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“Transparency for the management of $1 Billion Sovereign Wealth Fund” - Afripol

At the on-going World Economic Forum at Addis Ababa, Ethiopia the Nigerian minister of finance, Dr. Okonjo-Iweala spoke to Wall Street Journal on the country’s sovereign wealth fund (SWF). She confirmed that $1 Billion was withdrawn from Excess Crude Account and was used as seed money to establish Nigeria’s sovereign wealth fund.


The Excess Crude Account was also the source for funding of fuel subsidy. The government of President Jonathan made an attempt to completely remove fuel subsidy in order to replenish the account. The idea was to divert the fund from subsidy into upgrading and providing of the badly needed infrastructure in the country. Nigerians have been living with inadequate electric power supply, bad roads, defective health facilities and poorly equipped schools. By establishing a sovereign wealth fund, the set aside fund will be prudently invested and the returns put to a good use in building social amenities, but also as a bulwark against a rainy day. Moreover Nigeria’s oil reserve will not last forever; at least a reasonable and quantifiable wealth will be left for future generations of Nigerians.


According to Wall Street Journal, “Nigeria's $1 billion The sovereign-wealth fund will be overseen by a governing council, made up of members of civil society including representatives from media and academics, that will review its decisions to ensure that the money is transparently invested, she said. is set to start operating in the next few months, said the country's finance minister Ngozi Okonjo-Iweala, in what would mark a crucial step to help the government finance the revamping of its ramshackle roads and power grids… The sovereign-wealth fund will be overseen by a governing council, made up of members of civil society including representatives from media and academics, that will review its decisions to ensure that the money is transparently invested, she said.”


With Okonjo-Iweala at helm of affairs, she racks in the credibility that will make the project sustainable. The most important thing is to ensure that operation of the sovereign-wealth fund will be efficiently managed and be grounded in transparency. To make the public to be aware of the running of the fund, it may be necessary for the administration to lunch a website that is accessible to Nigerians. The website will delineate and show transactions, investments and returns coming from the sovereign-wealth fund.

Achieving Transparency through checks and Balances

For Nigeria to successfully manage her sovereign-wealth fund, transparency and probity must be underpinning tools that must be present. Transparency is doable and possible when responsible and patriotic Nigerians are called to duty to serve their fatherland by partaking in the running and managing of the fund. The management team will not be isolated to the country’s elite but by casting a wide net many Nigerians from all walks of life will be recruited. From business executives, experts, students, labour Union to market women. It is important that this is done in order to clamp down on cynicism while prompting and enhancing trust. Gathering of Nigerians from sectors of the economy will be an antidote to intellectual laziness which is prevailing among the country’s elite.

Emeka Chiakwelu, Principal Policy Strategist at Afripol, wrote, “Transparency is an important foundation on having and managing a corrupt free sovereign wealth fund (SWF). It is essential that transparency and probity will be the guiding light to our country as we invest our money with the returns to create more wealth. First and foremost, capable men and women of integrity will run and manage the SWF. Some people are so bearish and cynical on Nigeria that they think that Nigerians are devoid of honesty, uprightness and integrity. But the truth is that Nigeria has good men and women who are patriots and will do a good job for our beloved Nigeria. Transparency must be self evident in the sense that it will be open to the public and anybody can be able to access information on the investments and returns.”


Chiakwelu further stated: “The presidency should set up a committee of experts to manage the wealth fund. The Minister of Finance or the Governor of Central Bank of Nigeria may head the committee. The presidency may decide to step outside the confines of the government and appoint nongovernmental bureaucrat to head a commission. But whatever the case might be, by the nature of their roles – minister of finance and governor of the central bank will play active roles in the management of the SWF.  It is essential that the committee must comprise of Nigerians from all walks of life including the average Nigerian trader and market women to university professor and government bureaucrats. This is important in order to involve the Nigerian society as partakers and watchdogs. SWF can work for Nigeria when properly managed with transparency and probity.”


Dr. Okonjo-Iweala is a woman of integrity and she will do a good job in assembling men and women of goodwill to manage Nigeria’s sovereign-wealth. One advice for her is to hold her grip firmly on the door knob in order to make sure that unnecessary pressurized intrusion will not obstruct this golden opportunity for Nigeria.


Africa Political and Economic Strategic Center (Afripol) is foremost a public policy center whose fundamental objective is to broaden the parameters of public policy debates in Africa. To advocate, promote and encourage free enterprise, democracy, sustainable green environment, human rights, conflict resolutions, transparency and probity in Africa. This e-mail address is being protected from spambots. You need JavaScript enabled to view it










As South Sudan withdrew from Heglig, the dispute is far from over

The newly independent nation of South Sudan has officially withdrawn its determined but insufficiently equipped military contingent on the disputed Heglig oil field and the aggressive Khartoum government to the north, The Islamic Republic of Sudan has declared victory.


The Heglig oil field or Panthou oil field as South Sudan called it, is situated in the southern Sudan but the Islamic Sudan has laid hold of it even before South Sudan got her political independent and divorce from Sudan government last year July.


Heglig or Panthou is an oil rich field that Sudan depended for its wellbeing and its economic significant to Sudan cannot be overemphasized. Reuters reported that the disputed landstrip “The Heglig field is the key to the Sudanese economy because it contributes almost half of the country's output of 115,000 bpd. Sudan lost three quarters of its output when South Sudan became independent in July last year. Both countries are locked in a row over how much the landlocked new nation should pay to export its crude through the north. "


The Heglig oil field was operated by the Chinese as it was contracted to Chinese-led operator by Sudan government. The maximum output of 60,000 barrels per day was unaffected as South Sudan captured the peripheral of the oil field before its subsequent withdrawal.


