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The
ambitious target to be among the top 20 economies by the year 2020 may
be farfetched after all, as Nigeria’s current growth trajectory does
not support such climb. World Bank country director for Nigeria, Onno
Ruhl, said Nigeria’s current gross domestic product growth of around
seven percent is not enough to achieve that feat.

“Vision
2020 is not about if it can be achieved by 2020, because any economist
will tell you at this point that would take you about 15 percent growth
every year and that has not happened in the history of mankind anyway.”

Do things differently

He
said instead of striving to be among the top 20 economies within the
time frame, the country should begin to do things differently in order
to grow the economy. “The point is, Nigeria should be among the 20
largest economies. Whether it is 2023 or 2024, it doesn’t matter. What
matters is that Nigeria should be ambitious and not accept second best.
Nigeria should aspire to be the best in everything it does on the
continent. That is the destiny of the largest country on the continent
as far as I can see.”

The
federal government in 2008, launched the Vision 2020 with a mandate
that “by 2020, Nigeria will be one of the 20 largest economies in the
world, able to consolidate its leadership role in Africa and establish
itself as a significant player in the global economic and political
arena.”

Implementing plans and visions

Mr
Ruhl said rather than discussing why Nigeria has not succeeded, the
emphasis should be on what the country needs to do in order to be where
it belongs.

“The
best example is China which achieved ten percent growth consistently
for 30 years. There is no reason Nigeria cannot achieve that and if it
does, it would be a different country very quickly and a much better
country by the year 2020.”

He
said the major challenge facing the country was implementing the plans
and visions that have been drawn over the years. “There is nobody that
does not know how to solve the power problems in Nigeria. It is not
rocket science. The issue is how we are going to do what needs to be
done.”

The
major focus of implementation of the vision include agriculture and
food security, business environment and competitiveness, corporate
governance, culture, tourism and national re-orientation, education,
employment, energy, health, housing, human development, information and
communications technology, judiciary and the rule of law and
manufacturing, among other.

Mr Ruhl said within the next few years, Nigeria will grow to be the
largest economy in Africa and must begin to position for that role.

A total of N133.11
billion has been disbursed under the N200 billion Commercial
Agriculture Credit Scheme as at April, 2010 to 139 beneficiaries across
the country. The beneficiaries include 115 individuals/private
promoters and 24 state governments. The federal government in 2009
launched the scheme to intervene in the agriculture sector which
currently contributes over 40 per cent to the country’s gross domestic
product (GDP).

Under the scheme,
which is funded from the proceeds of the N200 billion bond raised by
the Debt Management Office, participating banks can access for onward
lending to their customers while state governments and Abuja could also
borrow for on-lending to farmers in their domain.

The participating
states have accessed N1 billion each for lending to farmers. According
to data posted on the website of the Central Bank of Nigeria, the
states are Adamawa, Anambra, Bauchi, Enugu, Gombe, Kebbi, Kogi, Imo,
Kwara, Nasarawa, Niger, Ondo, Sokoto, Taraba Zamfara, Akwa Ibom,
Rivers, Plateau, Edo, Kano, Benue, Bayelsa, Ogun and the Federal
Capital Territory – Abuja.

The funds are
disbursed through participating banks. The 13 banks participating in
the scheme are Access Bank, Fidelity Bank, First Bank, Guaranty Trust
Bank, Oceanic Bank, Skye, Stanbic IBTC, Union Bank, UBA, Unity Bank and
Zenith Bank. UBA has made the highest disbursement of N37.46 billion to
36 projects followed by Union Bank with N16.15 billion to 18 projects.
Zenith bank disbursed N13.84 billion to 10 projects while First Bank
disbursed N11.92 to 29 projects.

The Central Bank
stated that for failure to abide by guidelines, the regulator withdrew
fund from five banks with respect to 22 projects. The banks are UBA
N12.053 billion, Guarantee Trust Bank N581 million, Skye Bank N2
billion, First Bank N1.6 billion and Union Bank N2.166 billion.

Fast track development

The scheme was
meant to provide cheap funds to fast track development of the
agricultural sector, enhance national food security by increasing food
supply, reduce the cost of credit in agricultural production and
generate employment in the sector.

According to the
Central Bank, the key agricultural commodities to be covered under the
scheme are cultivation of target crops (rice, cassava, cotton, oil
palm, wheat, rubber, sugar cane, fruits and vegetable), Livestock
(dairy, poultry, and piggery), and fisheries.

