Archive for nigeriang

>Nigerian interbank rates fall on budget release

>Nigerian interbank rates fall on budget release

Nigerian interbank
lending rates eased to 1.1 percent on average this week from 1.66
percent last week, after the release of large budgetary allocations to
government agencies raised liquidity in the system, traders said on
Friday.

The secured Open
Buy Back (OBB) dropped 45 basis points to 1.05 percent from 1.50
percent last week, 5 basis points above the Standing Deposit Facility
(SDF) rate and 4.95 percentage points below the 6 percent central bank
benchmark rate.

Overnight placement fell to 1.10 percent from 1.75 percent, while call eased to 1.15 percent from 1.75 percent previously.

Nigeria, last
Friday, announced the distribution of 704 billion naira from central
accounts to the three tiers of government – federal, state, and local –
for the month of July.

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Egypt’s Alcotexa sells cotton worth $197.68 million

Egypt’s Alcotexa sells cotton worth $197.68 million

Egypt’s Alexandria
Cotton Exporters’ Association (Alcotexa) committed to sell 148 tonnes
of cotton in the week that ended on August 21, an Alcotexa official
told Reuters on Sunday.

The sales comprised 33 tonnes of Giza 88 and 115 tonnes of Giza 86, the official said.

The deal brings
Alcotexa’s export commitments for the 2009/10 season, which began in
September, to 81,550 tonnes of cotton worth $197.68 million, the
official said.

Egypt expects to export 80,000 tonnes of cotton this season, the agriculture minister said in February.

By this time last year, Alcotexa had sold 24,875 tonnes of cotton worth $62.69 million.

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Singapore firm to spend $108 million on Zambia coal mine

Singapore firm to spend $108 million on Zambia coal mine

Singapore mining
company, Nava Bharat Pte, will spend $108 million on modernising
Zambia’s Maamba coal mine, which it acquired in December last year, the
head of the Zambian operation said on Saturday.

Kalunga Mumba,
chief executive of Maamba Collieries Ltd., said the money would be
invested in a new coal processing plant and mining equipment over the
next 18 months. The mine is expected to produce 360,000 tonnes of coal
for the first year.

The thermal power
plant is important for the mine’s operations. Maamba, which used to be
a key supplier of coal to the country’s copper mines, lost that
business after the mines switched to using electricity, said, Mr. Mumba.

Nava Bharat in
December acquired a 65 percent stake in Maamba, while 35 percent of the
shares were retained by state-run ZCCM-IH.

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HSBC set to buy South Africa’s Nedbank

HSBC set to buy South Africa’s Nedbank

HSBC Holdings Plc
has emerged the frontrunner to buy a controlling stake in Nedbank,
South Africa’s fourth-largest bank, in a deal that could be announced
as early as Monday, the Financial Times quoted people familiar with the
talks as saying.

HSBC, Europe’s
biggest lender, was set to pip its emerging markets rival, Standard
Chartered, to the post in the race for what could be the last big South
African bank that regulators allow a foreigner to buy, the Financial
Times reported on Saturday.

Nedbank is
controlled by Anglo-South African insurer, Old Mutual, which is
undergoing a strategic overhaul to slim down its complicated structure.

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FINANCIAL MATTERS: The new inflation index

FINANCIAL MATTERS: The new inflation index

Which is the more
remarkable? The fact that in its statistical news for July 2010, the
National Bureau of Statistics (NBS) describes the revision of the basis
for computing the consumer price index (CPI) or the fact that on the
strength of this restatement, previous estimates of domestic price
movement may have been slightly understated (as has long been suspected
by most commentators on these data)?

At issue with the
former fact is why the NBS chose July 2010 to revalue the consumption
expenditure data from the May 2003-and September 1985-based indices,
and why it opted for November 2009 as the new basis for the index? Are
there triggers for such adjustments, and what pray tell, might these
be? Or is this a periodic thing, a key part of the statistical bureau’s
calendar? In which case, when might we expect the next revaluation?

No less important a
line of enquiry is why the NBS did not think as part of this
revaluation of the basis for computing the domestic inflation rate, to
re-weight the makeup of the basket of goods on which its computation is
based.

