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How Nigeria can curb Naira fall, soaring unemployment – Analysts



Analysts have advised the fiscal, monetary policy authorities to calibrate reform policies aimed at tightening of financial conditions in Nigeria.

They said the development will be enough to push inflation down to target levels relatively quickly as well as reversing current high unemployment rate in the country.

They also advised that policymakers should heed the lessons of the past and be resolute to avoid potentially more painful and disruptive adjustments later.

Their suggestion follows the uncertain outlook and persistent current account deficit in Nigeria.

They advocated the need for the Federal Government to prioritise greater investment in physical capital, education, and social safety nets, as well as more support for retraining and re-allocating workers to new and better jobs that will lead to the transformation of the economy to make it smarter, greener, and more resilient and inclusive.

They observed that the critical point for the domestic economy is the disequilibrium in the foreign exchange market which has starved businesses of dollars and pushed consumer prices higher, adding that the dollar crunch in the economy is due to the lack of clarity around Nigeria’s foreign exchange policy and investors’ aversion to the Central Bank of Nigeria’s demand-management strategies.

They expressed fears that further devaluation of the nation’s currency might not be necessary on the strength of the pressure on the Naira is due to speculative attacks and much of the concern for investors lies with the uncertainty around foreign exchange policy, according to

They advised the Federal Government to strengthen the credibility of fiscal policy to create room for further support in the short term without jeopardising public credit, adding that emergency spending needs to be accompanied by measures that ensure transparency and accountability.

The international monetary Fund (IMF) recently said that Central banks in major economies expected as recently as a few months ago that they could tighten monetary policy very gradually.

Inflation seemed to be driven by an unusual mix of supply shocks associated with the pandemic and later Russia’s invasion of Ukraine, and it was expected to decline rapidly once these pressures eased.

Now, with inflation climbing to multi-decade highs and price pressures broadening to housing and other services, central banks recognise the need to move more urgently to avoid an unmooring of inflation expectations and damaging their credibility.

The Federal Reserve, Bank of Canada, and Bank of England have already raised interest rates markedly and have signaled they expect to continue with more sizable hikes this year.

The European Central Bank recently lifted rates for the first time in more than a decade.

SEE ALSO:  CBN gives reason for raising interest rate to 18.5 per cent

Central bank actions and communications about the likely path of policy have led to a significant rise in real (that is, inflation-adjusted) interest rates on government debt since the start of the year.

While short-term real rates are still negative, the real rate forward curve in the United States—that is, the path of one-year-ahead real interest rates one to 10 years out implied by market prices—has risen across the curve to a range between 0.5 and 1 percent. This path is roughly consistent with a “neutral” expand around its potential rate. real policy stance that allows output to

The Fed’s summary of economic projections in mid-June suggested a real neutral rate of around 0.5 percent, and policymakers saw a 1.7 percent output expansion both this year and next, which is very close to estimates of potential. The real rate forward curve in the euro area, proxied by German bunds, has also shifted up, though remains deeply negative. That’s consistent with real rates converging only gradually to neutral.

The higher real interest rates on government bonds have spurred an even larger rise in borrowing costs for consumers and businesses, and contributed to sharp declines in equity prices globally.

The modal view of both central banks and markets seems to be that this tightening of financial conditions will be enough to push inflation down to target levels relatively quickly.

The monetary and fiscal tightening in train should cool demand both for energy and non-energy goods, especially in interest-sensitive categories like consumer durables. This should cause goods prices to rise at a slower pace or even fall, and may also push energy prices lower in the absence of additional disruptions in commodity markets.

Supply-side pressures should ease as the pandemic relaxes its grip and lockdowns and production disruptions become less frequent.

Slower economic growth should eventually push down service-sector inflation and restrain wage growth.

But, the magnitude of the inflation surge has been a surprise to central banks and markets, and there remains substantial uncertainty about the outlook for inflation.

It is possible that inflation comes down more quickly than central banks envision, especially if supply chain disruptions ease and global policy tightening results in fast declines in energy and goods prices.

Even so, inflation risks appear strongly tilted to the upside. There is a substantial risk that high inflation becomes entrenched, and inflation expectations de-anchor.

