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Buhari’s Economic Team Members Lack Requisite Knowledge – Atiku |RN

•Says NBS report on job loss terrible

Success Nwogu and Ogbonnaya Ikokwu  

 

The presidential candidate of the Peoples Democratic Party, Atiku Abubakar, on Wednesday said Nigeria’s economy was in bad shape because members of President Muhammadu Buhari’s economic team do not posses what it takes to turn the economy of the country around.

Atiku said if voted into office in 2019, he would use the knowledge he had garnered from many years of serving as a public officer and being in business to turn the economy around.

He spoke in Aba, during a town hall meeting he had with representatives of the business community.

The presidential candidate said he was in the South-East to interact with businessmen from the zone because of the role they played in the economic development of the country and West Africa.

He said he would do whatever was obtainable within the confines of the law to promote the ease of doing business in Nigeria.

He said, “I am aware of your challenges because I am a business man like you. Whatever that is your pain is also my pain.  I face the same challenges you are facing, but the only thing we can do to change the situation is to change the government in power now.

“This present government lacks the understanding and the capacity to turn our economy around, nor promote the ease of doing business in Nigeria.

“We would ensure that policies that would encourage businesses to thrive in Nigeria are put in place.”

Atiku said the nation could not afford to have a population of 15 million unemployed youths.

Meanwhile, the presidential candidate in a statement by his media aide, Paul Ibe, described the latest report by the National Bureau of Statistics that 20.93m Nigerians had lost their jobs under Buhari as terrible and catastrophic.

He said the implication was that the unemployed population in Nigeria was twice the population of Benin Republic.

He said Nigeria could not continue to be run by an administration that lacked solution to the country’s socio-economic and political challenges.

He said, “We expected a terrible job report, particularly with the comment on live television from the President’s spokesman, Garba Shehu, that President Buhari had ordered the Statistician-General of the Federation, Dr Yemi Kale, to fudge the latest job reports.

“However, the job report released by the National Bureau of Statistics on Wednesday, November 19, 2018, is not just terrible, it is catastrophic. It shows that under the APC administration, a whopping 20.93m Nigerians have lost their jobs!

“To put this in perspective, the unemployed population in Nigeria is now twice the population of Benin Republic!”

He added, “Nigeria cannot continue like this, especially with an administration that continues to blame others for things that they should find solutions to with the latest ridiculous episode being President Buhari’s blaming of former President Jonathan for his own inability to appoint ministers for six months, an action that is directly responsible for the sorry state of unemployment in Nigeria.”

The former vice-president  urged Nigerians to note that a President who could not  create jobs or wealth in his own private business could not create jobs or wealth for the public. (Punch)

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Inflation Hits 11.28% In November, Says NBS |The Republican News

Inflation notches up to 11.28% in November, says NBS

“The urban inflation rate increased by 11.61 percent (year-on-year) in November 2018 from 11.64 percent recorded in October 2018…”

Isaac Anumihe, Abuja

National Bureau of Statistics (NBS) has said that inflation rate in November has moved up to 11.28 percent, 0.02 percent points higher than the 11.26 percent rate recorded in October 2018.

Recall that the inflation rate dropped to 11.26 percent in October from 11.28 percent in September because food prices had a negative inflation between September and October 2018.

But in a statement, at the weekend in Abuja, NBS said that in November, increases were recorded in all classifications of individual consumption according to Purpose (COICOP) divisions that yielded the headline index.

“As regards month-on-month basis, the headline index increased by 0.80 percent in November 2018, up by 0.006 percent points from the rate recorded in October 2018 (0.74) percent. The percentage change in the average composite Consumer Price Index (CPI) for the 12 months period that ended in November 2018 over the average of the CPI for the previous 12 months period was 12.41 percent, showing 0.37 percent point decline from 12.78 percent recorded in October 2018.

“The urban inflation rate increased by 11.61 percent (year-on-year) in November 2018 from 11.64 percent recorded in October 2018, while the rural inflation rate increased by 10.99 percent in November 2018 from 10.93 percent in October 2018. On a month-on-month basis, the urban index rose by 0.83 percent in November 2018, up by 0.07 from 0.76 percent recorded in October 2018, while the rural index also rose by 0.78 percent in November 2018, down by 0.06 percent from the rate recorded in October 2018 (0.72 per cent). The corresponding 12-month year-on-year average percentage change for the urban index was 12.83 percent in November 2018. This is less than 13.21 percent reported in October 2018, while the corresponding rural inflation rate in November 2018 was 12.05 percent compared to 12.42 percent recorded in October 2018,” NBS said.

