The Nation Newspaper

Tag: unification

  • Unjustifiable unification

    •Unified examinations should not be conducted for varsity students

    AT a time when the wisdom of comprehensively decentralising Nigeria’s university education system is becoming ever more apparent, it is a tragic irony that one of the country’s most respected legal minds is advocating the establishment of unified examinations for final-year university students.

    Aare Afe Babalola (SAN), founder and president of Afe Babalola University, Ado-Ekiti (ABUAD), made the proposal at the university’s matriculation and award-conferment ceremonies for the 2018/2019 academic session. Calling on the National Universities Commission (NUC) to adopt the suggestion, he argued that it would compel universities to properly prepare their students, eliminate laziness, and thus raise standards of teaching and research. He plans to submit a position paper to the Federal Government in which his ideas will be stated in greater detail.

    Aare Babalola’s commitment to the promotion of quality university education is beyond doubt. The enormous strides and enviable achievements of ABUAD are a practical affirmation of a dedication to establishing and maintaining standards which transcend the merely financial. However, as well-intentioned as it is, his suggestion of national final-year university examinations is unworkable, untenable and fundamentally contradictory to the university idea itself.

    As a private university, ABUAD has consciously sought to side-step the challenges inherent in the nation’s public schools. It does not have the latter’s difficulties with unions, or the heavy hand of government. It does not have to struggle with an inflexible, slow and often-corrupt bureaucracy, nor is it vulnerable to capricious education ministries. Why its founder would seek to deliberately yoke its fortunes to those of public universities by demanding that they all take the same examinations is a mystery.

    Universities are like sovereign nations in that they individually traverse relatively dissimilar paths to success and development. Universities ideally develop their own curricula designed to meet specifically-designated goals and expectations within the framework of established guidelines.

    Thus, one school might consciously adopt curricula and teaching methods favoured by British universities, as opposed to say, European or American ones. Affluent schools could emphasise small class sizes, cutting-edge research and advanced classroom technology as compared to less-wealthy ones, where increased focus might be on internships, mentoring and community outreach. The fact that Nigerian schools are in the thrall of an over-mighty NUC does not invalidate this universal norm.

    The adoption of unified examinations would negatively affect this positive diversity. It would compel universities to alter their unique character in order to ensure that they meet the requirements of examinations that are unlikely to take their peculiar circumstances into consideration. It would amount to the virtual imposition of a unitary ethos on a system that is famously decentralised.

    To make matters even worse, the emergence of unified examinations could turn universities into glorified cramming mills, focused on the narrow objective of passing overwhelmingly important national final-year examinations as opposed to the broad intent of conducting path-breaking teaching and research. This phenomenon is already evident in national university entrance examinations like the Unified Tertiary Matriculation Examination (UTME), where high scores are no guarantee of qualitative scholarship.

    Unified examinations are unlikely to abolish scholarly indolence in the way Aare Babalola hopes, either. His own ABUAD is paradoxical proof of this; the undeniably stellar performances of the university’s students cannot be attributed to non-existent unified examinations but to a potent combination of hard work, dedication, competent staff, up-to-date facilities, and a generous reward system.

    If standards are to be raised in Nigeria’s universities, this is the surest approach to adopt. Regardless of cultural, methodological and other peculiarities, the world’s great schools are similar in their relentless drive for excellence built upon intellect, integrity, innovation and industriousness.

    Unified final-year examinations are no substitute for these qualities, and could in fact obstruct them by creating a monstrous bureaucracy with all the associated vices of rent-seeking, influence-peddling, examination malpractice and other forms of corruption.

    It is significant that virtually no country on earth has the kind of unified final-year examination ABUAD’s founder is advocating. While national university entrance examinations are the norm, it is very rare for any country to have unified examinations for undergraduates. The closest equivalent would be those organised by professional bodies which in any case lie outside the university system.

    Aare Babalola’s heart is certainly in the right place. But his advocacy of unified final-year examinations is very likely to create more problems than it solves.

  • Non-academic staff seek unification of labour centres

    The Non-Academic Staff Union of Universities and Associated Institutions (NASU) has urged the Nigeria Labour Congress (NLC) to lead the process of making organised labour one indivisible entity.

