Mark Carney warned his colleagues at major central banks against getting embroiled in a currency war, saying targeting weaker exchange rates only causes problems for the world economy.
In a hard-hitting speech at the start of a two-day gathering of Group of 20 finance ministers and central bankers in Shanghai, the Bank of England governor said nations can’t simply export their problems through currency depreciation and that there is “no free lunch.”
“For monetary easing to work at a global level it cannot rely on simply moving scarce demand from one country to another,” Carney said in prepared remarks for his speech. “For the world as a whole, this export of excess saving and transfer of demand weakness elsewhere is ultimately a zero sum game.”
Weak growth and muted inflation pressures have pushed central banks around the world to cut interest rates below zero. While G-20 meetings have habitually agreed on the need to refrain from competitive devaluations, it’s become a more pressing issue with about a quarter of global output now produced in economies where rates are, as Carney put it, “literally through the floor.”
Investor concern about the ability of monetary authorities to boost demand has helped spur market turmoil this year. Carney said that while it’s a “myth” that central banks are out of monetary-policy ammunition, G-20 leaders need to urgently co-ordinate supply-side initiatives as they are falling short on previous pledges.
“Since the start of the year, risk sentiment in financial markets has deteriorated sharply, stemming in large part from a renewed appreciation of weak medium-term global growth prospects accompanied by marked downside risks,” Carney said. “The global economy risks becoming trapped in a low growth, low inflation, low interest-rate equilibrium.”
The Bank of Japan adopted negative interest rates this year and the European Central Bank has indicated it may ramp up its stimulus next month, with one option being cutting its deposit rate further below zero. In the U.K., the BOE’s benchmark has been at 0.5 percent for almost seven years, though some officials have indicated they’d bewilling to push it lower if risks warranted such a move.
The BOE governor also said that there are implications of targeting a weaker exchange rate.
“To the extent it pushes greater savings onto the global markets, global short-term equilibrium rates would fall further, pulling the global economy closer to a liquidity trap,” Carney said. “At the global zero bound, there is no free lunch.”
Ibom MRO to Bring in Forex to Nigeria
Akwa Ibom State to open a cutting-edge smart terminal building at the Victor Attah International Airport
The governor of Akwa Ibom State, Governor Udom Emmanuel, has announced that the state is close to opening a cutting-edge smart terminal building at the Victor Attah International Airport and that this will generate foreign exchange for Nigeria.
This comes on the heels of praise from his Edo State counterpart, Gov. Godwin Obaseki, who attended the Tuesday reception in Uyo for two additional A320-200 Airbus aircraft that the state’s Ibom Air fleet had leased from a European company.
Speaking at the event, the governor of Akwa Ibom said that while there were already efforts underway to persuade the government to lease the MRO, the MRO is an investment because it was built with naira, despite its current depreciation, and will therefore generate income.
The Akwa Ibom governor said “Our terminal building is world-class in Africa, our MRO is world-class. If you find one today in the entire Gulf of Guinea, tell me I’ll disassemble this one and build another.
“Look at our MRO; what you see here can accommodate two 747 aircraft as well as eight CRJ aircraft, which we are flying for servicing at the same time.”
“This is the only MRO in this part of the world today, and these facilities are not built with local currency, but we are building this MRO with naira that has no value.”
“I invest in areas where we can see a return on our money. Right now without blinking an eye, I can make over $ 30 million with this MRO if we decide to sell but we are not selling, we will make a foreign exchange from this investment.
“Airbus is on us to come and lease our MRO for all their regional flights, but we are not selling.
“We are going to open up this place ( MRO facility) from January next year for commercial activities and we are going to earn in dollars.”
He thanked Ibom Air’s Board of Directors, Management, and Staff for making him proud, emphasising that “they have done very well.”
Gov. Obaseki, who spoke at the event, stated that Akwa Ibom has become the country’s flagship state for its efforts to invest in and make significant strides in the aviation sector.
Obaseki described Akwa Ibom as the country’s flagship state for its efforts to invest in and expand the aviation sector. “Ibom Air is always completely booked.” Let me thank you on behalf of Nigerians,’’ Obaseki said.
