As a corporate executive with extensive fortune 100 corporate background both in personal and corporate business. Dr Awofolaju is a governance, risk management and compliance guru, managed many organizations in leadership capacity. His company is one of the leading Leadership Business Development, Strategic Programs in Tri States Area. He is an American Board Certified Financial Forensic Examiner, American Board Certified Executive Leadership Development educator, American Board Certified Strategy Planner and also a Strategic Thinking Expert. An Applied Economist (Regional Development Economics)- PhD
He has been a top ranked Human Capital Engineering Business Resources & Leadership Development for executive educational industries in NY/NJ Regions for three consecutive years and also leadership development expert for the fortune 100 companies where he worked as an award winning leadership professional with over 17 years of management experience, demonstrated analytical skills. Dr. Awofolaju is a member of over twenty professional bodies amongst which are the American Association of Financial Forensic Fraud Examiners, the Nigerian Institute of Management, American Economic Association, and International Research for Income & Wealth, etc Author, a prolific writer and columnist on contemporary issues.
Dr Awofolaju is a motivator and mentor with a collaborative, entrepreneurial management style with expertise in translating the big picture into specific business leadership strategies. Dr Awofolaju was a leading Corporate Executive (New York/New Jersey regions) for Verizon Wireless Telecommunication Company in America, where he worked for over 10 years before he started his own company. Dr Awofolaju managed team of senior-level managers, and for his entire career there he was the top performer in his region, as well as nationally. As a management expert, he has broken many sales and marketing records with several awards and recognitions and also attended Advanced Program at Harvard University Business School & Cornell University graduated from S.C Johnson Postgraduate Business School in Executive Leadership Development & Strategic Thinking/Planning.
He has spent a significant amount of time in continuous personnel leadership development of his team as their team leader. Dr Awofolaju also managed over 500 high-performance driven team that generated over 450 millions of dollars in mergers & acquisitions when he worked as Regional Account Executive for British Petroleum Company for Tri- States ( PA/NJ/NY) - 1999 -2001. His strengths are his motivational and mentoring skills. A keen listener and creative thinker, Dr Awofolaju has been a consultant for individuals and businesses since 1991. He managed European financial powerhouse as President/CEO - Bayland Investments Company in Eastern Europe (1991- 1999), he discovered executive keen interest in his experience and insight into maximizing peak performance.
Dr Awofolaju developed the leadership development & training program that unleashes potential of individuals or organization value adding by opening up creativity and recharging passion requisites for consistently perform at their best. Dr Awofolaju's focus resonates with others because it sheds light on why people do not perform to their potential even when they're talented and committed. Dr Awofolaju works with various CEO's, corporate executives be it in Wall Street, business professionals to athletes – professional basketball players. Dr Awofolaju’s wide range of clients illustrates how anyone can benefit from performance coaching. He makes you to better maximizing your potentials, it is everyday for greater results. Dr Akin Awofolaju has been a consultant for individuals and businesses since 1991, when he discovered executives' keen interest in his experience and insight into achieving peak performance.
Chairman : State & Local Government Nigerians in Diaspora: Nigeria Constitution Review Commitee
Honoree: Top 50 Nigerians in US/Canada commemorating 50yrs of Nigeria Independence @ United Nations -New York, NY -USA
Founding Chairman : NigeriaCEO Council - New York 2010
Steering Committee Member: Nigeria In Diaspora Constitution Review Committee ( 1999 Consistitution Amendment Committee)
Alumni : Cornell University - Postgraduate School : S.C Johnson School of Business , Itacha, New York - USA
Member: Nigeria Global Forum - USA
Member of American Economic Association (AEA) -USA
Member: Association of Certified Fraud Examiners (ACFE)- USA
Member of International Association for Research in Income and Wealth (IARIW) .
President : Acumen Investment Club of State of New Jersey
Board Member: Aberdeen Township Planning Board -New Jersey
In retrospect, as a country, Naija nation never experienced a huge recession in any measures historically, and given that context, the great depression typified by unprecedented decline in economic activity majorly only when stock market is completely in comatose, banks were closed down and macroeconomic factors destabilized.
The major recession in history was generally to have occurred between 1929 and 1939. Although parts of the economy had begun to recover by 1936,then the high unemployment rate persisted until the Second World War but the reversed circumstances pixilated Nigeria context...despite our high unemployment rate domestically our macroeconomic stability remain solid, we still #1 economy in African continent till date hence our 2009 banks reform are still adamantly functional except for our manufacturing industry that remain weak as primal breeder for export growths to enhance foreign earning which stands to be the biggest fear I have for this devaluation, but considering all fronts amidst economic imbalances Nigeria towered the biggest economy in Africa mantle. How this new devaluation affects us econometrically?
Devaluation is ok as long as it doesn't cause us a loose monetary policy, and our central bank remains apolitical which can eventuate future inflation e.g. hyperinflation in Japan after 1936 is a good lesson to share
If we can recall vividly, lately the tumbling of oil prices has emanated serious doubt in the sustainability and survival of any oil economies worldwide, Nigeria is not an exception to the rule, and President Buhari was just a victim of circumstances, the previous administration should have seen it coming and saved hugely during the rainy days instead of wasteful spiral spending spree on security votes that was never executed, the naira that had just nosed dived had lost 40% of its value in one single "black Wednesday" is no surprise in an analyst corridors, its long awaited there is no doubt that in a such awkward economic situation present administration could have done anything differently than to succumb to a natural market driven method to revive the economy and our exchange given with little price of devaluation on a short term, the move was expected to be painful but 40% devaluation is an hard pill to swallow...but on long term naira floating freely will definitely translate to a fairer and positive economy growth down the road.
This measure will definitely give us a new template to operate on, however it will have an adverse effect on our sound macroeconomic values and that might in a short run create an economic stress to the whole continent being the largest economy in Africa however, this is the first step toward great moderation to steady economic growth and I see it as a right step forward.
As we all know in a simple terms a devaluation occurs when the exchange rate falls in value and this causes our exports to be cheaper and imports to be more expensive. In theory, it can help increase economic growth, though it may cause hyperinflation if unchecked
The impact of naira devaluation as in Nigeria context, depends on economic circumstances. If a country as our nation is suffering from being uncompetitive with high increasing unemployment rate and low inflation ( averages 8% - 9% before devaluation) a devaluation as right recipe may help considerably given historical perspectives, between 2008 and 2013, the British pound experienced same economic shocks at 25-30% devaluation in sterling, but the United Kingdom had a weak recovery despite their strong manufacturing sector, some cost push inflation and a surprisingly large current account deficit occurred. And it was obvious that the depreciation then in pound did little help to the UK economy
In theory, a devaluation of Naira will cause the following to happen to Nigeria economy:
Presumably, a) the price of imported goods into Nigeria will increase. This will reduce our spending on imports and instead we will be more likely to buy domestic goods given our growing population as a consumer economy – it is a good stress to have.... and the quick fix should be for our govt to give huge incentives to promote "Made in Nigeria" goods aggressively and improved on their standard for export gains.
b} The price of Nigeria exports will be lower in foreign currencies, this will increase the competiveness of Nigeria exports and it will cause an increase in demand for "Made in Nigeria" produce for export, solutions: Government should pump money and incentives (tax free etc.) to manufacturing industries for huge volume of production
c}Considering our balancing of trade temperament, focusing on: Made in Nigeria" mass productivity for exports the increased competiveness should cause an improvement in our current account and that will eventually solidify our foreign reserves.
Again, on simple terms, devaluation is the decision to reduce the value of a currency in a fixed exchange rate. A devaluation simply means that the value of the currency falls which eventually affords domestic residents to find imports and foreign travel more expensive because the rate of naira exchanges to foreign currencies become greater which will later typify hyperinflation, however on the long run domestic exports will benefit from their exports becoming cheaper and the manufacturing industry grows.
In the current conundrum, our export become cheaper and locally made goods becomes more competitive to foreign buyers. Therefore, this provides buffer and a boost for domestic demand and could lead to job creation in the export sector. And on the hindsight, the higher level of exports should lead to an improvement account deficit especially Nigeria as a country has a large account deficit due to lack of competitiveness. And in my opinion, I strongly believe that higher exports and aggregate demand can lead to higher rates of economic growth and that buttress Buharinomics moving in the right direction on the long term.
It is no doubt, that in a recession a devaluation can help boost growth without causing inflation however, in a boom a devaluation is more likely to cause inflation and besides, a devaluation may take a while to improve current account because demand is inelastic in the short term.
If we can recall, past years with fixed 195 naira to dollar, Nigeria had lost its competitiveness in a fixed exchange rate and as of now only a devaluation could be beneficial in solving that decline in competitiveness
However, with all great merits of devaluation, it is also good to note some warning signal aspects of it.... Devaluation may as well likely to cause inflation because any imported goods or raw materials will increase in price and that can make imports more expensive, devaluation might cause an increase in our aggregate demand which will eventually cause demand pull inflation.
Obviously, devaluation tends to reduce the purchasing power of citizens abroad e.g. more expensive to go on holiday, Solutions will be to build more domestic resorts for vacation
It will also not hurt to note that a large devaluation may scare off foreign investors (it reduces FDI – Foreign Direct Investment). It might reduce the competitiveness investors less willing to pump funds to the economy for fear of reducing value of their holdings and repatriation of their capital gains home might be a huge challenge
Overall, and to Buharinomic's credit, this current devaluation is a relatively painless way to boost domestic demand and unlike fiscal policy you don't have to borrow to supplement the economic revival however, one drawback of devaluation is that usually it can be inflationary, but in a recession inflation is unlikely to be a problem. And finally as an economist, I strongly believe our first objective as a country is to pursue the monetary policy which is most suitable for our economic situation. If a country like Japan is experiencing deflation. It is correct to pursue expansionary monetary policies. They should be seeking to reduce the value of their currency and pursuing looser monetary policy.
Nigeria is in a competitive devaluation mode and that implies that country pursue the correct monetary policy by allowing the market to seek the exchange rate to find its correct level unlike China with huge current account surplus in early 2000s with their currency manipulation, but still intervened to keep the value of their Yuan undervalued and the whole world reacted. Current administration in Nigeria had played save. Kudos to the govt on this new Buharinomics.
When you are a carpenter and the only tool you have is an hammer definitely every solution to you looks like nails to beat..
If some parts of the nation wanted to pull out of the federation what make us think it can only be through forces and war. I believe reality stares us into our face.
As an intelligent man you don't have to climb palm tree with your bare hands to prove you are strong, you can just borrow a ladder from John Doe to climb the damn tree or why will you carry a machine gun to kill a lion when a three- man hunters from Kenya killed 3 lions with their bare hands, sometimes it doesn't take our strength or conspicuous forces to move a feather.
You will be astonished on what's required to get any job done, you only need your cerebral acumen and commonsense. I strongly believe we can just come to a round table not a jamboree conferences, with all stakeholders and discuss what's at stake sincerely and weigh the pros and consequences in altruistic ways, and then if right decision were not taking, we can decide what the next alternatives will be, but our inaction could be our worst enemy.
The question that comes to mind ,and to ask our versed majority is simple, "Today, are you better of, than where you are 10, 5yrs ago, or 3yrs ago or simply put, you are 55 years old , Do you own a house? This has nothing to do with this present administration, of course, the change mantra is the best ever when it comes to accountability and probity but it's only taking too much time and Nigerians are out of time and duly impatient because there have a cemented minds of no trust. Nigeria of 170 million population, we have 135million above the age of 21.
You have to agree to disagree. How many of Nigerians will agree to continue living the way things are today? Honestly speaking, even the rich ones were also crying because their Rose Royce ply on the same pot holes , un tarred roads and the repairs cost govt fortunes 1billion naira per kilometer. Or their mansions are surrounded by slums houses, the postmaster cant even deliver their ordinary mails to their houses because there is no thorough fare. I strongly believe that there will be a time in Nigeria where the poor will have nothing to eat but the rich ones, and I hope the time is not here yet.
We need to come to the part of reality when we all say enough is enough. Besides, Nigeria can agree peacefully to divide and people will take what legally belong to them territorially and go and personally, i wont care whose eggs are gored, it might be the change we dread to have. Czechs and Slovakia had it good in 90s and both countries are thriving survived it as well, Soviet union went through it, divided peacefully on resolution, the heaven didn't let loosed, despite the facts that they are richer and more populous than Nigeria while Russia solely parted with lion share oil and other republics had nothing besides Kazakhstan and few others that were also rich in oil. Sometimes you have to learn to part with what you have to get what you don't have in life. Soviet Union then was a replica of Nigeria now in all ramifications . There was no war then and there won't be war anywhere if proper concessions are reached and mongering fears are appeased. . You bet every states in Nigeria has a minimum of 3-5 mineral resources and if its' of commercial standard now, so what, Singapore has no mineral resources but its economy based on their peoples sheer hard works on services and it becomes a strong emerging market of the world and #1 diverse Asia tigers corridor. As far as I'm concern as a yoruba man, the oil can go to whoever wants it. Czechoslovakia model could be a perfect solution to Nigeria panacea there is.