The Khartoum government of President Omar al-Bashir was energetic in its response to the temporary occupation of Heglig oil field. President Bashir's Sudan mobilized its relatively equipped military force and attacked military troops of  South Sudan via land and air. Sudan government also engaged efficiently in a massive public relation strategy to bring the whole world on her side. And Sudan government this time succeeded in bringing the world to her version of its perspective and story on Heglig , this time around the world for the first time condemned South Sudan's President Salva Kiir.


United Nations and African Union did not hold back in rebuking the actions of South Sudan. Even the United Nations secretary Ban Ki Moon went further with its condemnation and labeled the action of President Salva Kiir's South Sudan ‘illegal’.


South Sudan withdrawal can be strategic in the sense that it has alerted the global village that its claim on the disputed oil field has not ceased. The critical issue is that the enmity between North and South has not diminished even with southern independent.


South Sudan has the burden that history laid on her shoulder; the land and the people has been deprived with poverty, humiliation and undeniable oppression from the Islamic Sudan government. Now the South Sudan is in the position to assert her independent and dignity. South Sudan since divorce from the north has never shy away from registering its past grievances through peaceful or otherwise.  The diplomatic breakthrough enjoyed by South Sudan was achieve  by negotiations and settlements  through part by fighting and sitting on the table. Therefore South Sudan do have a clear agenda for her actions, but she should adhered to established norms and standard for attainable of peace.


Bashir's Sudan and South Sudan'sKiir should recognized that military confrontation cannot be the only channel for dispute settlement but through a less destructive path of peaceful negotiation and comprehensive conflict resolution.


BBC reported that "Mr. Kiir said the South still believed that Heglig was a part of South Sudan and that its final status should be determined by international arbitration, Associated Press reported. Heglig is internationally accepted to be part of Sudanese territory - although the precise border is yet to be demarcated. The UK minister for Africa welcomed the news of the withdrawal and urged restraint on both sides."


Map showing position of oilfileds in Sudan, source: Drilling info international"Both Sudan and the South are reliant on their oil revenues, which account for 98% of South Sudan's budget. But the two countries cannot agree how to divide the oil wealth of the former united state. Some 75% of the oil lies in the South but all the pipelines run north. It is feared that disputes over oil could lead the two neighbours to return to war."- BBC


President Obama and his administration did a good job in seeing to the implementation of the verses of Sudanese accord and subsequent South Sudan independent. President Obama reiterating of peaceful negotiation for the both parties must be enhanced with urgency and effective backup by United States.


President Obama was in the right direction as he called for negotiated peace on the land. His words “We know what needs to happen -- the government of Sudan must stop its military actions, including aerial bombardments," Obama said. "Likewise, the government of South Sudan must end its support for armed groups inside Sudan and it must cease its military actions across the border."


Bashir‘s government must be made to understand that more violence begets more violence and everybody will become a loser. As an elder statesman in Africa, he must be gradual and easy on force and continue to exhibit the path he took for the South Sudan to realize its nationhood. At same hand the South Sudan with its heavy heart rooted on history of  depravity and destruction should exercise patient and show some goodwill by allowing peaceful negotiation to be the pathway to a peaceful and mutual recognized outcome.


The world must acknowledged the burden of history that was laid on the new independent nation of South Sudan and should be  fair on its approach  not by throwing raucous and overreaching condemnation when South Sudan stands up for her right. Quite diplomacy and logical appeasement may  deem inevitable and necessary when dealing with a new nation that is struggling to stand on her own.



“Dangote Cement listing on London Stock Market is not necessary” - Afripol

Aliko Dangote, the richest African capitalist is on a move and it is no surprise to global market observers and analysts that he is strategizing to list his $11 billion Dangote cement on London stock Market. With its vast expansion and investments beyond its primary base in Nigeria into the rest of Africa’s emerging markets, Dangote Cement without doubt needs more resources and funds to keep up with the pace of development.


Aliko Dangote plans to bring his profitable cement industry into listing on London Stock Market Exchange and Dangote Cement will be free-floating 20 percent stake in the company. The twenty percent is quite big compares to the five percent stake in Dangote Cement listed in Nigeria.


On a surface the participating and floating of the company’s stake is quite compelling because it will enable the company to do more with its expansion and also bolster the image of the company as an transnational corporation with a net benefit of a positive branding. But before the next year implementation of the plan, it is imperative that a profound feasibility studies must be undertaken and the right decision be made. A strategic outlook is necessary to avoid mishaps and pitfalls that may be encountered.


The exposure to London Stock Exchange will attract investors who can be brand critical and may not have patience when the stocks underperform in the cyclical downturn that defines market trends. With the company roots in Nigeria and Africa, a more adverse criticism and depressing analysis can follow put when inevitable mistakes are made which are inherent in management of any big corporation. Whenever political turbulence and disturbances occur in Africa, the prospective investors and stockholders may quickly sell and that will affect the bottom-line of the company.


Moreover the market for Dangote Cement is in Nigeria and Africa. Most of the demand for the Dangote Cement is in Nigeria and with the increasing expansion in Africa the demand for cement will continue to increase inorder to the feed Africa’s emerging markets.


Comparatively, the argument can be made that the market demand with the resources for the expansion can be found in Africa. The suggestive argument that resources for further expansion should be sought outside the shores of Africa has no legs. The money and capital for expansion of the growing Dangote Cement can be found in Nigeria and Africa. That does not translate that the scope and vision of the company should be limited to Africa but potential human and physical capital are not wanting in that part of the world.


