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Financial
experts are of the opinion that the recent tightening of the nation’s
monetary policy rates could worsen the already poor state of private
sector lending, given the persistent liquidity tightening that the
nation has been experiencing since banks started addressing their ‘red’
books last year.

They
said tightening liquidity through the monetary policy rates, in
anticipation of expected inflation due to election spending, is not
going to help private sector lending, which is already contracting due
to increase in government lending. This portends more difficult times
for manufacturers, the private sector, and the average person in the
near and long term.

“The
only component that has grown is credit to government, which has
affected credit to the private sector, because that has contracted over
the months. The way out is to hope that the confidence that seems to
have returned to the markets should stay. If it does, prices would rise
and then markets would rise,” Ayo Teriba, managing director, Economic
Associates, a finance firm, stated last week.

According
to him, the key demand side driver of the economy is interest rates,
especially interest rates on the treasury bills, and Nigeria remains
among the nations with lower interest rates, operating well above
average.

“However,
compared to where we were, liquidity has been tightening in Nigeria and
this could be felt even in the stock market. Even though the stock
market has been faring better, when compared to some other stock
markets, it has been worsening locally,” Mr. Teriba said.

“Figures
obtainable indicate that there is credit crunch, that credit is
tightening, and at the end, you say you want to tighten liquidity,
based on an expected inflation that would be as a result of anticipated
election spending. This is not really appropriate now,” he added.

Akinbamidele
Akintola, a finance analyst at the Renaissance Capital, an investment
bank, expressed hope that the Asset Management Company (AMCON) would
bring a turnaround in banks and help liquidity.

“By
and large, we expect a gradual turnaround in the bank, as the CBN
continues to make concerted efforts to stimulate the recovery of the
financial system by acquiring non-performing loans from the banks and
assisting them in improving their capital and liquidity. So, the AMCON
would definitely help speed up the process of rerating the banks going
forward,” Mr. Akintola said.

Caution in public sector lending

Credit
to the public sector has gradually been increasing, at the expense of
the private sector, experts say. Last year, the Central Bank warned
that commercial banks should follow laid down guidelines for lending to
all the three tiers of government and their agencies.

The
warning, which was contained in a circular by the CBN director of
banking supervision, advised commercial banks to be more cautious in
their lending to the public sector.

The
circular, which stated that “A maximum limit of 10 percent of the total
credit portfolio should be placed on public sector credits both
on-and-off balance sheet,” further reminded banks of the history of
non-performing public sector credits and, therefore, strongly advised
them to exercise caution and avoid the mistakes of the past.

“The
CBN will be constrained to reintroduce measures to curb public sector
loans if banks do not put in place appropriate measures to avoid the
excessive exposure to the sector,” it said.

Earlier
in the year, the Central Bank noted that financing conditions,
especially for businesses and firms, are likely to remain as they are
in the near term as financing institutions continue to maintain a
cautious approach to credit extension.

The
notice, which was drawn at the then special Monetary Policy Committee
(MPC) meeting, noted that the persisting tight credit conditions and
the continuing under-performance of key monetary aggregates, had
informed its earlier decision to embark on a quantitative easing policy
to be implemented through investment in debentures to be issued by the
Bank of Industry (BOI).

Bank
officials have stated that they are still trying to be careful in their
lending, given their recent experiences with margin loans, adding,
however, that while lending is challenging due to liquidity problems,
they are still doing some lending.

Experts
said the ability of the Nigerian banks to grow their loan portfolios
will be limited by their ability to grow their deposit base, which may
be undermined by deteriorating economic fundamentals.

The graduation ceremony had a touch of solemnity and nostalgia about it; the special day has come and gone. Your precious child has reached the milestone you set them so many years ago; they listened to you and stayed the course. Perhaps you preached that once they had that foundation of a solid education under their belt they could step out into the world and enter the career of their dreams and start to build their own future. That time has now come and they are set to go out on their own, but there is nowhere to go. Every day young, intelligent, articulate graduates, pound the pavements in search of work. This year’s graduates are probably the most unfortunate in decades in terms of finding work. For many of them and indeed their colleagues who graduated up to two to three years ago, having a degree has not translated, as expected into getting a job. With the increased competition for only a few jobs from last year’s graduates who are still unemployed, the job outlook looks grim for scores of graduates. Are you an unemployed graduate? Do you have a child that faces this predicament? Here are some suggestions that might be useful until things improve.

Network, network, network

Does everyone you know realise that you are looking for a job? Use all the contacts and connections that you have, including your parents, aunts and uncles, family friends and so on. Make sure they know what your skills and talents are, so that they keep you in mind when they hear of any openings. Stay in close touch with professional colleagues and actively seek to expand your network. Use the web to search for job opportunities; through company websites you will be able to send out several applications efficiently, but bear in mind that most great job opportunities are not advertised; they are often filled by personal contacts.