Besides, I see no reasons why Gen. ADEBAYO'S position should be taking out of context, it might just as well meant what Nigeria needs at this opportune time as a clarion call. We are country of over 170m, about 2.54% of world population, produces .6% of world output, and by 2050 Nigeria population will be over 470million, youth population is growing exponentially around 65% of total population with vast majority unemployed, under-utilized, malnourished, despairing alternatives that informed a danger premises and escalating time pressured clime. Basically, with an upsurge population that will make Nigeria the third most populous country in the world after China and India by 2050. Worst still, in 21st Century, our power supply remains a luxury for our middle class, pipe borne water is a damn scarcity, post office system is dilapidated but yet with this mammoth problem our economy remain resilience, #1 in Africa due to her macroeconomic stability, youth unemployment is another bane but it can be turned around, youth population avoid us opportunity for cheap labor for any smart investors both locally and internationally.
Vodafone the then biggest telecommunications company in Europe left Nigeria in 2007 for lack of ease to do business and multiple taxation in Nigeria, and 5 months later they fired their CEO in England, who advised them to leave Nigeria because MTN came in shortly after their exit and took the center stage of our telecommunications goldmine and delivered billions of Naira returns in profit in their first year and over 45% returns on their investment.
Our innumerable natural resources are untapped, natural gases in Bonny burns all day wasted because we focus on oil, our govt should not be in business or management of oil resources, but in regulating it and give NNPC to highest bidder by true privatization. GOVT CAN COLLECT ROYALTY YEARLY ON IT but not the damn manager.Nigeria have over 254 mineral resources across the country but nobody cares to roll up their sleeves to experiment the tenacity of start-up pains but only to reap where we didn't sow.
If Nigeria must remain as unified Nation there must be equitable distribution of wealth or true federalism as often call, we need knowledge- based manpower, sustainable capital investment , true affordable education, the core of any sustainable economy as the new goals of this recent concluded UN resolution where -"Poverty reduction" is #1 Goal followed by "No Hunger" mantra on the planet out of all 17 SDGs , Nigeria falls on all 17 of them, and I wept for my country during the sessions at UN on its 70th.
Which way Nigeria? The only sustainable solution to Nigeria right now, are as follows: first and foremost are the, Nigerialiness-(attitudinal change Bottom-up, Top- down) ; proliferated free market economy-privatized developments ( Roads, transportation, power supply,services, enabled SMBs that will create jobs for our hungry idling youths.
Be that as it may, I call all well- meaning Nigerians to rethinking , listen to Gen. Adebayo clarion call, and come to this round-table to discuss whether to stay together and do the needful as listed above or divide and go in our separate way for the betterment of our generation yet unborn.
What make a wiseman not to act at the time when action is needed, makes the fools to act on their behalf and there is nothing they can do about it. Evil thrives only when the righteous are silent on issue that are paramount to all.
Stay focus and keep motivating!!!
I have great respect for Gov. Emefiele the Central Bank Governor and some of us actually supported his appointment but today given all his fire brigade approaches and quick fixes with various unilateral policies bedeviling the struggling Nigeria economy on his watch has questioned curious school of macroeconomic minds and this has amounted to simply call it - a waste of Nigeria meager resources and show of professional incompetency. Gov.Emefiele latest decision on MPR is hogwash and asymmetrical.
The point of implementing policy through raising or lowering interest rate is to affect people's and company's demand for goods and services and this policy actions ultimately affects real interest rates, which in turn affect demand and output, teeming unemployment and most worst of it all inflation.
As a development economist, the last straw for me was his unthinkable suspension of foreign currency cash deposits and the retention of Monetary Policy Rate(MPR) pegged 13% to revamp liquidity in the system whereas, basis of MPR reliance for good economy is sordid not to talk about weak fiscal approach. This approach is detrimental to our economy especially to versed masses who are already in abject poverty, it will raise the cost of living of the verse population
Here are the reasons why the pegging of Monetary Policy Rate (MPR) at 13% rate will do to Nigeria economy:
- It will lead to hyper inflation, much of which we have been witnessed, already happening 1$ exchange rate to Naira is 245 ($1.00 Vs N 245) compared to six months ago of N 190 to $1
- It will lead to further increase in prices of goods and services in the country i.e. Gari and petrol prices etc
- It will affect the real sectors (housing, manufacturing & agricultural etc) as cost of borrowing would remain high and skyrocketing which ultimately detrimental to our bottom line and it can affect the projected growth i.e most of the huge factories are relocating to Ghana, Benin republic and elsewhere......
Fundamentally, one would expect our most revere Gov. Emefiele to understand the economic impacts of his decision that it will affect tremendously the movement of funds from capital market to the money market due to high interest rate.
There is no doubt, that if MPR is not lowered and reversed, the wages and prices will begin to rise at faster rates because monetary policy stimulates aggregate demand which is enough to push labor and Nigeria stock markets beyond their long-run capacities. In fact, a monetary policy that persistently attempts to keep short-term real rate low will lead eventually to higher inflation and higher nominal interest rates, with no permanent increases in the growth of output or weigh down deadly unemployment rate .
And I do understand, that there must be a trade -off between higher inflation and lower unemployment rate in the short run, which besides hardly measured in Nigeria, but I can tell Gov. that the trade -off disappears in the long run if pursued aggressively with acute monitoring.
Gov. should also know that perception plays a strong role, MPR policy affects inflation directly through people's expectation about future inflation in the country, petrol staggering prices could alert as driving forces for higher liquidity. If Nigeria workers, consumers and even the corporate businesses figure that higher inflation in the future is realistic, they'll ask for bigger increases in wages and prices and that in itself will raise inflation even without big changes in output.
Gov. Emefiele should be thankful as blessing in disguise, for back dropped wages in some states lagging year and months, curbing the cash liquidity to some extent. Its unfortunate but its econometric and its a reality
Just for example, in a simple terms, and hypothetically speaking here, a borrower (a Nigerian vulcanizer or a barber) is likely to feel a lot happier about a micro finance loan at 18% when inflation rate is lower than when it is higher . In any case, the value of the money that the borrower would pay back would actually be lower than the real value of the money when it was borrowed. Borrowers, of course would love this situation, while lenders would be disinclined to make any loans. So Mr. Gov. riding on inflation can be detrimental to economy, there are better ways to revamp liquidity
I'd expect Gov. to understand that lowering the rate will help to reduce cost of funds in the economy than his aggressive approach and choice that will inadvertently accelerate it.And to curb inflation, Gov. can easily add a risk premium to long term rates, which will make them higher anyway, in other words, the markets' expectations about monetary policy tomorrow have a substantial impact on long-term interest rate today.
And I strongly believe, he can inform markets about future values of the funds rate in a number of ways. For instance, CBN could follow a policy of moving gradually once it starts changing interest rates. Or, the CBN could issue statements about what kinds of developments the CBN or MPRC is likely to focus on in the foreseeable future; the CBN even could make more explicit statements about the future stance of policy
The current Nigeria economy situation will not experience the desire growth without proper funding of the real sectors(manufacturing, Agricultural etc) to boost our export to rejuvenate economic activities..... we had enough of bank reform in 2009 in finance industries besides needed now, moderate regulatory and I strongly believe, there is no need to put cog in the wheel of economic progress.
The retention of MPR at 13% and suspension of foreign deposit without clear strategy lacks economic blueprint and shallow.
The increase in interest rates can make domestic financial assets more attractive to investors than foreign financial assets. This situation can trigger an appreciation of the nominal exchange rate, thus reallocating expenditure in the economy. The latter takes place because this exchange rate adjustment tends to diminish the price of imports and raise the price of exports, which tends to slow aggregate demand and eventually reduce inflation. When the exchange rate appreciates, the cost of imported inputs declines, and thus firms' costs in general.
These developments have a favorable effect on inflation.
An interest rate increase tends to make bonds more attractive for investors
and reduces the demand for equity, making the value of these and other assets decrease. In a situation where the market value of firms decreases, these firms can face lower capacity to access financing, therefore hindering the consolidation of new investment projects. The latter also slows aggregate demand and therefore reduces in inflation
The current situation of the economy called for cautions and not unthinkable hasty decisions with doomed reverie.
Nigeria becomes No 1 Giant Economy in Africa with rebased GDP calculations. And what is in it for average Nigerian?
By Akin Awofolaju, PhD (Developing & Applied Economist) New York, USA
Today Nigeria as a country has overtaken South Africa and become continent's biggest economy there is. Besides, in some quarters, it is highly orchestrated that Nigeria's weakest link could become its greatest assets in the next couple of years to come especially when it comes to its human capital resources, market potentials, young growing population and macroeconomic stability of GDP growth 7.1% . It has been predicted that Nigeria GDP can easily rise to US$4.9 trillion by 2050 by World Bank.
Although, nobody is expecting Nigeria to perform to par especially in global forum where corruption discussion is the center focus, as many put far too much weight on the negative images that are well-known - crime and corruption in Nigeria, but when you begin to think of a nation
With mixed economy, one might generally say about Nigeria as an example of rebase went wrong with 24yrs behind it is easier to be positively surprised about Nigeria sudden economic growth in the face of the imminent social problem.
To the man in the street, it will make no difference at all. But it'll be of some interest to economists. Certain ratios will change, for example the debt to GDP ratio will fall. And on a GDP basis, Nigeria will become the largest economy in Africa, knocking South Africa into second place. Nigeria's rebased GDP is thought to be around $510bn compared with South Africa's GDP of $370.3bn at the end of 2013.
But as an economist I would like to point out that Nigeria's economic output is under-performing because at 170 million people, its population is three times larger than South Africa's. And on a per-capita basis, South Africa's GDP per capita numbers are three times larger than Nigeria's ($11,800 Vs $2,800 est. 2013) respectively . So, while Nigeria can claim the crown of Africa's largest economy, there are certain caveats.
The best way to look at it is the impact of the proposed new base year of 2008 will lead to a larger GDP base and this new denominator may lead to a slowdown in the rate of accretion in subsequent quarters.
In my opinion, when the GDP is finally rebased, the GDP growth rate of the country could drop from the current 6-7 percent range, to around 3.5 to 5 percent. On the other hand, if Nigeria is to continue to achieve the 6-7 percent growth rate after the rebasing, it means that the country will have to post a much higher level of economic output per quarter than it is currently doing.
This higher output would need to be induced by big domestics and FDIs investments aimed at plugging the massive infrastructural deficit.
Given all circumstances without sufficient enabling environment & FDI investments in infrastructure, especially on power supply, roads, rail, sea ports and security. If these does not happen Nigeria's economic output may continue to suffer from some significant dysfunctional patterns which may undermine the growth trajectory in the long term".
Nigeria has a modest debt to GDP ratio of below 20 percent at current levels, and the outlook for the ratio indicates a further moderation after the rebasing."While policy makers may be quick to applaud the country's benign Debt to GDP, we must note that the 2013 – 2015 estimates of the Budget Office indicate that the country may use up to 10 percent of its entire Gross Federally Collectible Revenue for 2013 and 2014 and 9 percent in 2015 for debt servicing (domestic and external debts)".
"Policy makers should thus adopt a cautionary stance over the sustainability of debt levels at the current revenue base. The debt to GDP will only make meaning to Nigeria if there is a determined effort to widen the tax net as GDP expands". Without this, Nigeria may accelerate debt levels without matching it with the commensurate repayment capacity".
"Another drawback of the GDP rebasing is that it will further embellish Nigeria's poor human development indicators. With a GDP size that may place Nigeria as an emerging economy, it becomes more tenuous for policy makers to explain the current significant poverty and unemployment levels within the country".
It is a known fact that most governments overhaul GDP calculations every few years, to reflect changes in output and consumption, such as telecoms, financial services and internet usage. Nigeria has not done so since 1990 suggesting that the previous GDP framework underestimated economic activity.
It is expected that Nigeria's GDP rebasing would give the country a greater positive outlook in terms of economic size and other indicators like the debt to GDP ratio, and the country's per capita income." It will also firm up Nigeria's position as an emerging market economy and help improve the country's economic profile amongst FPIs and FDIs, but a more comprehensive look, at the proposed October rebasing, also shows that Nigeria may experience a slower rate of economic growth because of the larger GDP base and this might automatically translate to a slowdown in the rate of economic growth, especially in some quarters.
The risk is that once the GDP is expanded after calculations, a significantly smaller cosmetically enhanced budget deficit will encourage government to push up spending, which would be inflationary. A bigger GDP also implies an upward revision in per-capita income.