Dangote Cement Plc : Next year EPS consensus revisions : last 18 months


The five percent stake in Dangote Cement in Nigerian Stock Market can be increase to up to 10-15 percent. Nigeria’s stock market has been bullish for Dangote Cement. Financial Times reported: “Dangote Cement’s net profit in 2011 is expected to be $790m on revenues of $1.5bn, according to guidance filed at the Nigerian Stock Exchange.”


The president of Dangote Group, Mr. Aliko Dangote was reported to have said that he desired to magnify his profit to enable him to upgrade the business into a huge multinational company and world’s largest cement industry with impressive profit. Yes, it is doable in Africa with sound management and strategic planning.


Emeka Chiakwelu, Principal Policy Strategist at Afripol, outlined the operational standing that, “African market can give the company the fund, resources, capital and the market to realize its ambitious project. But the company must be ready to work with both small and medium capital markets in the continent without looking outside the shores of the continent.”


A while ago, Dangote Cement opened a billion dollar cement industry at Ibese, Ogun state in Nigeria. With this investment resource, enormous profit can be made as the demand for building materials are edging up in the region. As result of demand of cement in Nigeria and Africa as economic growth in non-oil sector of the economy bulges, the accumulating profit will increase and market will be highly appreciated. The profit can be diverted for further expansion especially in research and development.


“With the economic growth of Africa hovering above five percent and Nigeria’s GDP edging up to seven percent for 2012, Dangote Cement can grow without seeking resources from London Stock Exchange,” as Chiakwelu pointed out.


“And the company’s expansion and building of cement industries in the eight African countries should not necessarily be simultaneous but can be realized with one construction after another,” Chiakwelu concluded.


Africa Political and Economic Strategic Center (Afripol) is foremost a public policy center whose fundamental objective is to broaden the parameters of public policy debates in Africa. To advocate, promote and encourage free enterprise, democracy, sustainable green environment, human rights, conflict resolutions, transparency and probity in Africa. This e-mail address is being protected from spambots. You need JavaScript enabled to view it



Dangote Cement At a Glance:

Market Cap $12.51 B

Industry: Construction Materials

Country: Nigeria

Chairman/President: Aliko Dangote

CEO: Jagat Rathee Rathee

Employees: 3,468

Sales: $1.27 B

Dangote Cement Plc is a Nigeria-based company active in the building materials industry. The Company is primarily engaged in the operation of production facilities for the preparation, manufacture, control, research and distribution of portland cement and related products. It operates Obajana Cement Plant, which includes a captive gas power plant; a gas pipeline; a limestone quarry with associated conveyor belt; a dam impounding a reservoir with a total storage capacity of 5.1 million cubic meters and a housing complex. The Company also manages cement production plants in Gboko and Ibese, as well as four terminals, two in Lagos and two in Port Harcourt, through which it imports and bags cement. Dangote Cement Plc is a subsidiary of Dangote Industries Limited, which owned 99.95% of its issued share capital as of December 31, 2009.      -  Forbes Magazine

Unexpected Nigeria's inflation rate at 11.9% despite fuel subsidy removal

The inflation rate in Africa's most populous nation and second largest economy slowed down a little bit at 11.9 percent in February. It came as a surprise as the prevailing view stated that inflation will skyrocket due to partial removal of the fuel subsidy by President Goodluck Jonathan on January first of this year. Before the fuel subsidy removal inflation rate was hovering at 10.3 percent in December 2011. While in January it etched up to 12.6 percent and Sanusi's Central Bank of Nigeria (CBN) predicted that inflation rate would reach up to 14.5 to 15 percent this year before it moderates to 10 percent in 2013.


Surprisingly, inflationary pressure is gradually winding down and 11.9 percent inflation rate shows that the devastating impact of fuel subsidy removal as expected was not biting so deep. The deflating price of food price index was the principal reason for the slowing inflation. The record from National Bureau of Statistics (NBS) shows that food price index decreases from 13.1 percent in January to 12.9 percent in February. And this minor alteration in the food index does have a profound effect on the state of inflation because it accounts more than 50 percent of consumer price index (CPI). In the determination and tabulation of inflation rate the essential tool is consumer price index which constitutes the prices of foodstuff and consumer products including petroleum products.


The impact of the fuel subsidy removal which contracts disposal income with the rising price of the food and fuel products is a reality. Testament is seen when compared to the recent 12.9 percent food price index to that of last year which stood at 12.1 percent before the removal of fuel subsidy.



Sanusi's Central Bank of Nigeria (CBN) retains the interest rate at 12 percent. That comes  as no surprise after raising interest rates consecutively for six percentage points in a role to aggressively checkmate the rising inflationary trend and to reverse the losing value of naira. The Central Bank of Nigeria and its members of the Monetary Policy Committee (MPC) have no need at this time to raise interest rate. The executive arm of the government is working with country's parliament to rein in spending in the current expenditure and for the country to live within its means.


International Monetary Fund (IMF) in its recent review of the country's economic activities urged the Sanusi's CBN to desist from the jacking up of the interest rate. The further tightening of the monetary tool to mop up liquidity maybe waning without any fiscal pact with the executive to contribute in taming inflation and sizing up naira value.




For three weeks in a role Nigeria’s Naira continues to gain ground against US dollar

The appreciation of naira is due to relative mass inflow of dollars into the exchange market.  Due to dollar sales by oil companies and Central Bank of Nigeria the Nair's buoyancy is likely to continue expect fiscal expenditure and monetary interruptions. The conditional naira's appreciation is tactical move that lacks elongated strategic planning. Naira value should rest on a sound economic outlook and economic output not on temporary fix as inflow of dollar suggested.


