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Analysis: Nigeria’s economy under Buhari…for better or worse?

Published

6 years ago

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Lukman Otunuga, Research Analyst at FXTM, comments on Nigeria’s economy under Buhari…for better or worse?

It is quite thought-provoking how this month marks just over three years since President Muhammadu Buhari secured a historic victory in Nigeria’s state elections.

There was a high degree of optimism over Buhari changing Nigeria for the better by reviving economic growth and fighting corruption &insecurity.

Much has happened over the past few years under the Buhari regime, with the nation going through various trials and tribulations. Confidence over the health of Nigeria’s economy was dealt a painful blow after a currency crisis threatened to cripple the nation. Inflation skyrocketed to worrying levels as the Naira tumbled and economic growth slowedfor the first time in 25 years. While it could be easy to blame the APC for Nigeria’s woes, it must be kept in mind that falling oil prices may have played a leading role.

What remains highly worrying is that the National Assembly has just recently passed a record N9.2 trillion budget for 2018. Such a development could negatively impact confidence over the nation’s political landscape, especially when considering how this budget was the most delayed in 19 years. It is worth noting that the 2017 budget followed a similarly disappointing pattern of delays which could have negatively impacted economic growth.

Speaking about economic growth, for the first time in over two decades Nigeria experienced a recession thanks to the combination of falling oil prices, political uncertainty and a sharply depreciating local currency. A strong suspicion remains that Buhari’s six-month delay to select a cabinet after being sworn in as President on 29 May 2015 weighed heavily on the nation.

His refusal to allow the Central Bank of Nigeria to devalue the Naira when falling oil prices were eroding the nation’s external reserves compounded to Nigeria’s woes. When the CBN eventually de-pegged the Naira in June 2016, the local currency depreciated so badly that the economy and citizens felt the pain.

The ripple effect ultimately created restrictions on international payments while crippling liquidity and repelling foreign investors.

Focusing on the macro economics, Nigeria’s unemployment rate has jumped 18.8% over the past three years, while youth unemployment rate is currently around 33.1%. Inflation rose to gravity-defying levels, from 9.8% in May 2015 to a 12-year high of 18.72% in January 2017.

Although inflation has moderated, dropping to 12.5% April thanks to the CBN’s efforts to promote FX stability, the effects can still be felt on the economy. While the country displayed its resilience againstthe global arena by staging a rebound in 2017 thanks to higher oil prices, the latest GDP report for Q1 of 2018 disappointed, by sliding 0.16%.

The truth is, Nigeria needs to implement more fiscal and monetary measures with a strong focus on agricultural development to boost economic growth.

Today, the nation proudly boasts foreign exchange stability and moderating inflationary pressures;this could be off the back of recovering oil prices.

Painful lessons fromthe past regarding falling oil prices should act as a wake-up call for the nation to break away from oil reliance and diversify into a self-sustaining economy.

The World Bank Group has expressed satisfaction over the performance of the Nigerian economy, while Fitch Ratings has affirmed Nigeria’s long-term foreign currency Issuer Default Rating (IDR) at B+ with a negative outlook.

With the implementation of the new Economic Growth and Recovery Plan (EGRP) supporting trade and capital flows, the outlook for Nigeria remains encouraging.

The Central Bank of Nigeria has the ability to boost economic growth by cutting interest rates. With inflationary pressures slowly becoming a theme of the past and economic data improving, it becomes a matter of when, rather than if, interest rates are cut.

President Buhari will be seeking a second term in office in elections next year and it will be interesting to see if he secures another historic victory. Whatever the outcome of the election, the future remains bright for Nigeria.

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Transport

Federal Government To Launch Out 2700 CNG Buses, Tricycles Ahead Of First anniversary Of Tinubu’s Administration

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2 days ago

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April 22, 2024

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The Presidency on Sunday said it was ready to launch about 2,700 CNG-powered buses and tricycles before May 29 when President Bola Tinubu turns one year in office.

“All is now ready for delivery of the first set of critical assets for deployment and launch of the CNG initiative ahead of the first anniversary of the Tinubu administration on May 29.”

It said the Federal Government is set to deliver 100 conversion workshops and 60 refuelling sites spread across 18 states before the end of 2024.

The Special Adviser to the President on Information and Strategy, Mr. Bayo Onanuga, revealed this in a statement he signed Sunday titled ‘Presidential CNG initiative set for rollout.’

“From the end of May, Nigeria will take some baby steps to join such nations that already have large fleets of CNG vehicles.

The CNG tricycle
The CNG buses

“All is now ready for delivery of the first set of critical assets for deployment and launch of the CNG initiative ahead of the first anniversary of the Tinubu administration on May 29.

