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NASS grants Ogun’s $350m loan request for policy operation

By Abolaji Adebayo

The National Assembly has granted the request of Ogun State Government to take $350 million World Bank loan for the execution of the State Development Policy Operation as contained in the 2016-2018 Rolling Plan.

The approval was based on the clarification of a report on the loan by the Chairman, Senate Committee on Local and Foreign Debts, Sen. Shehu Sani.

Presenting the report at plenary on Thursday, Sani said that the committee observed that the Ogun State DPO budget for the loan had been approved by World Bank in 2016.

He explained that the loan was further captured in the 2016-2018 borrowing plan as approved by the National Assembly.

Sani noted that the committee also observed that the credit facility had an attractive low financing rate of 125 per cent interest, moratorium of five years and a five-year maturity term.

He said, “The facility has already been captured in the 2016-2018 Medium Term Expenditure Framework. It also has low and acceptable loan sustainability level.”

The lawmaker clarified that the DPO loan would help to enhance the capacity of the state government, arguing that the state had also met the various conditions laid by World Bank and as such qualified for the loan.

He added that the state had also put in place institutional framework for transparent and accountable budgetary and financial purpose.

He explained that the projects to be funded by the facility would engender economic growth, increase revenue generation and create employment opportunities.

As Sani said, the committee recommended that the Senate should go ahead and approve the loan as contained in the 2016-2018 external borrowing rolling plan of President Muhammadu Buhari.

The Deputy President of the Senate, Ike Ekweremadu, who presided over plenary, put the report to voice vote and was adopted by the lawmakers.

Buhari seeks NASS’s approval on $5.851bn foreign loan

By Jide Ajia

President Muhammadu Buhari has again written to National Assembly, seeking approval to borrow $5.851 billion for upgrading of various sections of  Nigerian railway.

This was contained in a letter to the leadership of  National Assembly, Senator Bukola Saraki and Yakubu Dogara.

Reading the letter during plenary on Wednesday, Dogara quoted the President as pleading with lawmakers to approve the loan on time.

Buhari said  timely approval would enable the country access the China-African fund provided for in the 2016-2018 external borrowing plan.

According to Buhari, the project form part of the overall plan to resuscitate the rail transport across the country and drive economic growth.

“I wish to refer to my earlier letter with respect to the above subject and to inform the distinguished senate that the China Exim bank has approved our request for a loan to execute the Lagos-Kano railway modernisation project, Lagos-Ibadan segment for a sum of $1.231 billion.

The China government has also informed us that the approval of the Lagos-Kano railway modernisation project, Kano-Kaduna segment and coastal railway project, the Lagos-Calabar segment are imminent,” Buhari said in the letter

He added that China Exim supported projects such as Lagos-Kano modernisation projects, Lagos-Ibadan segment $1.231 billion; Lagos-Kano railway modernisation project, Kano-Kaduna segment $1.146 billion and coastal railway project, and Lagos-Calabar segment 3.474 billion, making a total of $5.851 billion.

“As you are aware the funds available under the China-African fund are limited and loan applications from all over Africa countries are funded based on first come, first serve and therefore there is an urgent need to sign these loans as soon as they are approved or we may loose out in the event that we delayed in signing the loan agreement,” Buhari said

He said these loans form part of the overall money for the rail strategy,  adding that his administration is in the process of completing  concession of Port Harcourt Maiduguri line to immediately link the eastern part of the nation.

“We fully intend to source further concessioning funding to ultimately upgrade this critical line to high speed standard gauge. These projects form the overall plan to resuscitate the rail transport across the nation and thereby drive inclusive growth,” the president said.

 

 

Senate directs Finance Minister to release N15bn Amnesty funds

By Jide Ajia 

The Nigerian Senate has directed Minister of Finance, Kemi Adeosun to release the balance sum of N15 billion in the 2016 appropriation Act for further funding of the Amnesty Programme.

Senators took the decision after considering a motion titled: “The monumental challenges facing the Amnesty Programme due to Paucity of funds” sponsored by Senator Peter Nwabushi representing Delta North.

The Senate also mandated its committee on Niger Delta to probe the circumstances leading to funding constraints besetting the Amnesty Programme with a view to avoiding re-occurrence.