Don’t give up

Having your graduate child return home to unemployment is a depressing experience for any parent, but you must continue to motivate and encourage them to keep searching. Naturally it can be very tedious and disconcerting sending out several applications but don’t

focus solely on your area of study, be flexible and broaden your scope. Searching in related fields boosts your chances of finding something that is relevant and that will still utilise your training and abilities and may even give you new skills. Get tips on how to improve the presentation of your CV to make it flawless and perfectly tailored to the positions you are seeking. What qualities do you have that might make you stand out amongst literally thousands of applications and make you more appealing to a potential employer?

Be flexible

If you are broke and are not one of those that are lucky enough to be housed and fed by your parents or relatives for an indefinite period, you cannot afford to sit at home until you find your dream job. If you regard every other position as demeaning and ‘beneath you’ as you are in fact ‘a graduate,’ you could be in for a long wait. In this highly competitive world in recession, it is important that you are humble and accept the fact that you will have to start at the bottom and work your way up. There may be opportunities working at a restaurant, in a shop, baby sitting and lots of other temporary jobs that can keep you busy and give you some badly needed cash until something more in line with your expectations and credentials turns up. Try to avoid having significant gaps of unemployment in your CV to have to explain in interviews. A future employer will be impressed that you did not just sit at home doing nothing but you kept yourself occupied gaining experience and new skills.

Do you have a special skill or tal-ent?

Be creative and identify that special gift or talent that you might have ignored before now. Do people always comment on your painting, photography or writing skills? Are you good at public speaking or organising, web-design or programming? Can you design clothes or model them? If you can play musical instruments to a decent standard, there may be freelance work as a singer, pianist, organist or violinist in churches, clubs, music lounges or private receptions. There may be opportunities to offer tutorial services in a subject that you excelled in, to students in your area. There are endless options and not only will you be earning, but you will also open yourself to opportunities and contacts that may be of help in your job hunt.

Consider working for free

One good way to get your foot in the door with a company or organisation is to demonstrate to them what you can do. By working as an intern or volunteering, you have an opportunity to impress them by showcasing your skills, commitment, and professionalism. This might make them want to hire you. Do not assume that doing volunteer work will translate into a permanent position with an organisation or you might be disappointed. Even if it doesn’t you would have gained valuable experience. Of course if you have no assistance whatsoever from family or friends, it will be difficult to work for free.

Consider setting your business

What is it that you are passionate about and capable of doing relatively easily and well? When you are young and free of significant financial or personal commitments such as a family, a mortgage and other debt, you have a unique opportunity to take some risk and consider establishing your own business if you are so inclined. Do you have what you consider to be a great idea that you are passionate about and doesn’t have huge start up costs? You may be surprised at what you can accomplish.

Consider the fact that there may be comfort in numbers. Perhaps you could partner with a classmate or a friend whose skills complement your own and set up something together.

Improve yourself

Whilst no learning is wasted, avoid fleeing into an expensive and lengthy graduate programme that may not necessarily give you that added advantage, just to postpone the difficult period. As far as possible, seek continue training and experience
that can directly support your chosen career path. Professional qualifications or certifications, or shorter courses to improve your IT and other skills can sometimes be of greater value at this time. The hard reality is that being a graduate never guaranteed anyone immediate employment. As you await the ‘right’ job, open yourself to various opportunities and experiences. Above all, maintain a sense of optimism and keep your spirits and energy levels up through exercise. Despair
and depression will only make you less attractive to a potential employer. It is that strength of character and self-confidence that will make you stand out and help get you through an employer’s door or the door of your own
small enterprise.

Should we be
concerned that, lately, the stock of the nation’s foreign reserve is
being run down at rates that appear unsustainable even in the
short-term? The apprehension with which the newspapers reported last
week the fact that by Monday, our foreign reserves stood at US$35.66bn,
the lowest level since April 2006, and down from the May 2008 high of
US$62.24bn, seems to suggest that we ought to.

However, before
panic sets in, how do foreign reserves matter to the economy? The
relatively simple nature of our economy, depressed final demand, almost
non-existent local production of anything of value, abysmal levels of
domestic productivity, all these ensure that the quantum of reserves
directly affects the naira’s exchange rate. And in an economy where
everything is “made in China”, a volatile exchange rate could be a
problem indeed.