When the Federal government of Nigeria's over blotted budget kicks in and the price of oil comes down, it will affect the rising value of naira. The partial removal of subsidies may be aiding the value of naira as a source to replenish reserve but the possibility of disturbance have not been put to rest as the government continues to negotiate with the restive labour.


The scope and sources of inflow of foreign exchange into the market must be expanded and that is possible when the economy have arrays of products to export in order to generate ample foreign exchange. The limited source of dollar from oil export cannot do the trick and the economy with its structural imbalance cannot sustain the appreciating naira. Therefore naira has not arrived home safe nor is it possible to refer to naira as a strong currency.


Bloomberg reported that "The currency of Africa’s biggest oil producer appreciated 0.2 percent to 157.9 per dollar as of 10:27 a.m. in Lagos, the commercial capital, rising 0.6 percent this week. A close at this level would be the highest since Nov. 8, according to data compiled by Bloomberg."


This latest appreciation may not be an indication that the good days for naira is back again. The gaining by naira is not anchored on strong fundamentals of Nigeria's economy but rather on the momentum engineered by sales of dollar by the oil companies and the country's Federal Reserve Bank, Central Bank of Nigeria (CBN).


Apart from the recent gaining made by naira, the strengthening is probably temporal and conditional. It is conditional because the inflow of dollars may not be sustainable but when the inflow of dollar and its source flow decelerated, naira will return to its original standing. Naira is relatively a weak currency when it stand toe-to-toe to dollar especially when the oil companies and Central Bank of Nigeria supply of dollar ebbs and diminuted


"Nigeria has sold $600 million at two foreign-currency auctions this week, the largest amount sold in five days by the central bank since October. The bank offers dollars at twice- weekly auctions to maintain exchange rate stability. The oil industry is the next major source of dollar supply to lenders after the central bank," according to report coming from Bloomberg.


Speaking on enhancing the value of naira, Emeka Chiakwelu, Principal Policy Strategist at Afripol emphasized that  sustaining naira's appreciation must follow an unambiguous standard of operation and pathway methodology that will make a real difference on the value of naira. Chiakwelu restated that, "The country's reserve stood at US$ 32.64 billion in December  and the inability to replenish the dwindling reserve in spite of high price of oil was due to the constant defense of the weaken naira."



And he further stated : “To enhance the value of naira the country's war chest must be strengthened in order to withstand the threat coming from speculators. The CBN has eventually restored to the devaluation of naira up to N160 to $1. But the bulwark is not the panacea because it is focusing on the symptoms of the problem not on the root cause. The country does not produce arrays of agricultural and finished products to export in order to raise a quantifiable foreign exchange that can make naira stronger and that can discourage currency speculators."


The problem with Sanusi's Central Bank of Nigeria (CBN) is not coming in tune with the big picture but rather embracing piecemeal methods to fix naira. There must be a long term and comprehensive planning that will bring together the executive, legislature and CBN together. The appreciating naira in three weeks sounds good but to bring about a strong naira that is sustainable needs more work. The fiscal and monetary policies should be in tune with one another and more importantly a strong currency is a reflection of a country's economic wellbeing.


Africa Political and Economic Strategic Center (Afripol) is foremost a public policy center whose fundamental objective is to broaden the parameters of public policy debates in Africa. To advocate, promote and encourage free enterprise, democracy, sustainable green environment, human rights, conflict resolutions, transparency and probity in Africa.   This e-mail address is being protected from spambots. You need JavaScript enabled to view it




Friday, 03 February 2012 11:44

Nigeria: IMF role in fuel subsidy removal?

IMF role in the recent fuel subsidy removal in Nigeria

No matter how the Nigerian present economic team chooses to shade, equivocate or obfuscate it, International Monetary Fund (IMF) played a significant role, if not an upper hand in the removal of fuel subsidy in the poverty stricken Nigeria. It is no longer news neither is it a surprise that IMF has been interested in the removal of fuel subsidy since 2009. The evidence to this assertion has been littered everywhere especially in the public domain.


British Broadcasting Corporation (BBC) reminded us that “The IMF has long urged Nigeria’s government to remove the subsidy, which costs a reported $8bn (£5.2bn) a year.”  IMF has never stopped to meddle in the internal financial and economic affairs of the country in spite of the impression and double talk it has been making lately.  Nigeria’s economic team effort to obfuscate the matter is no longer functional.


The America's flagship newspaper, New York Times wrote recently: “In a 2009 report, the International Monetary Fund called the removal of the fuel subsidy “an important first step.” But in a place where experts estimate that $50 billion to $100 billion in oil revenue has been lost through fraud and that 80 percent of the economic benefit from oil production has flowed to 1 percent of the population, the monetary fund’s approval of a step that hits ordinary people so hard looks provocative."   The endorsement for the abrupt fuel subsidy removal without adequate palliative measures buttressed that IMF is clueless and at worst indifference on the level of poverty and depravity in Nigeria.


In the rush to appease the masterly IMF the Nigerian leaders failed to make a solid plan; which is to absolutely convince the poor masses before the subsidy removal with realistic and implementable palliative measures. The global news network CNN crisply described the removal of subsidy, “It is the abrupt removal of the fuel subsidy, in what has been described as a callous New Year's Day "gift" that proved unacceptable for many Nigerians. There has been intense speculation in the country that the decision came suddenly because of pressure from the International Monetary Fund. The announcement coincided with a visit to the country by IMF’s head Christine Lagarde weeks earlier."