"Nigeria's current per-capita income is estimated at $1,600, which still trails that of many other economies on the African continent. Nigeria's GDP per capita is expected to increase from $1,600 to $2,600, if the country's year-end 2012 GDP is revised upwards by 60 percent" said an expert
"Even with this, ours is still far behind when compared to that of South Africa which stands at $8,700 per capita for, which is the IMF's projection for 2012".unquote
"That said, the big increase in per-capita income is likely to attract interest in consumer names in Nigeria, from investors who are likely to extrapolate the effect of a seeming increase in purchasing power on such consumer stocks, as Nestle, Nigerian Breweries, Guinness, Flour Mills and PZ, amongst others".
Mr. Olufadi further explained that the draw-back in all of this is that policy makers might throw caution to the wind, and go into big time borrowing, which might again unnecessarily expose us negatively. "The debt to GDP will only make meaning to Nigeria, if there is a determined effort to widen the tax net, as GDP expands. Without this, Nigeria may accelerate debt levels without matching it with the commensurate repayment capacity".
To me , another disadvantage for the country is that Nigeria might stop getting aid and grants from Millennium Development Agencies and global donors, because the rebasing might expose us to be seen as a big strong economy, strong enough to cater for our poor, which in the real sense of it, we are not, due to some internal reasons".
Cadiz Asset Management equity analyst, Adrian Colette estimates show Nigeria has more than 40-million consumers in the middle income segment — just shy of South Africa's total population of 51-million — with millions more expected to join in the next decade. There is also a large swathe of Nigeria's unbanked population where interested foreign banks are angling to come into the country, like First Rand Bank of South Africa, because they believe they can use the country's rapidly growing mobile telephone penetration to provide cell phone banking services.
Nigeria's oil-based economy is expected to be the largest in the region, after South Africa, by 2015 after the country rebased its gross domestic product figures.
That alone will turn in to a further attraction for investors and potentially provide opportunities for FNB and RMB, and other South African banks eyeing the Nigerian market. My only reservation or prayer is that policy makers try too, live up to the expected expansion in economy after the result of the calculations in October.
Nigeria is a natural target for investors, given the size of its economy and its population, estimated at more than 160-million people.
As some economists have estimated the country's economy seems to grow more than seven percent annually over the next five years, compared with less than 5 percent in South Africa, for example.
This is among the reasons Nigeria was being seen "as a very attractive market for banks in South Africa.
This will probably mark a symbolic turnaround on the regional geo-political scene, but may not change much in terms of actual leadership in Sub-Sahara Africa. South Africa will certainly remain the dominant entity in the Southern African region and, to a lesser extent, in parts of the COMESA zone. Nigeria is and will be the most influential member -but not undisputed leader- of ECOWAS.
Be it as it may, Nigeria remains significantly underdeveloped in terms of basic infrastructure (electricity, roads, etc) and faces very high income inequality. This negative perception will not dissipate just because of the revision in aggregate GDP, especially as output per capita in Nigeria will continue to trail that of South Africa over the next decades.
"On the macro front, the implication is that GDP growth will probably slow further as output moves to a higher base. Additionally, the current account-to-GDP ratio will reduce, but so will the nominal FG fiscal deficit-to-GDP and public debt-to-GDP ratios".
Here is an amazing statistic about Nigeria. Hypothetically, let say, 170 million people in Nigeria today share about the same amount of power supply that is used by about 1.5 million people in the Europe. Almost every business has to generate its own power. The costs are enormous. Can you imagine, can you believe, that this country has been growing at 7% with no power, with zero power?
But the opposite is also true - and this could be a problem for Mexico, and all other three MINTs economies (Indonesia, Nigeria and Turkey), currently which financial investors are really quite, excited about.
And what is it that makes these economies unique than ordinarily, their economic potentials esp. three of them - Mexico, Indonesia and Nigeria - they are commodity producers (i.e. Oils) and only Turkey isn't. This contrasts with the Bric countries where two - Brazil and Russia - are commodity producers and the other two - China and India - aren't commodity driven economies either but technologically strong because of stable power supply. Think about what Nigeria can become if we take pains to fix our infrastructural problem, energy supply, good road networks, and other social problems such education etc. All Nigeria needs is to create an enabling environment for small & large scale enterprises to thrive.
Mexico owes much of its rising wealth to the oil, which it sits on, especially offshore oil potentials.
Indonesia, the country needs more of a sense of commercial purpose beyond commodities, and has to improve its infrastructure so as to be able to sustain its gigantic rebased calculation but there is something that's unique about Nigeria resilience that surpassed other developing economies, and that is how do you not give a due credit to an economy also Nigeria to able sustain
If you thought Maggie Thatcher stood for serious reforms, Jonathan government makes her seem like a kitten but with lacks of checks and balances. We need serious regulatory agencies to support transformational agenda. This government is putting in place many reforms (energy and fiscal policy) but need more follow-ups, time and serious accountability to shape it up esp. in education and non-oil exports. Corruption is obviously one topic that all developing economies have in common.
In Nigeria, people hides under the impression that hand-deep corruption is inimical to its development. Allow me to categorically say NO, Nigeria hypothesizes beyond corruption given the macroeconomic resilience, corruption stands as a rare prevention of economic development - and government should know that the growth of the economy, accompanied by improvements in education, emancipation of social responsibility programs would lead to better governance and greater transparency.
Speaking of the Mint countries, we should quickly note that corruption remains the consequence of their weak past, not a cause of a weak future, and certainly not the number one challenge. I'm not saying it's a good thing but we must not let it slow us down. With time it will fall off the radar, It should fall way down a list compared with the costs of energy and the breadth of its availability and, of course, infrastructure. With Nigeria rebased its gross domestic product (GDP) this weekend which pushes it above South Africa as the continent's biggest economy. I know energy policy was seen in both Mexico and Nigeria as a top priority and each country has launched major initiatives this year, which if implemented, will accelerate growth rates significantly.
I personally reckon Nigeria could grow at 10-12% by sorting out this problem alone. That would double the size of its economy in six or seven years.
In Indonesia, the fourth largest country in the world, I would say leadership and infrastructure are the major challenges, though there are many more too. But challenges and opportunities sit side by side.
In one of Jakarta's slum areas, the land is sinking by 20cm per year because of over-extraction of water, but property prices elsewhere in the city are rocketing.
In Turkey of course, its politics and the combination of a Muslim faith with some kind of desire to do things the Western way is a unique sort of challenge. Some might argue the same challenge exists for Indonesia but I returned thinking this was not the case. In Jakarta at least, the Western way of doing things seems to be generally accepted - in striking contrast with Turkey.
So can the Mints join the top 10 largest economies in the world, after the US, China, the rest of the Brics and maybe Japan?
I think so, though it may take 30 years.
Akin Awofolaju, PhD
Akin Awofolaju, Ph.D.,CFE.,CLE.,CSP,(Cornell)
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Given the new homosexual law in Nigeria. Personally , I see homosexualism as a sexual infatuation and a rare behavioral pattern or traits in modern human males, It may be considered as an obsession of sexual psychological fantasy in their respective carefree mind. And once they are in this realm, they become infatuated with it and it disorientates their unfocused brain synapses both pre synaptic and post synaptic sites that contain extensive arrays of molecular machinery in their brain link the two membranes together and carry out the signaling infatuation process( Just my little theory... not proven yet). This process is not only proven with homos but also pedophiles, father have sexual relationship with their own daughters, human males or females sleeping with dogs and ants. The chemical synapses in their brain ( raised) have some electrical activity such as neuron converted (via the activation of voltage-gated calcium channels) into the release of a chemical called a neurotransmitter that binds to receptors located in the post synaptic cell, usually embedded in the plasma membrane. The gay man in Australia is not different from the one in Lusaka or in Bauchi. The neurotransmitter may initiate an electrical response or a secondary messenger pathway that may either excite or inhibit their post synaptic neurons. Just some scientific jargons. Now let's get to it.
Here are some common myths on homosexual which are not limited to Nigerian new gay men or their counterpart in Lisbon or Lusaka.......
Myth #1: 10 percent of the population is homosexual
Pls don't believe this lie. This myth took off when advocates began misquoting a book written by Alfred Kinsey in the 1940s called Sexual Behavior in the Human Male. Kinsey's goal was to provide a scientific look at human sexuality on the whole homosexuality was just one aspect of sexuality that he addressed. It's very clear from more sophisticated research methods that Alfred Kinsey's 10 percent figure is bogus.
Fact: Only 1 to 3 percent of the population could be considered exclusively homosexual
Kinsey, who engaged in homosexual activity himself, never said ten percent of the population was gay. He actually said, "10 percent of the males are more or less exclusively homosexual for at least three years between the ages of 16 and 55, but that only four percent were exclusively homosexual throughout their lives, after the onset of adolescence. Kinsey's research methods were also skewed by his choice to include a high percentage of prison inmates and known sex offenders, both of whom engage in homosexual behavior much more frequently than individuals in the general population. More recently, a highly sophisticated study on sexuality in America, known as the National Health and Social Life Survey (NHSLS), found that only 2.8 percent of the men and 1.4 percent of the women said they thought of themselves as homosexual or bisexual.
Homosexual activist groups now admit that the 10 percent myth is false and that some have exploited the inflated Kinsey figures to try to "create an impression of our numerousness." In reality, the 10 percent figure is simply not true.
Why does the truth matter?
Maybe you're asking, "What's the big deal?" Well, by saying that one out of ten people in the U.S. is homosexual, some gay activists are knowingly promoting a lie. They are declaring to the world that homosexuality is "normal" and should be accepted as such. Yet, if you think about it, this reasoning is unintelligent. For instance, 10 to 15 percent of Americans suffer from alcoholism, but we don't accept this behavior as normal or healthy. Even if 95 percent of the population was addicted to alcohol, we still would not think of it as normal or acceptable.
As Christians we must ask ourselves, what standard will we live by? Will we accept the so-called norms created by our society or seek God and His Word to guide us in our lives? Sure, it's tough to walk the narrow way. But when we trust that God knows what's best for our lives—and follow His commands—we can receive His blessings and live an abundant life . . . the life He intended us to live.
Myth #2: Homosexuals are born gay
Can someone be born a homosexual? In 1993, a respected research journal, Science, published a study by Dean Hamer that ignited an explosive "born gay" myth. Hamer basically claimed that science was "on the verge of proving that homosexuality is innate, genetic and therefore unchangeable—a normal variant of human nature.
The media went ballistic. National Public Radio, Newsweek, The Wall Street Journal and several other news publications and programs heralded stories that suggested scientists have discovered a "gay gene." Of course, in the fine print, reporters qualified statements about this possible discovery because, in reality, there was no actual discovery but they did so in such a confusing manner! The public was beginning to be persuaded.
Why is it so important for some homosexual activists to prove this issue? Maybe the biggest possible reason is this: If the world was convinced that some people are indeed born gay, then some would feel there is a need to protect homosexuals by the government as a designated minority class status, such as Nigerians or other Africans. Slowly but surely, it seems the government is embracing this view and granting special rights to the homosexual community for what is a behaviorally based identity rather than a true genetic one.
Fact: There is no evidence to support the claim that a person can be born homosexual
The scientific attempts to demonstrate that homosexual attraction is biologically determined have failed. For example, a study conducted in 1991 by psychologist Michael Bailey and psychiatrist Richard Pillard, attempted to show that homosexuality occurs more frequently among identical twins than fraternal twins. However, this study actually provides support for environmental factors versus genetics! If homosexuality were in the genetic code, then both of the twins would have been homosexual 100 percent of the time, yet this was not the case.
The well-known Simon LeVay brain study of 1991, which tried to find differences in the hypothalamuses (a very small part of the brain) of homosexual and heterosexual men, found no evidence that there is any genetic cause for homosexuality. Nothing in the study showed that gay men are born that way. Other prominent researchers have concluded that there is no evidence to support a biological theory, but rather that homosexuality could be best explained by an alternative model where "temperamental and personality traits interact with the familial and social milieu as the individual's sexuality emerges.
Why does the truth matter?
As the myth of being born gay is more accepted by American society and government, US govt. is seeing the effects. For instance, increasingly more states are trying to legalize same-sex marriages. Educational curricula now include courses on lesbian, gay, bisexual and transgender studies. Clearly, our perception of science can affect political policies. LeVay, the researcher and gay activist mentioned previously, made an interesting observation about the emphasis on the biology of homosexuality. He noted, "...people who think that gays and lesbians are born that way are also more likely to support gay rights."
Let's face it: science is meant to be fact . . . not theory. So, when the media takes hold of false theories of genetic links to homosexuality and promotes it as science, people are led astray. This is not right. Even if somewhere in the future a genetic link could be proven, it wouldn't suddenly make the behavior right—or acceptable to God. Look at alcoholism or tendencies toward anger. While these have been promoted as having a genetic linkage, there are few, if any, in our society who would accept such behaviors just because they are linked genetically. God's Word still makes no provision for any type of sexual activity except that found within heterosexual marriage between one man and one woman. So to answer the question, "Are homosexual attractions biological?" the conclusive answer is there is no support in the scientific research for the conclusion that homosexuality is biologically determined.