The CPI measures the average change over time in prices of goods and services consumed by people for day-to-day living.    (The Sun)

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Nigeria’s Economy Growing Steadily – Presidency |The Republican News

By Anule Emmanuel

Muhammadu-Buhari6

…releases 41-page documents on Buhari’s achievements

 

The Presidency yesterday said Nigeria’s economy has bounced back and is heading on a steady growth path. The Senior Special Assistant on Media on Publicity, Mallam Garba Shehu, in a statement issued a 41- page document outlining some of the major achievements of the President Muhammadu Buhari administration in the last three years. Garba the 41-page document explained that it highlights the administration’s successes in the economy, security and the fight against corruption, “which are the three priorities of the government’s change agenda.”

The complete document according to the presidential aide has been uploaded to the State House website. He said the document is arranged into several sections including, Resetting the Economy; Restoring Growth, Growing What We Eat; Making Business Work; Doing More With Less; Investing In People; New Vision for the Niger Delta; Plugging Leakages; and Justice Reforms. The presidential spokesman explained that the Federal Government will be updating the document regularly.

He said it provides details with the improving economic indices, rising investment in agriculture and infrastructure, successes in the fight against terrorism, and on-going efforts to improve security in the North Central.

“In addition, it lists the several measures taken to promote transparency and accountability in government finances,” the statement read in part. According to the highlights of the statement, Nigeria’s economy is back on the path of growth under Buhari, after the recession of 2016-17 (1.95 percent growth in Q1 2018), Garba noted. (New Telegraph)

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Buhari Brags: Nigeria’s Foreign Reserve Hits $47.5bn In 3 Years Under Me |RN

Muhammadu-Buhari3

President Muhammadu Buhari

…Says TSA saved N200bn, economy growing

Juliana Taiwo-Obalonye, Abuja

President Muhammadu Buhari, yesterday boasted his economic policies have moved Nigeria forward, with foreign reserves rising from $30 billion in 2015 to $47.5 billion in the first three years of his administration. He stated that the nation’s economy has remained in a growth trajectory despite experiencing the worst recession in a quarter of a century.

The President also noted that the Treasury Single Account (TSA) policy has brought about greater accountability having saved the country over N200 billion, an amount that would have been frittered away paying ghost workers.
This was even as he has warned that he would not tolerate mediocrity from any public or private citizen, promising he would go out of his way to reward excellence.

Buhari said this at the 17th National Productivity Order of Merit (NPOM) Awards held in Abuja, where he presented awards to the Head of Civil Service of the Federation, Winifred Oyo-Ita, and other distinguished Nigerians drawn from the corporate and public sectors.
Speaking on the theme, “Productivity for Economic Recovery and Sustainable Growth”, Buhari said no nation can attain prosperity without vibrant and productive citizens.

For the umpteenth time, the president condemned the effect of corruption on the nation’s economy, warning that his government would not compromise on policies that would ultimately help to sustain the productive capacity of the country.

According to the President, Nigeria’s Gross Domestic Product (GDP) grew by 1.95 percent at the end of the first quarter of 2018, a feat he said his predecessors could hardly boast of even with a buoyant economy and huge capital inflow from oil resources.

He said: “The goal of this administration is to move Nigeria forward to become a strong, strategic and proactive state through a deliberate, pragmatic and productivity conscious programme of action. We want to build Nigeria into a competitive, virile, strong and productive economy; a state whose citizens are creative, innovative, responsive, accountable, incorruptible, patriotic and diligent.”
While underscoring the importance of the public service, he noted that “it is the vehicle through which government policies are transmitted,” adding, “it is my intention to hold the public servants collectively and individually responsible for the planning and implementation of the programmes of this administration.

“From now on, it will no longer be business as usual. Excellence will be rewarded and mediocrity will not be tolerated. In this regard, I am directing all Ministries, Departments and Agencies (MDAs) to drive the Change Agenda in the public sector,” he added.

He said the National Productivity Centre should be encouraged to carry out its mandate so as to ensure a productive nation. According to him, corruption is an anathema to productivity growth of any economy.

