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2017 Budget: ‘Public Trust Will Ensure Sustainability’

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Budget 2017 year on cube with pencil and clock
  • 2017 Budget: ‘Public Trust Will Ensure Sustainability’

A former President of the Institute of Chartered Accountants of Nigeria (ICAN), Chief John .K. Randle has said the 2017 appropriation bill which is currently before the country’s lawmakers requires public trust if it is to fly.

Randle who made this known in a statement, said there was need for co-operation and understanding between President Muhammadu Buhari, the Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele and the Minister of Finance, Mrs. Kemi Adeosun. He also argued that in the last two or three decades, the country had veered off from the ideal of 60:40, whereby 60 per cent of our revenue would be consumed by recurrent expenditure leaving a healthy balance of 40 per cent for capital expenditure.

According to him, “whichever way we lean, we must admit that the budget would require political tailwind if it is to fly. An essential ingredient of the tailwind is public trust.”

The public commentator added that financial analysts who had been tracking Nigeria’s budget and debts for several decades cannot but recall that the current insurgency (Boko Haram) which has engulfed the North-eastern part of the nation probably owed its genesis to what was inflicted on that area in the 1970’s and 1980’s.

Recalling the poor level of local manufacturing industries in some parts of the country, he said , “when we had only six states which later became 12 states under General Yakubu Goon, that part of the country was clearly devastated by arid desert, poverty and lack of industries. Even the few industries they had were ravaged by the Structural Adjustment Programmme (SAP) under the military government of General Ibrahim Babangida. Some of the early casualties were the tannery and shoe factories in Maiduguri.”

Randle noted that when the budget and debt management derailed, the consequences are nearly always stupefying- resulting in riots; currency collapse; bank crisis; and sometimes regime change.

However, he cautioned that the federal government’s tag of the 2017 budget as ‘budget of recovery and growth’, should avoid delay, so that it would not drag on for many months before it is signed into law.

“Unless there is a drastic improvement in the government’s capacity to deliver on its promises and put an end to project formulation delays, there is no hope that the 2017 budget will galvanise the economy out of recession. That is the main reason we must take all the promises contained in the 2017 budget with cautious optimism,” he said.

He however expressed concern that Nigerians have become non – chalant about critical issues, alleging that, “a case in point was when the then Minister of Finance, Chief Anthony Ani presented his annual budget in 1995 and publicly disclosed that included in Nigeria’s external debt was an amount of $1 billion which was ostensibly borrowed by Nigeria, but was actually shared amongst eight prominent Nigerians whom he declined to name. The funds never reached Nigeria! Nobody asked any questions about such a weighty issue.”

Randle warned that if at the end of this year, Nigerians are again presented with excuses that projects are not executed either due to revenue shortfall, inability to borrow money or delays in project formulation, “chances are we will still be mired in a recession or worse.”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Nigeria’s Inflation Climbs to 28-Year High at 33.69% in April

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Nigeria's Inflation Rate - Investors King

Nigeria is grappling with soaring inflation as data from the statistics agency revealed that the country’s headline inflation surged to a new 28-year high in April.

The consumer price index, which measures the inflation rate, rose to 33.69% year-on-year, up from 33.20% in March.

This surge in inflation comes amid a series of economic challenges, including subsidy cuts on petrol and electricity and twice devaluing the local naira currency by the administration of President Bola Tinubu.

The sharp rise in inflation has been a pressing concern for policymakers, leading the central bank to take measures to address the growing price pressures.

The central bank has raised interest rates twice this year, including its largest hike in around 17 years, in an attempt to contain inflationary pressures.

Governor of the Central Bank of Nigeria has indicated that interest rates will remain high for as long as necessary to bring down inflation.

The bank is set to hold another rate-setting meeting next week to review its policy stance.

A report by the National Bureau of Statistics highlighted that the food and non-alcoholic beverages category continued to be the biggest contributor to inflation in April.

Food inflation, which accounts for the bulk of the inflation basket, rose to 40.53% in annual terms, up from 40.01% in March.

In response to the economic challenges posed by soaring inflation, President Tinubu’s administration has announced a salary hike of up to 35% for civil servants to ease the pressure on government workers.

Also, to support vulnerable households, the government has restarted a direct cash transfer program and distributed at least 42,000 tons of grains such as corn and millet.

The rising inflation rate presents significant challenges for Nigeria’s economy, impacting the purchasing power of consumers and adding strains to household budgets.