To me, this new dimension Nigerian law is uncalled for, in as much as I detest homosexualism as a concept presumed to be of a new societal class indoctrination. It is like playing golf, and you dont know how to play it but you show up, simply because you want to be counted and you know that its mostly a rich man's club and you are trying as much harder than average citizen to get in and its hard because you do not fit, and it comes with a price tag, not necessarily based on your affluence but what else you have to offer that no else feel comfortable given? None the less, It is a mere distraction in an unsettled, fragile democratic society.To me it will open doors for violence,hatred, stigma and discrimination, just last week I heard in Bauchi state, the state govt. are hunting for gay men from house to house, door to door torturing some innocent people, and govt. are asking for community for help to" a fish out" of suspected gay men. It is a jungle justice and guerilla tactics per see. How for heaven sake, an African man can figure someone look like a gay or not? So if you owe me money and you refused to pay, I can simply declare you a gay man, and you may be convicted for just given my words against yours. Its barbaric. We are not there yet? Let's govt. improve for modern infrastructure first before we start fighting all goodies that comes westerner with it. When we get to that bridge , we will cross it. Do not put your cat ahead of your horses. This is another way to make homosexual popular in Africa,it is the least of our problem.Job creation,good road networks, high valued education,constant power supply laws and implementation will just do Africa fine not gay law.
I hope you enjoy this little research... Just another way to take a look at the issue.
Akin Awofolaju, PhD
In the last decade, the paradigm of Migration and Development (M&D) has shown that migration and development are closely interrelated fields and that migrants can strongly contribute to development in the country where they come from. According to the World Bank, the volume of money sent by migrants around the world to the African continent is currently bigger than the Official Development Aid (ODA) and reached nearly $40 billion (2.6% of the GDP) in 2010. Remittances not only enhance the livelihood of families in developing countries, but can also boost economies, finance micro-credit schemes or infrastructures and contribute to development programs in countries of origin. Therefore, migrants have a great potential to offer in favor of development. The question is: how can we effectively unlock it?
An estimated one in ten tertiary educated adults born in the developing world resides in the developed world; 30 to 50 percent of those trained in science and technology
The return of expatriates to their home country is widely perceived as being beneficial; favorable impacts have been attributed to returning scientists and engineers in Korea and China.
Why Diaspora Bonds? Why not? Nigerians love to travel and live abroad. We probably have more Nigerians abroad than any other African country. Nigerians in Diaspora remit an average of $300 per month to families in Nigeria. There are so many advantages of Diaspora bonds. One of the advantages if we have to borrow a leaf from Israel is keeping Diaspora actively engaged in the welfare of Nigeria or encouraging patriotism amongst Nigerian nationals abroad. Apart from the patriotism, Diaspora bonds may also help the investors save money from cost of sending money to Nigeria via Western Union. Most times, when people abroad send the money to their relatives, these monies ended up being misused. I have read instances on the news whereby folks kept repatriating money home thinking they were investing or that the money were being invested only for them to find out that the money have been squandered by their relatives. With Diaspora bonds at least you are sure where your money is going. The bonds are tax-exempted,
Implying bigger income for the investors; the bonds provide an alternative investment to equities, real estate and bank deposits. Bonds can also be used as collateral for borrowing from banks and discount houses, and bonds can be sold either through any of the 21 PDMMs licensed by the DMO or on the floor of the NSE”.
Factors to Consider before issuing Diaspora Bonds:
Based on my research, there are several factors to consider before issuing Diaspora bonds. Some of these factors are: the size and wealth of Nigerians in Diaspora; the compactness or dispersion of Nigerians in Diaspora; level of patriotism; integrity and stability of legal systems in Nigeria; and the potential for full subscription of the bond itself.
According to World Bank’s report, Nigeria made $10 billion (N1.5 trillion?) from remittances made by its citizens living abroad in 2008. While I don’t have the census of all Nigerians scattered all over the world, it will not be a stretch to assume that on the average, Nigerians remit over $100 million annually via Western Union, Money Gram etc to Nigeria. Note that these remittances via Western Union, Money Gram and the rest of them come with a huge cost---as you have to pay processing fees to send money to your families or whatever via these companies. When you think about it, if Nigeria made a staggering $10 billion from remittances made by its citizens living abroad in 2008, then it won’t be a stretch to deduce that the money that Nigerians in Diaspora remit annually represents a significant percentage of Nigeria’s gross domestic product. Most families in Nigeria depend solely on their families abroad for their sustenance. Most will go hungry without these remittances from Nigerians in Diaspora. According to the UN's Office of the Special Adviser on Africa (OSAA, the average African migrant living in a developed nation is sending $200 per month home to his or her family. In its report, it stated that “...Remittances from Africans working abroad in the period 2000-2003 averaged about US$17 billion per annum virtually overtaking Foreign Direct Investment flows which averaged about
$15 billion per annum during the same period.
North America accounted for nearly half of the remittance inflows in April 2013, while Europe and the rest of the World accounted for 27 percent and 24 percent, respectively. In May 2013 North America accounted for 52 percent of the remittance inflows, while Europe and the rest of the World accounted for 26 percent and 21 percent, respectively. North America’s dominant position is a reflection of the large number of Nigerians with gainful economic activities in the region.
According to the world bank and International Organization for Migration(IOM), Remittances generally reduce the level and severity of poverty, typically leading to higher human capital accumulation; greater health and education expenditures; better access to information and communication technologies; improved access to formal financial sector services; enhanced small business investment; more entrepreneurship; better preparedness for adverse shocks such as droughts, earthquakes, and cyclones; and reduced child labor.
Diasporas can be an important source of trade, capital, technology, and knowledge for countries of origin and destination. Remittance flows to developing countries are estimated to have totaled $401 billion in 2012, an increase of 5.3% over the previous year. Global remittance flows, including those to high-income countries, were an estimated $529 billion in 2012.
The top recipients of officially recorded remittances in 2012 were India ($69 billion), China ($60 billion), the Philippines ($24 billion), Mexico ($23 billion) and Nigeria ($21 billion). Other large recipients included Nigeria, Egypt, Pakistan, Bangladesh, Vietnam and Lebanon. However, as a share of GDP, remittances were larger in smaller and lower income countries; top recipients relative to GDP were Tajikistan (47%), Liberia (31%), Kyrgyz Republic (29%), Lesotho (27%), Moldova (23%) and Nepal (22%). Remittances sent home by migrants to developing countries are equivalent to more than three times the size of official development assistance and can have profound implications for development and human welfare. Remittances can contribute to lowering poverty and building human and financial capital for the poor.
Despite the current global economic weakness, remittance flows are expected to continue growing, with global remittances expected to reach $608 billion by 2014, of which $468 billion will flow to developing countries. Barely few days ago, Nigeria federal government announced that Nigerians in the Diaspora remitted N3.36 trillion (US$21 billion) in the last one year, as roughly 15 million Nigerian citizens are living abroad legitimately registered and gainfully employed. Furthermore, Secretary to the Government of the Federation (SGF), Hon. Anyim Pius Anyim, also declared that records had shown that Nigerians in Diaspora remitted about 21 billion USD...which today is one of the highest in Africa and this figure does not include unrecorded sums sent through individuals to relatives in homeland. One will conclude that alone put forth the legitimacy of Nigerians in Diaspora power to make difference in the homeland if this resources were thorough coordinated to serve as development financing through issuance of Nigeria Diaspora bonds..
In conclusion, some concerns have been raised that a significant amount of remittances sent by the Diaspora is used for direct consumption without getting into long term investment and savings, diminishing the money’s impact on the development of Nigeria. This is where Diaspora bonds come in. Diaspora bonds from what I have read typically mature in 5 – 7 years and pay annual dividends between 5% and 8%. (Currently, I don’t think bank deposit and certificate of deposit interest rates are more than 2%). Every year, the bond pays the purchaser this interest and at the end of the term, the purchaser receives her principal as well as the accrued interest. No doubt in my mind that Diaspora Bonds can serve as catalyst to unlock capital development financing.
Presidency to World bank? I think it goes beyond merits .... and seemingly this process is, it's quite a learning curve for us all especially for folks from the continental Africa. It is indeed, very sad, that despite all effort to showcase our talents , we are been sidetracked, deprived beaten to it over and over again.
Personally, I have great respect for Dr. Ngozi okonjo-Iweala as I have met with her on various interactions, quite number of times, the latest encounter with her was at Banking Reform Forum at Ritz Hotel in Washington DC, she as always, well composed, shouldered an expert mints on global economic issues and I have no doubt in my mind that she will serve best of interest for that global entity called World Bank. Alas, what people don't know is that the position for World Bank presidency is not and will never be based on sheer merits, but a strategic clandestine political one, it will be ever be based on intense capital politico - card expenditure coupled with extremely muscled shareholding influence, as a saying goes, "you can't withdraw from a bank if you do not deposit into it".
As Africans , we need to put our house in order first, and for a starter, African Development Bank for African Union there is, that will evidently culminate that effort.... you bet so much is going on there given OECD reports, and one would be a fool to think that Nigeria's violability did not play its role too. This current World Bank Presidency tuft process has shown us, the true ego centrists- American way of handling global Affairs, be it Obama or Bush empire. It is always the same doctrine. Average American are patriots, and here are some new science for Nigerians to explore, Americans always believe in Americans " what's in it for me first as an American" should we rather spend our moral capital worth within our own marketplace where we have an absolute control and interest, than in somewhere else where we can't predict our revenue payback but only the cost or the unforeseeable outcome
As Okonjo-Iweala aptly put it,
"With regard to the selection process, it is clear to me that we need to make it more open, transparent and merit-based. We need to make sure that we do not contribute to a democratic deficit in global governance. Nevertheless, by our participation we have won important victories. We have shown what is possible. Our credible and merit-based challenge to a long-standing and unfair tradition will ensure that the process of choosing a World Bank president will never be the same again. The struggle for greater equity and fairness has reached a critical point and the hands of the clock cannot be turned back."
Without mincing words, she called it out clear and steadily with high eloquence but average world bank experts are concerned with
The fact here is that it is as open as it get , it will and cannot get more opener than it gets as long as America remains the enabler , driver and major contributor to the World Bank residue... let's be real. George Bush was not made President of United States Of America because he was the most intelligent man in America neither was President Obama but both have a distinct quality that brought them to power.
There was never really a contest and Dr. Iweala knows it, Africa and some developing countries probably figured this out and put up a strong candidate to em brass the west, hoping this will lead to a more open process in the future. We can't bet on it. Americans hold 19% of World bank overtures, the highest stakeholder of World bank, follow by Europe and Japan, Africa only have less than 5% of the vote.
The west won't give up its hold over these institutions until they need something from the emerging markets.
No doubt , that lack of political instinct has damaged Okonjo-Iweala's chances. let's be more frantic. People don't like to be caught unawares. Where the US has such a major stake, this is something that clearly should have to be negotiated behind closed doors first. That is the golden rule in the boardroom or in politics.The Obama administration would almost certainly have withheld support for Lagarde's appointment to the IMF if European nations had not agreed in advance to support whomever was Washington's candidate for the World Bank .
So the Question is why Dr. Kim Yung not our own beautiful, intelligent, experienced Dr. Ngozi Iweala? Here are some insights !!!!
Kim's selection marks a break from previous World Bank leaders who were typically political, legal or economic figures.
The World Bank raises money from its member nations and borrows from investors to provide low-cost loans to developing countries.
But picking a new World Bank head is a little like picking a new Pope. The process isn't just about the individual candidates for the position, but about the overall direction of the faith. And so, the controversy over Kim's nomination is not really about Kim himself. It's a debate about a philosophical schism in the development community.
The original idea of development really gained strength with the de-colonialization that followed World War II in Asia and later in Africa. Just as objects in nature go through a process of development to achieve their full potential — acorns become oaks, tadpoles become frogs, human embryos become people — the idea was that newly sovereign states would experience a historical process whereby India would become Britain, Korea would become Japan, and Cote d'Ivoire would become France.
It was thought that this process, which is now known as national development, would involve the natural replication of the four-fold historical transformation of the developed nation-states: Economies would become more productive and hence support broad-based prosperity, polities would become more fully responsive to their citizens,administration would become more capable, and societies would become more equal as birth-based distinctions (such as class and caste) and divisive identities (of kith and clan) faded in favor of modern social relationships. Note that each of these was something that would happen not just to individuals but to a country.
Indeed, an article of faith was that the development of the nation-state was the best and most effective route to promote the development of individuals. It was assumed that the best way for Kenyans (or Haitians or any other national group) to develop as individuals was for Kenya (or Haiti or any other country) to develop as an economy, polity, administration, and society.
Of course, within the fold of the development faithful, there have been plenty of conflicting opinions about how to carry out this agenda. For instance, there have been debates about the sequencing of the four dimensions. Some have argued that economic growth needs to precede democratization, others that democratization is instrumental to economic growth and should come first. These debates have been heated and vociferous and often ideologically charged; but all have been within a shared understanding that the goal was national development.
