Nigeria Content Online

Amnesty International warns Nigeria over political violence

Amnesty
International has urged the Nigerian government to check the rising tide of
political, ethnic and religious violence threatening the April general election.

In a
statement issued on Thursday, Amnesty International said that so far, more than
50 people have also been killed since July 2010 in conflicts directly related
to elections.

According
to the statement, Human rights defenders, who will play a key role in
monitoring the April election, are facing increased threats and violence with
no adequate protection from the security forces.

The group
urged political parties and candidates to put justice, security and human
rights at the heart of the election campaign, in order to break Nigeria’s
nationwide cycle of violence.

Impunity

The human
rights group said Nigerian authorities have failed to bring suspected
perpetrators to justice, or to prevent further human rights abuses.
Investigations, it said, are infrequent and often inadequate and hardly anyone
has been convicted for the killings.

“The
Nigerian authorities must act to protect people’s lives and all political
candidates should denounce violence and tell their supporters to campaign
peacefully,” Tawanda Hondora Amnesty International’s Deputy Director for Africa
said.

“Candidates
should tell voters what they will do to stop the senseless killings and improve
security and justice in Nigeria. The Presidential Debate on Friday 18 March is
an excellent opportunity to make such a commitment,” he added.

The
statement added that despite these deaths, there have been no national
campaigns against election violence, and very few arrests.

Mr. Hondora warned that “When no-one is
brought to justice for violence, this sends the message that you can get away
with murder.”

Poor investigation

“The
authorities have also failed to competently prosecute those responsible for the
Jos and Plateau State violence, and the results of previous government
investigations into reasons behind the violence have never been made public.

“The
security forces have reacted with wide ranging abuses such as enforced
disappearance, extrajudicial execution, and sweeping arbitrary detention,”
Amnesty International added.

In Borno
state, where Boko Haram has been blamed for attacks on security forces,
government officials and religious leaders a local resident told Amnesty
International that “After the killings [by Boko Haram]… they come and arrest
all those people around [the area]… Now, if an incident happened in an area you
will see most of the neighbours packing out of the area.”

“We were
taken to SARS [Special Anti-Robbery Squad], Abuja. It’s known as the abattoir… we were not
alive. We had no food, no water… One
cell held about 45 of us… There were five small children there too,” another
resident described his detention as a Boko Haram suspect to Amnesty
international.

The human
rights group is of the view that poor police investigation is undermining
efforts to bring suspected perpetrators to justice.

Meanwhile, the international organisation will
today launch a website, Eyes on Nigeria. The website,
http://www.eyesonnigeria.org, “employs new monitoring tools and technologies to
expose and visualise human rights abuses and situations in which human rights
are at risk throughout Nigeria, including through active monitoring of harmful
gas flaring in the Niger Delta region.”

Jonathan may shun presidential debate

Jonathan may shun presidential debate

The presidential candidate of the Peoples Democratic Party (PDP)
in the April 9 election, President Goodluck Jonathan may not participate in the
presidential debate holding this evening in Abuja. The debate, which is being
packaged by NN24, will be held at the Transcorp Hotel, Abuja between 6 and 9pm.

The organisation had last Friday held the vice presidential
debate which was attended by Fola Adeola of the Action Congress of Nigeria
(ACN), Tunde Bakare of the Congress for Progressive Change (CPC) and John
Odigie-Oyegun of the All Nigeria Peoples Party (ANPP).

Vice President Nanamadi Sambo, who is also the running mate of
Mr Jonathan, stayed away from the event.

It was gathered yesterday that though the President sent his
security details to the organisers to clarify issues relating to the security
of the venue ahead of the debate, he may not show up.

Spokesman of NN24 Presidential Debate Committee, Shagari Sambo,
told NEXT yesterday that Mr Jonathan may likely participate in the debate
because of the signals coming from the Presidency. He did not, however,
elaborate beyond adding that the event will hold whether the president shows up
or not.

Abba Dabo, the director of media and publicity of the
Presidential Campaign Council (PCC) of the PDP, said yesterday that the
president may not take part in the presidential debate. He said Mr Jonathan is,
however, willing and ready to participate in the one planned by the other
groups that are collaborating with the Broadcasting Organisation of Nigeria
(BON).