A good number of
commentators have argued that a basket heavily weighted (65%+) in
favour of food items (including non-alcoholic beverages, and food of
the imported variety) does not sufficiently reflect the spending
patterns of the most economically active segments of the Nigerian
economy. Thus, if the quantum of spending is what matters to the
movement of prices in the economy, we shouldn’t be looking to the
all-in costs of the average Nigerian to explain such movements.
Instead, we should look to an index based on a basket that reflects the
spending patterns of the financially significant sections of this
economy.

In a sense, one
cavils a bit here. For, evidently, the NBS’ adjustment is driven by its
sense of a change in the mix of goods and services purchased by the
“typical Nigerian consumer”. To gauge the trajectory of this change,
one need only look at the composition of the basket over its many
incarnations, and the weights attached to the respective components.
For the September 1985-based index, the food component alone accounted
for 69% of the basket. This index also included a category “drinks,
tobacco, and kola”, which accounted for a little under 5% of the
basket. With the May 2003-based index, “food” alone had a weight of
63.76%. Add “non-alcoholic beverages”, and this weight rises to 64.41%.

With the new base
(November 2009), however, the bureau has introduced a new category
(“imported food” with a weight of 13.25%), on account of which the old
“food” category now has a much reduced weight of 50.70%.

The question is
what changes do these new categories tell of? Do they reflect a change
in the composition of domestic shopping baskets? Do they reflect the
entrance of new goods and services into the shopping basket, the way a
properly reflective index ought to have in the earlier parts of this
decade when telecoms spend entered household balance sheets to an
unusual extent? Or do they just show how granular the bureau can be
now, in the light of new skills and/or software?

The balance of
evidence favours more granular number crunching competences. The makeup
of the measured basket remains basically unaltered. But should we then
replace the one measure of price inflation (that of the man in the
street, plenty of numbers both, no spending weight) with the other
measure (where the size of the purses, and the items on which spending
goes are statistically significant)?

Not necessarily!
For each measure tells a different story about both the character of
the economy and its likely direction. This latter observation leads on
to another question: why do we have just one measure of inflation in
the country, when in some countries they make do with up to five?

Would, for
instance, monetary policy be better designed if we had some measure
that excluded more changeable items in the current basket? What would
we exclude from our own version of the “personal consumption
expenditures price index” to compensate for those short-term price
changes that could interfere with proper estimates of future long-term
inflation trends in the economy?

Point is that the NBS’ recent adjustments raise a few more questions than they do address.

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THE POLITICAL MANN: Obama’s undue rights campaign

THE POLITICAL MANN: Obama’s undue rights campaign

Maybe Barack Obama should have stayed out of it.

The American
president intervened in an argument he could have avoided and
overshadowed almost everything else he was trying to achieve this week.

“Politically it
was not wise at all,” said Democratic strategist James Carville. But he
added “it was the right thing to do.” Right or not, the argument that
got Mr Obama’s attention, is about a plan to build an Islamic cultural
centre and mosque two blocks from New York’s Ground Zero, the site of
the attacks of September 11, 2001.

America’s
conservatives have been aghast at allowing a Muslim place of worship so
near a site where Islamic extremists killed more than 2,700 people.

In fact, CNN’s polling has found that nearly 70 percent of Americans are opposed to it.

Mr Obama said that
“Muslims have the same right to practice their religion as anyone else
in this country. That includes the right to build a place of worship
and a community centre on private property in lower Manhattan, in
accordance with local laws and ordinances.” The president could have
concentrated on his other problems:

America’s anemic
economy and stubborn unemployment have turned voters against him. His
popularity is at an all-time low. Only 42 percent of Americans approve
of how he’s handling the presidency. His Democratic Party is bracing
for major setbacks in upcoming legislative elections.

This week, as Mr
Obama travelled the country to help campaigning candidates, some of the
most prominent were suddenly trying to distance themselves from an
issue they probably never wanted to address.