Agriculture potential

The Managing
director of the World Bank, Ngozi Okonjo-Iweala stated recently that
African countries need to improve on agriculture potentials in order to
boost its growth trajectory and reduce poverty. “I think African
countries really have to sustain their efforts to use agriculture funds
to ensure food security,” she said.

According to her,
Nigeria needs “to think of agriculture in a modern way,” since,
according to her, it is a sector that can provide so much employment.

I readily confess
to a fascination with the “theory of unintended consequences”. But, a
small clarification before anything further is written. My interest is
not in the certainty that everything that may go wrong about a policy
choice/decision is bound to. Confronted by almost six decades of inept
and often cynical management of this economy, it is to be expected that
we have come to associate “unintended consequences” with “negative
outcomes”.

In truth, put this
way, my central narrative is but a variant of Murphy’s Law. Instead, my
enthralment is with the benefits, losses, or wrong signals arising from
a particular action, but which were not conceived of in or intended as
part of the original action plan.

Newspaper headlines
on workers’ day, May 1, were all of one flavour. In their addresses to
the different labour rallies, state governors all pledged to implement
the new minimum wage. Not too long ago, the same persons had argued
that their state government budgets could not bear the extra financial
burden from paying the new minimum wage. What had changed since then? I
could think of only one proximate explanation: the events of late
April, this year.

On balance, the
last polls in the country appear to have moved the social engagement
envelope several notches up. The “voice” of the people was heard loud
and clear, amidst the din of many a strong man’s battered ego. That was
the intended consequence of the clamour over the years for a democracy
in which every vote is counted, and every vote counts.

To the extent that
it acts as counter-weight to the dominant culture of impunity that has
come to define our polity, a representative democracy ought to improve
both the collective capacity to choose, and the different cabinet’s
will to execute.

Perverse results

However, to the
extent that politicians interpret “re-election” as the main challenge
of a democracy, then even the best voting process could have perverse
results. One such result is the rise of populist politics. Because the
masses may now have the power of the vote, what is to stop unscrupulous
politicians from pandering to its basest instincts? To take but a few
examples, a thin line separates the need for higher taxes on the
affluent in aid of society’s redistribution responsibilities from a
restraint on commerce as part of an ill-advised process of
democratising poverty; a no less blurred space sits between the need to
protect employment for locals and xenophobia.

A less than honest
treatment of the policy choices at the heart of these two examples
could lead politicians in a race to the bottom of the dump yard; more
so in a democracy where people have only just begun to savour the power
that rightfully belongs to them. Our best bet is a lot more conviction
at the top. For leadership is not solely about bending resources and
capacity to the discharge of the popular will. It is more about shaping
the choice space. Agreeing a desired destination, and selling this to
the electorate. It is, in this very narrow sense, a question ultimately
of shaping the popular will. Of leading it down paths where only
visionaries have travelled previously.

Again as between a
visionary leader and a demagogue, the thinnest of lines demarcate. So
we arrive at the point where we must agree that even under the best of
representative democracies, the threat of continued misrule in this
country does not evaporate overnight. This danger is heightened by the
prevalent low levels of education in the country, both of the classroom
variety, and of the civic one, which can only come from a long thriving
civil society.

In the absence of such a society, then, our hopes for a better
tomorrow, in the short-term, at least still depend on the quality of
leadership we get. In the absence of a functioning democracy, a
benevolent caudillo almost became a popular fancy. One, who,
understanding the need for progress along modern lines, a la Singapore
and Malaysia, rammed that vision through society. Once we change the
rules of the game through trying to run elections properly, we deny
this possibility. Instead, the new need is for conviction politicians,
prepared to argue their corner as strenuously as the most modern
constitution permits, while eschewing popular lines.

The oil-producing
central African state of Congo Republic inaugurated a 120 Megawatt
Chinese-funded hydroelectric power station late on Saturday aimed at
bridging the gap in its energy needs. The $377 million Imboulou plant
150 km (90 miles) north of the capital Brazzaville is 85 per
cent-funded with soft loans by China and was built by China National
Machinery & Equipment Import & Export Corporation (CMEC). Terms
of the financing have not been released.

Energy Minister Bruno Jean Richard Itoua said the plant, which is
due to produce 876 million kilowatt-hours a year, would allow Congo
Republic to wean itself off energy imports from its larger neighbour,
the Democratic Republic of Congo.