Wider reach

He told NEXT in a telephone interview that the one organised by
BON will have a wider reach, hence Mr Jonathan has decided to participate in
it. Mr Dabo added that the vice presidential debate organised by NN24 did not
have wide coverage and reach.

Mr Jonathan had made earlier pledges through his aide that he
and his deputy were willing to participate in presidential debates.

Ibrahim Modibbo, spokesman of the Nuhu Ribadu Campaign Organisation,
confirmed to NEXT yesterday that the ACN standard bearer, will attend the
debate.

“Yes, Nuhu Ribadu will be there and in fact we are looking
forward to this debate,” Mr Modibbo said in a telephone interview.

It was not however clear if the CPC candidate, Muhammadu Buhari
will participate in the debate. Both his spokesman, Yinka Odumakin and that of
the party, Rotimi Fasahakin could not be reached as their telephones handsets
were switched off.

They were believed to be in the campaign field with Mr Buhari,
who was in Kebbi and Sokoto States yesterday. But a source in the party
confirmed that the former military head of state is prepared to participate in
the event.

On his part, the ANPP flag bearer, Ibrahim Shekarau has
reportedly given his word that he will attend the event. Meanwhile, NN24, in a
statement yesterday, said the debate would go ahead today.

Mr Sambo, who signed the statement also said that accreditation
and seating arrangements have been reserved for about 40 journalists. The
presidential debate is coming ahead of another one being packaged by the
Nigeria Presidential Debate Group, which is billed to hold on March 28-30.

Unlike the NN24 debate, which will have only four participants,
all the 19 presidential hopefuls in the April election will participate in the
three-day event.

Also on Thursday, the leaders of the debate group reportedly
held discussions in Abuja with the leadership of the political parties whose
flag bearers are participating in the debate, to fine-tune the procedure for
the event.

During the vice presidential debate last week, Messrs Bakare,
Adeola and Odigie-Oyegun frowned at the refusal of their PDP counterpart to
show up, noting that it was a display of arrogance on the part of the vice
president.

I will open can of worms, says Daniel

I will open can of worms, says Daniel

The Ogun State governor, Gbenga Daniel yesterday said he is
still keeping some secrets close to his chest but will open a can of worms
before May 29, 2011 when his tenure ends.

Mr Daniel spoke at an event held at the International stadium
Sagamu to honour his administration. He told organisers of the event, the
Academic Staff Union of Secondary Schools of Nigeria (ASUSS), Ogun State
chapter, that, “no amount of intimidation will stop your governor from standing
firm. And let me assure you that I will stand firm till the last day. By the
special grace of God, we will hand over the mantle of leadership to people that
you are going to be proud of. I don’t know who but God knows,” he said.

“There are a lot of people who want to go in through the
backdoor; they are the people who have gone to get kangaroo judgment. There is
no doubt that there was a lot of thunderstorm in Ogun State. Not many people
believed that we are going to be here till today. Even, as I stand before you,
those people are not relenting,” he said.

Speaking to the large number of teachers in attendance, Mr
Daniel declared that he has done his bit, pointing out, that “Ogun State will
never be the same again. There is no doubt that when a country or a state is
progressing, some people will not just understand the kind of magic we are
using. Let me assure you that there is no magic, but it is the work of God”.

For ₦2000 only

Mr. Daniel added that his investigation revealed that those who
booed him during the presidential rally in Abeokuta, the state capital, were
given N2,000 each by their sponsor. He said they have confessed to him. “On
Saturday, they hired some people. We have found out; they hired people to the
stadium in Abeokuta. The people that they hired have now come to us to confess.
Some of them from the Lagos State College of Education, Ijanikin; some of them
from the Polytechnic in Lagos confessed. They said each and every one of them,
they paid them ₦2000 each to come to the rally to come and boo OGD,” the
governor said.

Earlier in his welcome address, President of the teachers group,
Tunde Folarin, said the programme was designed to appreciate the governor’s
gestures to the teachers in the last eight years of his administration.

“Today is a day to show considerable appreciation for crucial
contributions of the OGD-led administration to we teachers, especially in the
Secondary School sector, so as to motivate you in your path of fulfilled
destiny,” Mr Folarin said.