On the other hand,
our managed exchange rate regime also forces us to include inflation
considerations in the concerns associated with the rate of depletion of
our foreign reserves. Can the Central Bank of Nigeria (CBN) continue to
intervene in support of the national currency, even as its main
ammunition for this is depleted? Or put differently, how soon before we
are called upon to choose between an exchange rate crisis and devaluing
the naira? Most commentators imagine that this scenario would not play
out before the general election is done. Apparently, no central bank
governor would want to act in a way that hands victory to any opponent
of an incumbent president. If after the election, the naira begins to
buy fewer dollars than it was wont to, inflation figures may then trend
up, as the value of our imports rise relative to the value of the naira.

But then, isn’t it
the case that we worry too much. Lamido Sanusi, the central bank
governor, has re-assured to no end, all as might care to attend to him,
that his leadership of the CBN is not minded to devalue the naira.
Besides, apart from the muscle provided by external reserves, within
the context of a managed exchange rate regime, the central bank has a
slew of administrative controls with which it could impose costs on the
demand side of the official foreign exchange market. The tension that
will arise were it to resort to these tools, between appearing to
abandon market-based solutions, and seeming to act in the interest of
the domestic economy, should comfortably be resolved in favour of the
latter. In the end, the fear of the depreciation of the naira in an
import-dependent economy might be overdone. Moreover, the current
levels of the reserves can still support several months of imports.

Thus assured, the
next question is, aside from the sense of the naira’s value as somehow
reflective of the nation’s virility, how harmful is this loss of the
foreign reserve?

We will have to
borrow metaphors here. Recall that it did not matter that the balance
on the excess crude account was run down faster than any of us could
count the cents. Remember also, that nothing happened thereafter. And
although state governors had objected to the sterilisation of
relatively scarce foreign exchange earnings in the “unconstitutional”
excess crude account (at a time of extreme need in their respective
states) salaries are still owed public sector personnel in most states;
and the infrastructure deficit grows dire daily. Inflation,
interestingly, has remained unusually restrained. So once again, we
confront another uniquely Nigerian quandary. Where is the money?
Inflation isn’t up, because the infusion of cash into the economy from
monetising the excess crude account wasn’t expended on anything that
might drive local demand. And the CBN prefers to see a repatriation of
earnings as responsible for the spike in demand for foreign currencies
at the official market, rather than capital flight.

Admitting to the
logic of the central bank, one ought to ask, “how much was earned in
the economy last year?” By whom (it would help the argument if
non-resident economic entities were the most profitable)? And why
should the default response on the part of such economic entities be to
shop all such earnings out, rather than re-invest in an economy healthy
enough to have generated such rich pickings in the first instance?

Strengthened by these perspectives, the economy is clearly immune to economic logic!

Update for September

NSE ASI opened the
month of September on a rather poor note; the bear had 16 of the 20
trading days in the month. The market experienced four black weeks of
the five trading weeks within the month. Month to date the market is
down by 1,217.65 points or 5.02% from 24,268.24 to 23,050.29.

Meanwhile, month to
date is up by 2,223.46 points or 10.68%. Recall that it opened the year
at 20,827.13. Market capitalization ends the week at N5.648 trillion.

The market traded a
total of 5.951 trillion shares within the month and the performance was
top by the banking subsector that moved 3.359 trillion shares. Only 22
equities closed above their month-opening prices and they accounted to
1.086 trillion shares or 18.26% of market volume for September.

85 stocks that lost
moved 4.051 trillion units of share; same as 68% of market volume. 94
stocks wrapped up the month activities on a flat note and they traded
813.03 million shares or 13.66% of market volume.

Afromedia led the
percentage gainers with 37.25%, as it closed at N0.70 from N0.51. Vono
Products gained 34.92% and First Alluminum, Nigerian Wire and Cable,
and Berger Paints followed. AIICO top the percentage losers with 37.74%
drop. Spring Bank shed 34.52% and Unity Bank, Custodian Alliance, and
Academy Press followed with 33.96, 33.73, and 30.83 respectively.

Market report for the week ended 30th September, 2010

The market recorded
a turnover of 1.1 billion shares, valued at N10.50 billion in 21,572
transactions within the week. Meanwhile, the stock market operated for
four trading days within the week, as Friday was declared public
holiday to commemorate the Independence Day.

The banking
subsector was the most active as it moved 673.50 million shares in
12,225 transactions. Performance was boosted by volume on the shares of
Stanbic IBTC, Guaranty Trust Bank, Zenith Bank, and First Bank of
Nigeria Plc. The insurance subsector was enhanced by volumes on the
shares of Guaranty Assurance Plc and Intercontinental Wapic, and it
followed on performance chart with 100.30 million shares in 923 deals.