    NASU President Chris Ani, who spoke in Abuja at the National Executive Council (NEC) meeting of the union, argued that a strong and virile unified labour centre would be in a position to champion better condition of service for workers.

    “We strongly believe in the unification of all labour centres into one strong and virile labour centre that will be able to deliver on the mandate of Nigerian workers. We urge the NLC to take the driver’s seat in the effort for the unification of the labour centres in Nigeria into one formidable united front,” Ani said.

    Calling on states to implement the peculiarity allowance to non-teaching staff employed in primary and post-primary educational boards, he urged its members to mobilise against state governors that are not sympathetic to workers’ welfare.

    Ani said: “NASU members in primary, post-primary and technical education boards across the length and breadth of Nigeria have suffered tremendous hardship as a result of the refusal of some state governments to accord the payment of salaries the priority it deserves.”

    Commending the affected NASU members for their resilience and perseverance, he urged members, who have been negatively affected by non-payment of salaries in some states, to ensure that they joined other workers in their states to vote out such governors and their parties in the forthcoming election.

    According to Ani, this is to replace them with those who will treat the payment of salaries as a priority. “NASU members are, therefore, advised to use their Permanent Voter Cards (PVCs) wisely as any attempt to return these insensitive politicians will amount to voting for continuous hunger and non-payment of salaries for another four years,” he added.

    The union commended the government for inaugurating renegotiation committees for the polytechnics and colleges of education, but expressed disappointment at the committees, which have failed to meet since inauguration.

    NASU President lauded the government for approving additional N8 billion for the payment of earned allowances to non-teaching staff in the universities. He urged the Federal Ministry of Education to facilitate the process of fund disbursement to members of the three unions in the universities and inter-university centres as soon as possible.

    The union admonished the government to put an end to non-payment of earned allowances by ensuring that henceforth the allowances are paid monthly and provision made for the allowances in the 2019 budget.

    NASU also called on government to put an end to the payment of salaries in percentages to staff of universities in line with the memorandum of understanding entered into with the three non-teaching unions in the education sector.

    The union described as appalling the nonchalant attitude of the Minister of Agriculture, Audu Ogbe and other Ministers whose ministries supervise research institutions in the country.

    It added: “The lukewarm attitude shown by them on issues bothering on the welfare and conditions of service of staff of the sector does not indicate that they are interested in research and development of the country.

     

     

  • How to resolve CCC nagging crisis, by unification group

    The Celestial Church Unification and Renaissance Mission has reemphasised the needs for all factional heads to embrace peace for the church to move forward.

    It said the pastoral seat of the church remains unoccupied despite the preponderance of claimants, saying no single diocese can appoint a successor to the late SBJ Oshoffa.

    These were some of the cardinal resolutions of the group at a recent stakeholders’ conference of the church in Lagos.

    The resolutions were signed by Chairman/General Coordinator of the Unification group, Prophet Pepe Asebiomo and Chairman, Prophet S.O Oshodi.

    The unification group lamented the division in the church, saying it has cost CCC worldwide so much in terms of spiritual and developmental uplifts.

    The church, the conference noted, is in tatters with no central authority to coordinate administration and activities.

    “Everything is upside down. We cannot pretend all is well with the church. We celebrated 70th anniversary with all the confusion unresolved,” it pointed out.

    Except the trend is reversed, the unification group warned the church might go into extinction with dire consequences for the unborn generation.

    To achieve unity, the group proposed that all claimants to the pastoral seat must back down because “none of the three established dioceses has the moral, spiritual or constitutional right to appoint a pastor for itself.”

    The group declared all the factional heads as self-appointed, saying they are acting illegally because the Supreme Court in 2000 declared that the position remains vacant until the church’s constitution is amended.

    Rather than arrogate territorial powers to themselves, the group appealed to factional heads to allow the 33-member CCC Nigeria Diocese Transitional Elders Council established in 2003 to become the central authority pending appointment of a Pastor Worldwide.

    It said the Council, which drafted an amended Constitution in 2015, that will lead to the emergence of an acceptable ‘’single pastor chosen and anointed by God as the Head Worldwide”, should be allowed to be the face of the church.

    The stakeholders appealed to all factional heads including Emmanuel Oshoffa, S.E Orovboni, J.K Owoduni, Pascal Togbe, J.B Adetunji, G Omoge, M.O Akinsoji and G.B Shonekan to give up their territorial claims in the collective interest of the church.