Lawmakers clash over petroleum industry bill

Lawmakers clash over petroleum industry bill

After weeks of rescheduling, the House of Representatives
briefly mentioned the Petroleum Industry Bill yesterday but shelved the
long-awaited passage after lawmakers rowed over the planned deregulation of the
sector.

The members only considered two clauses of the 405 reviewed
clauses of the bill, on Thursday – the same number earlier examined by the
senate – which spells out the bill’s introductory remarks and the purview of
its contents.

But the lawmakers, polarised between the North and the South,
expressed concerns on the contentious deregulation of the petroleum sector – a
government plan now to be integrated into the bill- and whether Nigeria’s oil
wealth is owned by the federal government as stated in the bill or the
federation.

Northern lawmakers argued that the region will be worst hit by
deregulation since transportation of fuel products will raise the retail cost;
while lawmakers from the south, insisted that the policy will serve the nation
best.

“I cannot sit here as a representative of my people and accept a
policy that will make the people of Borno State pay higher for fuel than people
in Lagos or Port Harcourt,” said Sa’adatu Sani, who heads the House committee
on Millennium Development Goals.

Southern representatives, whose members head the three
committees that turned in the PIB, responded that an open market will in the
long run introduce competition, combat high cost and as well dislodge the tiny
“cabal” that is feeding on government subsidy.

“We must be very clear, this bill is in the interest of the
country not for a particular section,” said Igo Aguma, the chairman of the
House Committee on Gas, which worked on the bill jointly with the committees on
Upstream Petroleum, Downstream Petroleum and Justice.

Ameliorating impact

As a safeguard, part of the projection is to site at least three
government-run mega filling stations in each of the 774 local governments
across the nation.

Again, lawmakers from the north protested the inclusion of a
clause vesting the ownership of petroleum in the country to “the Government of
the Federation,” asking that it be replaced with “the Federal Republic of
Nigeria.”

Both concerns were, however, overruled by the deputy speaker,
Usman Nafada, who nudged a lean plenary attended by only 15 members, to push
the final debates of the legislation before adjourning for another break.

“There may be difficulties when we start implementing them, but
over time I believe they will take shape,” he said. “For those who think that
the law is for a part because today we have oil in the south, the north too
will have oil.”

The House is to resume sitting April 19 after elections. Mr.
Nafada said the House, yet to complete work on other major bills including the
Anti-terrorism and Money laundering bills, will pass the long-standing
Petroleum Industry Bill upon resumption.

‘Higher recurrent expenditure in 2011 budget is worrisome’

‘Higher recurrent expenditure in 2011 budget is worrisome’

The expansionary tendency of the 2011 appropriation budget
passed by the Senate on Wednesday would yet again put the Central Bank of
Nigeria (CBN) under to introduce liquidity tightening much quicker than it
ought to.

Razia Khan, regional head of Research, Africa, Global Research
at Standard Chartered Bank at a media presentation in Lagos yesterday said a
major problem with the outlook is that it gives a false hope that all is well.
“Raising recurrent expenditure creates an expectation that this is the amount
that would be received every year such that if revenue drops, it becomes
difficult to cut back.”

The Senate approved a budget of N4.971 trillion as against
N4.538 trillion presented by President Goodluck Jonathan. Out of the amount,
N2.467 trillion or 54.4 per cent was earmarked for recurrent (non-debt)
expenditure, while N1.562 trillion or 34.4 per cent is for capital expenditure.
“Such higher spending, everything being equal will lead to higher inflation.”

According to Razia, the budget outline does not add real value
to the economy as such huge spending on recurrent expenditure have shown in the
past. “Other African countries are making more progress than Nigeria in terms
of increasing revenue earnings as a percentage of GPD (gross domestic product).
The huge amount that we have seen and the increasing debt burden that is
required to sustain the budget is worrying,” she said.

More transparency

While Nigeria still holds much promise to investors, she called
for more transparency on how resources are allocated. “Another source of
concern is the run down in the foreign exchange reserves. You can see how
reserves rise at the beginning of the month and fall at the end of the month.
The uncertainty for investors is that it is not necessarily transparent.
Investors want to know about what the future risks are.”

She said Nigeria would need to pay more attention to its debt
market, particularly the sustainability of the debt level especially with the
figures approved for the 2011 budget just passed by the Senate. “Nigeria is
still within comfortable level but we worry about the rate of increase and what
the borrowings are for. We can’t look at debt ratio in isolation but how much
of future earnings of Nigeria are going to be ring fenced to be able to pay.”