Even Senate
Democratic Majority Leader Harry Reid, a close ally who has leaned on
Mr Obama for support in his own tight re-election bid, issued a
statement “that the mosque should be built somewhere else.” New York
authorities have found no reason to stop the project and there is every
indication that if its supporters can raise the $100 million they’ve
budgeted for their 13-story centre, they will eventually be able to
build it.

So it’s not clear that the president needed to publicly help them along.

He and his party only stand to pay a price for his desire to make a principled stand.

He didn’t really have to do it.

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Activists want minister sacked

Activists want minister sacked

The Education
Rights Campaign (ERC) has called for the sack of the Minister of State
for Education, Kenneth Gbagi, over his call for the deregulation of the
university system in the country.

The group described
the statement as anti-poor comments, saying Mr Gbagi has been making
such confusing statements since his assumption of office. “Many of
these statements have created serious apprehension and misgiving in the
education sector as to the intention of the federal government towards
the funding of education,” the group stated. Mr Gbagi had recently,
while receiving the management of the National Universities Commission,
led by its Executive Secretary, Julius Okojie, in his office, said the
federal government should stop sponsoring the education sector,
claiming that if students could afford sponsoring themselves abroad,
they should be able to pay such money in Nigeria universities too.

The group however said if deregulation is introduced into the
university system, the education system will be destroyed by an
increase in fees and other costs of education beyond what students from
poor working background can afford. “The implication of this is that
[the] university education will now be the preserve of the rich few,
thus shutting out of school millions of youths from poor working class
backgrounds,” the group stated. “Deregulation is a pro-rich and
neo-liberal economic policy inspired by the International Monetary Fund
(IMF) as a means to continue to keep the economy and social services of
neo-colonial capitalist countries like Nigeria underdeveloped and
subject to the imperialistic interests of the advanced capitalist
countries.” The group therefore advised the federal government to
shelve the idea of deregulating the university system, saying that
“Nigerian students will not accept any policy that makes education the
preserve of the rich few.”

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Rep seeks agency’s assistance for fire victims

Rep seeks agency’s assistance for fire victims

A federal lawmaker
has called on the National Emergency Management Agency (NEMA), to
urgently come to the aid of the victims of Uselu market fire disaster,
whose goods worth millions of naira were razed down over the weekend.

Ifaluyi Isibor, the
member representing Ikpoba/Okha federal constituency, made this appeal
while presenting a cash donation of N15, 000 each to the 28 victims of
the disaster when he carried out an on-the-spot assessment of damages
in the market.

Mr. Isibor’s visit,
which was almost marred by heavy down said, “I came to Benin basically
to sympathize with my sisters and mothers and to assure them that
government will not forget them. Before I left Abuja, I have prepared a
letter addressed to the National Emergency Management Agency in Abuja,
directing them to come to the aid of the victims with a view of
bringing relief to affected traders.”

He said his
observation was that about 95 per cent of fire disasters in markets are
traceable to electrical problems. He therefore appealed “to the
government that is in-charge of the management of the markets to ensure
that accredited technicians are usually in charge of markets to enable
they monitor electrical connections. Once that is done our people will
be happy for it,” he said.

In the early hours of last Friday, fire gutted goods worth millions
of naira at the Uselu market, in Egor local government. This happened
just as the state government was finalizing arrangement to start
rebuilding the Agbado market destroyed by fire on November 5 last year.

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Abuja’s losing battle against prostitution

Abuja’s losing battle against prostitution

Two months ago,
Bala Mohammed, minister of the Federal Capital Territory (FCT), gave
all commercial sex workers in Abuja two days to quit or leave the city.
The territory’s Social Development Secretariat which was mandated to
implement the order, has since carried out three raids, but
prostitution remains big business in Abuja.

The FCT
administration has used different tactics to discourage the female sex
workers from plying their trade. It began with persuasion when in June,
the secretary for social development, Blessing Onuh, visited the call
girls at their respective abode to give them the minister’s order. She
told them that the secretariat’s task force would commence arrests and
warned them not to take the matter lightly.

“I’m out to
instruct the girls that the FCT minister has given them 48 hours to
vacate the city and quit the job,” said Mrs. Onuh two months ago. “They
constitute a nuisance in the city and the FCT administration will not
tolerate them.” Afterwards, the secretary donated N50,000 to the girls
after they complained that they had not eaten all day.

