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N500bn: NECA, Experts Demand Independent CBN Audit

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  • N500bn: NECA, Experts Demand Independent CBN Audit

Financial and economic experts have demanded an independent audit of the Central Bank of Nigeria following the alleged missing of N500bn.

They made this call while speaking in exclusive interviews with our correspondents.

The Director-General, Nigeria Employers’ Consultative Association, Mr Timothy Olawale, said despite the denial of the CBN that no N500bn was missing, there was still a need for due diligence to be followed, in unravelling the controversy surrounding it.

He specifically asked relevant government security and anti-graft agencies to look into the allegation to allay the fears of Nigerians on the alleged missing money.

He said, “Despite the denial of the CBN, there is still a need for due diligence to be followed in unravelling the controversy surrounding the alleged missing of N500bn. This is necessary in order to allay the fears of Nigerians on the issue.

“The relevant security and anti-graft agencies like Criminal Investigation Department and the Economic and Financial Crimes Commission must be brought in to unravel whatever gave rise to such an allegation. It is only then that Nigerians will know what is really happening.”

The Registrar, Institute of Finance and Control of Nigeria, Mr Godwin Eohoi, said while the apex bank boss had done a lot to stimulate the economy through various intervention programmes, there was a need for an independent audit of activities under his leadership.

This, he noted, would help to ensure that proper books of account were kept under the apex bank boss.

He said, “Every allegation is subject to investigations by the security agencies based on the fact that the current administration is fighting corruption.

“This is vital to clear the air for a better Nigeria. Someone can be investigated and not found culpable. If the tape is not to blackmail the CBN governor, then it should be investigated.

“The government should set up an audit panel to check what actually transpired at the CBN. The volume of money involved is huge and should not be swept under the carpet.

“At the Institute of Finance and Control, we stand for a sound financial control system. Finance should be well controlled that it would not lead to any misappropriation.”

A developmental economist, Odilim Enwangbara, said the allegations should not be dismissed based on the fact that it was coming at a time when the appointment of the CBN Governor, Mr Godwin Emefiele, was being renewed for a second term.

He said, “Of course, the allegations should be investigated. The transaction involved should be looked into. It is not enough to say the allegation is not true. It should be looked at to determine what actually happened.

“We have got to a level in this country when we cannot continue this way.”

A former President, Association of National Accountants of Nigeria, Dr Sam Nzekwe, worried that during the tenure of a past CBN governor, there was a similar issue like that when money was reported to be missing but nothing happened after that.

He said, “When they talk about this one again, we are confused. Even though the CBN is saying that the reporter did not get the beginning of the conversation, there must be something going on. The public needs to know and if the current CBN governor wants to keep on creating confidence or wants the public to have confidence in his second term, he has to come out clearly to tell us exactly what is the issue surrounding that so that the public can also be able to make an informed decision.

“But if you are telling us that nothing like that happened and we don’t have the background information on that and people are saying that something happened, it behoves on the CBN to come out and give us the information of what has transpired for the public to stop feeling that way.

“Let them give us the beginning part of what happened because we are dealing with people’s money. It is not just denying,”

The Executive Director, Civil Society Legislative Advocacy Centre, Auwal Rafsanjani, said the purported confession by Emefiele that money was missing showed that many officials working in the government of President Muhammadu Buhari did not share his anti-corruption drive.

Rafsanjani said, “I am not surprised, given the nature and character of this administration, which some of its personnel have been exhibiting. They act in a way that shows they don’t believe in the government that is fighting corruption.

“These kinds of leaks are not new. Audio bearing the voice of the Minister of Transport, Rotimi Amaechi, also leaked some time ago. It is because there is a disconnect between the officials on the one hand and the nation and the administration they represent.

“It is the same with the National Assembly leadership and the issue is that even when they are found wanting, they will never resign because, for them, it is not about service.”

He said the CBN governor could be given the benefit of the doubt since he had claimed that the audio misrepresented facts.

Rafsanjani, however, said if it was true that N500bn was missing, then the National Assembly and other bodies in charge of oversight had failed in their jobs.

The CBN on Sunday night said that contrary to claims in some quarters, there was no money missing or stolen from the apex bank.

The bank said this in a statement signed by the Director, Corporate Communications Department, CBN, Isaac Okorafor.

The statement said contrary to the narrative that the discussion was about a fraudulent transaction, the beginning of the conversation was omitted to create a different impression to a misunderstanding that affected the bank’s balance sheet.

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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South Africa’s Inflation Rate Holds Steady in May

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South Africa’s inflation rate remained unchanged in May, increasing the likelihood that the central bank will maintain current borrowing costs.

According to a statement released by Statistics South Africa on Wednesday, consumer prices rose by 5.2% year-on-year, the same rate as in April.

The consistent inflation rate is expected to influence the decision of the six-member monetary policy committee (MPC), which is set to meet in mid-July. The current benchmark rate stands at 8.25%, a 15-year high, and has been held steady for six consecutive meetings.

Central Bank Governor Lesetja Kganyago has repeatedly emphasized the need for inflation to fall firmly within the 3% to 6% target range before considering any reduction in borrowing costs.

“We will continue to deliver on our mandate, irrespective of how our post-election politics plays out,” Kganyago stated earlier this month in Soweto. “The only impact is what kind of policies any coalition will propose. If the policies are not sustainable, we might not have investment.”

While money markets are assigning a slim chance of a 25-basis point rate cut in July, they are fully pricing in a reduction by November.

Bloomberg Africa economist Yvonne Mhango anticipates the rate-cutting cycle to begin in the fourth quarter, supported by a sharp drop in gasoline prices in June and a rally in the rand.

The rand has appreciated more than 3% since Friday, following the ANC’s agreement to a power-sharing deal with business-friendly opposition parties and the re-election of President Cyril Ramaphosa.