Nigeria’s potential She however said Nigeria has the potential
to double the size of her economy within the next 10 years if it maintains the
current trajectory of 7 per cent annual growth in gross domestic product (GDP),
adding that African economies are the focus of many global financial players.
“The growth momentum in Africa has been strong. Perhaps, more meaningfully in
our view is that policy makers in Africa are reacting to the global financial crisis
themselves, using monetary instruments to address the issues.”

According to her, the youth dependency which used to be the case
in much of Africa is changing as many of the youth are growing into working age
due to a change in demography. “With the exception of Asia and the middle east,
much of the rest of the world are contending with an aging population.

She said the regulator would need to keep its focus on the
exchange rate in order to achieve a more balanced portfolio. Contrary to
expectations, she advised the CBN not to embark on huge devaluation of the
naira. “What we will not recommend is a big devaluation in the naira because
that will create more problems in the economy. It may lead to increase in
prices. There is nothing to stop the CBN from adjusting it up gradually in
response to higher demand. Why ignore the signals coming from the market. If
you keep supplying foreign exchange just to keep exchange rate steady and
demand keeps rising, then you are creating a situation which is simply problematic.
The band could move up to N151 for example. ” She said the plan by the CBN to
begin foreign exchange forwards may reduce demand pressure.

The CBN has said it would commence sales of foreign exchange
forwards from Wednesday, 23rd March, 2011.

BRAND MATTERS: Social media and its importance to brands

BRAND MATTERS: Social media and its importance to brands

I read a news
report in the media recently about Toyosi Akerele, the founder of
R.I.S.E, a youth development organisation. She was quoted as saying her
organisation can mobilise about 60 million youth.

I gave her comment
serious thought and was beside myself imagining how it could happen.
However, it is possible, as R.I.S.E network has been a veritable
platform for youth networking. The organisation utilises social media
as a potent tool to reach out to millions of youth out there and has
achieved huge success through this platform.

Social media has
become an integral part of our daily existence. With consumers getting
more sophisticated, companies should begin to refocus their marketing
strategies. It is actually the ‘in’ thing and has definitely come to
stay.

Companies now use
social media, such as blogs and community sites, to market their
brands. Popular social sites such as Linked In, Facebook, Twitter,
Flickr, and You Tube have more than five million visitors daily. In
Nigeria, bellanaija.com, Naijapal, Linda Ikeji, and others have become
veritable channels of engagement.

Promoting brands
using these sites is very attractive and will definitely reach the
target audience. This is due to the huge amount of human traffic that
passes through the sites on a consistent basis. Social media helps
brands maintain a consistent and constant presence in the lives of
consumers, bridging the gap between the two.

This platform is
also attractive to brands, as it is a low cost investment when compared
to other available options. Conventional methods of advertising cost a
lot more, while effectiveness and reach are achieved with social media,
which guarantees consumer attention and loyalty to brands. Social media
fosters a two-way communication and builds meaningful connections with
the target audience companies intend to reach.

It also promotes
the word-of mouth concept which drives visibility for brands. When more
people tell good stories about a brand, it helps build goodwill and
brand acceptability. Companies, through their brands, can make lasting
impact on consumers through the adept use of social media marketing.
Brand advocates are created through the influence of this platform.
Through networking, some causes are promoted online in order to
mobilise support and enlist others.

For instance, on
Facebook, a group is created to advance a particular issue and within
the twinkle of an eye, thousands of people sign up for such.

Imagine if a group
on ‘Good Health is in Our Hands’ campaign of Dettol is created online.
It will massively drive visibility for the brand through its key
messages on why we need to have maximum protection against germs. The
brand will have advocates that will ultimately become consumers.

However, in
adopting social media, there should be a strategic plan to communicate
the brand offerings. This is important in order to maximise the
enormous potentials and leverage that social media offers. The brand
should be properly defined in clear and concise language.

The core target
segment should be identified, while opportunities for the brand are
also explored. A content and engagement strategy that appeals to the
identified needs of the target audience is important.

It is also key to
listen and observe the trend of online conversations. It is not just
enough for a brand to adopt social media marketing. This is because
each target segment has something that appeals to it than the others.