Senator Nwabushi had in the motion noted with serious concerns the challenges facing the presidential Amnesty Programme arising from delays and staggered release of funds by the ministry of finance as captured in the 2016 Budget.

The Senate raised concerns that the financial challenges facing the programme was threatening the well-conceived programme as it was finding it difficult to meet its obligation to its workers and beneficiaries of the Amnesty programme.

Also, the Senate expressed worries that 30,000 beneficiaries of N65,000 Monthly allowances are being owed five months in arrears among other backlog of unpaid debt with regards to education and training aspects of the programme both home and abroad.

The motion indicated that the fund appropriated in the 2016 budget for the Amnesty programme was about N20 billion with an additional supplementary appropriation of N35 billion in late 2016, adding that the sum of N40 billion had so far been released by the Finance Ministry leaving a balance of the sum of N15 billion.

According to the Senate, there was a need to act fast because the situation was becoming very serious and capable of truncating the lofty programme as tension and threats were said to be already palpable in the Niger Delta region and capable of bringing the Nigerian Government into disrepute nationally and internationally.

The committee on Niger Delta was also mandated to investigate cases of impersonation, and how certain persons from other states like Abia were short-changed and report back in two weeks.

Why we unveil economic recovery, growth plan – Buhari

By Newsdesk

President Muhammadu Buhari on Wednesday explained that he unveiled Economic Recovery and Growth Plan (ERGP), in Abuja as one of the strategies to bail the country out of recession and spur growth and prosperity.

The plan which is the brainchild of the Ministry of Budget and National Planning contained 60 critical initiatives expected to help get Nigeria out of recession and reposition on the path of growth.

Some of the initiatives included stablizing macro-economic, energy infrastructure and driving industrialization.

Speaking at the brief ceremony that preceded the meeting of the Federal Executive Council (FEC), Buhari said that his government was determined to turn Nigeria from a consumer nation to a producing one.

“We are determined to change Nigeria from a consumer nation to a producing nation”, he said.

The Minister of Budget and National Planning, Udo Udoma, in his welcome address said that the initiative was in line with the change agenda of the government to revive the ailing economy.

President Buhari (m), Vice President Osinbajo (second from Left), Senate President Saraki and Speaker of House of Reps. Dogara a the launch of Nigeria Economic Recovery and Growth Plan in Abuja on Wednesday

“This is therefore a fulfillment to re-invigorate the economy”, he said.

Senate President Bukola Saraki, the Speaker of the House of Representatives, Yakubu Dogara, and the Chairman of the Nigerian Governors Forum, NGF and Governor of Zamfara State, Abdulaziz Yari, lauded the initiative.

Meanwhile some financial experts have expressed optimism that there would be increased liquidity in the capital market in the second quarter of this year if the plan is stepped up for quick implementation.

They said that the sustained economic recovery measures of the Federal Government would impact positively on the market this quarter.

The Director General, West African Institute for Financial and Economic Management (WAIFEM) in Lagos, Hogan-Ekpo, made the call while delivering a convocation lecture at Bayero University Kano.

“The government has launched the Economic Recovery and Growth Plan which if properly implemented will enable the economy to exit the current recession, while the growth component will ensure an average growth rate of 4.5 per cent from 2017 to 2020,” he said

According to him, there is urgent need for the Federal Government to adhere strictly to the plan if the economy is to get out of the recession.

He also stressed the need for government to invest in infrastructure, particularly in power, roads, railways and housing, among others.

“In a recession, recurrent expenditure, mostly personnel cost, will stimulate aggregate demand; sub-national governments owe salaries and allowances to workers, the sooner these workers are paid, the better for the economy”.

Minister of Finance, Kemi Adeosun

Investments pundits predict Nigeria’s economy rebound at second quarter

By Newsdesk

Stakeholders and investment pundits on Wednesday  have foretold growth and overall economic rebound in the second quarter, when the federal government economic recovery plan is expected to make impact.

The analysts, in a chat with a news agency, emphasised that  sustained economic recovery measures of the Federal Government would impact positively on the market this quarter,

Leading the separate stakeholders,  the Head of Banking and Finance Department in Nasarawa State University, Keffi, Dr Uche Uwaleke, said that market would witness enhanced liquidity during the period with appreciation of the naira.