Royal Dutch Shell,
France’s Total and Eni sold a 45 per cent stake in a Nigerian oil block
to a Polish-Nigerian consortium, Kulczyk Oil, a partner in the
consortium, said late on on Friday. The price paid by the consortium
consisting of Kulczyk Oil and Nigeria’s Nest Oil, Aries and VP Global,
was not disclosed, but a source on Thursday told Reuters the deal was
worth $600 million. Kulczyk Oil said in a statement it has acquired 9
per cent of the OML 42 block, a stake which could produce 11.5 million
to 46.4 million barrels of oil equivalent. “Kulczyk Oil believes these
estimates are cautious because they do not take into account
significant volumes of gas,” the statement said.

The transaction is
subject to a number of approvals, including permission from Nigerian
National Petroleum Corporation, which owns the remaining 55 per cent of
the block.

The All Farmers Association of Nigeria, Delta Chapter, has urged the
state government to consider farmers in the disbursement of the N50
billion bond recently approved for it. Jerry Ossai, the chapter
Chairman, made the call in an interview with the News Agency of Nigeria
in Asaba. He said that with adequate support to farmers, the “Delta
without oil initiative” would be realised. Mr Ossai, who said funding
had remained the bane of agricultural development in the state, pointed
out that farmers had found it difficult to access any of the sector’s
intervention funds. “I will advise the government to put some good
money from the N50 billion bonds just approved for the state into
agriculture,” he said. Mr Ossai, a former Commissioner for Agriculture
in the state, said only one farmer in the state had been able to access
funds from the federal government’s agriculture intervention scheme.

Barclays Plc plans to move its Africa headquarters in Dubai back to
Johannesburg, a spokesman for the bank said on Sunday, leaving more
than 120 employees with the option of relocating or quitting the bank.
The British lender mainly runs back office functions for its Africa
operations out of its Dubai base. A source said employees had been
informed of the plan and their options. Sami Lahoud, head of corporate
affairs at Barclay’s Africa, said 123 employees affected by the move
will have until the end of the year to decide. “These are individual
decisions based on peoples circumstances and preferences,” Lahoud
added. “The majority of senior positions will move to Johannesburg. “By
the 1st of January 2012, we will be operating out of Johannesburg.”

Rwandan President
Paul Kagame appointed the country’s central bank governor as minister
for trade and industry in his first reshuffle since being re-elected
with 93 per cent of the vote last year. Francois Kanimba, a former
World Bank senior economist who had been governor of the National Bank
of Rwanda since 2002, was replaced by his deputy Claver Gatete. Mr
Kagame, who has a firm grip on power in the central African country,
gave no reason for the reshuffle announced late on Friday. It had been
expected, however, because two ministerial posts recently became vacant.

Mr Kagame, who has been credited with rebuilding the country since
his rebel army swept to power and ended a 1994 genocide, last rejigged
his cabinet in December 2009.

The

World Bank has said it is prepared to provide support to any foreign

investor interested in Nigeria’s power sector. Onno Ruhl, World Bank

country director for Nigeria said the Bretton Woods institution

realises that the power sector is critical to the future of the

economy.

“We will do what we can to give comfort to investors who have the courage to come to invest in the sector in Nigeria,” he said.

According to him, private participation in the power sector was critical in order to see improvement.

“We

will focus on power generation effort and will also focus on getting

private participation in distribution companies especially key

distribution companies that have short term viability in their

horizon.”

He

said key distribution centres include Ikeja and Abuja distribution

centres. According to him, the major issue with Nigeria is the

implementation of the plans that have been drawn up over the years.

Speaking yesterday in Lagos at the bi-monthly breakfast meeting of the

Nigeria British Chamber of Commerce, the World Bank official said it

would be erroneous to think that solving the power problem would

translate to solving other issues in the country.

“It

is government’s business to make it easy for people to do business.

Should the government be more concerned about the power sector or

should it be concerned about social inclusion which is indeed very

important, the power sector is the simplest story as far as I am

concerned.”

Frightening statistics

Reeling

out statistics, he said the Nigeria has over 100 million people under

30 years of age which is more than the entire population of Libya,

Egypt and Tunisia combined. “Nigeria has 75 million people under 20.

Nigeria has 46 percent unemployment between 16 to 24 years of age.

Every year, 800,000 Nigerians pass their JAMB exams and do not get

admission into the university because there is no space for them.” He

said government has to find ways of including these people in the

economic space or they could be sources of social disorder in the years

ahead. He cited the Brazilian example where the government dedicated

about one percent of the country’s gross domestic product to cater for

the bottom 20 percent of the population. He said procedures at the

country’s ports need to be overhauled in order to make it easier for

goods to be cleared at the point of entry. According to him, the

country would achieve more progress by improving the business climate

than it would in the power sector which would take several years to

accomplish.