Observation will
enable companies measure the impact of usage of social media. There
should be a tangible reason for doing so. It is one thing to have fans,
but the fans should be turned to consumers and advocates.

The importance of
having the right message cannot be underestimated in social media. This
is because of its effective role in reaching a dynamic audience. Brands
should paint realistic pictures of what they stand for in the
marketplace. There should be a linkage between brand promise and
consumer satisfaction. Social media helps in spreading the good sides
of a brand only when the consumer experience is exciting.

Social media indeed brings new opportunities which should be
leveraged for impact. It helps companies learn how to achieve results.
It also builds brand loyalty and followership. This creates an online
community of brand loyalists and enthusiasts who have had an exciting
experience with the brand.

Money

Capital market on the downswing

Capital market on the downswing

Investors at the Nigerian Stock Exchange (NSE) yesterday recorded
more losses on the value of their equities, as market closed trading on
negative note.

The NSE market capitalisation of the 194 First-Tier equities
closed on Thursday at N7.775 trillion after opening the day at N7.969 trillion,
reflecting 2.43 per cent decline or N194 billion losses. The market has lost
over N399 billion since transaction started this week.

Commenting on Thursday’s trading performance, analysts at
Proshare Nigeria Limited, an investment advisory firm, said the continuous
downward trend could be attributed to “the intense sell activities” by
investors, adding that the sell pressures were “very dominant in some blue
chips stocks” in sectors like Banking, Building Materials, Breweries, and
Foreign Listings.

Stockbrokers at GTI Capital, a stockbroking firm, said the
market had “staged a stabilisation trial during the better hours of trade only
to tumble and succumb to sellers’ mood at the concluding session.”

Low gainers

At the close of trading on Thursday, the number of gainers
closed lower at 10 stocks as against the 14 gainers recorded previous session;
while losers also closed lower at 42 stocks when compared with the 45 losers
recorded on Wednesday.

Transnational Corporation and Red Star Express topped the price
gainers’ table with an increase of 4.35 per cent and 4.26 per cent, to close at
72 kobo and N2.94 per share, respectively.

Starcomms and Goldlink Insurance followed on the gainers’ table
with an increase of 3.80 and 3.64 per cent, to close at 82 kobo and 57 kobo per
share.

On the flip side, Dangote Sugar Refinery, Stanbic IBTC Bank, and
Cement Company of Northern Nigeria led the price losers’ chart with a loss of
five per cent each, to close at N12.35, N8.74 and N10.84 per share,
respectively. First City Monument Bank followed with a loss of 4.99 per cent,
to close at N6.48 per share.

Active subsector

The Banking subsector led the market transaction volume on
Thursday with 107.122 million units valued at N788.799 million. The volume
recorded in the subsector was driven by transaction in the shares of Diamond
Bank, First Bank, Oceanic Bank, and Skye Bank.

Trading activities in the Insurance subsector was second highest
yesterday, with 36.063 million shares valued at N29.005 million. Volume in the
subsector was boosted by deals in shares of Goldlink Insurance, Aiico
Insurance, and Mutual Benefit Assurance.

The Conglomerates subsector was third with 33.694 million shares
valued at N874.380 million. PZ Cussons Nigeria, Transnational Corporation, and
Unilever Nigeria boosted volume in the subsector yesterday.

Money

BPE states key requirements for distribution companies’ bidders

BPE states key requirements for distribution companies’ bidders

The Bureau of
Public Enterprises (BPE) has issued the requirement for the next stage
of the privatisation process of distribution companies created out of
the Power Holding Company of Nigeria (PHCN).

The director
general of the Bureau, Bolanle Onagoruwa, said on receipt of
Information Memorandum and Request for Proposal, pre-qualified bidders
will be given access to physical and e-data room; will be able to carry
out physical due diligence; will be issued with draft copies of the
Multi-Year Tariff Order (MYTO); will be encouraged to submit comments
on MYTO; and Bidder comments on MYTO will be subject of conference to
be organised by sector regulator (Nigerian Electricity Regulatory
Commission).

The Nigerian
privatisation agency chief made the remarks on Tuesday as a panel
discussant at POWERINBADA in Johannesburg, South Africa, according to a
press statement on the firm’s website.