As the government continues to grapple with inflationary pressures, policymakers are faced with the task of implementing measures to stabilize prices and mitigate the adverse effects on the economy and livelihoods of citizens.

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FG Acknowledges Labour’s Protest, Assures Continued Dialogue

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Power - Investors King

The Federal Government through the Ministry of Power has acknowledged the organised Labour request for a reduction in electric tariff.

The Nigeria Labour Congress (NLC) and Trade Union Congress (TUC) had picketed offices of the National Electricity Regulatory Commission (NERC) and Distribution Companies nationwide over the hike in electricity tariff.

The unions had described the upward review, demanding outright cancellation.

Addressing State House correspondents after the Federal Executive Council (FEC) meeting on Tuesday, Minister of Power, Adebayo Adelabu, said labour had the right to protest.

“We cannot stop them from organizing peaceful protest or laying down their demands. Let me make that clear. President Bola Tinubu’s administration is also a listening government.”

“We have heard their demands, we’re going to look at it, we’ll make further engagements and I believe we’re going to reach a peaceful resolution with the labor because no government can succeed without the cooperation, collaboration and partnership with the Labour unions. So we welcome the peaceful protest and I’m happy that it was not a violent protest. They’ve made their positions known and government has taken in their demands and we’re looking at it.

“But one thing that I want to state here is from the statistics of those affected by the hike in tariff, the people on the road yesterday, who embarked on the peaceful protests, more than 95% of them are not affected by the increase in the tariff of electricity. They still enjoy almost 70% government subsidy in the tariff they pay because the average costs of generating, transmitting and distributing electricity is not less than N180 today.

“A lot of them are paying below N60 so they still enjoy government’s subsidy. So when they say we should reverse the recently increased tariff, sincerely it’s not affecting them. That’s one position.

“My appeal again is that they should please not derail or distract our transformation plan for the industry. We have a clearly documented reform roadmap to take us to our desired destination, where we’re going to have reliable, functional, cost-effective and affordable electricity in Nigeria. It cannot be achieved overnight because this is a decay of almost 60 years, which we are trying to correct.”

He said there was the need for sacrifice from everybody, “from the government’s side, from the people’s side, from the private sector side. So we must bear this sacrifice for us to have a permanent gain”.

“I don’t want us to go back to the situation we were in February and March, where we had very low generation. We all felt the impact of this whereby electricity supply was very low and every household, every company, every institution, felt it. From the little reform that we’ve embarked upon since the beginning of April, we have seen the impact that electricity has improved and it can only get better.”

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Nigeria, China Collaborate to Bridge $18 Billion Trade Gap Through Agricultural Exports

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In a concerted effort to address the $18 billion trade deficit between Nigeria and China, both nations have embarked on a collaborative endeavor aimed at bolstering agricultural exports from Nigeria to China.

This strategic partnership, heralded as a landmark initiative in bilateral trade relations, seeks to narrow the trade gap and foster more balanced economic exchanges between the two countries.

The Executive Director of the Nigerian Export Promotion Council (NEPC), Nonye Ayeni, revealed this collaboration during a joint meeting between the Council and the Department of Commerce of Hunan province, China, held in Abuja on Monday.

Addressing the trade imbalance, Ayeni said collaborative efforts will help close the gap and stimulate more equitable trade relations between the two nations.

With Nigeria importing approximately $20.4 billion worth of goods from China, while its exports to China stood at around $2 billion, representing a $18 billion in trade deficit.

This significant imbalance has prompted officials from both countries to strategize on how to rebalance trade dynamics and promote mutually beneficial economic exchanges.

The collaborative effort between Nigeria and China focuses on leveraging the vast potential of Nigeria’s agricultural sector to expand export opportunities to the Chinese market.

Ayeni highlighted Nigeria’s abundant supply of over 1,000 exportable products, emphasizing the need to identify and promote the top 20 products with high demand in global markets, particularly in China.

“We have over 1,000 products in large quantities, and we expect that the collaboration will help us improve. The NEPC is focused on a 12-18 month target, focusing on the top 20 products based on global demand in the markets in which China is a top destination,” Ayeni explained, outlining the strategic objectives of the collaboration.

The initiative not only aims to reduce the trade deficit but also seeks to capitalize on China’s growing appetite for agricultural products. Nigeria, with its diverse agricultural landscape, sees an opportunity to expand its export market and capitalize on China’s increasing demand for agricultural imports.

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