The economic team of the present administration led by Dr. Okonjo-Iweala went before the country's congress after IMF’s Christine Lagarde visit to reassure them that Nigeria will not implement IMF's neo-liberal policies. But on the first day of January the removal of subsidy came suddenly. Nigerians protested not necessarily because they disliked the administration but for the rejection of the policy. The poor masses could not accept the jumped in price of a gallon of petrol from less than $1 to almost $4 in a country that seventy percent survived with less than $2 a day.  The decision for the removal is not logical knowing quite well that the masses are already deprived and barely surviving. It is beginning to look that IMF does not have compassion for the poor struggling masses of Nigeria. IMF history with Nigeria has been a historical annals filled with thorns of suffering and misery.



When IMF Managing Director Christine Lagarde came to Nigeria, instead of the Nigerian leaders and intellectuals to ask her to apologize to Nigerians on behalf of IMF for the austerity measures of 1980s and the subsequent deformation of the country's economy; rather they were busy praising her. She was also given credit for the so-called 18% write-off of the Paris club debt. The praise and credit should go to poor Nigerians on whose back the payment was made to rich syndicates of Paris Club in which the mountainous payment made was based on high interest rate and arrears accumulated by the outstanding debt. The provision of water, electricity, healthcare and roads were abandon in order to make the payment to Paris Club. The credit and heaping of praises should go to Nigerians not to IMF’s head whose highest priority is not on women and children who went to bed hungry.


No one is suggesting that a nation should abandon its financial obligations and deleveraging of its debt. But at same time a logical approach must be taken which is to put people’s welfare on account and not relegated it to the nadir level. Nigerian people should not be thrown aside to satiate international wealthy syndicates. After all, charity should start from home.


The implementation of IMF's Structural Adjustment Program with its austerity measures in Nigeria’s 80s and early 1990s comes with naira devaluation, importation restrictions and slash of social spending, that was too traumatic to be easily forgotten.  The negative adjustment in the economic outlook and wellbeing of Nigeria was expressed by Gideon Nylan, a writer on political economy of developing nations at Afripol, on which he painted the situation with this troubling description: "The Nigerian middle class has yet to recover from the IMF devaluation of 1986. Suddenly teachers, lawyers, doctors, and civil servants saw their life savings disappeared. In order to support their families and create a better living for themselves, they left the country for greener pastures in other countries."


In addition Nigerians have not wholly recovered from the aftermath of the implementation of the neo-liberal policies that separated families, worsen the health wellbeing of the country and totally demolish the educational sector that was starved of fund. The manufacturing sector that relied on the importation of raw materials closed down due to lack of import license and foreign exchange. The IMF's austerity measures spiked and induced higher unemployment and together with surging inflation rate made life unbearable for majority of Nigerians. Are Nigerians quick to forget?  Probably, the temporary amnesia has made them to be praising the visiting IMF's chief instead of asking IMF for reparation and apology.


A Nigerian government official was suggesting that the removal of subsidy was necessary to save Nigeria from not ending up like the bankrupt Greece.  But in reality and joke apart, Nigerians should be envious of Greece because in spite of the so-called debt problem of Greece, their lifestyle have not changed. Last time we checked there is still tap running water, 24 hours electricity and paved roads in Greece. Nigerians will not mind having all the social amenities, social safety nets, security enjoyed by Greeks even together with its debt.  Many Nigerians may be willing to trade places with Greece if asked.


Nigeria should work with IMF when she deems it necessary and there is no reason to be genuflecting and kowtowing. Nigeria has produced capable men and women that have the ability, intellect and potential to salvage the sinking country. IMF should not be adding sand to the garri of nation struggling to determine her destiny.


African National Congress made it to 100years... it was no easy journey

As racism and oppression against Black Africans gained momentum in the newly established Union of South African, Pixley ka Isaka Seme a visionary leader in 1911 appeal to all non- European ethnic groups in South Africa to unite together. Pixley ka Isaka Seme rallying words - "Forget all the past differences among Africans and unite in one national organisation" led to the formation of the African based liberation organization named South African Native National Congress (SANNC) at Waaihoek Wesleyanchuch on 8 January 1912. The first elected president of the newly formed organization was John Dube and with company of many intellectuals including Sol Plaatje, an author and a poet the fight against racism and oppression took a more focused dimension.

South African Native National Congress (SANNC) was later renamed African National Congress (ANC) in 1923. With promulgation of Apartheid system of government, African lands and Rights as citizens were taken away. The struggle for gaining of full rights of South African citizenship was not an easy struggle and there were many lows and highs encountered by ANC. But one of the greatest achievements of ANC was internationalization of the struggle that made the civilized world to come together and to reject apartheid government of South Africa. It was not an innocent and bloodless struggle for many lives were lost, properties destroyed and the innocence of a nation was lost forever.

Chiefs, churchmen and a lawyer met at the Waaihoek methodist church in Bloemfontein, and the founding South African Native National Congress (SANNC), the forerunner of the ANC, is born. John Langalibalele Dube, centre, is the first president. Chiefs, churchmen and a lawyer met at the Waaihoek methodist church in Bloemfontein, and the founding South African Native National Congress (SANNC), the forerunner of the ANC, is born. John Langalibalele Dube, centre, is the first president.  Pic: creative commons- Wikepedia

There were many low points during the struggle for liberation by South African majority including the jailing of Nelson Mandela and many of his comrades for treason. Another blow to ANC was the exiles of many of its top notched leaders but it became a diplomatic breakthrough for ANC for the exiles were campaigning for liberation in the foreign lands including Oliver Tambo and Thabo Mbeki who later became the president of liberated South Africa after Nelson Mandela's tenure.