Uwaleke said that the lower inflation rate and the expected passage of the 2017 budget would also help to boost liquidity in the stock market.

“For the equities market, the year-to-date return currently stands at a negative of 5.96 per cent. However, for the second quarter of 2017, I expect a positive turnaround in the fortunes of the stock market, ” he said.

Uwaleke said that that the financial performance of many listed firms would improve, noting that of 25 companies that had released their audited financial results, 13 reported increased earnings.

Speaking in the same vein, the Head of Research at SCM Capital, Sewa Wusu, said that investors were still exhibiting negative sentiments because of current poor macroeconomic environment in the country.

Wusu said that market outlook looked positive in second quarter in view of the recent economic recovery measures of government, adding that the economic environment was steadily responding to current economic recovery measures.

“What this means is that risk tolerant investors should seize the current low value of stocks to position themselves ahead as market begins to respond in the near term.Consequently, I see a positive outlook hinged on the economic recovery measures,” Wusu said.
In his submission, the Chief Operating Officer, InvestData in Lagos, Ambrose Omordion, however, said that the future market outlook was still uncertain.

Omordion said that global economic uncertainties arising from the fiscal and monetary decisions would dictate market direction in the quarter.

He added that positive figures for March Purchasing Managers Index  (PMI) and Gross Domestic Product (GDP) which confirmed that the economy was on the path of recovery  and that could drive activities in the market.

China boosts Zamfara agriculture with $4.5bn credit line

By Jide Ajia

The Zamfara State Governor, Abdulaziz Yari, on Tuesday hinted that an offer of $4.5 billion has been extended to develop and increase agricultural produce in the state from China.

Governor Yari stressed that the loan had a 20-year repayment period at an interest rate of 1 percent, adding that the loan was meant to ressucitate ageing agricultural machinery and infrastructure in the agrarian state.

Yari, who doubles as the Chairman of Governor’s Forum addressed journalists after a brief meeting with President Muhammadu Buhari and Minister of Agriculture, Audu Ogbeh in Abuja, reiterated that China was giving Zamfara a credit line of $4.5 billion for the procurement of strategic machinery for rural development and agriculture.

He added that the loan offer would be presented to cabinet colleagues on Wednesday and considered by lawmakers for final approval.

The Minister for Agriculture, Audu Ogbeh, alongside governor Yari briefed the president on agricultural developments following the duos visit to China in April last year and the progress of negotiations on issues related to agricultural machinery.

Nigeria, Africa’s biggest economy and a strong member of Organisation of Peteroleum Exporting Countries (OPEC), is in its first recession in 25 years largely due to low oil prices.

The government has prioritised growth in the agriculture sector to reduce its reliance on crude oil sales, which make up two-thirds of government revenue.

The Guild had earlier reported that the World Bank  approved a $200 million loan to boost agriculrutural practice in Nigeria and more so, to support the federal government’s effort to grow small and midium scale farmers.

The loan from the International Development Association, the bank’s low-interest arm, has a maturity of 25 years with a grace period of five years. It also said about 60,000 individuals would benefit directly from the funding, of which 35 percent were women. Report added that about 300,000 farming households would be affected indirectly.

The bank was quoted as saying: “Priority value chains will include products with potential for immediate improvement of food security, products with a potential for export and foreign currency earnings”.

The funds, the report added would help tackle low yields, lack of seed capital to set up agro-factories, low-level adoption of technology and limited access to markets, stressing that Nigeria spends $20 billion a year importing food. With the fall in oil prices, it has been running short of dollars, which has also weakened the local currency.

Last month for instance, the government unveiled sweeping recovery plans which included currency reforms to boost tax revenues. It aims to achieve self-sufficiency in rice by 2018 and in wheat by 2019 or 2020.

By the latter date, the bank urged the beneficiaries to channel the fund towards making the country becoming a net exporter of rice, cashew nuts, groundnuts, cassava and vegetable oil, some of the crops the World Bank loan is meant to finance.

It stressed the needs to tackle poor road network in the country so as to alow free movement of farm produce in the country.

DBN will crash lending rate in MFBs – expert

By Newsdesk

The Managing Director, Fortis Microfinance Bank (MFB), Tiko Okoye, said the Development Bank of Nigeria (DBN) if managed correctly, could bring down cost of lending by MFBs in Nigeria.