    They said the claim of Ketu as the international headquarters of the church died with the pastor/founder, saying that claim has become obsolete.

    Makoko as Diocese Headquarters is also untenable because since the late Supreme Evangelist Abiodun Bada and Pa. S.O Ajanlekoko relocated to Ketu in 1977, no other “Diocese structure, personnel or office exists there.”

    The Overseas Diocese, they said, also remains unoccupied since the late Superior Evangelist P.H Ajose left London for a six-day misadventure to take over from Bada.

    The Benin Diocese under Rev D.B Adeogun has refused to sit on the Pastor’s seat in Port-Novo like the predecessor, the late Superior Evangelist D.B Agbaosi, meaning the seat of the “CCC Pastor remains unoccupied till date,” the stakeholders added.

    They dismissed Owodunmi’s claim to the seat because he was a non-worker member of the Nigeria Board of Trustees only in charge of properties and litigations of the church.

    They resolved: “All factions in Nigeria Diocese should cooperate with the Unification Group as a mediator to bring the Nigerian Church together.”

    The stakeholders also hinted that a worldwide stakeholders’ conference is billed for December in Lagos to “seek for a final solution to the CCC Worldwide problem of disintegration.”

  • NIOB seeks regulatory agencies unification

    NIOB seeks regulatory agencies unification

    • 2017 AGM/conference begins today

    The Nigerian Institute of Building (NIOB), Lagos State Chapter, has reiterated the need to unify regulatory agencies in the built environment to enhance better co-ordination among various government agencies.

    The regulators include the Lagos State Land Bureau; Lagos State Survey General Office, the state’s Ministry for Physical Planning and Urban Development, the Building Control Agency, the Physical Planning Permit Authority and the state’s Safety Commission.

    This position of the NIOB, among others, will form the fulcrum of the institute’s 2017 annual general meeting (AGM)/Conference which begins today place at the Academy Inn and Multi-Purpose Hall, Lateef Jakande Road, Agidingbi, Lagos, with the theme: Regulatory Authorities: Panacea for Building ProjecAt Delivery in Lagos State.The Conference, which ends tomorrow, will address issues pertaining to problems encountered by the developers, investors and other stakeholders in the state.

    According to the Conference Committee Chairman, Mr. Adelaja Adekanbi, the NIOB, Lagos Chapter, deemed it necessary to bring together the end users and government officials saddled with the responsibility of regulating the various activities in the built environment to educate, fine tune and discuss best mode of their operations.

    He further explained that the designated agencies are not giving adequate information on their mode of operations, thus, the cause for many abberations encountered by the major players in the industry.

    “Their performances in their respective capacities tend to not only be contradictory, but filled with duplicity and in some cases, causing confusion by which developers, investors and private project owners become wary of their activities,” Adekanmbi said.

    In similar vein, the NIOB Chairman for the state, Mrs. Adenike said while regretting that the incidences of building collapse in the metropolis have become not only an embarrassment to government, but also to the professionals in the sector, observed that the regulatory agencies most times cause conflict, deliberately or otherwise, which needs to be addressed; hence, the convergence of all relevant stakeholders in the industry at the conference.

    For the Honourary Secretary of the NIOB Lagos chapter, Mr. Alani Adegoke, some of the laws put in place by the authority appear to be contradictory, a situation that has been a source of concern to the investors. This, he said, is why it is necessary to ensure that these agencies come open to clarify their roles and functions in clear terms so that the public would know every requirement, stage by stage, in the processing of their building documents.

  • Will exchange rate unification save the naira?

    Will exchange rate unification save the naira?

    For years, direct transfer of funds to foreign bank accounts was stress-free for Nigerians. But gone are those days when such transfer was done at low rates. The exchange rate for international bank transfer was at N505 to the dollar at the weekend, painting a gloomy picture of what to come in the months ahead. Stakeholders are calling on the Central Bank of Nigeria (CBN) to fully allow the naira to float. They want the apex bank to launch the process of unifying the multiple exchange rates in the economy, writes COLLINS NWEZE. 

    What the naira is undergoing major crisis is no longer news. But the declining purchasing power and exchange rate of the local currency against world currencies, especially the dollar, has become worrisome.