Inflation rates in services—for everything from housing rents to personal services—appear to be picking up from already elevated levels, and they are unlikely to come down quickly.

SEE ALSO:  Nigeria records 5 million new job seekers yearly as unemployment rate hits 41% in 2023 – KPMG

These pressures may be reinforced by rapid nominal wage growth. In countries with strong labor markets, nominal wages could start rising rapidly, faster than what firms reasonably could absorb, with the associated increase in unit labor costs passed into prices. Such “second round effects” would translate into more persistent inflation and rising inflation expectations.

Dr Muda Yusuf, Founder/CEO Centre for the Promotion Of Private Enterprise (CPPE) , in an exclusive interview with Daily Independent, said the recent Consumer Price Index (CPI) report by the NBS indicated that Nigeria still has a structural problem, inhibiting both production and exports potential.

He expressed optimistism that there is room for improvement in the provision and maintenance of infrastructure, investment productivity, and boosting of local business activities to support export activities and strengthen channels for dollar inflow.

He said: “There is need to reduce the level of debt financing especially the reliance on commercial debt to fund government operations. Public debt is already at an unsustainable threshold. Steps should be taken to attract foreign exchange through a strategy of ensuring new investment opportunities to stimulate foreign capital inflows into the economy.

“We should be seeking more equity capital than debt capital. There is urgent need to review the country’s trade policy to support investment growth and investment sustainability. tax policy must support investment not become a disincentive to investment”.

Mr. Taiwo Oyedele, fiscal policy partner and Africa tax leader, PwC in a chat with DAILY INDEPENDENT, advocated the need for institutional reforms that are necessary to ensure that the regulatory institutions have better disposition to support the growth of investment and focus less on the generation of revenue and boost employment opportunities for the youths

He warned that the continuous introduction of new taxes without considering the poor may create a social problem for the Nigerian government.

Speaking against the backdrop of the recently announced 5% excise duty on telecommunications services, Oyedele said the tax system in Nigeria lacks intentionality as it creates no room for the protection of the poor and vulnerable.

According to him, an additional 5% tax on telecoms services will bring the total consumption tax on data and voice calls to 12.5%, when VAT is added. This, he said, will add extra burden on poor Nigerians who use telecommunications services, which have become essential needs for all.

Emphasising the importance of call and data services to every Nigerian, Oyedele noted that if Maslow’s Hierarchy of Needs theory were to be developed today, telecom airtime and data could have been properly classified along with food and shelter as physiological needs hence the need to ensure that government is not excessively taxing basic needs.

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Mr. Friday Udo, South-South Coordinator of Institute of Chartered Economists of Nigeria (ICEN), told Daily Independent that there is need for urgent steps to be taken to ensure a better macroeconomic management framework to stabilise the exchange rate, eradicate the challenge of liquidity in the foreign exchange market and to stem the current depreciation of the Naira.

Calling for business friendly reforms and policies that will restore confidence, improve the regulatory environment and address insecurity, Udoh said: “there is need for not only competitive returns, but also investors’ confidence and an enabling environment of which clear and robust policies, good infrastructure and business friendly regulations are a major component”.

“Concomitantly, unemployment in any economy is connected to short demand at the same time this affects consumption which means that little money would be available for businesses to expand their production line. At the same time little money will be available for saving which businesses would have accessed as loan”.

Oyinkan Olasanoye, the National President, Association of Senior Staff of Banks, Insurance and other Financial Institutions (ASSBIFI), told our correspondent that Federal Government should lay emphasis on reforms that will simplify complex regulation and processes, and eliminating the hurdles that stand in the way of a bigger and more productive private sector.

She said: “Significant reforms across the labour market, business environment and fiscal management will be required. A skilled workforce is critical to improving Nigeria’s productivity and efficiency to boost revenue generation for the government.

“Considering the services sector is projected to be the key drivers of the Nigerian economy going forward, measures have to be implemented to improve the value-added of labour in this sector. A comprehensive approach is needed; sound and quality education provides a solid foundation to develop the relevant skills for the workplace. In addition, collaboration among all stakeholders to design and implement education and training tailored to market needs is necessary.”

