Blog Spot


On Tuesday, 9th November 2016, the world was stunned by the victory of Donald Trump as president of the United States of America. During Trump’s campaigns, he made several racist comments about Africans, which included threats to send Africans away from America if he becomes president. This has led many to ask how his victory is going to affect Nigeria’s economy and her trade relationship with the US.

In an interview with Ventures Africa Anointing Momoh, a Research Associate at Centre for the Study of the Economies of Africa (CSEA) highlighted the potential impacts of Donald Trump’s on Nigeria’s economy:



The Governor of the Central Bank of Nigeria, Godwin Emefiele, has finally unveiled the flexible exchange rate policy. This comes barely two weeks after he announced at the Monetary Policy Committee meeting that he was going to allow the Naira float freely at the interbank market.

Here is what the CBN governor stated during the announcement which was aired by CNBC Africa:

“CBN will launch a foreign exchange interbank trading window on Monday to boost the supply of hard currency in Nigeria. The new window will have eight to ten primary traders handling minimum volumes of $10 million.The new system will help with economic growth and restore investor confidence,” he said. “The precise guidelines will be published later on Wednesday.”

According to Reuters, the CBN governor also stated that the window’s exchange rate will be purely market-driven.

“Nigeria will introduce fx primary dealers to operate with others in the interbank market. Under the new structure the 41 items previously not banned from getting access to forex in Nigeria will remain unchanged.Nigeria’s Forex Reserves is robust an can cover five months of import,” said Emefiele. “The time is right to reintroduce a flexible interbank forex market. Forex market will operate as a single market structure.”


Thursday, 17 December 2015 08:56

Zuma’s economy-wrecking legacy

Songezo Zibi, Editor, Business Day (SA) –

UNDER normal circumstances, 2015 would be a year President Jacob Zuma would like to forget. This year saw the culmination of six years of economic policy mismanagement and dithering that sapped the confidence of business to invest and led to most economic and fiscal indices pointing in the wrong direction.

While everyone else was looking for measures to curb the decline, Zuma decided to throw fuel on the fire by firing Nhlanhla Nene. The reasons given for his dismissal and replacement by David Desmond van Rooyen were unconvincing.

As expected, the rand crashed through the psychologically important barrier of R15 to the dollar, and then on to the hitherto unthinkable R16/$. Banking stocks lost up to 10% of their combined market capitalization upon the news.

Since Zuma ascended to the presidency in 2009, unemployment has risen from 23% to 25%. Youth unemployment — the anchor of his electoral promises six years ago — has increased from 33.7% to 35.5%.


Monday, 16 November 2015 00:00

Fraught SA-Nigeria ties


REFLECTIONS on the history of Africa’s two biggest economies dominated the SA-Nigeria Chamber of Commerce’s (SA-NCC) 10th anniversary dinner in Johannesburg last week.

George Nene, a former South African ambassador to Nigeria, told guests of how his six-year sojourn in exile during apartheid was transformed into an ambassadorship when he was asked by former president Nelson Mandela to open SA’s first embassy in Nigeria in 1994.

Nene facilitated the long corporate trek to Lagos by companies such as South African Airways, MultiChoice and MTN.

The early relationship was dynamic. In 1999, the SA-Nigeria Binational Commission was formed and deputy president at the time Jacob Zuma was the lead representative in its early meetings.

In 2005, when the chamber was formed, MTN was already the market leader in Nigeria.

Its success in the market had attracted many other big household names, such as Protea Hotels.

That year, Nigerian oil company Oando listed shares on the JSE to great fanfare; Virgin Nigeria, the national airline for a time, started flights to Johannesburg.

Ten years later, investment and trade has escalated significantly. Nigeria is probably SA’s biggest trading partner in Africa and one of its biggest crude oil suppliers.

However, speakers at last week’s chamber dinner rued the fact that, at many levels, the relationship has not realised its full promise.

This is not about the statistics. It’s about a lack of trust, the easy triggers for disputes at official and unofficial levels; the fact that 20 years after the start of formal diplomatic relations, citizens of both nations are still only getting three-month visas to visit each other; a lingering — but erroneous — perception that the low levels of Nigerian investment in SA are the result of laws preventing such investments; and that South African companies are exploiting Nigerian consumers, a view exemplified by MTN’s success.

Its failure to cut 5-million unregistered lines, as directed by the Nigerian regulator, has led to accusations of arrogance. Other South African companies are often tarred with the same brush.

There are many possible reasons behind the excessive fine slapped on MTN. One is likely to be the view that MTN is making pots of money in Nigeria and the country should get some of it back.