    The purchasing power and value of the naira expressed in terms of the amount of goods or services that one unit of it can buy has continued to decline.

    Also nose-diving is its exchange rate in international transactions against the dollar.

    For the first time in decades, the rate for international bank transfers soared to N505/$ at the weekend. The naira-dollar foreign transfer rate has for months resisted the pressure to cross the N500/$ mark in all transactions despite continuous dollar scarcity.

    The new foreign transfer rate of N505 to the dollar is at least, N200 above the N305 official rate of exchange, which many analysts see as unrealistic and ineffective price of the local currency against the greenback.

    Managing Director, Financial Derivatives Company Limited, Bismarck Rewane, who confirmed the international bank transfer rate at N505/$, insisted that the naira under the current market regulatory framework will remain unstable until the market is allowed to operate efficiently.

    He described the state of the official exchange rate as unrealistic given that forex traders and users cannot get dollars at that price unconditionally. The naira was trading at N495 to the dollar in the parallel market at the weekend.

    He said: “Any market structure where the same product is selling at different prices at the same time is described in economics as a price discriminating monopoly market structure. Typically, this market is characterised by barriers to entry that allow those with influence or connections to buy in the cheaper market, such as N305 to dollar, and sell in the more lucrative market, at N500 to dollar. This is what is probably happening right now (round tripping),” he said in an emailed report to investors.

    President of the Association of Bureau De Change Operators of Nigeria (ABCON), Aminu Gwadabe, has called for the harmonisation of the multiple exchange rates currently at play in the country.

    No fewer than 10 operational exchange rates exist, depending on the purpose and the market where the dollar is bought or sold, adding that there is currently a total dysfunction of the forex market, which became more pronounced after the June 20 implementation of the flexible forex policy.

    He listed them as the budget exchange rate (N305/$); Form ‘M’ processing rate (N285/$); Inter-bank rate (N315/$) and International Money Transfer Operators (IMTOs) rate (N375/$). Also, the BDCs rate (N399/$); Western Union (N450/$); Airline intervention rate (N355/$); pilgrimage rate (N197/$); parallel market rate (N485/$) and the CBN rate (N305/$).

    “I suggest a weighted average rate of between N350 and N400 to dollar to bring calmness to the market and attract dollar inflows into the economy. Once the exchange rate is harmonised, the parallel market will shape up,” Gwadabe said.

    Rewane said the outlook for the naira for this year can only be clearer by examining the fundamentals that determine exchange rates.

    He was also puzzled by the country’s failed attempts to unify its exchange rates, saying: “Forex policies usually complement trade and investment policies. The Nigerian government will in 2017 strive towards greater coordination of these policies, and will move from its current bias for a command economy monetary policy towards a mixed economy.

    “I believe that with oil prices at $55pb and production back up to 2mbpd, the naira will slip in the interbank markets to N350-N380 to dollar. It will fall in the parallel market to N520 to dollar before recovering sharply to N425 to dollar. These projections are based in the assumption that the market will be reformed and that sanity will return to what is now essentially a foreign exchange asylum.”

    He described the forex market as a product of policy-making regulatory and market player interaction.

    “Many fundamentals”, he said, “go into the determination of an exchange rate. These include balance of trade, the terms of trade, investment flows and the international competitiveness of the economy. There is also the interest rate/inflation differential, which impacts the purchasing power parity of the currency.

    “When a currency is appropriately priced, it will be in equilibrium and will have minimum deviation from the real equilibrium exchange rate path. When you test the Nigerian case against a number of these indicators, it is not far-fetched to see why the Nigerian currency value is misaligned from its monetary policy anchors. It is also clear why there has been a slow but consistent erosion of confidence in the naira.”

    Rewane noted that rational investors and domestic economic agents always make decisions in their own enlightened self-interest and not because of emotional and irrational considerations.

    He went on: “Historically the Nigerian economy, and by implication the naira, has been a beneficiary of oil windfalls and a victim of oil shortfalls. History shows that after a windfall, the naira remains relatively stable for an average of five to six years before the next oil shock.

    “Immediately after every shock, the government embarks on adjustment measures including devaluation. However, since 2008 the shocks have become more frequent and shattering. The time frame of the shortfalls has also been much longer and the impact more devastating.”