Okoye in an interview on Tuesday in Abuja, said that although MFBs take the risk to lend to low-end small scale businesses, the lending rate remains too high at between 25 to 100 per cent.

He said that the reason for this, was the source of most MFB funding, which was mostly from commercial banks, because few MFBs were currently able to access funding  from Central Bank of Nigeria (CBN) and Bank of Industry (BoI).

He said that a lower interest rate, would give businesses the opportunity to make capital improvements, and acquire equipment or supplies to grow.

He urged the DBN to priotise funding the MFBs rather than commercial banks if it indeed wants to improve  the MSMEs.

It would be recalled that the CBN on March 28, 2017, approved the grant of a Wholesale Development Finance Institution Licence with national authorisation to DBN.

The DBN would have access to 1.3 billion dollars (N396.5 billion) which has been jointly provided by the World Bank, German Development Bank, the African Development Bank and the Agence Française de Development, a French Development Agency.

The DBN, would provide loans to MSMEs of all sectors of the economy including, manufacturing, services and other industries not currently served by existing development banks.

As a wholesale bank, the DBN would lend wholesale to Microfinance Banks, commercial banks and other financial institutions, expecting them to in turn,  provide medium to long-term loans to MSMEs.

The Management team is led by a former Deputy Chief Executive Officer, Ecobank Nigeria Limited, Tony Okpanachi.

Okoye advised the DBN management to learn from the mistakes of other development funds provided by the federal government but failed to make any impact.

“The CBN had initially set up the N220 billion MSME development funds, which is supposed to have been channeled through the Microfinance institutions for onward lending to target customers.

“But that fund was not accessed that much by micro finance banks because of the conditions attached to accessing the funds.

Like the N220 billion MSME fund, if DBN ask us to bring bank guarantees, many MFBs may not to be able to access it.

“You expect me to lend to the grassroots who have virtually no collateral then why ask me for collateral? Where am I going to get collateral from?.

“To bring a bank guarantee, I have to go to a commercial bank and if I don’t meet their requirements, I’ll have to sign an agreement that the money remains with them.

“It’s helping my liquidity as a bank because I have it as cash, but in terms of outreach to the people, it does not help in any way,” he said.

Okoye expressed concern over the members on the board of the DBN, as it has no SME or MicroFinance representatives but rather from the commercial banks and other financial organisations.

He said that this was worrisome because there ought to be people on the board who were concern first about the social mission of the bank rather than profitability.

He said that representatives from Association of Small and medium enterprises or National Association of Microfinance banks should have constituted part of the board.

“Notwithstanding, my advise to Okpanachi and his team, is to establish an SME credit guarantee scheme to de-risk the sector.

“They should also promote the creation of industrial clusters and provide them with government support, the right infrastructure and funding at affordable prices.

“When doing a wholesale lending, he should first look at the lending methodology of the MFBs. We have a preponderance of debt capital in this sector. The only thing that works effectively is the group lending methodology.

“DBN should also set up business incubation centers for capacity building, to reduce failure rate of the project.

“There are policy aspects that DBN and SMEDAN should look at for this to work and improve the success rate of whatever they are doing,” he said.

He said there was need for the Federal Government to create incentives like tax rebate, tax holidays to improve the success rate of Microfinance banks in the country.

Buhari to launch Economic recovery plan

By Jide Ajia

As a major step to revamp the economy, President Muhammadu Buhari has announced that Economic Recovery and Growth Plan (ERGP) from 2017 to 2020 would be launched on Wednesday.

The Guild recalled that the plan remained one of the major promises of the Buhari led administration, despite the fact that the supposed promise fulfillment is coming two years after he made it before and after the 2015 general elections.

The launch would hold at the Council Chambers of the Presidential Villa on Wednesday in Abuja, which is expected to sustain and build on the successes so far recorded in tackling corruption, improving security.

According Special Adviser to the President on Media and Publicity, Femi Adesina, explained that the Medium-Term ERGP was approved by the Federal Executive Council (FEC).

“ERGP is to restore sustainable, accelerated inclusive growth and development; investing in the people; and building a globally competitive economy,” he said.