Shortly afterwards,
35 offenders were arrested when the task force, made up of officials of
the Abuja Environmental Protection Board (AEPB), the secretariat and
the police, conducted its first raid. The second raid in July nabbed 50
suspected prostitutes. The most recent raid, held last Wednesday,
netted about 60 sex workers, including a man and woman caught in
compromising situation in a car around midnight.

The suspects were
eventually taken to Wuse Police Station before being charged to a
mobile court where they were tried by the magistrate, Aminu Abdullahi.

Guilty as charged

At the court
session in August, the prosecuting counsel, Eze O. Eze, accused the
girls of soliciting men for commercial purposes. The session was held
under a tree and most of the girls, who had no lawyers representing
them, pleaded guilty to the offence.

The court convicted
those who pleaded guilty and sentenced them to two months imprisonment
or N3000 option of fine. Those who pleaded not guilty were told to
reappear at the court on Friday, 20th August, for hearing and they were
given bail on condition that the bond was signed by a resident of the
FCT. At the end of the court session, bank officials were on hand to
collect the fines from the convicts. The payments were made to the
environmental protection board’s account.

However,
investigations revealed that the group arrested in the first raid in
June were never charged to court. In July, the magistrate had suspended
his judgment against the women, because they were “first offenders.”
Sources at the environmental monitoring unit told NEXT that they were
in a hurry to discharge the girls because the “pressure from outside
was too much. After the July arrest, we received several calls from
high-profile personalities in this country, including National Assembly
men, governors, commissioners from the states and high military
officials, asking us to release the girls,” said one source, who
declined to be named. “We had no choice because we do not want to lose
our jobs.” The officials said they were not even able to keep the girls
for more than one night and had to hold the court session on Saturday
instead of Monday.

“The DPO was not willing to keep them again because of several calls coming to him,” said another source.

We have no jobs

Some of the
suspects who pleaded not guilty insisted that they were not women of
easy virtue, while others claimed they were going about their own
affairs when they were caught. Maureen Opah, a native of Liberia, said
she was about to enter a car when she was arrested.

“I sell chicken on the street and, in fact, I had chicken in my hand when I was arrested,” one of them said.

However, Sade
Ayileka, deputy director of social services with the secretariat,
denied that innocent bystanders were rounded up. She said the team
invaded popular red-light districts in Abuja to apprehend the suspects.

“We consider their
dressing, the location they were in at the time, the time they were
there,” she said. “How can a lady be standing by the roadside at the
dead end of the night, half naked?” Some of the sex workers who spoke
to NEXT after their trial said they were lured into the profession
because they could not get gainful employment.

“I lost my husband
a few years ago and I have three children,” said Chidinma Michael. “My
mother was sick and I spent all I had.” She said she approached a
friend for help. Instead of giving her a loan, her friend showed her
how to make ‘free money.’ “So that was how I started coming out to the
street,” said Ms. Michael. “My children are now at home and have not
eaten since yesterday when they arrested me.” She was eventually given
automatic employment at the social development secretariat to assist in
rehabilitating other sex workers.

Mrs Ayileka accused
the women of laziness. She cited a medical doctor who was arrested some
time ago whose colleagues had to beg for her release because she was
supposed be on call the next day.

“Some of them are
graduates. A lot of them are working-class ladies,” she said. “There
are lots they can do with little money instead of degrading
themselves.” She said the FCT administration would rehabilitate those
who are willing to change. At the skills centre in Lugbe, a suburb of
the city, girls could choose from 10 different skills, including
hairdressing, tailoring and computer studies. Upon completion of the
course Mrs Ayileka said the girls would get equipment relevant to their
fields of training.

However, though many of the girls filled out the application forms, the training is has not commenced.

A wider net

In the meantime
the FCT administration promises the raids will continue, and may be
expanded to the men who patronize the girls.

During one raid,
which lasted from 11 pm on a Friday night to 4 am on Saturday, a
retired director of one of the federal ministries was arrested for
allegedly patronizing one of the girls.