Skye Bank top the
price percentage gainers with 21.61% gain, from N6.20 to N7.54. Afro
Media gained 18.64%, Diamond Bank was third with 17.78%, while
Starcomms Plc, Costain, and Access Bank followed in that order.
Meanwhile, Custodian & Allied tops percentage losers’ chart with
drop of 26.97%, RT.Briscoe lost 24.79%, and Ashaka Cement, UTC,
Guaranty Trust Ass. and AIICO followed in that order.

Ikeja Hotels

The Q4 scorecard
for the year ended December-2009 of Ikeja Hotels was released to the
market on the first trading day of the week. The company reported a
turnover of N7,169 billion, which was 11.08% over the N6,454 billion
reported in 2008. PBT was up by 30.97%, while PAT and Net Asset were up
by 34.32% and 21.16% respectively.

Earnings/ratios/proposed dividend

Estimates from the
released figures show that the EPS improved by 33.33% from 0.42 of the
previous year to 0.56. The said earnings yielded 42.27%. ROE stood at
0.176% while the profit margin was 16.35%. The management has proposed
a dividend of 10k, which will be paid on the 6th of December, 2010,
after the company would have closed its book between 15th-19th
November, 2010. The AGM has been scheduled to hold on 25th November,
2010, while the venue is yet to be announced.

CHAMS Plc, audited year end – December, 2009

The company reveals
its Q4 2009 results to the market yesterday. The figures revealed
dropped on its top and bottom lines, as the TO dropped by 58.81% and
both PBT and PAT closed low at 394.98% and 1,588.43% respectively. The
company could not reward its investors and all its performance indexes
are negative.

Observations

The company needs
to improve; there is need to strategically position and come in with
profitable investments decisions. The result will not attract traders
in both short and medium term.

Adswitch Plc, year ended 30th April, 2010

The audited report
for the above mentioned year was released to the market today. The
released figures revealed an almost double growth in both top and
bottom line. The turnover was up by 75.37% when put side by side with
the comparable period of 2009. PAT gallop by 84.81% to N10.181 million,
from N5.509 million. And it marginally grows its net asset by 12.21%.

The management has
proposed 2k dividend, which when approved, shall be due for payment on
the 29th November, 2010, to investors in the company’s book by 18th
-22nd October, 2010. Other details on the AGM date and venue are as
stated in the table below.

Ratio analysis

EPS doubled from 4k
of the previous year end to 8k this year and it yielded 4.29%, when
compared to the current market price. It currently controls a good
PE/Ratio within the market average. Comparing the TO and PAT, its
profit margin was fair at 6.85%.

Observations

The result is good
and very impressive, despite the current economic situation. We expect
the company to sustain its current market price.

Custodian & Allied Insurance Plc

Payment of Interim
Dividend – The company notified The Exchange that its board of
directors has approved an interim dividend of N0.06 per share. The
closure of register is October 14, 2010, while the payment date is 20th
October, 2010.

Report on the over-the-counter market for FGN bonds

A turnover of 332.8
million units bonds valued at N317,950.53 million in 2,864 deals was
recorded this week, in contrast to a total of 209.3 million units worth
N195,013 million exchanged in 1,875 deals during the week ended
Thursday, September 23, 2010.

Measured by
turnover/volume, the most active bond was the 10.00% FGN July 2030
series, with a traded volume of 97.12 million units valued at N82.7
billion in 799 deals. This was followed by 5.5% FGN February 2013
series with a traded volume of 54.85 million units, worth N51.98
billion in 443 deals.

Eleven (11) of the
available thirty-seven (37) FGN bonds were traded during the week,
compared with fourteen (14) recorded in the preceding week.

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Seed fund for research

We are now looking at how we can use our coming together as directors of research institutes to solve the problem of decreased funding for the research sector. That is one area which we now articulating a position paper that can be sent to government. Already, some of us have worked during the crafting of Vision 2020 on how to have what is called the National Science and Technology Fund. In the past, we had this fund which is a quick intervention fund that people in science and technology and related areas can draw from.

It can be called the Foundation for Industrial Development, but we believe there is a need to have a mechanism that will enable research institutes to be able to have the kind of funding they require to be able to do the kind of research that can impact on industries. Almost every developed country has it. Its equivalent in the United States is the National Science Foundation. They use funds from that foundation to solve industrial problems. If problems from industries are given to research institutes, they draw money from that foundation. It can also be used for capacity building, for improving on laboratories so you can have centres of excellence for certain area of science and technology.

Minimum of N500 billion required

If you are an entrepreneur and you are interested in setting up a business based on the result of a new research, you can draw from this fund. Usually funds like this are not given as loans because sometimes people ask: ‘why you don’t go to a commercial bank?’ That kind of work is not something that profit will start coming in a year’s time. So it is something like venture capital. In other words, that fund can be taken to set up an industry using research result from Nigerian scientists and before the industry is developed they can be given five years before they need to start paying back the money. In paying back, it should be at no interest so they can stabilize, but once they start making profit they will be like any other company and begin to pay tax.

