reported this week on more than 100,000 leaked emails they say show inappropriate interference in lucrative tenders.

    “Our economy is now in tatters as a direct result of an ANC government which is corrupt to the core and has no plan for our economy,” Mmusi Maimane, the leader of the opposition Democratic Alliance said.

    South Africa’s Treasury said it would work to finalise policies critical for boosting confidence and economic growth.

     

  • Pains of poverty hard to forget – Osinbajo

    Pains of poverty hard to forget – Osinbajo

    Acting President Yemi Osinbajo yesterday said the Social Investment Programmes (SIPs) being implemented by the Federal Government for the citizens are not favours but their right.

    He spoke at an event showcasing the achievements of the National Social Investment Programmes (NSIP) of President Muhammadu Buhari’s administration at the second anniversary of the administration at the old Banquet Hall of the State House, Abuja.

    It was tagged: “A smile for every Nigerian”.

    Noting that the SIP is both a heart and a head programme, he said that it is heart because the pains of poverty cannot be ignored.

    He said: “I want to say to all of you that we do not consider the programme as a favour done to you. It is not. You deserve this programme because you are citizens of this country.

    “This country can provide and should provide all that is in need of help and we will do our very best to provide.”

    He noted that the President during the campaigns had kept on saying that everything must be done to get Nigerians out of poverty.

    Osinbajo said: “The programme is also a head or logical common sense issue. A country’s economic development is a function of the number living above poverty level, our levels of poverty are so alarming that clearly some fundamental interventions by government are necessary.

    “Often, our economic development plans and budgets assume a trickle down approach, namely that, if we put resources in promoting industry and commerce, jobs would eventually be created and the poorest will be reached.

    “The other premise is that GDP growth should translate to jobs. Both premises are flawed. First the trickle down model has proved far too slow to stem the tide of poverty in one of the fastest growing populations in the world.

    “Secondly, most of the growth was on account of the oil sector, which is capital intensive but not labour intensive. So, while we were recording growth levels of seven per cent because of the high oil prices, unemployment figures grew.

    “In developing the APC manifesto and later our economic development plans, we knew that government had to directly intervene with a massive social investment programme that would tackle poverty and exclusion across the various spectra.”

    He added: “We have heard a lot about the programmes already, but I would like to emphasise some of what I am particularly proud of. First, is that we have shown that a massive programme can be initiated and managed on-line. The N-Power programme is the largest post-tertiary jobs programme in Africa. We now know that we can train large numbers electronically.

    “Secondly, we have demonstrated that a transparent process of employment is possible. All of these young men and women have testified that they knew nobody and paid nobody to get the jobs they now have.

    “Thirdly, we have achieved great success in our financial inclusion efforts by bringing in many, especially the extremely poor in the hinterlands into the formal banking system. Beneficiaries of the Conditional cash Transfer programme, home grown school feeding vendors and cooks, now have BVNs and bank accounts.

    “We have also demonstrated that electronic payment on such a huge scale, across the nation is possible. Most importantly, we have ensured that our programmes are in all states not just APC states, so much so that some of the governors in non-APC states even take credit for these Federal Government programmes.”

    “We know that our children in public schools many from poor homes do not really care about whether the food is from one political party or the other. Most of the testimonies you have heard today, it is clear that our programmes have just simply gone,” he said.

    He added that the N100 billion set aside for the Family Home Fund, a Social Housing Project under the SIPs, is a yearly contribution to the N1 trillion Social Housing fund.

    Osinbajo said “The largest in the history of the country. The World Bank and Africa Development Bank (AfDB) are contributors to the fund. The same fund will enable us to provide inexpensive mortgages for hundreds of thousands across the country. Already the project has started in 11 states.”

    The National Chairman of the All Progressives Congress, John Odigie-Oyegun, noted that the APC has contributed majorly in solidifying democracy in Nigeria in comparison with all administrations since 1999.

    Also speaking at the occasion, the Senate Minority Leader and former Akwa Ibom State Governor, Senator Goodwill Akpabio, endorsed the programme and hailed the Federal Government for achievements recorded so far.

  • Recession: Cleric advises Muslims against social vices

    An Islamic scholar, Malam Sulaiman Adedokun, yesterday in Lagos advised Muslims against engaging in social vices because of the economic recession in the country.

