29 Apr

The week ahead – Again, the economy comes into focus

Newspaper reports earlier this week claim that all is not well at the war front ‎in the North East as over a hundred soldiers are grumbling over unpaid allowances for several months. The allowances include peace keeping allowances and the daily operational allowances ‎for those engaged in counter insurgency in Adamawa, Borno and Yobe. Reports suggest that about two hundred soldiers from 158 Task Force Battalion  who fought in the AU Peace Keeping operation in Guinea Bissau in 2015 were owed six months allowances. Another soldier said eight of the affected soldiers were killed by Boko Haram in the recent clash in Kareto‎ and another one died in an accident, disputing claims ‎by military authorities that only one soldier died in Kareto. There were also serious cases of equipment failure and a general sense of neglect by the Defence Headquarters. The Army’s spokesman, Col. Sani Usman, has denied the reports.

Following the outrage that followed the attack on the Ukpabi-Nimbo community in Enugu State on Monday leading to the deaths of scores of people, President Muhammadu Buhari has finally broken his silence on the rising waves of attacks by militia associated with Fulani herdsmen across the country. The President reportedly directed the Inspector General of Police, Solomon Arase, Chief of Army Staff, Lt-Gen Tukur Buratai, and the Department of State Services to investigate and arrest the situation. Similarly, the House of Representatives has summoned the Director General of the DSS, Lawal Daura, as concerns mount over attacks in parts of the country. SBM Intelligence published a report on these attacks recently.

The Nigeria Labour Congress has proposed a new minimum wage of N56,000 to the Federal Government. The President of the NLC, Mr. Ayuba Wabba, said that the labour body made the formal proposal to the Federal Government on Tuesday. Wabba said that while it was a fact that the economy was in a bad shape, the law made it clear that a review of the minimum wage was overdue. He also said that the economy would not be down for ever. The NLC president said that the Nigerian worker had not fared well in the last one year and would not continue to lament the situation. “

The Central Bank of Nigeria’s Consolidated and Separate Financial Statements for the year ended 2015 released on Wednesday showed that its net income for the year was N108.530 billion, while its group net income was N123.074 billion. The results stated that in line with the provision of the Fiscal Responsibility Act, 20 percent (N21.706 billion) of the net income of the bank will be credited to its retained earnings while the remaining 80 percent (N86.824 billion) will be paid to the federal government. It stated that the preparation of the consolidated and separate financial statements was in conformity with International Financial Reporting Standard, which required the use of certain critical accounting estimates and judgements. This, according to the CBN also required management to exercise its judgement in the process of applying IFRS accounting policies. The results revealed that the Group Operating Income increased by N287.65 billion or 64.6 percent to N732.51 billion from N444.86 billion in 2014. Also, the Group Operating Expenses rose by N185.72 billion or 42.8 percent to N618.86 billion from N433.14 billion. The increase in operating income was as a result of a 93 percent increase in net interest income, which rose to N132.2 billion in the year under review, from N38.45 billion in 2014. In the year under review, the CBN recorded N657.16 billion as interests and similar income, representing 132 percent when compared with N434.77 billion earned in 2014. Conversely, it paid N434.96 billion as interest and similar expenses.

President Muhammadu Buhari has asked the World Bank to help Nigeria recover $320 million (N102.4 billion) looted and hidden in Swiss bank accounts by military dictator, General Sani Abacha. The President made the appeal during a visit by the World Bank’s Managing Director, Sri Mulyani Indrawati. It has been reported that the authorities in Switzerland agreed to return the funds on the condition that they are used for social programmes monitored by the World Bank, reason the Nigerian government is actively engaging the bank to return the funds.

The Federal Government reportedly borrowed the sum of N2.89 trillion from the banking sector in the fourth quarter of 2015. According to the CBN, the total credit of N2.89 trillion from the banking sector to the Federal Government was an increase of 3.8 percent over the amount borrowed in the third quarter of 2015. The CBN said the increase in lending by banks to the Federal Government was because of an 18.7 percent rise in Deposit Money Banks’ holding of government securities within the period.

No fewer than 150 women and girls were raped, while 31 babies were abandoned on the streets of Lagos in the last one year. The Commissioner for Youth and Social Development, Uzamat Akinbile-Yusuf, explained that 150 reported cases of sexual and physical abuse were officially recorded, while five pregnant schoolchildren were assisted to access adequate ante-natal and delivery services and then integrated back into school. Akinbile-Yusuf added that while 85 suspected rapists and paedophiles had been taken to court, the cases were still pending. Thirty-one babies, made up of 19 females and 12 males, abandoned by their parents, were rescued in the last one year on the streets of Lagos.

COUNSEL

  • There is no other choice but for the government to address the issue of welfare and poor equipment for troops in the North East, or whatever other theatre of operations the Army is in. A situation where soldiers who are fighting and laying down their lives for peace, and are suffering neglect is unacceptable. We urge the FG and the DHQ to work assiduously to ameliorate the ugly situation.
  • The massacre in Ukpabi-Nimbo community has shown the level of incompetence and the general feeling of lack of security across the country. We hold the President and the Commander-in-Chief responsible for this for this state of insecurity, and have no kind words for the Minister of Interior.
  • The NLC, rather than fight for a wage increase, ought to address the injustice the leadership has meted on workers. Currently, thousands of workers have contributed billions of naira to a Home Ownership Scheme under the previous leadership through a peculiar public private partnership between workers and a private developer in Abuja. Many have retired or died while waiting for this facility. The leadership should channel energy to anti-worker policies in the public and private sectors. That, they have failed woefully to do. The current demand for minimum wage is unrealistic.
  • While we commend the CBN for a good financial report. However, the CBN flourishing while businesses, including banks are suffering is wrong. The regulator should address the issue of access to single digit interest rate for entrepreneurs in the real sector and not the usual multi-billionaire naira intervention funds for big businesses. The CBN has failed terribly to address struggling start-up companies who are the real drivers of the economy.
  • We commend the President for advocacy on the return of the Abacha loot and we believe the millions of dollars trapped in Swiss banks and else where should be returned to Nigeria. However, what becomes of the money if it is returned should be the subject of a well thought out plan, and great public debate.
  • In a week that two commercial banks have declared huge slides in their profits, increased FG borrowing from the same banks, at a time that the FG’s revenues are dipping is unsustainable. Nigeria must diversify its revenue sources not just by words, but by actions. It starts with a thorough, and sincere review of the Constitution.
  • The statistics reeled out by the Commissioner are not unsurprising. We call on the states and the FG to provide security, support, care and prevention for women and children who are the most vulnerable in the society. We commend Lagos for its efforts and urge further action, especially with regards concluding the cases of those charged to court, and ensuring that the guilty are convicted and punished.