Among the lowest points in the struggle was 1960 Sharpeville massacre of young people and this buttressed to the world how ruthless and cold the system was. Karen Allen of BBC news recalled the massacre with this chilling description: "Thousands of protesters had gathered in Sharpeville, just south of Johannesburg, to protest at the use of the infamous passbooks, or "dompas", that every black South African was expected to carry and produce on demand. It governed a person's movement, was a tool of harassment and was one of the most hated symbols of the apartheid state. Sixty-nine men, women and children were gunned down on that day, killed when police officers opened fire on the crowd. The police station - where they had gathered - is now a memorial to the dead."

The highpoint of ANC struggle was the unbanning of ANC and the release of political prisoners including Nelson Mandela, Walter Sisulu and many others from the famous Robben Island prison. The climax of the ANC struggle was the releasing of Mandela and his subsequent election as the first Black president of non-racial South Africa in May of 1994 after spending 27 years in prison. The ANC as a political party and liberation organization deserved the greatest praise and acknowledgement for the defeat of apartheid South African government and its management of victory. To the credit and maturity of ANC victory became the univeral freedom for both the oppressed and oppressor,  white and black, poor and rich.

ANC celebrates 100yrs


There were also unsung heroes, men and women of goodwill all over the world that never sleep nor stop fighting until the evil apartheid was declared death and irreversible. It was truly a collective effort of the good people of the world that refused to be quiet that eventually brought about the collapse and eradication of apartheid.

There has been successful transfer of power since President Mandela has been at herald affairs in South Africa. And each of the successive presidents has done a fairly decent job in trying to right the wrongs of the nation without upsetting the system. Although some will not evaluate it in more positive light given the quantity of poverty in the country, others may even accuse them of being timid and have lost their focus and direction. But all things being equal, it can be a delicate dance being that the majority poor Black masses are hurting but at same time the minority whites were engulfed with fear and anxiety.

The president that came immediately after Nelson Mandela was another intellectual and financial guru named Thabo Mbeki; he was good with the economy. Mbeki appointed both black and white technocrats to his government including the finance minister Manuel Trevor, that helped him to balance the budget and rein in spending. Mbeki appointed Tito Mboweni as the governor of the Central Bank of South Africa, who kept the rand currency healthy and strong, while at same time held down inflation. Mboweni tenured at the South African Reserve Bank was a success story for his monetary policy application reassured investors and business community.

Mandela is elected as the country's first black president.AFP/Getty Images

The current President Zuma has shown a great leadership especially in the economy and management of emerging social crisis of restlessness among the youths. Due to his radical days during ANC struggle, many people were worried especially business community that he has socialistic inclinations. But to the surprise of many he is relatively conservative in spending and economic management. He held down inflation with the spearhead of good fiscal policies and the appointment of Gill Marcus, a conservative financial banker as governor of the Reserve Bank and this has solidified Zuma's new found fiscally conservative principle . Under the leadership of Zuma, South Africa has become the latest member of the BRICS - a powerful trading organization of emerging super nations. South Africa is also a member nation of G-20, the only African member of the esteemed group.

Mandela serves a term as president. The ANC wins a second democratic election, with Thabo Mbeki elected as successor. However, the party's image begins to falter when MP Patricia de Lille presents a dossier containing numerous allegations of bribery relating to an $8.5bn arms deal.Thabo Mbeki Pic:EPA

With resolute and confidence, ANC has matured into a ruling party from their victory and has shown a great ability to lead a multi-racial South Africa. Nelson Mandela, the conscience of the struggle deserved a great respect and honor on the way he directed the affairs of the nation as the first Black president of South Africa. Mandela displayed of no remorse and bitterness to his fellow South African whites was a mark of maturity and statesmanship rarely seen in the annals of history. He taught the world that peace-making is a virtue and the once enemies can co-exist together and peacefully sought out their differences and work together to build a peaceful and prosperous nation. It has not been easy but the legacy he put forward has become a foundation for building a great, non-racial and prosperous South Africa.

With freedom and victory comes great responsibility. ANC cannot afford to sit on its laurels for as the ruling party it has a daunting task of rewriting the wrongs of yesterday. This is an enormous task because of how sensitive and delicate racial relationship in South Africa has become. The liberated Black majority has been overwhelmed with poverty and depravity rooted in the defunct apartheid structure, while whites were riddle with guilt and anxiety on the apparent loss of their ruling class status. ANC as the governing party together with the government leadership needs a strategic outlook and plan to successfully tackle and solve the problem.

Jesse Jackson of the US (C back) stands behind South Africa President Jacob Zuma

Democracy is an expensive form of government and it is not sustainable in a sea of poverty. South Africa under the leadership of ANC has demonstrated that it has the potential to become one of the richest nations under the sun. And the nation of South Africa can lead Africa to a better tomorrow. This is not the time to allow internal bickering to get hold of ANC. The greatest advantage ANC enjoyed is that it has men and women of goodwill that believes that Africa can rise again and become a productive continent that can determine its destiny without begging for a handout. ANC is strategically position to change not only South Africa but the entire continent for good. That must be the desire and vision of ANC, therefore ANC should provide the moral compass to a great nation and a great people.

ANC does not have the time to be timid, visionless and to wallow in corruption because if it chooses to go slow, the people of South Africa will not accept it. Only time will tell whether the blood and sweat deposited in the bank of liberation is redeemable. Happy 100 years anniversary!!!