An executive director of a new generation bank in Nigeria, who craves anonymity,  said Nigeria’s low revenue generation has been a very serious challenge for past and present Administration, and therefore, called for the review of the medium-term fiscal frameworks that can reassure lenders that governments are fiscally responsible and lower financing costs.

The banker argued that: “Although the international community has provided critical support so far to help alleviate fiscal vulnerabilities in low-income countries, more is needed. (Daily Independent)

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150 illegal livestock shops demolished in Onitsha for failing to relocate



About 150 illegal livestock shops have been demolished in Onitsha, Anambra State for failing to relocate to the markets provided for them by the state government.

Iweka-Ochanja road, the location of the demolition, according to the records made available to New Telegraph, should not be a livestock market in the first place.

This development was a joint team of task forces from Onitsha South and Onitsha North local government areas.

Leading the operation the Chairman of Onitsha South local government area Chief Joseph Emeka Orji, the task force used bulldozers to clear the blocked trains as a result of the activities of the traders who were trading there before the demolition.

According to Emeka Orji, the traders were issued with demand and quit notice for months but they refused to obey the order ”

*We gave them more time for to relocate to the market provided for them but they were adamant about it so those days of grace have passed and we have to move in and do the needful”

“We got a temporary place at Akunnia Njoke Street where they can stay and do their business but none of them relocated and we have no apologies for this action”

“They have messed up the place and they cause so much obstruction of traffic and whenever it rains the entire place becomes a sorry sight and this not what we want in Onitsha North and South local government areas ”

“This demolition is a joint action by the two local government areas Though the area is in Onitsha North local government area we have to come together and work as a team,” he said.

SEE ALSO:  CBN gives reason for raising interest rate to 18.5 per cent

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Nigerian boy, Odumuboni, wins Toyota’s car contest



A10-year-old pupil of Corona School, Gbagada, Lagos, Oluwademilade Odumuboni, has emerged global grand prize winner of the Toyota Dream Car Art Contest.

He won the coveted prize after beating 782,852 other contestants from 90 countries.

The contest is organised yearly by Toyota Motor Corporation (TMC), Japan for pupils worldwide, challenging them to draw their dream cars with an inspirational idea.

Master Odumuboni’s waste converter drawing, with the concept of helping countries, especially African communities, in food production and ensuring clean environment, was adjudged the best globally.

He was on Saturday, September 2 honoured and presented with a prize money of $5,000, a trophy, and a certificate at a ceremony organised by Toyota Nigeria Limited (TNL) in Lagos on behalf of the TMC of Japan.

His school, Corona, was also given $10,000 prize money.

The prize money awarded to Demilade and the school is meant for education.

His Art teacher, Mr Ojeagbega Oserogho, received a laptop for helping the gifted boy to excel.

Managing Director, Toyota (Nigeria) Limited, Mr Kunle Ade-Ojo, said: “We are very excited and elated. Indeed, we are very proud of the feat that Demilade achieved by also placing Toyota (Nigeria) Limited in the forefront of distributors globally.”

He said the star boy’s unique idea and dream had placed him and Nigeria on the global map of one of the largest Global Art Contests for children.

“His unique and truly inspirational idea expressed in an equally creative drawing earned him a global grand prize in the contest beating over 782,852 contestants from 90 countries/regions,” he added.

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Ade-Ojo said while the parent company, TMC of Japan initiated the contest in 2004, Toyota Nigeria keyed into it four years later as a corporate social responsibility initiative to help children express their imagination of a future car through drawing.

The TNL MD declared that his company felt fulfilled with its efforts of 15 years finally crowned.

“Apart from the shield and prize money from Toyota Motor Corporation that Demilade will be going home with, Toyota (Nigeria) Limited will also present a certificate and trophy to him,” he added.

The contest, he said, was also meant to drive the children to imagine a peaceful world full of smiles and to promote a friendly society.

“This way, Toyota is also cultivating a lifetime friendship with all these children while encouraging them to care for our planet and push their imagination beyond limits,” he stated. Ade-Ojo said annually, like other participant countries, three winners are picked in Nigeria from each age category: Category 1 (children not older than seven years); Category 2 (8-11 years); and Category 3 (12-15 years old), making nine winners.

The shortlisted nine national winners and their drawings are sent to Japan to compete with other drawings received from all over the world.