Government needs to absorb that gestation period of five or 10 years as a development process, because when you have 1000 of such industries established to utilise research outputs, of course they will start employing our school-leavers and that will solve social problems for government. That is what that kind of fund can do for this country so that any area that is a new venture area, a smart entrepreneur can develop with it. That was how all these countries did it and unless we do it in this country, we will continue to go round and round. Unless we energise the emergence of a critical mass of Nigerians who can produce and manufacture things within Nigeria we are not going anywhere.

We had recommended minimum of N500 billion to start this foundation. We are talking of changing the economy and it will cost a lot.

An example

When Peugeot Automobile Nigeria (PAN) was established in Nigeria, the government gave PAN a deadline that after 10 years they must move from completely knocked down parts to actual manufacturing of the parts in Nigeria. PAN was working with their French counterpart at that time. Some scientists were saying that if we give PAN this challenge we must also create an enabling environment within the research communities in Nigeria to be able to create vehicles parts. That didn’t happen here. Although RMRDC gave grants to people to work on auto bodies – that is, doing composites – they came up with a good result of a mixture of metals, plastics and fibre to do auto bodies. They could only make panels, but it showed that it was possible. The challenge we had was who will pick up that and begin to make auto bodies from it. If there was a national science foundation, a businessman can pick up that and begin to do auto bodies.

That didn’t happen, but Peugeot in France was also thinking ahead. We were looking at doing auto bodies within five or ten years in Nigeria, by the time we got to the five or ten year mark, the main manufacturers in France were no longer doing auto bodies with metal. The bodies are now made of fibre-enforced plastics, which is lighter and stronger. If you go to PAN today, they are still bringing in knocked-down parts, but if we had a national science foundation, companies can begin to manufacture even one component of a car using local raw materials. This is important because if you are making it in Nigeria, you can even get orders to supply in plants in Germany. Once you manufacture to standard, you can supply internationally.

Commercialisation will be possible

The other area of focus is on what we have observed in the past. Moving results of research from laboratories to marketplace has been a major challenge in this country. We find a situation where if you go to every research institute you see technologies coming up, research that has been done, gadgets and devices that have been developed are just sitting there. So we want to use this network to see how we can collaborate among ourselves. Working together will enable us to synergise more, work more closely with industries. So our main thrust now is commercialization.

Every year we will target a certain number of research results, whether they are ideas or machines, and apply them directly to industries either to use them to establish new industries or to use those results to solve existing problems in the industries. That means there will more collaboration with organised private-sector groups. So we hope to work more closely with the Manufacturers Association of Nigeria, the Association of Small Scale Industrialists and chambers of commerce.

Need to adjust our models

Moving research results from laboratories to the market place also implies looking at the entire model we had adopted. Today, people stay in their laboratories, imagine problems and attempt to solve them and then begin to look at who will adopt the results. But there are two models of development, when you are talking of manufacturing.

The Technology Push model adopted in even world-class institutions is when a researcher sits and thinks about a problem that doesn’t even exist and comes up with a solution. Because the solution exists, the technology for that solution exists, he begins to market it. Nobody may have thought about that problem before but because people are now seeing a solution, they begin to adopt it as long as that is going to make somebody’s work easier. Before the Wright brothers thought about flying, nobody thought about it. In addition to the Technology Push model, there will also be the Demand Pull model.

It is the season
for political campaigns and the media space is agog with several
messages aimed at winning the minds of the electorate. This piece will
focus on the campaigns for the highest office in the land – the
presidency, due to the fact that it should set the pace for others.

A communication
campaign should be strategic in all ramifications. The strategy reaches
for the end goal in mind – what change is expected at the end of the
campaign. The strategy is that single thread that holds the entire
communication campaign together. And when this is faulty, all other
elements fall apart.

For any
communication campaign to realise its purpose, there should be set
objectives to be achieved. These should be placed within the campaign
time frame and what the desired response of the audience should be. The
campaign objectives will help in designing and planning the chain of
activities that will achieve a tangible outcome.

Based on this, it
is obvious that none of the political campaigns of the aspirants have
coherent strategy that can resonate with the electorate.

Personally, I have
not seen that campaign that brings out the distinctiveness of the
brands, that is the aspirants. It seems all they are interested in is
buying advert space and using ordinary acronyms to project the
aspirants. A political campaign should be issue based, which eventually
will touch the lives of the people.

For instance, it is
not mandatory that the declaration of interest should be done through
open rallies. What stops a presidential aspirant from going to a rural
environment to drive home his message of making every Nigerian have a
sense of belonging? One of the aspirants tagged the campaign ‘Making
Good Things Happen.’