Africa Political and Economic Strategic Center (Afripol) is foremost a public policy center whose fundamental objective is to broaden the parameters of public policy debates in Africa. To advocate, promote and encourage free enterprise, democracy, sustainable green environment, human rights, conflict resolutions, transparency and probity in Africa.



Thursday, 29 December 2011 15:02

S&P lifts Nigeria's Credit Rating to positive

Standard & Poor's ratings agency moves higher the Nigeria's economic outlook from stable to positive

Standard and Poor's (S&P) the compassing powerful rating agency brought a smile to the faces of President Jonathan's economic team by lifting the country's credit rating from stable to positive. According to AFP news agency, "It also reaffirmed its B+/B long- and short-term issuer credit ratings for Nigeria, the continent's most populous nation."  This is a good news for President Jonathan and his economic team principally  Dr. Ngozi Okonjo-Iweala, Minister of Finance and Lamido Sanusi, Governor of the Central Bank of Nigeria (CBN), the country apex reserve bank.

This upgrade of the country’s economic outlook to positive will enable the country to continue with its on going reforms and to justify the removal of fuel subsidy. The country‘s administration can use it as a leverage to assure investors and capitalists that the country is moving in affirmative direction.  The Nigerian economic team will be strengthened on its battle against the rising inflation and the softening of naira.

Inspite of the security and social problems confronting Nigeria, including the Boko Haram endless bombing and the looming removal of the fuel subsidy the premier credit rating agency S&P still has faith in the country's economic outlook and the on going reforms by President Jonathan 's administration. The agency reiterated that, "The Nigerian government under President Goodluck Jonathan has been undertaking several important reform initiatives and is tightening its fiscal and monetary stance,"  and continued to emphasized that the "The authorities have restructured and strengthened the banking sector, and we expect economic growth to remain strong. We are revising our outlook to positive from stable ..."

Okonjo-Iweala, Sanusi, Alison-Madueke: subsidy should goL-R Madueke, Okonjo-Iweala, Sanusi

AFP agency further reported that, "Economists and government officials view the move as essential to allow for more spending on the country's woefully inadequate infrastructure and to ease pressure on its foreign reserves.Nigerians however view the subsidy, designed in part to hold petrol prices at 65 naira per litre ($0.40, 0.30 euros), as their only benefit from the nation's oil wealth.Nigeria's central bank head Lamido Sanusi has also led sweeping bank reforms seen as having pulled the sector out of crisis. Finance Minister Ngozi Okonjo-Iweala is a highly respected former World Bank managing director. However, the country has also seen worsening violence blamed on Islamists and warnings from the Christian population that they will defend themselves against further attacks. Standard & Poor's noted concerns over the situation.Nigeria relies tremendously on the oil industry for revenue, and the ratings agency pointed out that crude exports accounted for 72 percent of current account receipts in 2010."

This endorsement from S&P is goodwill gesture to the country’s administration that has many challenges coming its way. Most especially the Boko Haram's nightmare and its determination to shake and destroy the stability of the emerging economic power of this West African nation. The rampant, senseless and ceaseless bombings from this radical organization pose a great threat to the security and wellbeing of the nation. And without relative peace and stability; ample and comfortable environment the flight of capital and investment becomes more imminent. Therefore the upgrade is an approval by S&P on the monetary and fiscal policies employed by the administration to grow and stabilize Nigeria's economy.


Wednesday, 23 November 2011 18:01




Aliko Dangote is the brainy Nigerian based entrepreneur, the founder, CEO and president of Dangote Group. He is an industrialist, a manufacturer of commodities principally food and cement. The head office of Dangote Group is in Lagos, Nigeria but company's prowess is felt across Africa and beyond. Dangote can be described as the King of cement industry due to his vast, enormous and extensive investment in cement manufacturing throughout Africa.

No other Nigerian has done more than Alhaji Aliko Dangote for entrenchment, consolidation and promotion of capitalism, market economy and free enterprise particularly in Nigeria and Africa in general. With his industry, business acumen and dedication comes a great dividend and returns that has made Dangote the richest man in Nigeria and Africa. The world renowned capitalistic magazine Forbes has quantified his personal wealth at a tune of $10.1 billion and that is not bad at all for a person who started a business from a loan he got from an uncle. For his vanguard in business and investment in Nigeria, President Goodluck Jonathan awarded him Grand Commander Order of Niger,GCON, which he richly deserved and merit.

Forbes wrote that the "Nigerian commodities titan Aliko Dangote is also Africa's cement king. In late 2010, he listed Dangote Cement on the Nigerian Stock Exchange. The company integrated Dangote's cement investments across Africa, including Benue Cement, formerly listed on the Nigerian Stock Exchange. It's now the largest company on the Nigerian exchange, with a market capitalization of $10 billion. In August, Dangote received approval from the Central Bank of Nigeria to invest $4 billion to build a new cement facility in the Ivory Coast. He's also building a $115 million cement plant in Cameroon, and owns plants in Zambia, Senegal, Tanzania and South Africa, among others. Dangote started trading commodities more than three decades ago after receiving a business loan from his uncle. He then built the Dangote Group - a leading West African conglomerate with interests in cement manufacturing, sugar refineries, flour milling and salt processing. Venerable philanthropist has given away millions to education, health and social causes."