This philosophy has had some spectacular successes. South Korea has moved from a basket case in 1962 to a fully developed nation-state — prosperous and democratic — in record time. Chile, after some tumultuous and violent periods of authoritarian government, has now arrived as a developed nation-state. National development has also seen some abject failures in which none of the four transitions have happened: Somalia, where the post-independence national development project has ended in anarchy and violence, is probably the most obvious example. And, in many other countries around the world, one or more of the four dimensions of national development have been painfully slow — sometimes economic growth but without democracy or freedom (as in Myanmar), sometimes democracy without economic growth, sometimes economic growth and forms of democracy but without an effective state (as in Pakistan).
But throughout this time there has been another side to the development world: one that is less interested in national development and more interested in humane development. (I say "humane" development to distinguish from "human development," which is an integral component of national development.) These are the people, often supported by philanthropy, who step into the breach where national development has failed. These idealists and the organizations they run have helped to mitigate famines, pandemics, poverty, violence, and lawlessness in some of the poorest areas in the world.
Nearly everyone understands that humane development, while terrific and noble and important work, is not the same as national development. Famine relief is a holding action not an agricultural strategy. Refugee camps during periods of violence are needed, but they do not constitute a housing strategy. Earthquake re-building is not an infrastructure strategy. This is not to denigrate those efforts, which draw on the dedication of some of the most heroic people on the planet. But these people recognize that their humane work is palliative and the need for it shrinks when national development happens.
Which brings us back to the leadership of the World Bank. As a medical doctor who has devoted himself to mitigating the consequences of poverty in places like Haiti and Rwanda and the slums and highlands of Peru, Jim Young Kim is from the world of humane development. But the World Bank is fundamentally an organization devoted to national development, especially the economic component of that process. As a result, his appointment appears to be an intrusion by the world of humane development into one of the core institutions of national development. By contrast, the nominee backed by many African countries, Ngozi Okonjo-Iweala, has been finance minister of Nigeria and a managing director of the World Bank. In other words, she is from the world of national development, rather than the world of humane development. What has shocked the development world is that President Obama did not seem to know the difference.
The new World Bank president must overcome concerns about the legitimacy of the leadership selection process even as he tackles three key problems.
First, he must lead the Bank in creating new instruments to respond to common global problems, such as drug resistance, fisheries collapse and climate change. Country loans and grants – the Bank's main product – are not well suited to these cross-border problems.
Second, he must reduce the hassle costs for middle-income countries that would welcome the Bank's expertise but are discouraged from borrowing by long delays between loan requests and disbursements. This means streamlining procedures and treating borrowing countries more like clients taking on risks and responsibilities, and less like children.
The reality of investment and development in large-scale projects in the less developed world is that it requires both extensive and hard-headed experience in the field. However, it also demands leadership and diplomatic skills in the rough and tumble of the financial management of a globally oriented multi-billion dollar enterprise. It is doubtful that even Dr. Kim would view himself as qualified under those requisites.
Finally, the new president needs to lead the bank in finding better ways to help fragile and weak states, like Somalia, Afghanistan, the Democratic Republic of the Congo and Timor-Leste. The World Bank needs to shift from a culture that feels it must pretend it knows what to do to a culture of trying, failing, adjusting and trying again. To build a consensus around solutions to these problems, the new president could appoint high-level groups to study each problem and present proposed solutions to the World Bank board for discussion, modification, and eventual approval. Here is my candid question to the "New World Bank President "
"Can you give us just one example where the Bank's structural adjustment policies have worked?' the answer is none !!!! Absolutely , NONE !!!!!
Jim Kim may be brilliant. He may be perceptive of the world's needs. But he is not qualified to be the leader of the World Bank Group. And neither is anyone else who believes GDP growth and corporate profits work against socio-economic well-being.
Just a thought !!!!
Nigeria Political can of worms:Issue of Identity crisis between the Hausa and Fulani's, Yoruba and Yoruba's, N'digbo, Ikweres and Igbo's, Edos and Ishans, etc
by Akin Awofolaju, Ph.D
And Just Who Are the Nigerians?
It was a question that was never too far from the surface details of the reports and commentaries from foreign pundits. Just who are these Nigerians? The presupposition behind this was that even fraudulence requires some subterfuge, some competence, some finesse besides, megalomaniac belligerence, which, by any standards in the world, was so inept, chaotic and open call for special understanding of "NIGERIANS" identity
The number of languages currently estimated and catalogued in Nigeria is 521. This number includes 510 living languages, 2 second languages without native speakers and 9 extinct languages. Over 250 ethnic groups including Hausa and Fulani 29%, Yoruba 21%, Igbo (Ibo) 18%, Ijaw 10%, Kanuri 4%, Ibibio 3.5%, Tiv 2.5%
Religions: Muslim 50%, Christian 40%, indigenous beliefs 10%
The official language of Nigeria, English, was chosen to facilitate the cultural and linguistic unity of the country post-colonization by the British. The major native languages spoken in Nigeria represent three major families of African languages - the majority is Niger-Congo languages, such as Yoruba, Ibo, the Hausa language is Afro-Asiatic; and Kanuri, spoken in the northeast, primarily Borno State, is a member of the Nilo-Saharan family. Even though most ethnic groups prefer to communicate in their own languages, English, being the official language, is widely used for education, business transactions and for official purposes. English as a first language, however, remains an exclusive preserve of a small minority of the country's urban elite, and is not spoken at all in some rural areas.
Communication Style Due to the ethnic make-up of the country, communication styles vary. In the southwest, where the people are from the Yoruba tribe, people's communication employs proverbs, sayings and even songs to enrich the meaning of what they say. This is especially true when speaking their native language, although many of the same characteristics have been carried into their English language usage. The Yoruba often use humor to prevent boredom during long meetings or serious discussions. They believe that embedding humor in their message guarantees that what they say is not readily forgotten.
Nigerians living in the south of the country tend to speak more directly. You may also find their tone slightly louder than elsewhere. They may raise their voices even more and become emotionally excited when they feel passionately about a topic. At the same time, a harsh tone is considered unwelcoming and even hostile. Nigerians prefer facial expressions that imply empathy and believe an indifferent facial expression indicates that a person is ignorant or obnoxious.
Generally speaking, Nigerians are outgoing and friendly. Communication commences with polite inquiries into the welfare of the person and his family. Such social niceties go a long way since. Therefore, foreigners who take the time to get to know the Nigerian as a person are considered friends and welcomed into a Nigerian's inner circle of family and close friends.
Nigerian communication can also be indirect and may rely on non-verbal cues. Many use gestures when communicating. They may smile to mask their true feelings, especially when disappointed or confused. Many employ indirect eye contact to demonstrate their respect for the other person. It is common to gaze at the forehead or shoulders of someone they do not know well. Very direct eye contact may be interpreted as being intrusive unless there is a longstanding personal relationship.
At the same time, there are some Nigerians who are extremely direct communicators and have no difficulty stating what is on their minds. Therefore, it is a good idea to observe the situation carefully before determining what behavior is appropriate.
In general, Nigerians start with the general idea and slowly move into the specific, often using a somewhat circuitous route. Their logic is often contextual. They look for the rationale behind behavior and attempt to understand the context. They tend to examine behavior in its total context, not merely what they have observed
Looking into one of our leaders and his style, Bola Ige was one of a very few numbers of our politicians in the South who have been able to cut through to the core of our dilemma: the Fulani politics of power supremacy. He was no rabble-rouser who indiscriminately amalgamated more than 250 diverse ethnic grouped together as "these Nigerians" in 1918 by Lord Lugard
Bola Ige had a clear vision of a democratic Nigeria where no ethnic or racial group will dominate our polity, and his activities in the Obasanjo government have been geared towards this goal.
Fulanis hated Bola Ige for he understood the mechanism of their dominance in Nigeria. He's therefore held responsible by the Fulani power elite for what they perceive as the "anti-North" policies of the government. Of course, the President makes no policies against the North, but the interest of the Fulani Oligarchy is deceitfully called the "interest of the North" by Fulanis.
The vitriolic media campaign against him by Fulani politicians and intellectuals (and their lackeys in the Muslim North), which began as soon as he was named a minister in the Obasanjo government, has no precedence in our political history. The virulent attacks on the person of the politician were only a precursor to his physical elimination.
Unfortunately, many of his contemporaries in Yoruba politics did not understand that he was already advancing the same struggle they claim to lead. And Bola Ige himself obviously underrated the enormity of the danger he represented to the racial and power supremacist Fulani Oligarchy hence the feeble attention he paid to his personal safety and that of his family.
The professional way in which Bola Ige's elimination was carried out shows that his detractors far beyond Yoruba land were the perpetrators of his demise. The twisted mode of his murder shows that it had nothing to do with the machete and Dane gun thuggery of the Akande-Omisore rift. It should also be remembered that unknown persons had twice broken into his Abuja office and destroyed documents in the past one year.
The logic of his elimination marks out the Fulani elite as prime suspects.
Nigeria must not be misled by the hypocritical condolence visit of M. D. Yusuf, the Fulani chairman of Arewa Consultative Forum, to the Ige family in Ibadan or by the statement issued by the organization warning against the imposition of emergency rule on Osun State.
We must refuse to be deceived by the feigned kind comments of some Fulani politicians on Bola Ige, because they are presently reveling in schadenfreude, joy over misfortune that befalls one's enemy.
As bombings and shootings by the militant Islamic group Jama'atu Ahlus Sunnah Lid Da'awati Wal Jihad - better known as Boko Haram - escalate, the Nigerian government appears to be struggling to cope with the violence, or map a political solution to the crisis.
The Salafist group grabbed attention in 2009 with coordinated attacks on government buildings and police stations in four northern states which left more than 800 people dead. The attacks were revenge for an earlier clash with the police, who had opened fire on Boko Haram followers in a funeral procession in the northeastern city of Maiduguri, which was widely seen as a deliberate attempt by the state authorities to crush the group.
The violence metastasized in 2011: there were bombings of the headquarters of the police and the UN in the capital, Abuja; more than 100 died in bomb and gun attacks in a single day in two towns in northeastern Yobe State, and Boko Haram promised strikes in the largely non-Muslim Christian south. In what seemed a deliberate attempt to stir sectarian unrest, a series of bombings on churches on Christmas Day in Abuja killed close to 40 people.
What does Boko Haram represent?
Boko Haram represents different things to different people depending on where you stand in the deep divide of Nigerian society. To the political elite in the south, it may have started as a small, fringe religious sect with a radical worldview about how Nigerian society, especially the northern part, should be governed according to the dictates of Islam. But today [they feel] it is has been hijacked by the northern political elite who have not hidden their distaste about the emergence of President Goodluck Jonathan [a Christian southerner], and are now using the group to make the state ungovernable in order to ensure the return of political power to the north. To me that's simple hypocrisy for a group(North) who may or could not afford civil war that clearly non beneficial to them taking into consideration our resources control.
However, a more reflective viewpoint sees the group as representing the voices of the northern poor and downtrodden, even though misguided, who have been marginalized in the scheme of things and now seek a violent outlet to [highlight] their issues, like their counterparts in other parts of the country, such as the militants of the Niger Delta and the Odua People's Congress in the southwest, who seek consistently Oduduwa Republic given their enormous human resources.
Boko Haram (BH) represents the backward slide of Nigeria. Although presented in Islamic religious garb, its activities are deeply criminal and political. While the history of BH can be traced to a young Muslim group in the northeast of Nigeria, they have since [morphed] to include criminal groups. Today nobody is clear what the group stands for [and] people are not sure who exactly is responsible for the spate of violence in the country. There is therefore no one acceptable narrative on the issue. The perception of north/Muslim is different from that of south/Christian. Whereas must people in the south or Christians accuse what they call "a disenchanted north" for the problem, the north seems to believe the violence is being perpetrated by people in government and their foreign backers to divide the country.
Boko Haram is a name given in 2009 by the press to the religious group led by Mohammed Yusuf, when fighting broke out between the group and the Nigerian police in Maiduguri, Borno State. This group is an outgrowth of the [conservative] Izala Movement [one of the largest Islamic societies in the country]... [But] Yusuf fell out with senior preachers over ego, differences in perception of religious texts and their attitude/relationship towards the Borno State government... Yusuf built up a robust camp that was self-reliant, well organized and a popular destination of jobless and frustrated youths who found hope and engagement. As his followership grew, his confidence grew - to the deep consternation of the state governor and his courtiers... At the moment the group has resorted to taking revenge for killings, persecution and torture of its members in various prison cells nationwide, with targeted killings of informants and bombings to rattle the government. Lately they have also started to seek recognition and relevance by appealing to aggrieved northern Muslim sentiment [over Jonathan's election victory].
Where the military is involved, the rules of engagement should be defined to avoid molestation of unarmed civilians and abuses that could further mobilize local communities.
How should the government respond?