The Saturday ceremony was attended by parents of the star prize winner, family members, selected pupils from the school and their teachers led by the Head Teacher, Henrietta Eguagie.

Also in attendance were the three judges that shortlisted the drawing in Nigeria for the world competition.

Eguagie commended Oluwadamilade for his remarkable achievement that had brought glory to the school.

SEE ALSO:  Nigeria records 5 million new job seekers yearly as unemployment rate hits 41% in 2023 – KPMG

She also hailed Toyota for the initiative of inspiring young people to unleash their creative expression and artistic potential.

“As one of Nigeria’s leading educational institutions, we are dedicated to utilising this prize money in a manner that directly benefits the learning experiences and development of our students,” she said.

Specifically, Eguagie listed areas they plan to invest the money as Toyota Dream Car Endowment Fund, Oluwademilade grant for art, establishment of art gallery and exhibition, digital art studio, art and tech competition, among others.

The star boy expressed gratitude to the TNL and the TMC for the opportunity to express himself through art; as well as his school, art teachers, parents for their encouragement.

“I appreciate Toyota for this award and for believing in a little child like me. I’m also grateful for the big award shield; I’ll surely display it in my room and admire it every day when I wake up in the morning. This experience has taught me that hard work pays and that we should never give up,” he said.

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Tony Elumelu To Indian Investors: ‘This is the Best Time to Invest in Nigeria’



Heirs Holdings Group Chairman, Tony O. Elumelu C.F.R.

Investment pledges amounting to nearly $14 billion U.S. dollars were committed during the Nigeria-India Presidential Roundtable and Conference in New Delhi convened by H.E. President Bola Ahmed Tinubu.

Heirs Holdings Group Chairman, Tony O. Elumelu C.F.R., urged the Indian private sector to seize the opportunity to invest in Nigeria, during the Nigeria-India Presidential Roundtable and Conference on Wednesday, September 6th, 2023, in New Delhi, India, jointly organised by the High Commission of Nigeria to India, the Confederation of Indian Industry (CII) and the Nigeria-India Business Council (NIBC).

Elumelu has built pan African financial service businesses and now controls significant power and natural resources operations, all focused on value creation in Africa.

During a keynote address, Elumelu invited Indian private sector leaders to join him and other global investors in accessing the rapidly evolving Nigerian economy, home to 20% of Africans and one of the largest consumer populations globally: “This is the time to invest in Nigeria. I speak as a private sector investor in Nigeria, the companies in our Group’s investment portfolio demonstrate the opportunity. I believe you also can take advantage of our track record and success.”

At the Presidential roundtable, hosted by H.E. President Bola Ahmed Tinubu Indian investors pledged investments of nearly $14 billion to Nigeria, following the Nigerian president’s commitment to create the enabling environment for foreign investments to thrive.

“Nigeria is a huge market; over 200 million people with the largest economy on the continent.
was in Delhi for the G20 Summit, both as an invitee of the President of the Federal Republic of Nigeria, H.E. Bola Ahmed Tinubu, and as co-chair of the Business 20 (B20) Action Council focusing on African
economic integration, the private sector counterpart to the G20.

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Most importantly, the population is not just over 200 million people; the demography of the population is exciting. We have a cohort of young people who are there to consume, and we also have people who are intelligent, energetic, hardworking, who provide the human capital that investors need to drive their businesses”

Tony Elumelu, was recently named co-chair of the Business 20 (B20) Action Council focusing on African economic integration, alongside Sunil Mittal, Founder of Bharti Enterprises (Owners of Airtel). Established in 2010 within the G20, the B20 comprises corporate business enterprises and organisations and
serves as the official platform for dialogue between the G20 and the global business community.

About Heirs Holdings Heirs Holdings is a leading pan-African investment company. Its investment portfolio spans the power, oil and gas, financial services, hospitality, real estate, and healthcare sectors,
operating in twenty-four countries worldwide.

Heirs Holdings is inspired by Africapitalism, the belief that the private sector is the key enabler
of economic and social wealth creation in Africa. Driven by this philosophy, Heirs Holdings invests for the long-term, bringing strategic capital, sector expertise, a track record of business success, and operational excellence to companies we invest in.

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