However, The Guild can reveal that for millions of Nigerians already jobless and others battling with the harsh economic realities, the move by the presidency might be coming too late.

In another development, the Minister of Finance, Kemi Adeosun, hinted that the ministry was working towards fixing the nation’s infrastructures as way to building Nigeria economy and put it in proper perspective.

She gave an instance that building the economy has been an odious task for the ministry, especially when the price of commodity such as oil and gas is high, all would be happy but when the price is low, it becomes quite a miserable period for the ministry and the Nigerians.

Adeosun, who spoke for the first time in an interactive session on social media this afternoon, further explained that nonetheless, either the prices of commodity is low or high, the finance ministry still interested in ensuring that there was sustainable growth for Nigeria and its citizenry.

The minister added there was no short cut to growing the nations economy without investing in infrastructures, because of the need for good road network, railway operations, power supply and others.

While speaking on tasks, responsibilities and challenges confronting the ministry since her resumption in office two years ago, Adeosun noted that economic growth and other factors that would facilitate it recovery has continued to be the finance’s priority.

How funds delay issuance of National ID Cards-DG

By Newsdesk

The National Identity Management Commission(NIMC) has said it is working hard to address challenges associated with delay in issuance of new National Identity Cards to Nigerians.
The Director-General of the commission, Aliyu Aziz, said in Abuja on Tuesday that paucity of funds was delaying  production and issuance of the cards.
Aziz said the commission had been inundated with complaints about the delay and that complaints were from Nigerians who had registered long ago but were yet to be issued with their permanent identity cards.

The deputy-general, who explained that the commission has facility to register as much as three 300 million citizens in its data base, said National Identity Number (NIN) is more important than the card,stressing that NIN is a unique 11-digit number assigned to an individual upon successful enrollment into the national identity database (NIDB).

According to Aziz, it is the NIN that helps to tie all records about a person in the database and is used to check the identity verified.
“What is important is digital certification. We have always emphasised that NIN is the most important.
“So, once you have the NIN that is okay. But we are doing our best to issue the cards,” he said.

He assured that the commission is exploring avenues to expand its cope and capacity to be able to deliver faster and more efficient in meeting expectation of Nigerians.
“It is part of measures to create a comprehensive national identity database to drive national development planning and to prevent both double identity and identity fraud,’’ he said.

It would be recalled that NIMC began the enrollment exercise into the NIDB in September 2010 and started the issuance of a multipurpose card in 2013,just as it would be recalled that as at 2016, over 750,000 cards are yet to be collected, while about 300,000 cards had been collected by Nigerians.
Millions of Nigerians have been screened and issued with the temporary NIN, but have yet to receive the permanent Identity card.

Registration of unemployed Nigerians begins Wednesday – NDE

By Newdesk

In a development perceived long overdue,the National Directorate of Employment (NDE), on Tuesday pronounced its readiness to start online registration for millions of unemployed Nigerians from Wednesday, April 5, 2017.

Its Deputy Director, Information and Public Relations, NDE, Edmund Onwuliri, announced the development in a statement addressed to newsmen in Abuja on Tuesday.

The Onwuliri said the exercise would enable the directorate to serve as a clearing house linking job seekers with existing vacancies in government agencies and the private sector.

The deputy director, who said the registration was aimed at collecting up to date data of  unemployed Nigerians, stressed said the registration was in compliance with NDE’s mandate to obtain and maintain a data bank on unemployment and vacancies in the country.

“The online portal which goes live on Wednesday April 5, 2017, is designed to capture the relevant details of any unemployed person. It will equally serve as a job exchange portal,”he said

The Guild writes that it is on record that Nigeria’s rising youth unemployment is now a major source of worry with the recent World Economic Forum (WEF) and the Lagos Business School saying the country sits on a ‘time bomb.’

But government said the situation is under control and efforts to curb joblessness would pay off this year.

The country’s unemployment rate rose from 13.3 per cent in the second quarter of 2016 to 13.9 per cent in third quarter, according to the National Bureau of Statistics’ Unemployment/Under-employment Report released in October last year.
Accordingly, the rising rate of unemployment would enlarge existing risk of insecurity and militancy in major parts of the country and undermine government’s efforts at fighting insurgency in Northeast, uprisings in Southeast and other serious crimes in other parts of the country.