The attacks by Boko Haram and the security challenges they pose represent a potent threat to the corporate existence of Nigeria and need to be responded to with all seriousness using a multipronged strategy. Government, in my view, has not given the group all the attention and seriousness it deserves and appears to be playing politics with it in order not to be seen to be hurting certain vested interests. A more holistic strategy should combine an intelligence-led security approach to fish out the masterminds of the attacks, and initiatives that would aid the isolation of the group from the communities in which they operate.
The government needs to be decisive and deepen intelligence gathering. Where the military is involved, the rules of engagement should be defined to avoid molestation of unarmed civilians and abuses that could further mobilize local communities against the state. The government will also need to make a long-term strategic investment in the northeast of the country to contain the level of poverty and exclusion in the area.
The federal government should:
Appoint independent local, national or international leaders to appeal, appease and engage the aggrieved sect members and leaders;
Unban the group, granting them the right to freedom of belief and practice as guaranteed by the Nigerian constitution;
Renounce the use of violence, by all parties;
Unconditionally release the thousands of Yusufiyya members in cells, detained without charge;
Dispassionately review the events of 2009 and show remorse where necessary;
Work to win the confidence and trust of the affected communities through careful conflict resolution measures;
Compensate and rehabilitate all those families who have suffered loses both human and material;
Allocate federal government resources for rapid rehabilitation of infrastructure, boost agriculture and cross-border trading to promote rapid employment for the teeming uneducated, excluded youths.
What are the constraints the government faces?
The major constraints faced by the government in dealing with Boko Haram is the politicization of everything in this country, which has crippled law enforcement and security agencies from carrying out their functions in a professional manner, without fear or favor.
There is also a certain level of insincerity and deceit on the part of government in confronting the issue squarely. A typical example is the half-hearted declaration of a state of emergency made by President Jonathan in 14 local governments areas [in Yobe], which is neither here nor there in practical terms. Everybody knows that unless you declare a state-wide state of emergency, which would mean removing elected governors and replacing them with people with clear mandates to work with security agencies to restore law and order in affected states within a given period of time, not much can be achieved.
Lack of capacity, especially intelligence gathering capacity, poor political will to face the challenge of dealing with criminality, the religious coloration of the situation, and the extreme politicization of the situation by the government.
The following: Weak and heavily compromised political leadership;
The inability of the federal government to detach itself from the exploitation of sectional, sectarian, ethnic [interests];
Inability of the federal government to reverse itself having already tagged the problem a national security threat that should be wiped out;
Difficulty in breaking free from the beneficiaries of this standoff, i.e. the leaders of the security arms of government, security equipment suppliers, agents and contractors;
The reluctance of the federal authorities to bring the former Borno State governor, Ali Modu Sheriff, to account for his misrule.
QUESTIONS ON DEREGULATION OF PETROLEUM SECTOR AND REMOVAL OF PETROLEUM SUBSIDY
1. What is meant by the deregulation of the downstream petroleum sector?
Deregulation of the downstream petroleum sector refers to the reduction, or removal of government control, rules and regulations that restrain free operational activities in the sector. This does not mean a complete elimination of the laws that govern smooth operations of activities in the downstream oil sector. Rather, it means that the role of government in this sector will be limited mainly to providing regulatory oversight.
2. What is the rationale behind the government's plan to deregulate the downstream petroleum sector?
Deregulation of the downstream oil sector will improve the efficient use of scarce economic resources by subjecting decisions in the sector to the operations of the forces of demand and supply. This will attract new sellers, buyers and investors into the market, thereby increasing competition, promoting overall higher productivity and, consequently, lowering prices over time. The ultimate effect of this chain of activities is increased gains for the people of Nigeria who would be getting the most out of their natural resources. For example, following government's deregulation in the telecommunication, there has been a reduction in call tariffs. Similar successes have also been recorded in the banking sector with the emergence of stronger banks with unprecedented spread to several other African countries. These are classic examples of the kind of positive effects deregulation could have on the oil sector.
Deregulation further reduces economic waste and lightens social burdens caused by government control. For several years, Nigeria experienced scarcity of petroleum products that crippled national economic activities, and increased the cost of doing business, several times over. The resulting scarcity inevitably leads to a flooding of the market with adulterated products, which usually leads to the damage of vehicles and machines. On many occasions, and in many parts of the country, particularly outside of the big cities and towns, a majority of Nigerians have been forced to buy petroleum products at 300% higher than their original price. Deregulation will help address this price scalping and a host of associated problems related to the sector.
Deregulation of the downstream oil sector promises to be the way forward in expanding opportunities for economic growth and a competitive downstream petroleum sector if regulation in the downstream sector is limited to oversight and supervisory functions, aimed at guaranteeing quality of products and preventing consumer exploitation, then the process of deregulation could help achieve greater cost-effectiveness.
3. How important is pricing to deregulation of the downstream oil sector?
Appropriate pricing of petroleum products is one of the major factors that will attract private investment into the Nigerian downstream petroleum sector. This is because the prices of the petroleum products will be set by independent marketers based on demands and the supply of the products. Like every other goods and services in the marketplace, independent oil marketers would be free to set their prices. This would lead to further reduction in prices for refined oil product until an appropriate market price is attained. Continued subsidization by the government will not help achieve such appropriate pricing. Deregulation through subsidy removal will lead to adjustments that will push prices towards its market-determined level. Appropriate pricing achieved through this policy will make activities in the sector more profitable and attractive to private domestic and foreign investors.
4. Is rehabilitating the refineries part of the strategy for deregulating the downstream petroleum sector?
Yes. In the last 12 months the country's refineries have worked relatively well, and this has led to increased capacity utilization from 30% to the current 60%. This means that for 12 months now, the country's refined petroleum production capacity has been steadily on the increase. To further improve on this to an internationally accepted level of 90% capacity utilization in the next 24 months, the original contractors responsible for building the refineries have been contracted to carry out a Turnaround Maintenance (TAM) of these refineries. Specifically, TAM for the Port Harcourt Refinery will be carried out in the first Quarter 2012. This would be followed by the Kaduna Refinery and then the Warri Refinery. Thereafter, the normal cycle of TAM will be respected.
However, research and analysis show that even if all the country's refineries were to operate at full capacity, there would still be a petrol supply gap of 15 million liters per day. Therefore, importation WILL remain inevitable until additional refining capacities are built through the on-going Greenfield Refinery Project. Discussions are currently under way with prospective investors who are willing to provide Foreign Direct Investment (FDI) to build additional refineries in the country to ensure domestic self sufficiency and the export of refined petroleum products within the next few years.
The Petroleum Industry Bill (PIB) contains special fiscal incentives in place to encourage the establishment of new refineries around the country. Clearly, the establishment of new domestic refineries and the rehabilitation of existing ones are critical to ensuring a successful deregulation program. A viable local refining sector will, in the long term, bring down the pump price of petroleum products below the current import parity level.
5. Are there countries that have deregulated their downstream petroleum sector and removed subsidies?
Yes, there are examples of countries that have removed petroleum subsidies, including oil producing countries. In particular, Indonesia, Malaysia, and Ethiopia have eliminated it completely. Only recently Ghana announced that it would be removing fuel subsidies in order to sustain its fiscal consolidation.
6. Why not a staggered, phased removal of fuel subsidy, if at all?
The removal of subsidies in phases has never worked in any country and there is a strong likelihood that it will not work in Nigeria. A partial removal will lead to partial results because investors will continue to be discouraged and the distortions and inefficiencies existing in the sector, such as smuggling and rent-seeking behavior, will continue. A gradual deregulation will imply that substantial amounts of money will continue to be spent on fuel subsidy through continued borrowing. This will imply that future generations of Nigeria would have to repay part of the debt being contracted. The optimal policy response, therefore, is to remove it once-and-for-all.
7. Has deregulation succeeded in other sectors of the Nigerian economy?
Yes it has! The communication, banking, and aviation sectors are typical examples where deregulation has worked in Nigeria.
Before the deregulation of the communications sector, the Nigerian Telecommunications Limited (NITEL), a government-owned company, was the sole operator for telephone lines in the telecoms sector. This period was marred by inefficiency, low telephone access, high tariffs and poor services. Once the sector was deregulated, private investors, both domestic and foreign, came in with Global System for Mobile Communication (GSM) services, resulting in high competition, which significantly improved service coverage, increased telephone access, and drove down prices.
Similarly, deregulation of the banking sector resulted in the emergence of strong local banks offering a variety of services, and with a high presence in several other African countries. A few of these banks are also operating in some non-African countries including the United Kingdom, the United States, and France.
Prior to deregulation of the aviation sector, Nigerian Airways, a government-owned and managed airline, was the sole operator. This resulted in service inadequacies that included flight delays and cancellation, poor route network and high airfares. With deregulation of the industry, there have been an increased number of airlines, wide coverage and reduced airfares. Today, people can book a flight from the comfort of their rooms.
These are some typical examples of where deregulation have been successful in Nigeria and have created greater competition, reduction of prices and efficiency in services more possible. This too can be achieved if the downstream sector of petroleum industry is deregulated.
8. What is fuel subsidy?
Generally, subsidy refers to the money paid, usually by government, to keep prices below what they would otherwise be in a free market system. Such intervention by government leads to a distortion that has the potential of imposing large economic costs. More specifically, fuel subsidy is the difference between the price a consumer pays for the pump price of fuel and the actual total cost of producing or importing it. For instance, the price of petrol is currently pegged at N65 per liter but the actual cost of supply is about N138 per liter at crude oil price of $110 per barrel. Therefore, the subsidy element is about N73 per liter. This means that for every liter of petrol purchased at the official price of N65, the government contributes N73. It should be noted that only petrol and kerosene currently enjoy government subsidy, and that imported and locally produced petroleum products enjoy these subsidies.
9. Who benefits from government's fuel subsidy?
Benefitting from government's subsidy depends largely on the level of fuel consumption. The greater the consumption, the more the benefit. In Nigeria, it is the rich, and not the poor, who benefit the most from fuel subsidy. The reason for this is that rich members of society can afford several cars, which gulp quite a lot of fuel every week. As they buy fuel for their cars, they benefit from the subsidy because government pays the difference between what they would have paid and what they actually pay. In contrast, many of the poor do not own cars while middle income Nigerians can only afford small cars that consume minimal fuel. In many cases, these latter groups depend on public transportation with low fuel consumption per person. As a result, they do not benefit much from the subsidy because they consume relatively very little fuel. The government subsidy as it currently stands benefits only smugglers and neighboring countries to which these petroleum products are smuggled.
10. Is it really true that fuel subsidy removal will affect only the rich and not the poor?
No, but it will affect the rich more than the poor. Right now, the rich benefit more from the subsidy since they consume more fuel relative to the poor through ownership of several cars. They are therefore more subsidized relative to the poor. This means that they will face more adjustments with the removal of the subsidy compared to the poor who consume less petrol.
11. How much does the government spend on subsidy?
Between 2006 and August 2011, total government expenditure on petroleum subsidy amounted to N3.7 trillion. Expenditure on subsidies increased from N261 billion in 2006 to N673 billion in 2010, which represents an increase of about 160%. Additionally, there have been unprecedented payments in 2011 that so far amounted to N1.4 trillion due, in part, to two key factors: increase in subsidy per liter as a result of rising global oil price, and large arrears due NNPC for household kerosene imports.
12. Is there any provision in the budget for petroleum subsidy?
Government does not have any budget line for petroleum subsidy. However, estimates are made annually for it. In the last few years, Government has provided a notional amount in the budget for subsidy payments. The monies are disbursed from the excess crude account before distributing the remainder among the three tiers of government. Thus, the issue of disparity between the amount budgeted and the actual payments does not arise.
Furthermore, the amount spent on petroleum subsidy is highly unpredictable, as some of the underlying factors are highly volatile (i.e. international price of crude oil, exchange rate, volume consumed, etc.). Therefore, Government's estimates can deviate significantly from actual payments because of these factors.
13. Shouldn't government fix the refineries before removing subsidies?
Although NNPC is making efforts to fix the refineries over the next 24 months, continuation of subsidies will be counter-productive to government's effort to deregulate the sector. As long as the subsidies are maintained, petroleum product pricing will remain a disincentive to operators and potential investors in domestic refineries. In other words, there will be little incentive to fix the refineries as long as government can continue to pay for people to import refined product from abroad. Therefore, the removal of the subsidy should logically pave the way for the proper functioning of the refineries through increased private local and foreign investment.
The fact that subsidy would be removed would create better market incentives for the old refineries to be fixed and new ones to be built. Indeed, once the downstream oil sector is deregulated, government will have no need to invest in the refineries. That becomes the responsibility of private local and foreign investors, leading to a permanent solution to the perennial problems of poor functioning of the refineries which, in fact, has been one of the major reasons why private investors have been reluctant to invest in them, despite the fact that 18 licenses have been granted for new refineries by the Federal Government.