He said, “we must leave no stone unturned in tackling the monster. Corruption is dangerous and cancerous to the nation; we are therefore resolute in our commitment to fight it in all facets of our national life.”

Buhari stated that his administration was committed to rewarding hard work and excellence, saying it was in line with this that his administration had placed a great premium on the National Productivity Order of Merit Award as an award of honour and dignity.
“We have therefore been consistent in the yearly conferment of the award on deserving Nigerians and organisations,” he said.
Buhari maintained that the government had approved the conferment of the National Productivity Order of Merit Award for 2018 on few individuals and organisations who had been adjudged to have performed exceedingly well in their various endeavours.
He congratulated the awardees for their remarkable feats and expressed the hope that the awards would propel and motivate them for greater achievements.

In his remarks, the Minister of Labour and Employment, Chris Ngige, revealed that 327 Nigerians and 800 organisations had so far benefited from the award.

According to him, the National Productivity Order of Merit Award is not a “cash and carry” award as only deserving citizens and productive organisations with track records benefit from it.

Ngige also seized the occasion to take a swipe at former President Olusegun Obasanjo. He said the ruling All Progressives Congress (APC) government can never be perturbed with letters of criticism coming from the former president.
The Chairperson, Board of Directors, First Bank of Nigeria, Mrs Ibukun Awosika, delivered the award lecture at the event, where 15 persons and five organisations received the NPOM award.
She identified gaps in Nigeria’s bilateral policies, which are militating against the nation’s growth, saying more often than not, Nigeria signs bilateral deals with foreign multinational firms but feign ignorance of the need to leverage on such deals to provide jobs for its teeming population.

Awosika also noted that the nation’s leadership ought to device means of harnessing the potential in the youth population, adding that ideas that boost productivity should be made to trickle down from the central government to the federating states.
Meanwhile, President Buhari in a surprise twist bestowed the prestigious National Productivity Order of Merit award on Head of the Civil Service of the Federation (HoCSF), Ms Winifred Oyo-Ita, whom he called “one of the most patriotic Nigerians.”
She was recognised for her productivity and commitment towards nation building, and for the growth and development of the country.

“I am totally taken unawares. To God alone be all the glory,” Oyo-Ita said on receiving the award.
Since her appointment as the HoCSF in January 2016, she has pushed to refocus the civil service, enthroning an Efficient, Productive, Incorruptible and Citizen-centred (EPIC) culture. (The Sun)

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Nigeria Records 1.9% GDP Growth In Q4 2017 |The Republican News

Samuel Bello, Abuja

The National Bureau of Statistics (NBS), said the nation recorded a growth of 1.92 percent in its Gross Domestic Product (GDP) in the fourth quarter (Q4) of 2017 while maintaining its positive growth trajectory since the economy exited recession in the second quarter of 2017.

In its Q4 report released on Tuesday in Abuja, NBS stated that the growth compared to a contraction of –1.73 percent recorded in the fourth quarter of 2016 and a growth of 1.40 percent recorded in the third quarter of 2017.

According to the bureau, 2017 recorded a real annual growth rate of 0.83 percent higher by 2.42 percent than –1.58 percent recorded in 2016.

“In the quarter under review, aggregate GDP stood at N31,209,137.74 million in nominal terms and higher when compared to N29,169,058.99 million in Q4 2016, resulting in a nominal GDP growth of 6.99 percent. This growth is lower relative to growth recorded in Q4 2016 at 12.49 percent.

The bureau reported that in the period under review, oil production averaged 1.91 million barrels per day (mbpd), -0.12 million barrels lower than the daily average production recorded in the third quarter of 2017.

It added that oil production during the quarter was higher by 0.15 million barrels per day relative to the corresponding quarter in 2016, which recorded an output of 1.76mbpd.

In term of contribution, NBS stated that the oil sector contributed 7.17 percent of total real GDP in the fourth quarter of 2017, up from figure recorded in the corresponding period of 2016 and down from the preceding quarter, where it contributed 6.75 percent and 10.04 percent respectively.

“Quarter-on-Quarter, the oil sector dropped by–25.52 percent in Q4 2017. The annual growth of the oil sector stood at 4.79 per cent higher than the previous year’s growth of –14.45 per cent.