Improving business climate

“You

can achieve more in the short term by making the business climate

better than in power because power will still take time. Improving the

business climate would have more impact on job creation. We need

government with political guts to do this,” he said.

On the future prospects of Nigeria, he said the country can get it

right if the implementation strategy is well thought out. “Nigeria is a

country with enormous potentials not because it has oil but because of

it has a good balance sheet, because it has a large market which cannot

be ignored and because it has more money in its pocket more than

before,” he said.

Far too many people
are still sitting on the sidelines and are hesitant about investing in
the stock market. Because of their strong aversion to risk and the fear
of loss, they are watching opportunities pass them by. The stock market
can seem intimidating for the new investor and for those who have had a
bad experience in the past; but it needn’t be. Here are a few tips as
you consider investing:

Set yourself clear goals

Before you put any
money down at all, set yourself clear goals. These may include funding
your children’s education, making a down payment on your new home or
saving for your retirement. The best way to navigate the investment
environment is to have set goals in place and a clear plan on how to
achieve them. If you have set yourself clear goals, your focus will
largely be on accomplishing them and your plan will provide you with
direction on how best to invest your money. Investing is a journey
towards achieving your goals.

Build your knowledge

One of the best
investments you can make in yourself is to take the time and trouble to
improve your knowledge of investing. There is a plethora of information
and research by professional analysts and experts, which will be a good
guide. Investment seminars are also available that can develop you and
point you in the right direction. Resolve to take some time to educate
yourself. You will be surprised to see how much you can learn in a year.

How much risk can you take?

How much risk can
you endure without staying awake at night? Sometimes you do need nerves
of steel to sit tight when the market dips sharply. It is important to
be aware of your attitude to risk and that stock market investing comes
with risk. Stock market investments are not guaranteed. This means that
although you are likely to make money over the long term, you can lose
your investment.

If you can’t bear
to take much risk and would be devastated by any loss, it is best for
you to put only a small portion of your investible funds in the stock
market and the balance in money market investments.

Invest for the long term

How much money can
you really afford to put away for say five years and beyond? When you
think of investing in the stock market, adopt a long-term strategy
rather than looking to make a quick profit. Avoid investing more than
you can comfortably afford to be without during your time horizon.
Historically, stocks have generally outperformed other investment
classes over the long term. However, in the short term, the market can
be unpredictable and carry a greater risk of loss.

Diversify

“Don’t put all your
eggs in one basket!” Don’t put all your money in one stock and don’t
invest in stocks alone. When it comes to buying shares, diversification
is essential. Instead of investing all your money in just one or two
companies, its best to diversify by buying shares in different
companies and sectors.

Get professional Help

Most of us do not
have the time or expertise to make sound investment choices without the
help of a professional. Professionals have the expertise and an
enormous amount of information with which they can make well-informed
decisions and guide you appropriately.

Don’t jump on the bandwagon

When you make an
investment, you should know your reasons for doing so. Relying upon
every rumour or tit bit from your friend or neighbour is tantamount to
gambling.

Invest regularly

Allocate a part of
your investments in a systematic investment plan. Instead of trying to
time the market, invest on a regular basis say monthly, or quarterly in
an appropriate vehicle, and even when your finances are stretched.

Invest in Mutual Funds

If you are new to
investing or don’t have that much money to invest, a mutual fund may be
the most convenient way to invest. A mutual fund pools investor’s funds
and manages them in stocks, bonds, money market instruments, etc. The
benefits of mutual fund ownership include the wide variety of
investment types to choose from, having a diversified portfolio of
stocks, bonds and cash, and having access to professional management,
usually the prerogative of substantial investors.

Buy low-sell high

This seems so
obvious but many investors often do the exact opposite! They jump on
the bandwagon and invest when the market is already rallying. Once it
reverses, they panic and sell. If anything, this should be considered
an opportunity to invest in strong companies at bargain prices. A
market decline is not the time to panic and sell, but rather to take
advantage of the lower prices.

Be realistic about
your expectations of the stock market. If you set reasonable long-term
profit expectations for your investments, you will be more accepting of
the inevitable periods of volatility. If you stay the course and
continue to build upon the foundations of a sound investment strategy,
you can come closer to your financial goals. Depending upon your
particular circumstance, your age and time frame and your overall
financial plan, do consider putting at least some portion of your money
in the capital market; it still offers the best prospect of real long
term growth.