A total of 331
applications were received by the Bureau of Public Enterprises (BPE) on
Friday, March 4, 2011 – the deadline for the submission of Expressions
of Interest (EOIs) in the privatisation of the successor companies
created out of the Power Holding Company of Nigeria (PHCN.)

One hundred and
seventy four applications were received from prospective
investors/concessionaires interested in acquiring the four thermal
stations and the two hydro stations. One hundred and fifty seven
applications were harvested from prospective investors interested in
acquiring the eleven distribution companies.

Mrs. Onagoruwa told
her audience that the reform of the Nigerian power sector presents
enormous investment opportunities, adding that the government has put
in place investment-friendly initiatives. This includes the fact that
foreigners can own 100 per cent of investment; that there is guarantee
against expropriation of investments; that repatriation of profits are
guaranteed by law; that there will be generous tax incentives; and that
the nation has one of the highest Returns on Investment (ROI) in the
world.

She pointed out
that the objectives of the electric power sector reform are to increase
electrification; ensure cost reflective tariffs; attract private sector
investments into the sector; create competitive electricity market;
induce investments in new power generation facilities; rehabilitate
existing power generation facilities; improve efficiency by increasing
collections; reduce costs and technical and non-technical losses; and
improve customer service.

Chukwuma Nwokoh,
the spokesperson of the firm, said the firms would have to be
shortlisted first, before the request for proposals would be sent to
the successful ones.

“We would
shortlist, and then when we do, we would send them their Request for
Proposal. It is the next stage after the submission of Expressions of
Interest.”

The core investor
sales to be carried out through international competitive bidding will
cover the eleven electricity distribution companies in the country.
They are Abuja Electricity Distribution Company Plc; Benin Electricity
Distribution Company Plc; Enugu Electricity Distribution Company Plc;
Eko Electricity Distribution Company Plc; Ibadan Electricity
Distribution Company Plc; and Ikeja Electricity Distribution Company
Plc.

Others are Jos
Electricity Distribution Company Plc; Kaduna Electricity Distribution
Company Plc; Kano Electricity Distribution Company Plc; Port Harcourt
Electricity Distribution Company Plc; and Yola Electricity Distribution
Company Plc.

Money

Bank budgets $40m to support Nigerian products

Bank budgets $40m to support Nigerian products

The Nigeria Export Import (NEXIM) Bank plans to spend about $40
million (N6 billion) within the next two years to support potential buyers of
Nigerian products in order to boost the country’s export market.

Managing director and chief executive, Roberts Orya, told
reporters in Abuja on Wednesday that the aim is to make Nigerian products more
competitive within the sub region.

“As part of our mandate to facilitate and promote Nigeria’s
trade, NEXIM has engaged consultants in the region to develop a sea-link
project, which is expected to culminate in the establishment of a company to be
owned by investors from all ECOWAS sub-region, to facilitate sea transportation
of goods across the region,” Mr. Orya said.

Potentials and opportunities

According to him, the bank has set an ambitious target on how to
deepen cross border trade and payment system within the Economic Community of
West African States (ECOWAS) sub-region and Africa, to make it the traditional
market for exporters, as is the practice in most EXIM (Export Import) banks
around the world.

“What we have in the ECOWAS or the Central African region is a
non-traditional market, which nobody wants to go and do business, while we
allow other countries’ EXIM banks to take advantage of the huge potentials and
opportunities.

“If trade in the sub-region is deepened, it will help create
jobs and halt capital flight within the region, while every benefit that go
with deepening of trade would come to the region,” he said.

In order to discontinue the current scenario of huge non
performing loans among its clients, he said the institution has resolved to
follow stringent conditions in approving fresh facilities to prospective
beneficiaries.

Out of a total portfolio of over N10 billion recorded in its
books as non-performing loans to various groups since 2009, the bank has been
able to recover less than N1billion.

Tackling non performing
loans

“Loan recovery is usually a challenge in Nigeria. As at August
2009, the total amount of non-performing loans that had 100 per cent provision,
based on the grading of the prudential guidelines, was only N10.03 bilion.
NEXIM was able to recover about N540 million that year; less than N300 million
was recovered between January and December last year,” Mr. Orya said.

A special remedial management department, he said, has been
established charged with the responsibility of following up on customers on a
daily basis to help reduce the high level of non-performing loans, while
stricter conditions are to be adopted in approving future loans facilities.