In his remarks, the Managing Director of Ibom Airlines., Mr Mfon Udom announced plans to begin regional flights in 2023.
Udom said the new addition to the fleet of Ibom Air would expand its carrying capacity and boost employment opportunities in the state by 40 per cent.
“With this new capacity coming on board, we are delighted to inform our passengers that we have increased our offerings, providing more frequencies for their convenience.
“The Uyo-Lagos and Uyo-Abuja routes now have three frequencies each every weekday, while our Lagos-Abuja passengers will have seven frequencies to choose from both ways, every weekday,’’ he said.
Lagos State Boosts Food Supply With Mass Sale of Rice and Cooking Oil
LAISA has commenced the massive sale of rice and soya bean vegetable oils ahead of the December festival
Lagos state government through the Lagos State Agricultural Inputs Supply Authority (LAISA) has commenced the massive sale of rice and soya bean vegetable oils ahead of the December festival.
The sale which is taking place at different locations in the state is already attracting massive buyers.
According to the General Manager of LAISA, Mr Bolaji Balogun, places where potential buyers can get the products include New Farm Service Oko-Oba Centre, and Gengeto Bus stop, Abeokuta Road, Lagos.
While speaking to the press, Balogun disclosed that available products include 50kg of rice and 1-3 litres of soya vegetable oil all sold at affordable prices.
The GM added that the food sale event was a response to the yearnings of Lagosians who demanded affordable rice and cooking oil for the yuletide festival.
He noted that several people came to LAISA stand for the request at the just concluded Lagos Trade Fair.
Investors King understands that the Lagos State Agricultural Inputs Supply Authority (LAISA) was established with the mandate to boost food supply in the state and also provide the necessary support such as farm tools to farmers.
” As a responsible agency of government, LAISA will continue to provide customers/farmers with high quality and healthy food supply at affordable prices as and when available. We also intend to continue to support and encourage farmers on the best farming practice as well,” Balogun noted.
Meanwhile, the Federal Government has replied to a statement credited to the International Monetary Fund (IMF) that Nigeria will face food crisis in 2023.
The Federal Ministry of Agriculture and Rural Development opposed the position of the global financial institution stating that Nigerians should not panic nor worry about the projection.
The ministry added that several measures had been put in place to forestall any scarcity of food in Nigeria.
It added that the government had approved a five-year tax break as an incentive to encourage private investments in the agricultural sector and increased food production, processing and marketing.
U.S 2024 Elections: Donald Trump Declares For President
Former President of the United States, Donald Trump has once again showcased interest to seek the oval office after he failed re-election in 2020.
Former President of the United States, Donald Trump has once again showcased interest to seek the oval office after he failed re-election in 2020. Trump will be expected to tussle the Republic ticket with other potential nominees.
At his private beach on Tuesday night, Trump said “In order to make America great and glorious again, I am tonight announcing my candidacy for president of the United States”.
Trump’s ambition might however not be “Uhuru” as his party, the Republican failed to perform as expected in the midterm election. Although the Republican has been projected to win the majority seats in the house, the party, however, lost the senate including key states.
In addition, the former US president will likely face stiff opposition from his party as potential co-contestants include his former Vice President Mike Pence and the Governor of Florida Ron DeSantis, who won a resounding reelection victory on November 8.
Unfazed by the opposition and confident in his large following, Trump said “This is not a task for a politician or a conventional candidate. This is a task for a great movement.”
Investors King could recall that in 2020, Donald Trump lost to Joe Biden (Democrat).
After his exit from office, there have been a number of investigations into his conduct before, during and after his first term as president which could ultimately result in his disqualification.
He is also investigated for inciting violence which led to the drastic attack on the Capitol building on January 6, 2021.
Meanwhile, analysts and observers are divided on Trump’s potential comeback.
The mid-term election result shows that voters rejected candidates who backed Trump’s baseless claims of election fraud in 2020, and many of his high-profile picks for office struggled or lost out in the race.
It could be recalled that Donald Trump alleged manipulation in the 2020 presidential election which produced President Joe Biden. Trump claimed he was rigged out and tried to establish a conspiracy to back up his claim.
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