    He said the unified flexible exchange rate usually forms an important component of an interventionist or state led economic development model but the consequences include pervasive state intervention in the economy, financial repression, restrictive trade regimes and closed capital accounts.

    He said that multiple exchange rates always lead to distortionary trade regimes, exchange controls leading to the stunting of the export sector and reduced forex earnings. It has also led to misallocation of resources, lower fiscal revenues and a smuggling boom and rent-seeking activities, driven by a complex set of administrative controls.

    Rewane said that for Nigeria to escape from this forex trap, the authorities must understand the need for a properly functioning market.

    His explanations: “A well-functioning forex market allows the exchange rate to respond to market forces and reduce market distortions. Russia and Kazakhstan recently did this and their currencies sank for a short period and then recovered sharply. On the other hand, Venezuela fell into the trap and has become a basket case.

    “The CBN will need to eliminate or phase out regulations that stifle market activity and create a sense of two-way risk in the market as well as reduce its market making role while stopping indirect or overt rate determination.” The economist also urged the apex bank to increase market information on the sources and uses of foreign exchange and be firm in dealing with market infractions.

     Multinational companies hit

    Assistant Manager, Equity Research at Financial Derivatives Company Limited, Augustine Onwunali, identified the companies at the receiving end of exchange rate translation losses as mostly multinational companies (MNCs).

    He said: “Nigeria is an import and commodity-dependent economy, and therefore vulnerable to exchange rate volatility. Nigerian corporates that conduct international trade depend on Letters of Credit and financing from parent company.

    “Parent company credit is an integral part of financing for MNCs. Prior to the current forex issue, these companies usually used their profit in netting against forex translation losses.

    “But the significant depreciation of the naira has resulted in monumental forex translation losses that have wiped out earnings. In addition, making sales in naira and having to repay dollar-denominated losses has put margins under pressure.”

    Listing some of the affected companies as Lafarge, Guinness, and Nestle, he explained that these losses are not peculiar to companies in the stock market as other companies such as airline have had to bear losses associated with foreign exchange translation.

    “The exchange rate vulnerability has resulted in an evolution of the cost structure of many Nigerian companies, and those that survive will be those with adequate strategy aimed at ensuring cost efficiency. Forex losses are one-off expenses that can be managed with adequate strategy. If Nigeria transits into a flexible exchange rate regime, then MNCs will be able to hedge against both commodity and currency risks,” he added.

    According to him, the MNCs have been able to hedge against commodity risk but the vagaries the forex market makes hedging against currency risks intractable. Though dampened consumer demand has affect revenue growth for Nigerian corporate, effective management of forex risks will ensure their survival.

    Speaking on the state of the exchange rate, Head of Treasury at Ecobank Nigeria, Olakunle Ezun, said the exchange rate uncertainties will persist due to sustained low oil prices, lower forex reserves, and robust import demand.

    “We expect a managed interbank exchange rate of NGN305.50 and a parallel market rate of NGN495 in 2017. Naira will remain under pressure largely due to a structural imbalance between dollar supply and demand, which will be reflected in proliferated forex market and rates,” he said.

    According to Ezun, inflation will likely accelerate towards 20 per cent by the end of June this year, driven by fiscal expansion, energy cost and high forex cost caused by over 30 per cent naira devaluation 2016.

    He said 91-day T-bill yield will likely remain around 16 per cent through 2017 assuming the CBN maintains its tight monetary stance while the currently inverted yield curve is likely to moderate as we move into 2017. Also, bond yields remain relatively elevated between 15 to 16 per cent. But, assuming the market’s exchange rate expectations settle they could start to fall moderately.

    Ezun predicted that a further decline in oil prices, will add pressure on forex reserves, and in turn undermines naira.

    Nigeria has been grappling with currency crisis since crude oil prices dropped by about 43 per cent from an average of $100.35 throughout 2014 to an average of $57.20 for the first six months of last year. It closed at $55 per barrel at the weekend.

    The drastic fall in the price of crude oil, which constitutes the largest component of Nigeria’s forex reserves has cut dollar earnings from about $3.2 billion monthly to about a billion dollar for the same period. This has negatively impacted on the value of the naira.

    The impact is reverberating at home and abroad. Parents whose wards school abroad are feeling the pang of the dollar scarcity, which makes it difficult for them to settle tuitions.