The statistics office also reported that the mining and quarrying sector contributed 8.30 percent to overall GDP in the fourth quarter of 2017, higher than the contributions recorded in 2016 fourth quarter at 6.70 percent but lower than the previous quarter recorded as 11.17 percent. It’s annual contribution to GDP in 2017 stood at 9.22 percent as against 5.39 percent in 2016.  (The Sun)

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Again, 138 Stranded Nigerians Return From Libya |The Republican News

Returnees-from-Libya

By Louis Ibah

No fewer than 138 Nigerian who were stranded in Libya have returned to the country. The returnees were brought into the country on Tuesday via an aircraft with registration number 5ADM which touched down at the Cargo Wing of the Murtala Muhammed International Airport (MMIA) around 8:0. 5pm
The Zonal Coordinator of the National Emergency Management Agency (NEMA) in South West, Mr Suleiman Yakubu who welcomed the returnees urged them to see a brighter future ahead of them and avail themselves of the various government initiatives put in place to create jobs and grow the economy. He said the returnees voluntarily agreed to be brought back to Nigerian when their efforts at crossing over to Europe were truncated due to difficulties in reaching their expected destinations.

“Nigeria is already on the right track to recover its lost glory with efforts to create more job opportunities in various fields of endeavours,” he said.
Those repatriated comprised 65 female adults, two teenage girls and two infants baby girls while the males among them included 64 adults, two teenage boys and three infant baby boys.  (The Sun)

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Recession Exit: United States Denies Praising FG |The Republican News

USAIDlogo
From AIDOGHIE PAULINUS, Abuja

The United States Agency for International Development (USAID), has said it never at any time applauded the federal government (FG) for allegedly exiting recession.

It also said the statement credited to USAID in the Thursday edition of Leadership Newspaper, was false, even as it said the David Musa who was quoted in the publication is not affiliated with USAID and has no authority to speak on its behalf.

Musa was reported to have said that the second quarter report of the National Bureau of Statistics which indicated that Nigeria was out of recession was a welcome development.

Musa who was referred to as the Team Leader of USAID Bee Keeping Pollination Project in the publication had said “the report of the National Bureau of Statistics has credibility because farmers, especially bee farmers are now selling more and making more profit.

“We are happy for this but the government must strengthen the ease of doing business, public policies, help the private sector to deliver wide impact to sustain the exit.”

But in an electronic mail sent to Daily Sun, the Press Attaché (Spokesperson), Embassy of the United States of America, Russell Brooks, said “the story in today’s Leadership concerning USAID applauding the FG on exiting recession is false.

“The person being quoted, David Musa is not affiliated with USAID and has no authority to speak on its behalf. He’s a fraud and obviously, the journalists did not do their homework.”

Recall that the FG, through the National Bureau of Statistics, had in August 2016, confirmed that the nation had slipped into recession.

The release by the National Bureau of Statistics on Tuesday that the nation has exited recession drew comments from different segments of the country just as it did earlier. (The Sun)

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Nigeria Emerges From First Recession In 25 Years |The Republican News

Nigerian-market
                                    Market

‘Femi Asu

The nation’s economy has snapped out of its first recession in 25 years as Gross Domestic Product has returned to positive growth.

The National Bureau of Statistics on Tuesday said the GDP grew by 0.55 per cent (year-on-year) in real terms in the second quarter of 2017.

The GDP shrank by 0.52 per cent (year-on-year) in real terms in the first quarter of 2017, representing the fifth consecutive quarter of contraction since the first quarter of 2016.

“This growth is 2.04 per cent higher than the rate recorded in the corresponding quarter of 2016 ( –1.49 per cent) and higher by 1.46 per cent points from rate recorded in the preceding quarter, (revised to –0.91 per cent from –0.52 per cent). Quarter on quarter, real GDP growth was 3.23 per cent,” the NBS said in the Q2 2017 GDP report.

The economy had shrunk by 1.5 per cent in 2016, the first full-year contraction in 25 years.