    The cleric gave the advice during a Ramadan Lecture entitled “Muslims and Contemporary Economic Challenges”, organised by the Movement for Islamic Culture and Awareness (MICA).

    “People are no longer trustworthy, indulging in bribery, kidnapping and deception just to ease themselves out of economic challenges,’’ Adedokun said.

    He urged Muslims to imbibe Islamic tenets of justice, equity and redistribution of wealth to the needy through Zakaat (almsgiving).

    The News Agency of Nigeria (NAN) reports that the event also featured health talks on how to stay healthy during the fasting period.

    In his presentation, Dr Abdulwaheed Mohammad advised Muslims on the importance of balance diet, enough water to prevent dehydration and regular exercise for healthy living.

    Mr Babatunde Abdulsalam, coordinator of the programme, thanked the lecturers for their inputs and urged participants to utilise the lessons learnt during the programme.

  • ‘Islamic banking can help economy out of recession’

    The Federal Government has been urged to embrace Islamic banking if it is desirous to end the present recession in the economy.

    Managing Director of Credit Bureau, Ahmed Popoola stated this in a lecture delivered at the 10th annual lecture of Muslim Lawyers Association of Nigeria (MULAN) held in Lagos with the theme: Pulling Nigeria Out of the Economic Recession.

    He contended that Islamic finance is an alternative option worth exploring to raise funds for public works and to support the private sector access to finance. He stressed that the options that Islamic finance offers in funding public infrastructure and empowering small business will help bail the country out of recession.

    “Worldwide, Islamic finance is no more peripheral to conventional finance as it is being operated in 75 countries, including western nations. People think that the Islamic financial system is based on faith, but it is based on justice for the two parties.

    “Besides, Islamic finance system does not allow investments that harm people or the environment, thereby promoting sustainable finance,” he said.

    Popoola recalled that the country was experiencing recession for the second time as it once experienced recession in the 1980s.

    “Before this current experience of recession, the last time Nigeria was in recession was about 25 years ago. That was in 1987 when the Gross Domestic Product (GDP) recorded consecutive negative growth of -0.51 per cent in the first quarter.

    According to him, recession does not happen overnight, the ominous signs are always there.  During the recession of the 1980s, the signs of things to come were apparent   in the early 1980s when the then Federal Government declared ‘Austerity Measures.’

    “The signs of the 2016 recession were also manifested in the preceding years. Real GDP growth slid from 6.3 per cent in 2014 to 2.7 per cent in 2015 and finally to a negative of -1.5 per cent in 2016. Just as it was in the 1980s, Nigeria again, found itself in recession because of the challenge of earnings from oil.

    Popoola, however, noted recent improvements in the earnings from the oil industry which he said may assist the country to exit the recession.

    He emphasised the need to  diversify the economy and invest massively in infrastructure, stressing “The need to re-orientate Nigerians towards appreciating our products is imperative. Peace and stability has to be restored to all parts of the country as it is crucial and a pre-requisite for any economic development. Foreign direct investment needs to be nuances and the promotion of Small and Medium Enterprises (SMEs) needs special attention as there is a need to separate SMEs development from poverty alleviation programmes’’.

    The National President of the Nigerian Bar Association (NBA), Abubakar Mahmud (SAN) in a remark, said that the NBA and MULAN should collaborate on Islamic banking projects. “The NBA and MULAN should collaborate on a proposal on Islamic banking which can be adopted by financial organisations. When we look at national indices, we notice the inequalities between some certain groups. This becomes problematic in countries and developing Islamic finance can bridge a gap between the groups,” Mahmoud said.

    The NBA President noted that his presence at the conference was to express support and solidarity for MULAN.

    In his remark, Alhaji Femi Okunnu (SAN), decried the low level of western education among people of the Islamic faith. “I am extremely happy that Muslim lawyers came together to form MULAN, the level of education among Muslims is very low, we are still behind in western   education. If you look at the list of successful candidates at the bar exams in the law school, we still find that the number of Muslim brothers and sisters called to bar compared to our Christian brothers and sisters is as low as 10 to 15 per cent,’he said.