14. Why should Nigeria remove fuel subsidy when other OPEC countries have their petroleum products subsidized?
With Nigeria's GDP per person at $1,600 per year and total crude production of approximately 2.5 million barrels per day, Nigeria has substantially less oil revenue per person and greater social challenges compared to other OPEC countries. Nigeria therefore cannot afford fuel subsidies like those provided in other OPEC countries. Consequently, when compared to other OPEC countries, Nigeria, with its large population of about 167 million, is significantly disadvantaged in terms of its low Human Development Index, which is a comparative measure of life expectancy, literacy, education, standard of living, etc. For example, Nigeria's low level of human development indicates that our spending priorities have to differ from those of more developed OPEC nations, as a large number of unmet needs will have to be addressed through the judicious use of resources that will become available following the removal of fuel subsidies.
15. Why should Nigerians not enjoy low fuel prices since the country is a major oil producer?
Crude oil price is the same for all countries whether they are oil producing or not. It is an internationally traded product; the prices are not set by the countries that produce it. Neither do oil producing countries get a discount in the international market for producing this product. Furthermore, crude oil accounts for about 80% of the final cost of fuel. Other costs include depot charges, transportation costs, chemicals, spare parts, raw materials etc. used in turning the crude into PMS or fuel. Therefore, at the current crude oil price of $110 per barrel, the finished domestic refined fuel sold to Nigerians cannot be priced lower than the cost of the crude, plus the other associated costs enumerated above which are used to refine it. This is why it is difficult to price the finished PMS fuel at a cost lower than its crude from and the total cost of production.
16. Must the government remove subsidy to provide infrastructure?
Although there is provision in the budget for capital expenditures including infrastructure, it is clearly not enough due to the poor state of infrastructure in the country and the fact that the budget is heavily tilted in favour of recurrent expenditures. Removal of subsidy will free extra cash for meeting the much needed increase in infrastructure spending.
17. What are government's plans to cushion the effects of subsidy removal?
Unlike in the past, the Federal Government has adopted initiatives that are different from previous efforts. In meeting the core needs of the people, the Federal Government has decided to channel its own share of the budgetary savings from the elimination of fuel subsidy into a combination of specific programs that will stimulate the economy and alleviate poverty, through the provision of the following:
Critical infrastructure: The proposed infrastructure projects are Niger Delta development projects; road development projects, rail transport projects; water and agriculture development with special attention to irrigation projects; electrical power projects focusing on hydropower, and Greenfield petroleum sector projects to be located in Bayelsa, Kogi and Lagos States.
Implementation of safety net projects: The planned safety net programs include maternal and child health services, public works/youth employment program, urban mass transit scheme, and vocational training schemes.
The Federal Government is launching a Subsidy Reinvestment and Empowerment Program (SURE Program) that encapsulates all these alleviating programs. Structures have also been developed to guarantee adequate oversight, accountability, and implementation of the various projects.
18. Why not start pilot alleviating measures to ascertain that they will work effectively before removing the subsidy?
Government has a number of competing needs for the limited financial resources at its disposal and fiscal resources are needed to implement pilot alleviating measures. Moreover, one of the pillars of the Transformation Agenda guiding current policy stance is fiscal consolidation. To pilot the alleviating measure will require additional budgeting of finances for their implementation. Budgeting additional financial resources for pilot alleviating measures will run counter to this policy goal. Therefore, government aims to use the resources freed from the subsidy removal to implement the identified alleviating measures. This government is deeply committed to implementing these cushioning measures.
19. What assurance is the government giving Nigerians that the additional revenues realized from petroleum subsidy removal will be judiciously used?
The skepticism is understandable. However, similar government policies in the past have worked as promised. An example is the Petroleum Trust Fund (PTF), which undertook many road, education, and health infrastructural development projects across the country. The PTF remains one of the most successful public works program embarked upon in the country.
20. Will the removal of subsidy not cause scarcity?
No. The Federal Government, through the NNPC, has made arrangements to ensure adequate supply and prevent scarcity during the period leading to deregulation and beyond. The NNPC is currently maintaining a 50-day sufficiency for petrol. This means that even if petrol is neither imported nor refined locally for a period of 50 days, Nigeria will still have sufficient quantity to meet the country's daily needs.
21. How does petrol price in Nigeria compare with those of other countries?
Petrol price in Nigeria compares favorably with those of other African countries as well as those of other oil exporting countries. The charts below show that Nigeria has one of the cheapest petrol prices across Africa, behind only Libya and Algeria. Nigeria has the lowest petrol price among its surrounding countries. The same is true of Nigeria's petrol price relative to other oil producing countries.
22. Is petroleum the only source of government revenue? Why not explore other means of revenue generation?
No, petroleum is not the only source of government revenue but it is the major source of revenue for the entire country. Of course, government is exploring other sources for revenue generation through various policies, programs, and initiatives that promote economic diversification and boosts development in key non-oil sectors such as Infrastructure, Agriculture and Entertainment and Tourism. The diversification from oil as the main source of revenue is in line with the government's transformation agenda.
The results of this diversification are expected in the medium term. In addition, government is fast-tracking reforms of revenue collecting agencies by actively engaging with them to ensure that revenues are remitted fully and promptly to the Treasury. In the short to medium term, the non-oil sector is expected to contribute a greater share of budget revenue compared to the current contribution of about 30%. In any case, the way and manner we use our major source of revenue will determine sustainability of the economy and the extent to which we are able to meet our development aspirations.
23. Why is government not seeking savings through a sharp cut in government expenditure?
Fiscal consolidation is one of the major pillars of the Transformation Agenda. This simply means that government is trying to cut down on spending by progressively reducing recurrent expenditure in favor of capital expenditures. However, government cannot afford a sharp reduction in total expenditure as this will imply reducing the capital vote, which is already insufficient to close the infrastructure gap, complete ongoing critical capital projects and begin new ones. Thus, the savings generated from subsidy removal will provide additional outlays for critically needed infrastructure.
24. If the National Assembly rejects the proposal, has the Federal Government considered the political implications of going ahead with the removal?
Nigeria has three tiers of government and each is autonomous. The Executive Branch has the responsibility for running the economy, and will continue to consult with the members of the National Assembly. Even more important is the Executive's commitment to consulting and listening to the Nigerian people. Once the Nigerian people get all the facts right through government's extensive information sharing and enlightenment campaign, we are sure that they will support the policy because the long term benefits of this policy are clear and certain and the future of the country cannot be left adrift. 25. Is the timing right?
If not now, when? If we procrastinate, the cost will only become higher. The right time to do the right thing is now.
Let always use our heads: It is better to have your head in the clouds, and know where you are... than to breathe the clearer atmosphere below them, and think that you are in paradise. Nigeria's head are still far away from hell, despite the fact some parts of his body are roasting. Life is paradise after hell.
by Akin Awofolaju, PhD
Board Certified Fraud Examiner (Applied Economist)
Let me seize this opportunity to provide a gloss for recent Nigeria government Oil subsidies removal proposal and its implications .I will like to take this opportunity to share my personal idea on those frequently-raised questions. Going back to history, we all know that there is a systemic crisis of governance in Nigeria, in which there is the virtual absence or loss of national vision, direction, leadership, role models, rules, procedure, and institutional performance but Nigeria is a country to love. A country endowed with tremendous immeasurable natural resources. We all know and believe that we have series of institutions and political actors that are supposed to protect democracy regrettably subvert it with fanfares and reckless abandon; impunity is a culture of life in governance taking advantage of loony society and populace day in day out, and we all know that all our key public institutions which should be democratic champions like the judiciary have become culpable in its erosion. There are two cords that hold the house together - oil peppermints and uncourageous leaders. No doubt, that our house is in cracks; the foundation is shaking; its inhabitants are walloping in darkness, poverty and pains; but the care-takers or sycophants/handlers of the house are in self-delusion that all is well.
Before going to the first one, oil subsidy removal and why its essential at this point in our social development. I would like to mention a famous saying that when the leadership is right and the time is right, the people can always be counted upon to follow—to the end and at all costs. Sometimes I likened, Nigeria House to, a mad fellow and a drunk fellow who were both dumped in a house and the house was set on fire. The mad fellow notice the rabid change in temperature and the change in the constitution of the house and his own conditions and sought the exit way and saved his life. But the drunk fellow sat ensconced in his delirium only rejoiced and shouted: oh at last it has become warm.
Our current crisis is the result of the misguided notion that financial markets can regulate themselves in an unplanned economy. Here's a rundown of the mistakes we've made and the three reforms we need now. To me, as a board certified/Charted Fraud Examiner, I have over the years analyzed various agency overseeing oil marketing and banking industrial system and it all amount to sheer greed and unbalanced sheet economic practices. I strongly believe, Nigerians need to pay close attention to the role of PPPRA (Petroleum Products Pricing Regulatory Agency )allocations, in order to be able to understand the magnanimity of fraud- based syndrome on capacity allocations. We have seen in the past a re known oil companies such as Chevron, Mobil with less allocation, with capacity for say 65,000 MT as big as there are, and a relatively no name (unknown name but well connected) companies with more capacity of over 100000 MT.
That's speaks a- tons -fraud volumes in subsidies accrual (what a wastage of resources) and that is a total failure of accountability, hence I support oil price deregulation and for cogent reasons......in a simple terms, we have seen in the past years, just a few abysmal Nigerians culprits of less than 0.01% of our society ( 16,000 out of 16 millions- extremely wealthy individuals if not less than that) are taking advantage of unregulated economy to maximize their ill gotten wealth while 99% are walloping in abject poverty . We all know that PPPRA is supposed to give license only to marketers with a national distribution network suffice it to say 50% of the allocations are fictitiously awarded by this agency to companies that do not even own a filling station in Nigeria contrary to its principle and law that guides PPPRA. That's is something to worry about folks. If china did followed Nigeria path of looking the other way when financial crimes been committed, they wouldn't have reached the level of sustainable economic development today. In china, corruption is no go area, If you are found committing fraud, the simple term penalty is firing squad. It is not your aptitude but your attitude towards results will take you to your highest altitude. Nigeria attitude towards corruption is uncontrollable
For me this could well explain the first and foremost factors ( Corruption) which uncontributed to China’s fast development: the leadership of the ruling Chinese Communist Party (CCP). Looking back on the 90-year history of the Party, it is its wise and correct leadership that has successfully united and mobilized Chinese people of all ethnic groups to concentrate their efforts in realizing the goal of the revolution and development of China.
The leadership, since its founding in July 1921, had run through the New-Democratic Revolution against imperialism, feudalism and bureaucrat-capitalism, which led to the founding of the People's Republic of China (PRC). The termination of the long-existed status of semi-colonial and semi-feudal society, and in particular the systematic large-scale socialist construction, led to the rapid development afterwards. The success and advancement of CCP has won it countrywide admiration and support with people taking pride in becoming a member of the Party. Chinese Communist Party is now the world’s largest party, having registered members of more than 80 million and 3.9 million primary organizations. A generally peaceful environment at home and abroad has made it possible for China to achieve development during the past several decades and to focus entirely on development in the fundamental interests of the Chinese people. A peaceful world is all the more important for China to concentrate on development in the future. China will therefore remain steadfast on the path of peaceful development and work with other countries in a joint endeavor to build a harmonious world of enduring peace and common prosperity
The first responsibility of a leadership is to define reality. People’s Republic of China was founded a country with a large population and weak economic foundation. How could it overcome the poverty and backwardness and feed the over one fifth of the world population? The answer of CCP to this reality is development. A generally peaceful environment at home and abroad has made it possible for China to achieve development during the past several decades and to focus entirely on development in the fundamental interests of the Chinese people. A peaceful world is all the more important for China to concentrate on development in the future. China will therefore remain steadfast on the path of peaceful development and work with other countries in a joint endeavor to build a harmonious world of enduring peace and common prosperity
Let's take United States Of America for Instance, in his fiscal year (FY) 2012 budget request, President Obama proposed to end subsidies for oil companies by eliminating tax breaks, including accelerated depreciation options. A growing number of policymakers have echoed that call.
Though the President’s anti-subsidy rhetoric is on track, there are several fundamental problems with the Administration’s crusade. The President overreaches on what truly is a subsidy for oil and ignores the fact that the government does far more to hurt oil production than help it. He singles out the oil industry, which already faces a higher marginal tax rate at 41 percent compared to 26 percent for the rest of businesses in Standard & Poor’s 500.
The President attacks oil subsidies while continuing to push for subsidies for renewable fuels, electric vehicles, wind, solar, clean coal, and even natural gas. According to the Congressional Research Service, President Obama’s tax hikes on the oil and gas industry proposed in his FY 2012 budget would increase the price of oil and gas for American consumers. A much better policy for taxpayers and consumers would be to define subsidies accurately and then remove all energy subsidies. Any repeal of tax breaks should be offset with a broad tax cut to avoid any net tax increase. Unlike Nigeria, the current estimate of the proposed Nigeria budget for 2012 is N4.749 Trillion naira that conspicuously exclude oil subsidy, representing 6 percent increase over the N4.48 Trillion in 2011. The petroleum subsidy allocation was excluded in the budget proposal; thus, validating that subsidy on petroleum will be eradicated by end of the year. With the removal, prices of petrol at the pump are expected to rise to N 130 per litre from the current N 65 per litre. According to President Jonathan, the 2012 budget is based on a set of assumptions reflecting Government's determination to maintain prudence in the face of continued uncertainties in the external environment.