After several quarters of slowdown in growth on the back of the steep fall in crude oil prices, the economy contracted by 0.4 per cent in the first quarter of 2016, 2.1 per cent in the second quarter, 2.2 per cent in the third and 1.3 per cent in the fourth. (Punchng.com)

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How Banks, Politicians Hijacked CBN’s N220bn MSME Intervention Fund |RN

cbn

CBN

…NASME, NACCIMA blame banks for scheme’s flop

By Bimbola Oyesola

President Muhammadu Buhari’s dream to get the economy out of  recession through the Micro, Small and Medium Enterprises (MSMEs) with the injection of about N220 billion into the sector is turning out a tall order.
This is sadly so because the N220 billion set aside by the Central Bank of Nigeria (CBN) for MSMEs financing using five commercial banks has been hijacked and diverted to some wrong hands, Daily Sun investigation has shown.
Under the original programme, entrepreneurs can access loans of N500,000, N5 million, N50 million at 9 per cent interest from Nigerian banks approved for the project.
It was considered a major breakthrough for SME financing at its launch as the regular interest rates were dropped by over 100 per cent for entrepreneurs under the MSME fund.
Each of the 36 states and the Federal Capital Territory (FCT), is also entitled to access as much as N2 billion, to be disbursed to the states through banks, which are expected to effect the disbursements directly to the beneficiaries. But immediately the various state governments got the MSME lsargese, many became emergency entreprenuers, and appropriating the facility to themselves and their cronies.
Banks that signed agreement with the CBN for onward disbursement to entrepreneurs in the country, include United Bank of Africa (UBA), Skye Bank, GTBank, Zenith Bank and Fidelity Bank with stakeholders expressing high hopes of SMEs contributing more to the nation’s Gross Domestic Product (GDP), accounting for over 60 per cent, the effectiveness and transparency of the disbursement of the CBN’s funds will determine the impact on the economy.
In developing economies like Nigeria, that MSMEs hold the key to government’s plan to develop the non-oil sector and generate income from it, hence the need for their empowerment through easier access to credit and specific business-friendly policies.
According to the Director General of the Lagos Chamber of Commerce and Industry (LCCI), Muda Yusuf, the MSME intervention fund was a concept designed to correct market failures in the financial markets.
According to him, some growth sectors would naturally find it difficult to access fund from the regular or conventional commercial banks because of competitiveness issues as well as the concerns around risk perception of the real sector.
“Besides, the Nigerian banking system has not got much of long term funds, and cost of funds is also very high. Intervention funds are long term and often at single digit. These are the gaps the intervention funds are designed to fill,” he explained.
The CBN has explained that it initiated the fund to unlock the potential of Nigerian MSMEs, thereby shoring up their potential for job creation and enabling them reduce poverty within the country.
“Our optimal goal is to see that this fund gets to our people at the bottom of the economic and social pyramid at single digit interest rate without which it will be impossible to achieve job creation and poverty reduction.
“In order to ensure the attainment of our goal, therefore, the CBN will be committing human, material and financial resources to monitoring both the disbursement and utilisation of these funds in a robust and verifiable manner.”
Disbursement
Though other participating banks have not disclosed how much they have disbursed nor their mode of disbursement, Fidelity Bank, one of the five designated banks, was reported to have disbursed N2.2 billion to the beneficiaries so far.
The report credited to the Managing Director, Mr. Nnamdi Okonkwo, said the loan beneficiaries have been committed to its repayment, adding that the bank has not recorded any default.
He had said that CBN was very serious about the N220 billion SMEs’ fund. “We are witnesses because we have customers who accessed the SME funds through us. We have done about N2.2 billion of the funds. We have got repayment of about N400 million. We haven’t had any default because of the process through which these funds were accessed,” Okonkwo said recently.
But from Nigerian Association of Small and Medium Enterprises (NASME), Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Nigeria Employers Consultative Association (NECA), Network of Entrepreneur Women (NNEW) and all other reputable Business Management Organisations (BMOs) interviewed, none has accessed any of the funds, raising some questions as to who owns the SMEs that have accessed the fund so far.
While some of the groups said they shunned the fund due to previous experiences, some who approached the banks said their applications were turned down because of the stringent requirements attached to the loans by the banks.
President of NASME, Prince ’Degun Agboade, said the organisation has got nothing from the N220 billion fund despite claims by banks of so many windows open to SMEs to raise funds.
According to him, “I’m not aware of anybody that has got anything. N220 billion was supposed to be given out by the banks at 9 per cent, but there are so many stringent measures, conditions that are not possible to meet, including collateral and unrealistic turnover. It is so cumbersome. Lots of applications were rejected. Even the Bank of Industry (BoI) loan, First Bank has just informed us that it has stopped disbursement because CBN wants it to guarantee the loan 100 per cent. With the way it is structured presently, I think it can never work,” he said.
Though both the real sector and MSMEs have applauded the formation of the new Development Bank of Nigeria (DBN), which they considered would fill the vacuum created by BoI, NASME President said the new bank has equally failed the SME group.
“The bank also said it would not give out loan directly but through commercial banks whose interest would be between 29 and 30 per cent. How would SMEs be able to access such loans?” Agboade queried.
“Banks should tell us who they have disbursed the money to because the way they treat SME is like leper, which is not the practice in other countries like India, China, or Malaysia. We’re told that about 13 windows are available but we cannot access any. The only fund our members have been able to access is Dangote Fund, which is N5 billion at 5 per cent, while banks added 1 per cent as their profit and it was allocated per state, and some states exhausted this within a month. For example, we have over 55 per cent of the SMEs in the country in Lagos alone but this was not factored in while disbursing the funds.”
Lamenting the plight of SMEs, Agboade called on CBN to moderate and prevail on the banks to ensure that the funds actually get to the right group.
Also expressing his displeasure on the fate of MSMEs in Nigeria, the National Vice President of NACCIMA and the Chairman of SMEs group, Alhaji Sanusi Maijamaa, confirmed that no member of NACCIMA has accessed the funds due to their past experiences.
He, however, wondered on which platform the funds being disbursed by the banks if not through the Organised Private Sector (OPS) like NACCIMA, NASME and others.
Maijamaa noted that the system of disbursement was not transparent, adding that the SME clinic launched by the Acting President, Yemi Osinbajo, in Abuja and Aba equally failed to address the problem at hand.
“The conditions set by banks cannot allow our members to get the loans because there are lots of cumbersome requests. We look for the same treatment given to the multinationals. There is need to recognise informality when dealing with SMEs. When they grow, you can now formalise the conditions,” he said.
Maijamaa stated that though there are lots of impacts on what the government is doing, they, however, do not reflect directly on the SMEs. “There is need to involve the grassroots in all these developmental plans because lots of SMEs are in the grass roots. The government also needs to emphasise cluster arrangement, and role of states and local governments should be spelt out clearly to support the intervention of the Federal Government,” he said.
Sharing the same view as others, the Vice President of NNEW, Edobong Akpabio, said it has been frustration galore for the members of the group in accessing loans from any of the commercial banks designated to disburse the fund.
“We have made several applications, but till date, none of us has been able to get anything. Actually, we were happy when we discovered that such fund has been set aside for the SMEs sector but the conditions set by the banks to access the loan are unattainable. This makes us wonder whether it is actually meant for us or another ploy by commercial banks to give it to their privileged clients,” she said.
The LCCI Director General, Muda Yusuf, however, berated government on the management of the intervention fund. He said, “for most of the funds, the deposit money banks are expected to provide 100 per cent cover (to the CBN) for the funds disbursed and this should be done with securities such as treasury bills and Federal Government bonds. The implication is that the banks are made to bear full credit risk for the facility.
“They would be held fully responsible in the event of default. This is why the banks also impose stringent collateral conditions for granting the loans, which invariably creates a major problem of access to the funds, especially by the small scale industrialists or farmers. Some banks are not even keen about intervention funds for this reason. The risk and reward metrics are not often favourable.”
To succeed with intervention fund
The LCCI DG expressed the view that for better results, the risk bearing responsibilities of the banks in the funds should be reduced considerably through other forms of guarantees.
Yusuf lamented that intervention funds lay too much emphasis on equipment and machineries, whereas what most of the small scale industrialists and agricultural investors need is working capital.
“Many are carrying idle capacity because they lack adequate working capital. Funding provision for working capital should therefore be given better accommodation in the intervention funds scheme than is currently the case,” he said.