President Jonathan decorating DangotePresident Jonathan decorating Dangote with award

The great thing about Aliko Dangote is his commitment to Nigeria and Africa. Most of his investments are in Africa and with that he has shown that Nigeria and other African countries can be lucrative for investments due to large returns from them. Dangote is the largest private employer of labour in the continent and jobs given has aided to slow down rampant unemployment facing Nigeria and Africa. This has given hope to the youths and has sown the seed of fruitfulness in the emerging economies of Nigeria, Senegal, Zambia and many others in Africa. Dangote can now become a tril blazer, a role model to aspiring business executive and many rich Africans that they can invest in Africa's market. Dangote is the greatest rebranding that Nigeria needs because he has shown to the whole world by his handwork and patriotism that Nigeria and indeed Africa are ready for 21st century, that a century of innovations and possibilities can be spearhead by Nigerians and Africans.

For his unflinching patriotism, business commitment and investment in today and tomorrow’s Africa's, the board and staff of Afripol Organization chose the business giant and magnate ALIKO DANGOTE, THE PERSON OF THE WEEK.


As CBN raises Benchmark interest rate to 12 percent, inflation rose to 10.3 percent in September from previously 9.3 percent in August

Once again at the beginning of fourth quarter, the country’s Federal Reserve Bank; the    Central Bank of Nigeria (CBN) raises the monetary policy rate (interest rate) to a new high of 12 percent from previously 9.25 percent. There is no surprise with the new hike knowing quite well that CBN has been aggressively engaged in the tightening measures of its monetary policy and assiduously mopping the monetary base liquidity. But the margin of the hike at 2.75 percent from the previous rate was astounding. The capital market was anticipating at least a 10 percent hike but the muscular CBN jumped interest rate to 12 percent.

The reason given by the Governor of Central Bank, Mr. Lamido Sanusi  for the hike was to strengthen the relatively malleable Nigeria’s currency naira. Although naira is weakening but it is not necessarily in a dire straight either it is totally collapsing to require such a drastic hiking of the interest rate to 12 percent. Subsequently Naira responded and appreciated against dollar due to the aggressive move; it did rally in the market and closing good the next day after the hike of the interest rate.

Vanguard Newspaper reported that “naira opened at 157.40 against the dollar at the interbank, firming from Tuesday’s close of N158.90 and up six percent from the record low of 167.8 reached before the CBN imposed several monetary tightening measures at an emergency meeting on Monday.” It was reported that Central Bank of Nigeria (CBN) at auction market sold $519.67 million at price rate of N150 for a dollar. On the previous day before the recent interest rate hike $400 million was traded at N156.91.

Other than the strengthening of naira, the unmentioned reason for the interest rate hike might be to get the economy ready for the removal of fuel subsidies. The idea is to utilize the monetary tightening policy as bulwark from the eventual higher inflationary trends as the subsidies are removed.There is no doubt that inflation will spike momentarily for a short time as fuel subsidies become history. Although Sanusi’s CBN was mum on fuel subsidies as propelling force for 12 percent monetary interest rate, but the writing is on wall. The development buttressed that the removal of fuel subsidy is a sure banker and there is no more orbiting around it, the government has finally made up its mind.

But the move to fix naira from its fall by CBN is not sustainable for the ‘shock therapy’ cannot solve the problem of naira permanently. The Sanusi’s CBN appears to be riding on momentum rather on fundamental; Nigeria has a structural imbalance that the tickling by CBN is quite minuscule to make a long term impact on the monetary affairs of the country and the strengthening of naira. Nigerian economy is based on oil and such an economy without diversification lacks the strong fundamental to sustain a viable and strong currency. When Nigeria sits up and makes the necessary changes in the way she runs her economy, the malleability of naira can be checked. The reactionary posture by policy makers is not the panacea to the falling naira.

CBN's Sanusi

The source of foreign exchange to Nigeria’s economy is limited. The major source of dollar to the economy is through the export of crude oil and remittance coming from Nigerians in Diasporas particularly from North America.  Another weakness in the economy is its inability to sustain or hold to those dollars flowing into the economy. This is because the economy and country lack the necessary infrastructures that can hold on to the dollars in the economy. Paucity of social infrastructures, poor security and underdevelopment contributes to capital flights. The country is becoming unattractive to foreign investments and dollars.

The problem with Nigerian economy and particularly with Naira is akin to football team that never soccer a goal in matches and always loses due to lack of training and planning.Although a team might have some good players but without training, planning and coordination it will never succeed. Nigeria has intelligent men and women but it has failed to map out a pragmatic and strategic framework to transform the nation’s economy.

In September inflation rose to 10.3 percent and this shows that the tightening monetary measures employed by CBN maybe waning. There is so much CBN can do with its monetary policy and if care is to be taken the success that CBN achieved may even reverse. This is why it is important that propping of naira and the battle against inflation must come with comprehensive strategy and economic reforms spearheaded with the executive fiscal policy.

Another thing sticking out with the 12 percent hike is the underpinning contradiction coming from CBN policy makers. The appreciation of naira will result in a sharp demand of dollar and CBN may not satisfy the demand. A contradiction that arises from the strength of naira is contrary to devaluation of naira that CBN is planning for near future. It is not logical to make naira stronger, simultaneously planning to devalue the currency in near future. The withdrawal from the country’s foreign reserve to defend naira has lowered the Nigeria’s reserve from $31.75 billion at the end of September to $30.86 billion as of October 7. The battle to save naira is expensive to the country therefore Nigeria must look beyond monetary tightening measures.

Africa Political and Economic Strategic Center (Afripol) is foremost a public policy center whose fundamental objective is to broaden the parameters of public policy debates in Africa. To advocate, promote and encourage free enterprise, democracy, sustainable green environment, human rights, conflict resolutions, transparency and probity in Africa.     This e-mail address is being protected from spambots. You need JavaScript enabled to view it


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