“We have decided to carry on this transformation, knowing that
going forward, any credit to be created must be of good quality. Apart from the
one per cent general provision that the prudential guidelines require the bank
to make, we do not want to create any bad loans. We have taken time to
establish the pillars necessary to ensure that the bank does not go the same
way in the next two to three years, in terms of bad loans.

“We have learnt from our mistakes. We must ensure that any money
that is given is judiciously used. Any exporter that is not prepared to comply
with our conditions would not be attended to, as there are no political loans
in NEXIM. Any project that the bank must support must be bankable and viable.
Such projects must not only be able to pay back itself, but must also be seen
by all that the capacity is there to do so,” he declared.

He said the bank would henceforth be more concerned with its
ability to generate more foreign exchange for the country as well as facilitate
jobs creation, pointing out that only businesses with healthy balance sheets as
well as those with proven capacity to make sufficient returns to their
shareholders and those in a position to approach the international capital
market to raise money and have good relationships with other EXIM banks around
the world enjoy its patronage.

According to him, Nigeria, with a population of over 150
million, is well-placed to control the political and economic advantages within
the ECOWAS sub-region, pointing out that NEXIM, as Nigeria’s trade policy bank,
is poised to take up the challenge.

Money

Nigeria’s crude oil output declines

Nigeria’s crude oil output declines

Nigeria’s crude oil output dropped 3.8 per cent in February at
2.098m barrels per day (bpd), though it remained Africa’s top oil producer,
outperforming Angola (1.704m bpd), Libya (1.347m bpd), and Algeria (1.261m
bpd).

In its March Monthly Oil Market Report released this week, the
Organisation of the Petroleum Exporting Countries (OPEC) estimated the nation’s
crude oil output at 2.098m barrels per day (bpd) in February, from 2.181m bpd
in January, and 2.192m bpd in December.

Samir Gadio, Emerging Market strategist, Standard Bank, says
these statistics seem to suggest that a sizeable increase in production in the
short-to-medium term looks somewhat unlikely, until new oil fields come on
stream and the existing infrastructure operates at a higher capacity.

“Although last month’s output was still up 7.4 per cent year on
year, the annual growth rate in the data flattened further, in line with our
expectations, given the sharp rebound and subsequent stabilisation in output
since November 2009, as the security situation in the Niger Delta region
broadly improved. Additionally, the average crude oil production (2.139m bpd)
has edged up 8.5 per cent year on year said,” Mr. Gadio said.

“Overall, the turnaround in output since late 2009 as well as
the rally in the Bonny Light oil price in 2011 should theoretically translate
into a significantly positive trade balance and robust current account
surplus,” he added.

Foreign reserves
accretion

Experts believe that the surge in the oil price (and a somewhat
stable output) is translating into an increase in foreign exchange reserves,
which reached $35.9 billion on 10 March 11, up from $3.6 billion.

“Although it is difficult to estimate the breakdown in the
accumulation of foreign exchange reserves between Central Bank’s monetised
proceeds and the Excess Crude Account (ECA), it is worth stressing that the
finance minister, Olusegun Aganga, indicated in February that oil-related
savings had resumed this year.

“In this case, we should see a rapid rebound in the ECA balance,
given the substantial differential between the current oil price and the
proposed oil price benchmark in the draft of the 2011 budget ($65 per barrel),”
Mr. Gadio further said.

World economic growth remains robust and continuing improvements
have led to improved growth expectations for 2011, which have been adjusted 0.1
per cent higher to 4.0 per cent, according to the OPEC report, though inflation
is beginning to pose a challenge for policy makers in both the OECD and the
developing countries.

Afrinvest, a finance research and analysis firm, said the
government has offered to increase its crude oil production, on OPEC’s request,
to cool soaring oil prices.

“Oil prices last week rose to their highest point in more than
two years, as the social unrest in Libya reduced global supply by as much as
1.0 million barrels per day. Nigeria’s Bonny Light is similar to the type of
oil produced by Libya and would be a good replacement for refiners, who are
currently lacking adequate supplies because of the North African crisis.

“Nigeria has a combined crude oil and condensate output of
around 2.4m bpd, with a production capacity of around 3.0m bpd,” the firm said.