He also noted that for the desired outcomes to be realised from intervention funds in the promotion of the real sector, some other complementary conditions must be in place. According to him, “infrastructure (especially power and transportation); policy consistency; effective regulatory environment to curb smuggling, faking and counterfeiting, and many more, need to be given attention. Advancing the frontiers of the real sector is not just about funds, the operating environment and policy context must also be right. Unless this is addressed, default rates will remain high and the impact will remain marginal.”
He recalled that one of the biggest beneficiaries of intervention funds is the textile manufacturing sector but till date, the sector is still comatose. Many of the companies, he said, could not repay the loans; some are already in receivership. “This underscores the point that while funding is important, other factors which impact on competitiveness are equally critical,” he stated.
He added further: “The obsession of policy makers (in the context of  interventions funds) for real sector also needs a rethink. There is a perception that for jobs to be created in the economy, focus on funding should be almost entirely in the real sector. But the integrated character of the economy needs to be understood.
“The inter-sectoral linkages also should be appreciated. The distributors, for instance, need funds to buy the products of the manufacturers for onward transmission to consumers; the transporter that moves the products to different parts of the country needs funds to buy and maintain trucks; the fashion designers need funds to buy fabrics from textile manufacturers; the advertising companies that undertake marketing and promotions of the real sector products need funds; real sector needs various forms of IT support, and so on.
“Besides, the service sector of the economy is fast growing and currently creates more jobs and more incomes for citizens and therefore contributes to improving purchasing power in the economy from which all sectors, including the real sector, benefit.  While not diminishing the importance of the real sector, the role of the service sector in wealth creation and employment generation needs to be better appreciated. There is need for the sector to be better accommodated in the intervention funds scheme.” (The Sun)