When he was caught,
the embattled man claimed that the lady with whom he was caught was his
daughter; but on getting to Wuse Police Station, he changed his story,
saying that she was his fiancée.

At the station, the
man, who introduced himself as Mr Clem, accused the FCT minister of
going beyond his limits. “When I was a Director, I know Bala. He was a
deputy director. How come now he wants to decide how we live our social
life in the FCT?” said the man. “He should concentrate on the Abuja
Master Plan and forget about the sexual life of the residents.” Mr Clem
was arrested on Gimbiya Street, where he was reportedly caught
negotiating with a prostitute. However, he was eventually discharged.

The FCT administration has said that all that will change soon, as men who patronize prostitutes will also be tried in court.

“Because if men do not patronize them, they will not be there,” said
Mrs. Ayileka. “But we will take it a step at a time; let’s start with
the girls first.”

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World Bank to assist in creating 100,000 jobs

World Bank to assist in creating 100,000 jobs

The federal
government and the World Bank have signed an agreement to facilitate
the creation of over 100,000 jobs in six key sectors of the economy
over the next two years. The process will be carried out under the
auspices of the Nigerian Growth and Employment Pact with additional
support from the UK’s Department for International Development (DFID).

The pact, which is
designed to boost growth, investment and job creation, is expected to
cover the construction, entertainment, information & communication
technology (ICT), meat, leather and tourism sectors. World Bank’s
Private Sector Development Specialist, Richard Sandall, noted that
despite Nigeria’s status as a growing economy as a result of her huge
riches from oil, the country’s waged employment, put at less than 10
percent of the total labour force, has been declining in recent times.
“The World Bank, DFID and the federal government are partnering in the
implementation of the Growths and Employment in States (GEMS) project
designed to support select industries in accelerating their growth and
job creation. We are committed to create about 100,000 jobs in the
target sectors in the next couple of years,” he said.

Lead Economist,
World Bank Nigeria, Volker Treichel, said the goal of the bank is to
ensure a world free of poverty, and this cannot happen unless jobs are
created for the people. Noting that growth in Nigeria has been very
strong across all sectors of the economy, even in the wake of very
difficult global circumstances in recent times, Mr. Treichel said this
has hardly translated into jobs development for the people in the
formal sector, except in agriculture.

Minister of
Finance, Segun Aganga, described the new pact as an unprecedented
collaboration between key stakeholders to determine steps necessary to
ensure that the country’s economy continues to grow and create
employment, assuring that government, through its policies, has already
begun the implementation of some of the recommendations identified by
the stakeholders during their group interactions held in Abuja last
week.

Improved infrastructure

Mr. Aganga listed
some of the areas to include the review of the process for the
establishment of a more tourist-friendly visa regime; improvement of
airport facilities through private public participation (PPP) and
review of the tax system to eliminate multiple-taxation. Others include
a comprehensive reform of Land Use Act and unlocking credits for
investment by de-risking the banking system to recommence lending; and
review of the Evidence and Bankruptcy Acts. He said government is on
course to ensure that the recently established Asset Management
Corporation of Nigeria commences operations soon, to make banks begin
injecting money to the formal sector. The minister also said government
is considering establishing special commercial courts to ensure that
those who get collateral for loans are able to take possession of their
property without much hassles. Representatives of the various sectors
that participated in the two-day deliberations identified areas they
want government to intervene to open up the system and create jobs.
Most of the issues centred on the need for improved communication
between government and its agencies as well as with the private sector;
strengthening of the capacities of the various regulatory authorities
through improved legislative processes; improved access to finance;
harmonization of taxes and review of incentives, as well as enhancement
of capacity building for operators. While urging stakeholders to come
up with workable business plans, Mr. Aganga disclosed that government
plans to liaise with the Lagos Business School (LBS) to provide about
26 enterprise centres nationwide to help entrepreneurs develop and
nurture business plans for about one year to help them understand how
to set up and run successful businesses “The resolutions we have
arrived at have been very promising. The next step is for stakeholders
to show commitment to timelines and deadlines for their implementation
to ensure that we build on the momentum when the meeting reconvenes
next November,” the minister said.

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