The question is, in
what specific ways? Let us take unemployment for example; the aspirant
can provide us with empirical evidence of unemployment in Nigeria and
proceed to offer workable strategies to empower the vast majority of
the youth.

There should be a
concise message you want to pass across to the target audience and in
this case, I have not seen any that will strike a chord in the minds of
Nigerians. The other day, I watched a documentary on one of the
aspirants. It was more or less a Tale by Moonlight story, as there was
no single message to hold on to. It is the message which is hinged on
strategy that can drive the campaign process.

Strategic branding effort

One thing that
stands President Barack Obama out is his message, which is based on a
strategic branding effort. The campaign, the speeches, and the message,
positioned him like a high end consumer brand. I believe Nigerian
politicians should take a cue from this. It is also imperative to state
that Obama was positioned like a real brand, and this stood him out.
His was a very robust and colourful campaign that endeared him to the
people. From his campaign, he utilised several strategies to achieve
his aim of firing the enthusiasm of his audience. He really moved his
audience with his speeches and the response was instantaneous. We need
such vibrant campaigns that will really inspire us and open a new
chapter in our political landscape.

Quite a lot of
money has been expended without Nigerians holding on to a specific
message and how the campaigns will translate to benefits for Nigerians.
We should ask ourselves, what is the benefit of the campaigns to us?
Every brand, short or long term, holds a promise of benefit to its
target audience. It is the expectation of this benefit that stimulates
desire.

Even though I
stated earlier that this piece will be limited to presidential campaign
alone, I remember vividly Jimi Agbaje’s campaign some years ago for
Lagos governorship. It was one that was very strategic in all intents
and messages. It really aroused the curiosity of Lagosians and arrested
their attention. His campaign endeared him to several people and he was
even the preferred choice of some young people. Why? He had a focused
and inspiring campaign that was hinged on a coherent strategy.

Political campaigns
in Nigeria should be innovative, inspiring, and dynamic. It is also
important to develop tactic as part of the communication campaign that
addresses specific targets in the country. It is also imperative for
the campaign handlers to first focus on the aspirants as brands.

This will go a long
way in coining several messages aimed at moving the people to action. I
have not seen a notable pay-off or slogan that appeals to the
generality of Nigerians. A coherent strategy delivers impactful
messages, which ultimately influence the target audience.

Ayopo, a communication strategist and public relations specialist, is the CEO of Shortlist Ltd.

shortlistspecialists@gmail.com

Trees are the lungs
of the earth; it can be assumed then Nigeria, which displays severe
cases of deforestation, is literally gasping for breath for lack of
oxygen. That Nigeria’s rainforests have been depleted to less than 10
percent of its size 50 years ago is not news.

What is left of our
forests are under threat, and many areas are degraded and converted for
other uses. This phenomenon is not restricted to Nigeria. Overall, the
United Nations surmises that 13 million hectares of forested land have
been converted every year over the past 10 years and most of this is
said to be for agricultural purposes.

In areas like the
Amazonia, most of the conversion has been for monoculture farms where
crops like soy are cultivated for animal feed and other industrial
uses. In South East Asia, the threat has been from forest conversion
into oil palm plantations for ultimate production of fuels for
machines. Indeed, the land uptake and the highly invasive oil palm
trees, make this writer wince whenever Latino friends insist on calling
the tree ‘palm Africano’ or ‘African palm’. A crop, whose origin is
Africa, is being introduced in environments where the locals view its
arrival with anxiety and at times anger.

In Nigeria, our
forests are threatened by logging for export and conversion into
plantations. It is said by some that we export logs and import back
into Nigeria as floorboards, furniture, or even toothpicks. As The
Economist noted in a recent issue, “clearing forests may enrich those
who are doing it, but over the long run it impoverishes the planet as a
whole.”

There was a
notorious forest gobbler who was well known for logging outside its
area of concession in the Omo Forest. Whenever confronted, the
operators of this company would plead that they simply got lost in the
forest. Interestingly, they always ‘innocently’ strayed into areas
where the bigger trees were.

The company’s
creative way of avoiding responsibility perhaps reached its crescendo
in the Cross River forest, after they found the Omo Forest too hot to
stay in. When community folks in Cross River began to complain about
this company’s activities, they recruited a bunch of community people
who supported the company and even staged a demonstration during which
they carried signs saying ‘we want factories, not monkeys.’ This
company was eventually kicked out of the forest by the Cross River
State government.