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Nigeria Will Exit Recession Within The Last Three Months Of This Year – Emefiele

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Governor of Central Bank of Nigeria, Mr Godwin Emefiele

Leke Baiyewu, Abuja

The Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele, has said that with the current efforts by the Federal Government to revive the country’s economy, the country should be out of recession by the third quarter of this year.

Emefiele also said the CBN would continue with its intervention in the foreign exchange market, adding that efforts by the apex bank so far had been yielding positive results.

He added that the country had started to see a downward trend in the prices of commodities, indicating a reduction in the rate of inflation.

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

The CBN governor said these after meeting with the leadership of the Senate in Abuja on Tuesday.

In attendance at the closed door meeting were the President of the Senate, Bukola Saraki; and Chairman, Senate Committee on Banking, Insurance and Other Financial Institutions, Rafiu Ibrahim.

Emefiele, while briefing journalists after the meeting, said discussions were held between the apex bank and the legislature on the current state of the economy.

He said, “Actually, the Senate President invited us to come and brief the Senate leadership in a closed session and to provide some updates on the foreign exchange markets. You would have observed that in the last two months, the central bank has been involved in some form of intensive intervention in the foreign exchange market and this has fortunately resulted in a downward trend in the parallel market price of foreign exchange, from as high as N525 to a dollar to as low as N370.

“Right now, it hovers between N370 and N380. I think it’s an opportunity for me to say that we are going to continue this intervention because the reserves look very good. As I speak to you, our (external) reserves stand at above $31bn and that provides us enough of 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.

“If you want to import raw materials, you will get foreign exchange; you want to import plant and equipment, you will get foreign exchange; you want to pay school fees or you are a small business that wants to buy foreign exchange for you to import your small items, you will procure foreign exchange.”

Emefiele recalled that the CBN had last week announced a policy to encourage foreign investors in the country’s forex market.

He said, “It is the market or window that is opened for them to bring in their foreign exchange and come into the market on what we call a willing-buyer, willing-seller basis, in which case there will be no form of any price intervention by anybody, including the Central Bank of Nigeria.

“Indeed, with the kind of firepower that we have, we are also going to play in that market to ensure that as the prices move on based on the managed float regime that we run, we should be able to control the price based on the willing-buyer, willing-seller basis.”

In his remarks, Ibrahim said the meeting was part of the engagements between the legislature and the executive.

He stated, “As usual, the leadership of the Senate is always engaging the most important sectors of our economy. So, we had a discussion with the Senate President and the (CBN) governor and they were briefed just like he (Emefiele) has given you an overview of the briefing.

“We have proffered more solutions, which will result in more policy directions very soon, because the major reason is for us to attract foreign direct investments so that the watchers, that is, the reserves, and the monetary aspect of the economy will be intact and the intervention will be sustainable.

“So, we are happy with what they (CBN) are doing and we have been able to proffer more solutions as usual and more suggestions. We are hopeful that by the grace of God, we will be able to sustain working together.”   (Punchng.com)

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