    CBN’s measures to strengthen naira

    Some of the measures put in place by the CBN to end the crisis include the first Naira-Settled Over-the-Counter (OTC) Forex Futures Market (FFM) launched on June 27 with FMDQ OTC Securities Exchange and the planned resumption of dollar sales to the BDCs.

    The FMDQ OTC Securities Exchange (FMDQ) is an organisation with the strategic intent of bringing about revolutionary changes and fostering the development of the Nigerian financial markets

    The CBN had imposed some currency control measures to save the naira. In June last year, it curbed access to the interbank currency market for importers bringing in a variety of goods.

    In an effort to conserve its dollar reserves, the bank said importers could no longer get hard currency to buy 41 items, ranging from toothpicks and rice to steel products and private jets as well as what the bank classified as finished products.

    The Naira-Settled OTC Forex Futures are non-deliverable forwards, or a contract where parties agree to an exchange rate for a pre-determined date in the future, without the obligation to deliver the underlying dollar on the maturity/settlement date.

    On the maturity date, it will be assumed that both parties would have transacted at the spot forex market rate. The party that would have suffered a loss with the spot forex rate will be paid a settlement amount in naira to ensure that both parties enjoy the rate that had been guaranteed to each other through the OTC Forex Futures.

    FMDQ’s Managing Director/Chief Executive Officer Bola Onadele Koko said: “The naira-settled OTC Forex Futures product is a major milestone development in the evolution of the Nigerian financial markets. The Futures market is an opportunity to transform risk into certainty – a major paradigm shift in the financial markets landscape.

    “This innovation offers opportunities for government, businesses, pension fund administrators, investors and individuals among others to hedge (not speculate) to cope with exchange rate risk.

    “It also affords the CBN a greater opportunity to manage exchange rate volatility, thus achieving greater market confidence, liquidity, improvement in business planning, job security, employment, better allocation of resources, global competitiveness of the Nigerian financial markets, and all in all, a thriving economy.”

    Koko explained that the OTC Forex Futures contract is an effective exchange rate management tool supported by a transparent price driven by two-way quote market. The contracts will assist the CBN in managing the volatility in the spot forex market, thereby promoting stability and entrenching confidence in the forex market.

    The spot rate is the price quoted for immediate settlement on a commodity, a security or a currency. The spot rate, also called “spot price,” is based on the value of an asset at the moment of the quote.

    FMDQ Chairman and CBN Deputy Governor in charge of Economic Policy, Dr. Sarah Alade, also said that the innovative product will bring liquidity, transparency, price formation and diversification into the forex market, making the market globally competitive.

    She said the introduction of the OTC Forex Futures market will encourage end-users to spread out their demand for spot forex deals as they are now able to lock down the exchange rates for future forex requirements.

    Mrs. Alade said: “This has the potential to eradicate the constant front-loading of forex requirements and minimize the disequilibrium in the spot forex market.

    “End-users will make better judgment as to the timing of accessing the spot forex market. The availability of the OTC forex futures will improve the business planning practice of end-users and forex sellers, as the future exchange rate is guaranteed through the OTC forex futures.

    Exchange rate issue as nationa discourse

    To Rewane, exchange rate has been a national discourse in recent time. He recalled that the country had suffered similar fate in the past from an overly con-trolled currency.

    Rewane said in an on-line report: “From 1981 to 1985, during a similar period of control and oil shocks, relative prices did not adjust to restore internal and external balances. This led to low production, economic distortions, massive retrenchment, poverty and higher unemployment.

    “In contrast, from 1986 to 1991, when the structural adjustment program was introduced, the exchange rate was flexible. Economic data showed that there was increased output, better employment figures and less poverty. Both periods had negative oil price shocks.

    “Nigeria’s current managed floating exchange rate regime combines features of both the fixed and flexible exchange rate. A lightly managed floating exchange rate regime is advocated given that the exchange rate becomes determined essentially by demand and supply forces, while allowing the CBN to intervene occasionally to moderate excessive fluctuations, which are prone in developing countries such as Nigeria.”

    Besides, other factors like terms of trade, inflation differential, public debt, current-account deficits, interest rates, political stability and the overall economic health determine the exchange rate of a currency.