How about those
converting forests into rubber plantations? Chunks of the Okomu Forest
as well as the nearby Iguobazuwa forest have been at the mercies of the
Nigerian subsidiaries of a French multinational tyre company, as they
convert the forests into rubber plantations. Some people push the idea
that plantations are same as forests and that they provide same
services. Truth is that plantations are not anything near to being
forests; even the Food and Agriculture Organisation (FAO) of the United
Nations says otherwise. At a very fundamental level, a tree cannot make
a forest, even if you plant a million stands of that tree. The rise of
monoculture plantations have seen huge use of agrochemicals, including
pesticides that eat at the very heart of a forest ecology.

Plantations do not
have the sort of ground cover and undergrowth that forests have, and
cannot absorb as much carbon as forests do. Plantations do not provide
vegetable, medicinal, and other support to communities. Neither do they
provide the essential service of protecting watersheds as forests do.
We need not mention that bush meat is not found in plantations.

Time to ask questions

As Nigeria
celebrates 50 years of political independence, it is apt to ask if we
can easily find many 50 years old trees standing anywhere within our
borders. Some would likely be found in community-managed forests;
especially those ones designated as sacred or even evil forests.

The massive loss of
our forests cover should give us serious concern as we clink glasses in
celebrations that many Nigerians are unable to identify with because of
the sad and alienating records we have chalked up in various sectors,
including the environmental area.

As we celebrate 50
years of political independence, we may as well look back at the many
oil spills that have flooded the Niger Delta over the same period of
time. At 50, we should ask why half the population of Jigawa State
should be displaced by flooding and why water levels in dams in the
Northern parts of our country are not properly managed.

At 50 years, we
should perhaps place garlands on the necks of multinational oil
companies who had flared gas in the oil fields routinely over the same
period without care that we are daily choked and killed by the toxic
cocktail that they spew into the environment.

As we celebrate 50
years of political independence, we should track how we have fared in
all areas of human development. It is a good time to pause and ask if
50 years is not enough for Nigeria and other celebrating African
nations to pause and ask when they would have true socio-economic
independence.

As we celebrate 50
years of Independence, it is a good time to ask what are the ecological
agendas of those who wish to contest for the presidency and other
offices in Nigeria. The environment is our life, and we cannot afford
to have Honourables and Excellencies who do not care about ecology
beyond how to guzzle ecological funds and use them for electioneering
campaigns.

It should be a good time to look for a 50 years old tree anywhere it
can be found, sit on its roots, and think. If we cannot find such
tress, then we may stand before any sapling we find and promise to let
it stand for at least 50 years.

First City Monument
Bank said on Wednesday it is on track to securing a $70 million loan
package from the International Finance Corporation (IFC), the World
Bank’s private-sector arm.

Chief Executive
Ladi Balogun told an investor conference the loans — $50 million of
straight debt and $20 million of convertible debt — should be
confirmed within the next few days.

Nigeria’s foreign reserves dropped to $35.66 billion as at Monday, the lowest level in over four years.

The
reserves, which peaked at $62.24 billion in mid-May 2008, have
fluctuated ever since due to huge withdrawals by government. The last
time the reserves stood near this level was around April 2006.

The
latest figure, which closed at $36.54 billion last month, signifies a
net withdrawal of $880 million (N132 billion). This is in addition to
the savings that would have been done during the period, especially
with oil selling at over $70.

The
Central Bank (CBN), at the last Monetary Policy Committee meeting held
in Abuja at the beginning of the month, expressed concern that huge
spending in an election year and implementation of new salary structure
in the civil service may create inflationary pressure in the economy.
The MPC subsequently raised the benchmark interest rate from 4.2
percentage points to 6.25 percent.

No devaluation

Lamido
Sanusi, the Central Bank governor, said recently that the regulator
does not intend to devalue the naira. This reassurance came after the
naira had depreciated for two weeks consecutively, dropping to its
lowest level in 13 months on Monday.

According to Mr. Sanusi, the CBN would continue to meet genuine demands for foreign exchange.

“The
Committee would continue to monitor developments in the market to
ensure that measures are taken to eliminate speculative demand and
exchange rate volatility,” said Mr. Sanusi, at the end of the MPC
meeting.

He,
however, attributed the increased demand for foreign exchange to
dividends remittance by some companies and enhanced importation of
refined petroleum products, due to the Federal Government sovereign
debt instruments.

Analysts
at FSDH Research, a financial services and research firm, however,
blame the drop in the value of the naira on the huge demands which were
not met by the Central Bank.

“We
expect the CBN to increase the amount of foreign exchange on offer in
order to douse the rising demand for foreign exchange and to ensure
that the value of the naira remains stable and within the limit of
three percent.”

Depleting reserves

Samuel
Nzekwu, former president of the Association of National Accountants of
Nigeria (ANAN), said the steady depletion of the foreign reserves has
far reaching effects on the economy.