“About 2,500 of the tricycles will be ready before May 29, 2024…working towards delivering 200 units before the first anniversary of the Tinubu administration,” said the Presidency.

He also said that over 600 buses are targeted for production in the first phase which will be accomplished in 2024.

In October 2023, about five months after the removal of the petrol subsidy, President Tinubu launched the Presidential CNG Initiative to deliver cheaper, safer and more climate-friendly energy.

The CNG Initiative was designed to deliver compressed natural gas, especially for mass transit.

The Federal Government earmarked N100bn (part of the N500bn palliative budget) to purchase 5500 CNG vehicles (buses and tricycles), 100 Electric buses and over 20,000 CNG conversion kits, with plans to develop CNG refilling stations and electric charging stations nationwide.

The FG had said the initiative would ease the burden of the increased pump price on the masses.More information added that the creation of a new plant on the Lagos-Ibadan Expressway that will assemble the tricycles while Brilliant EV will assemble electric vehicles when it receives the Semi Knocked Down components.

The Presidency explained further, “The SKD parts manufactured by the Chinese company LUOJIA in partnership with its local partner to support the consortium of local suppliers of CNG tricycles are set for shipment to Nigeria and expected to arrive early in May.

It is expected that before 2027, There’ll be a considerable wave of these buses and tricycles in use.

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Finance

Immigration Office Place Ex Governor, Yahaya Bello On Watchlist While IG Of Police Withdraws All Police Officers Attached To Him

Published

4 days ago

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April 19, 2024

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The Inspector General of Police, Olukayode Egbetokun, has withdrawn all police officers attached to the embattled former Governor of Kogi State, Yahaya Bello.

The order for the withdrawal was contained in a police wireless message. The document with reference number:

“CB:4001/DOPS/PMF/FHQ/ABJ/VOL.48/ 34 reads in part;“IG has ordered the withdrawal of all policemen attached to His Excellency and former Executive Governor of Kogi State, Alhaji Yahaya Bello. Acknowledge compliance and treat with utmost importance.

Please, above, for your information and strict compliance.”

Meanwhile, the Nigerian Immigration Service has placed the former governor on its watchlist.

This comes after the Economic and Financial Crimes Commission on Thursday, April 18, declared him wanted in connection to an alleged case of money laundering to the tune of N80.2bn.

From EFCC

In a circular signed by an Assistant Comptroller of Immigration, DS Umar, for the Comptroller-General, Kemi Nandap, the NIS detailed the former governor’s name, nationality, and passport number.

From National Immigration Office

And read;

“I am directed to inform you that the above-named person has been placed on the watch list.

Suffice to mention that the subject is being prosecuted before the Federal High Court Abuja for conspiracy, breach of trust, and money laundering vide letter Ref; CR; 3000/EFCC/LS/EGCS.1/ TE/Vide/1/279 dated April 18, 2024.

If seen at any entry or exit point, he should be arrested and referred to the Director of Investigation or contact 08036226329/07039617304 for further action.” the circular reads in part.

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Finance

BREAKING: EFCC Declares Former Kogi State’s Governor, Yahaya Bello Wanted

Published

5 days ago

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April 18, 2024

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The Economic and Financial Crimes Commission has declared a former governor of Kogi State, Yahaya Bello, wanted for offences relating to economic and financial crimes.

This was contained in a notice posted on the commission’s official Facebook page on Thursday.

The notice read, “The public is hereby notified that Yahaya Adoza Bello (former Governor of Kogi State), whose photograph appears above is wanted by the Economic and Financial Crimes Commission in connection with alleged case of Money Laundering to the tune of N80,246,470,089.88

“Bello, a 48-year-old Ebira man, is a native of Okenne Local Government of Kogi State.

“His last known address is: 9, Benghazi Street, Wuse Zone 4, Abuja.”

The notice asked anybody with useful information about the former governor’s whereabouts to contact any of the commission’s offices across the country.

The anti-graft commission had earlier stated that it would, on Thursday (today), arraign the former governor before a Federal High Court sitting in Abuja.

This was after the EFCC was granted a warrant of arrest by the Federal High Court in Abuja to apprehend the former governor.

Punch reported that The agency’s team of lawyers, led by Kemi Pinheiro, SAN, during the proceedings on Thursday, said that EFCC operatives were prepared to carry out the arrest warrant for the former governor, even if it requires the use of force.

Bello and three other suspects, Ali Bello, Dauda Suliman, and Abdulsalam Hudu, will be arraigned before Justice Emeka Nwite.

They face 19 counts related to money laundering to the tune of N80,246,470,088.88.

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