In May, the annual inflation rates for four of the twelve product groups remained stable, including food and non-alcoholic beverages.

However, transport, alcoholic beverages and tobacco, and recreation and culture saw higher rates. Food prices increased by 4.3% in May, slightly down from 4.4% in April, while transport costs rose by 6.3%, up from 5.7% and marking the highest rate for this category since October 2023.

The central bank’s cautious stance on monetary policy reflects its ongoing concerns about inflation.

Governor Kganyago has consistently voiced worries that the inflation rate is not decreasing as quickly as desired. The MPC’s upcoming decision will hinge on sustained inflationary pressures and the need to balance economic stability with fostering growth.

As South Africa navigates its economic challenges, the steady inflation rate in May provides a measure of predictability for policymakers and investors alike.

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Ghana Reports Strong 4.7% GDP Growth in First Quarter of 2024

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Ghana’s economy showed impressive growth in the first quarter of 2024 with the Gross Domestic Product (GDP) expanding by 4.7% compared to the same period last year, according to Government Statistician Samuel Kobina Annim.

This represents an increase from the 3.8% growth recorded in the previous quarter and should provide a much-needed boost to the ruling New Patriotic Party (NPP) as the nation approaches the presidential elections scheduled for December 7.

The positive economic data comes amidst a challenging backdrop of fiscal consolidation efforts under a $3 billion International Monetary Fund (IMF) rescue program.

The government has been working to control debt through reduced spending and restructuring nearly all of its $44 billion debt.

This includes ongoing negotiations with private creditors to reorganize $13 billion worth of bonds.

The latest GDP figures are seen as a vindication of the NPP’s economic policies, which have been under fire from the main opposition party, the National Democratic Congress (NDC).

The opposition has criticized the government’s handling of the economy, particularly its fiscal policies and the terms of the IMF program, arguing that they have imposed undue hardship on ordinary Ghanaians.

However, the 4.7% growth rate suggests that the measures taken to stabilize the economy are beginning to yield positive results.

Analysts believe that the stronger-than-expected economic performance will bolster the NPP’s position as the country gears up for the presidential elections.

“The growth we are seeing is a testament to the resilience of the Ghanaian economy and the effectiveness of the government’s policies,” Annim stated at a press briefing in Accra. “Despite the constraints imposed by the debt restructuring and IMF program, we are seeing significant progress.”

The IMF program, which is designed to restore macroeconomic stability, has necessitated tough fiscal adjustments.

These include cutting government expenditure and implementing structural reforms aimed at boosting economic efficiency and growth.

The government’s commitment to these reforms has been crucial in securing the confidence of international lenders and investors.

In addition to the IMF support, the government has also been focused on diversifying the economy, reducing its reliance on commodities, and fostering sectors such as manufacturing, services, and technology.

These efforts have contributed to the robust growth figures reported for the first quarter.

Economic growth in Ghana has been uneven in recent years, with periods of rapid expansion often followed by slowdowns.

The current administration has emphasized sustainable and inclusive growth, seeking to ensure that the benefits of economic progress are widely shared across all segments of the population.

The next few months will be critical as the government continues its efforts to stabilize the economy while preparing for the upcoming elections.

The positive GDP growth figures provide a strong foundation, but challenges remain, including managing inflation, creating jobs, and ensuring the stability of the financial sector.

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World Bank Commits Over $15 Billion to Support Nigeria’s Economic Reforms

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The World Bank has pledged over $15 billion in technical advisory and financial support to help the country achieve sustainable economic prosperity.

This commitment, announced in a feature article titled “Turning The Corner: Nigeria’s Ongoing Path of Economic Reforms,” underscores the international lender’s confidence in Nigeria’s recent bold reforms aimed at stabilizing and growing its economy.

The World Bank’s support will be channeled into key sectors such as reliable power and clean energy, girls’ education and women’s economic empowerment, climate adaptation and resilience, water and sanitation, and governance reforms.

The bank lauded Nigeria’s government for its courageous steps in implementing much-needed reforms, highlighting the unification of multiple official exchange rates, which has led to a market-determined official rate, and the phasing out of the costly gasoline subsidy.

“These reforms are crucial for Nigeria’s long-term economic health,” the World Bank stated. “The supply of foreign exchange has improved, benefiting businesses and consumers, while the gap between official and parallel market exchange rates has narrowed, enhancing transparency and curbing corrupt practices.”

The removal of the gasoline subsidy, which had cost the country over 8.6 trillion naira (US$22.2 billion) from 2019 to 2022, was particularly noted for its potential to redirect fiscal resources toward more impactful public investments.

The World Bank pointed out that the subsidy primarily benefited wealthier consumers and fostered black market activities, rather than aiding the poor.

The bank’s article emphasized that Nigeria is at a turning point, with macro-fiscal reforms expected to channel more resources into sectors critical for improving citizens’ lives.

The World Bank’s support is designed to sustain these reforms and expand social protection for the poor and vulnerable, aiming to put the economy back on a sustainable growth path.

In addition to this substantial support, the World Bank recently approved a $2.25 billion loan to Nigeria at a one percent interest rate to finance further fiscal reforms.

This includes $1.5 billion for the Nigeria Reforms for Economic Stabilization to Enable Transformation (RESET) Development Policy Financing, and $750 million for the NG Accelerating Resource Mobilization Reforms Programme-for-Results (ARMOR).

“The future can be bright, and Nigeria can rise and serve as an example for the region on how macro-fiscal and governance reforms, along with continued investments in public goods, can accelerate growth and improve the lives of its citizens,” the World Bank concluded.

With this robust backing from the World Bank, Nigeria is well-positioned to tackle its economic challenges and embark on a path to sustained prosperity and development.

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