Consequently, the budget is based on the following: Oil production of 2.48 million barrels per day (mbpd) up from 2.3 mbpd for 2011; Benchmark oil price of US$70/barrel, a cautious revision from the US$75/barrel approved in the 2011 Amended Budget;Exchange rate of NGN155/US$; Projected GDP growth rate of 7.2%; and Projected inflation rate of 9.5%.
The landing cost of a litre of petrol was N 129.21, the margin for transporters and marketers was N 15.49 the expected pump price is N 144.7 while the official pump price today is N 65 per liter this shows that the Federal Government spends N 79.70 as subsidy on each liter of petroleum consumed in Nigeria with about 32 Million liters consumed daily. It means the country spends 2.66 billion as subsidy every day.18.2 billion per week and 72.8 billion monthly. According to the presidential letter, a major component of the policy of fiscal consolidation is government’s intent to phase out the fuel subsidy beginning from 2012 fiscal year
The accrual to the sovereign wealth fund [S.W.F] as a result of subsidy withdrawal will also augment funds for critical infrastructure. Through infrastructure windows of the S.W.F., Government said it will save 1.2 trillion naira in 2012 alone which would be used for the provision of safety nets for the poor to ameliorate the effects of the subsidy removal.
The four refineries in the country have 445,000 barrel per day installed capacity. But their output is currently epileptic and insignificant. Nigeria requires up to 32 to 35 million liters of PMSS per day. Nigerians will be paying little above N 150 per liter initially if subsidy is withdrawn, before the market competition will ensure price drop. Nigeria currently pays one of the highest pump price even at N 65 per liter if you compare the table below:-
Using N 155 per USD
The prices are this low because these OPEC countries and other petroleum producing states have refineries and produce the petroleum products locally while Nigeria has to add the cost of freight to and fro and other handling charges.
If subsidy withdrawal becomes effective, it would be the fifteenth time fuel price was adjusted between 1998 and 2011. Late Gen. Abacha pegged the pump price at N 11 per liter from 1993 to 1998. Gen. Abdusalami Abubakar adjusted it to N 19 per litre. Chief Obasanjo adjusted the price more than 10 times in his 8 years regime 1999 to 2007 from N 19 to N 70 before Late Umaru Yar’Adua adjusted it to N 65.00. And Jonathan now gamed proposing N 145.
The current discourse on oil subsidy in Nigeria cannot be said to have been over flogged.
Nigeria is currently practicing a regulated economy in the oil sector. For some time now, in fact since the era of (IBB) Gen. Ibrahim Babangida in the 80’s, the federal Government of Nigeria has continued to talk about Government intention to remove oil subsidy in the downstream sector of petroleum products market. It is obvious today that the remaining subsidy is more on premium motor spirit (PMS) also called petrol. The federal Government argues that there should be an end to the high cost needed to make importers of PMS happy. The importers have claimed to be bringing these products at a higher cost than pump price of N 65.00 [Sixty five naira] per litter which is the controlled price fixed by the Government. The Federal Government claimed that oil subsidy will be removed in stages from 2012 .I know its very hard bitter pills to swallow, esp. to an ill-informed society, when you are dealing with a corrupt leadership and as for students of economics, we all know that subsidies impede social development and investment ladder in the world where investment means revenue paybacks hence our oil industries are less developed and up till now, nobody asked questions as to why our 5 refineries haven't perform to par, and govt rely exporting crude oil abroad for processing. No doubt that our fuel prices is under priced by inordinate govt . subsides with no microeconomic and fiscal measures to it. The fact remains that if we insisted in keeping subsidies they would be less investment in that sector and nobody will like to invest in a venture when the cost for production of a gallon is 140 naira and we want govt. to keep price at 65naira , that is very unrealistic but quite plausible given global economic situation and level of poverty in our society. Take for instance, the current budget of Nigeria govt. Unemployment rate is at 23%, 2012 federal Budget fails to address some key economic points such as subsidies , but white elephant expenditure esp. on govt. security I know it is widely known that there was no provision for fuel subsidy in the 2012 budget.
The Gross federally collectible revenue for the 2012 budget is projected at N9.406 trillion, of which the total revenue available for the Federal Government’s Budget is forecast at N3.644 trillion.
The aggregate expenditure proposed for the 2012 fiscal year is N4.749 trillion. The share of recurrent expenditure in the 2012 Budget proposal is 72%. The aggregate expenditure comprises N 398 billion for Statutory Transfers, N 560 billion for Debt Service, and N2.472 trillion for Recurrent (Non-Debt) Expenditure (payment of salaries). Capital expenditure has an allocation of N1.32 trillion. Based on the above, the fiscal deficit is projected at about 2.77% of GDP in the 2012 Budget.
As to the long-list members that constituted that committee - that's is just a big joke and huge mistake on the part of govt. that always clamoring for national fiscal sanctity, the cost alone to run that committee could run into millions of dollars, henceforth, the idea fell short altruistically. It was a total farce and rip- off and lack of seriousness of purpose. Ministry of Finance should have handled that area with integrity and sense of resourceful purpose rather than looking for ways of creating positions for party loyalists. It is a DUMB process. Old sneakers run poorly, Belgore in his 70s, Chief Kolade @79 have done their part in that country. Govt should play smart and tap on young intelligentsia to run the affairs of the country
Measurement of Subsidies
The financial cost of subsidies funded directly out of the government budget can be measured precisely. However, even for these interventions, their economic impact needs to be estimated. An additional problem is to agree on the list of policies that constitute subsidies, and it is noteworthy that not even the European Union has been able to agree on a standardized list of energy subsidies.
A practical approach to the measurement of consumer subsidies that can be applied to almost any country is the so‐called price gap approach. It identifies the gap between the actual price charged and the reference price for that particular form of energy. The difference is the subsidy per unit sold and may be financed either explicitly or implicitly. The reference price is calculated differently in the case of traded and non‐traded forms of energy. In the former case the reference price is based on the international price (adjusted for transport costs and quality differentials), applicable particularly to oil, natural gas, and, to a lesser extent, coal. Where an energy source is not traded—most commonly with electricity, followed by coal, and lastly by natural gas—the reference price has to be calculated from assumptions on what would be the cost of domestic supply for an efficiently run firm. For oil exporting countries that face production quotas, the reference price may be lower than the international price and is the higher of the marginal cost of supply and the discounted value of an additional barrel of unproduced oil.
The hidden‐cost calculator is able to split the difference between the reference price and the actual price into three components: under pricing (setting the price below the level that would be charged by an efficiently run firm in a liberalized market), unaccounted losses (due to theft and excessive technical losses), and collection failure (due to failure to send out bills or to enforce their payment). In Sub‐Saharan Africa, one third of the losses to power utilities that have to be covered by explicit or implicit subsidies arise from the latter two components, indicating that these need policy attention as well as the level of power tariffs. Both the price gap and hidden‐cost method have been applied to a number of countries and are capable of further extension to other countries and through a wider definition of the costs of an efficient utility.
Channels through Which Energy Subsidies Affect the Economy
Energy subsidies have a variety of aggregate impacts on the economy. The macroeconomic effects include government accounts, the balance of payments, the long‐run growth potential of the economy,and the degree of energy intensity of capital investment. Partial equilibrium analysis of the effect of energy subsidies emphasizes the deadweight losses that occur within the sector where the subsidies apply, including an allowance for the presence of externalities. General equilibrium analysis goes beyond this to evaluate the spillover effects into other markets that are themselves affected by the presence of the energy subsidy. A number of studies using computable general equilibrium models have evaluated the impacts of reducing or removing energy subsidies, mainly applied to single countries. These generated estimates of the change in the level of output of the economy, and of use of different energy sources. These studies were conducted along rather different lines and used different assumptions so that a unified approach to modeling the global effect of reducing energy subsidies does not yet appear to have been established. A group of such studies applied general equilibrium modeling to large energy consumers in order to estimate how reducing energy subsidies affect energy demand and the economy.
I wholeheartedly agree with Nigeria pundits appeasement given reality on the ground. No doubt our people had suffered in the face of wealth inequality and countless social ills in the hand of their leaders. No doubt things are extremely hard for average Nigerians especially on this ill-timed measures of decontrolling fuel prices leading to excessive price hikes. It will noteworthy that the minimum wages in Nigeria is leveled 18,000 naira monthly which fell short of average 20,015 naira a month to fill gas tank for SUV used or new ( doesn't matter) in Nigeria on N 143-145 estimate monthly. No doubt, average man's life in Nigeria will never be the same after this oil imbroglio.
But on a more serious note, let's face it squarely, when do we really going to see the change that we all yearning to see in Nigeria? I strongly believe that failure in life is an opportunity to begin again, this time more intelligently. Discontent is the first necessity for success and for greater results yet to come. Unfortunately, it will be hard for everyone not to take opposing view on this removal subsidy and not reiterate its discomfort and not that I'm completely in agreement with President Jonathan, if only is been done in a good faith and on how he introduced it at the wake of Boko Harram and on the pedestal of New Year. It was shallow approach and ill-timed and seem an inept failure to study circumstances that bedeviled his understanding and morale of the Nigeria society that he rules as a leader. The temperament of Boko Haram surging still at large, he could have tempered the introduction by first try to woo and build rapport not tantrums and discussing it on open forum,explaining why it's necessary thing to do to grow investment and revamp our economy. He needs to educate average Nigerians on ' ''WHY'' factors, but he failed in that capacity. Am additional problem is to agree on the list of policies that constitute subsidies, and it is noteworthy that not even the European Union has been able to agree on a standardized list of energy subsidies.
A practical approach to the measurement of consumer subsidies that can be applied to any country is the so -called price gap approach and with ebbing Consumer price index . It identifies the gap between the actual price charged and the reference price for that particular commodity. The difference is the subsidy per unit sold and may be financed either explicitly or implicitly . The reference price is calculated differently in the case of traded and non- traded forms of commodity.In case of Jonathan deregulation( reducing govt. roles and allow market and industry greater freedom in how it operates) He's impulsive when it comes to subsidy stake with little thought given to its long- term viability and affect effect implication on his unpopular administration that plunged his subject to untold hardship inadvertently, that which beset various conflicted issues since his administration inception some of which might not be his own making but indulged. No doubt that this is Ill-timed but as an international economist it's right thing to do, it is just matter of when and how is to be implement and under what fiscal monitoring scale.
Nigeria has become an active part of the global world, inevitable economic strength and role model to her African brothers. The strategic importance of Nigeria needed to be stemmed in world global arena. If better can be achieved, our good education, innumerable natural and human resources are not enough, enough said on our highly orchestrated potentials, potentials will not move a needle unless actions, self -consciousness, conscientiousness and accountability are been put to play
In conclusion, this house, Nigeria house, for the discerning mind, is a house with swampy roots; its tenuousness is palpable; its longevity depends on hope and prayer. It is a house, whose form, shape and essence must change radically, if ultimately it is not to fall !!!
Akin Awofolaju, PhD, CFE, CLE, CSP (Cornell)
Board Certified International Fraud Examiner
New York, NY -USA
There remain, however, a few questions [to] be answered:
1- Would it not have been sensible that first a thorough investigation should have been conducted initially by independent groups on Emeka's behalf instead of him self- orchestrating American -intrepid ( resolute fearlessness) influence on pages of naija newspapers, and blogs to conclusively identify the elements involved in is personal smear ,attacking a 51 year's old machinery that for the fun of it might incarcerate him as long as it takes and for Emeka defiance in failing to map out a rational plan and strategy( as taught in Harvard) to take measures against issues not individuals involved? Sometimes, they say, silence is golden, but my friend think otherwise, whilst,failed to realized that some abysmal individuals, who claimed to be his friends now might be using him to gain cheap popularity while is been served a guinea pig in kirikiri hole
2- Assuming the viewpoint of the Nigeria government defending what's right for them, is it not rational to launch a classic war through widespread deployment of immoral recluse that led to re-trial and re-trial and its center cannot hold?
3- Was it not possible for Epharim Emeka Ugwuonye to act the under dog mode for once, seek and find better constructive ways to clear his name, than using town crier mode, if what he claimed was true?
Those people who develop the ability to continuously acquire new and better forms of knowledge that they can apply to their work and to their lives will be the movers and shakers in our society for the indefinite future but not those, with seldom fling of burning desires, in which lights frequently goes out on them, when they stop adding their fuel. The earlier we realize that this issue is not about its objectivity but who will win, and muscled up, the better for the man in question.
If you care enough for a result, you will most certainly attain it
Posterity will judge us all .
Now you can shoot !!! why I rest my case