He
said the depletion may invariably lead to depreciation in the value of
the local currency, which can equally send early warning signals to
Nigeria’s trading partners.

“It
is not a good omen, although it is not bad if we were using the
reserves to develop infrastructure. In this case, we don’t know what
the money is used for.

“We
know election costs a lot of money, but you cannot hide under election
to spend money anyhow. Unemployment is rife, armed robbery and
kidnapping have become the order of the day. My problem is that we do
not even know what the CBN is doing. They come up with different
policies every day,” he said.

He
noted that the excessive spending by government, which has led to the
near exhaustion of the Excess Crude Account (ECA), will inevitably lead
to inflation.

The ECA, which stood at over $20 billion in 2007, is now about $500 million.

The Nigerian Stock
Exchange was established in 1960 as the Lagos Stock Exchange. The
Exchange started operations in 1961 with 19 securities listed for
trading.

The first National
Development Plan (1962-1968) was launched. During this period,
investments in the country rose to about $45 million, with the
manufacturing sector was contributing 11 per cent to the GDP. Today, it
contributes only about 5 per cent.

On July 1, 1965, the first series of bank notes were replaced with new notes to commemorate the republic status of the country.

On 6 July 1967,
Civil war broke out due to the resolve of the Eastern part of the
country to secede to form Republic of Biafra. More than one million
people died in the war while oil production output was disrupted during
the period, leading to drop in Nigeria’s revenue.

In 1968, the
Central Bank of Nigeria issued a new set of bank notes to forestall the
usage of illegally withdrawn notes from the CBN branches in Enugu, Port
Harcourt and Benin during the civil war.

In 1971 Nigeria
joined OPEC and the oil boom, which began in 1973, elevated the country
to be one of the prominent members of the oil cartel.

The Nigerian
Enterprises Promotion Act was passed into law in 1972, was aimed at
stimulating entrepreneurial activity by Nigerians in the more modern
sectors.

1973 – CBN issued Naira notes replacing the Nigerian Pound

Operation Feed the Nation (OFN) was introduced in 1976 in order to enhance agricultural development and food security

In December 1977,
the Lagos Stock Exchange became The Nigerian Stock Exchange, with
branches established in some of the major commercial cities of the
country.

The Privatisation
and Commercialisation Act of 1988 put the country on the path of
creating efficiency in public enterprises and reducing the role of
government in the economy

In 1979, the N1, N5 and N10 notes had the portraits of three Nigerians – Alvan Ikoku, Tafawa Balewa and Herbert Macaulay.

Austerity measures
introduced by government of Shehu Shagari in 1982 to reduce government
expenditure and stimulate a private sector

Structural
Adjustment Programme by Ibrahim Babangida in June 1986 to restructure
and diversify the productive base of the economy so as to reduce
dependency on the oil sector and imports. SAP was one of the conditions
for accessing the IMF loan despite its rejection by Nigerians after an
intense national debate.

In order to
mitigate the negative impact of the SAP programme, the government
established the Urban Mass Transit Programme in 1988; People’s and
Community banks in 1989/90; Directorate of Food, Road and Rural
Infrastructure (DFRRI) in 1986; a reflationary budget package in 1988;
the 1991/1992 relief package for public sector officers; the reform of
the civil service; and Better Life for Rural Dwellers’ Programme in
1989.

The Nigeria Deposit
Insurance Corporation began operation in 1989 through the promulgation
of Decree No. 22 of 15th June 1988. Between 1991 and 1996, the NDIC had
taken over management and control of 24 distressed banks.

The N100 note, with
the portrait of Obafemi Awolowo was issued in December 1999, while the
N200 note, with the portrait of Ahmadu Bello, was issued in November
2000.

In 2003, the
government liberalized the telecommunications sector with the granting
of license to private operators of global system of mobile
telecommunications (GSM). This led to huge investment inflow in the
sector and the tremendous improvement in Nigeria’s teledensity. Today,
over 70 million Nigerian have access to telephone.

July 6, 2004,
Chukwuma Soludo, then Central Bank governor commenced consolidation of
banks with a December 31, 2005 deadline for banks to shore up their
minimum capital to N25 billion from the previous N2 billion.

This led to the reduction of the number of banks from 89 to 25.

In 2005, Nigeria paid $12 billion to the Paris Club of creditors in exchange for a debt forgiveness of over $32 billion.

On August 14, 2009,
Lamido Sanusi, the current CBN governor, injected N620 billion into
eight banks in the country following the negative impact of the global
financial crisis which resulted in the withdrawal of huge sums of
foreign capital out of the country.

Compiled by Stanley Oronsaye and Oluwaseyi Bangudu