This negates the reality that the company has reinvested billions into the country. Many Nigerians benefit from MTN. It has Nigerian directors, staff and shareholders. Even the vice-president has shares. But it is still a South African company and as SA’s flagship investor in Nigeria, it tends to set the tone for the perceptions about South African business. So this saga is unfortunate.

Many are surprised at the harsh penalty imposed on MTN. They shouldn’t be. As security is Nigerian president Muhammadu Buhari’s top priority, the link between unregistered lines and security was always going to be a red flag.

Strict adherence to the rule of law is another priority. The regulators have been harnessed to wield the new broom sweeping Nigeria.

Moreover, there is the question of Nigeria’s significant budget deficit — $5.2bn is a large chunk of change.

Nigerian companies are, however, also being penalised for regulatory infractions. The strong action against two of SA’s most prominent investors in Nigeria — Standard Bank is involved in a spat with a different regulator — was bound to suggest the new administration is negative towards SA.

The reality is that the Buhari government represents an opportunity to reset this often fraught relationship. The behind-the-scenes talks on the MTN fine may determine the way forward.

MTN took a gamble that didn’t pay off. It has been a harsh lesson and a wake-up call for other investors that it is not business as usual in Nigeria. But there will surely be business.

• Games is CEO of advisory Africa @ Work and executive director of the SA-NCC

Wednesday, 14 October 2015 00:00

At last a cabinet, and now for the policies

Africa Confidential, Vol 6 No 20 –

After balancing political interests and restructuring ministries, the most urgent issue facing President Buhari is economic strategy

At his self-imposed eleventh hour, President Muhammadu Buhari submitted his list of 21 ministerial nominees to the Senate on 30 September. On 8 October, the Senate was to start vetting the names but it will not know the portfolios that Buhari intends to give to his nominees. That means that most of the questions will be about personal integrity and political loyalties rather the technical competence required in a specific portfolio (AC Vol 56 No 9, APC to lead with a leaner team).

The list is the outcome of a tricky political balancing act which has taken far too long – he was inaugurated on 29 May – but has at least succeeded in not alienating critical constituencies in the political and business worlds. In addition to the complexity of mediating among and sifting through the myriad interest groups which descended on Abuja to press their claims to run ministries, Buhari has been trying to restructure the government at the same time. Not only does he want a leaner government – the 21 nominees are likely to be the substantive ministers and the next 15, so far unnamed, will be the deputy or state ministers – he also wants to cut the ministers' scope for patronage.

That is why many of the boards and managements of state-owned companies have been reconfigured in the last few months. In theory, this should allow the new ministers to concentrate on their portfolios and public administration rather than dealing with the pressure to find jobs and contracts for their supporters.

Yet the biggest question about the Buhari government – its economic strategy or lack thereof – remains stubbornly and worryingly unanswered (AC Vol 56 No 16, Fighting graft, Buhari-style). A halting performance by Central Bank of Nigeria (CBN) Governor Godwin Emefiele on 5 October at the Financial Times Africa Summit in London failed to convince many of his fellow bankers. Emefiele, who has plenty of enemies in the governing All Progressives Congress (APC), insisted that the government's costly defence of the naira, using billions of dollars of foreign reserves and putting restrictions on the availability of foreign exchange, was sound economic policy.

On the sidelines of the conference, Donald Kaberuka, former President of the African Development Bank, said the dogged defence of the naira risked creating new problems rather than solving current ones: 'As the gap widens between the official rate of the currency and the parallel, you open up opportunities for arbitrage and corrupt rent-seeking.' Even the political argument against devaluation – that it would alienate town-dwellers and the middle-classes because it raises the price of imports – was wrong, said Kaberuka, because most of those imports would be coming in at the more expensive parallel market rate.

When and whether the government changes its line on the currency will emerge after the economic team is in place. Based on the structure of the state governments under the APC, the Finance Ministry portfolio is likely to be divided into two: firstly, with a minister in charge of bringing in and tracking all revenue that is due to the Federation Account, from export earnings, taxes, duties and investments, which would entail close cooperation with the CBN Governor on currency and interest rates; secondly, the minister – probably the national planning minister – would allocate the revenue to each government department and entity.

The likely innovation will be the introduction of zero-year budgeting: that means that at the end of every year, each department must return its unspent allocation to the Federation instead of trying to roll it over into the following year. Already Vice-President Yemi Osinbajo, a former Finance Commissioner in Lagos State, is taking the lead on economic matters and is seen as one of the competent technocrats in the government so far.

There are at least two possible candidates on Buhari's list who could take the finance minister's role: British- born Kemi Adeosun, former Finance Commissioner in Ogun State; and Udoma Udo Udoma, a lawyer and former Senator from Akwa Ibom who has held several company directorships. Meanwhile, for national planning minister we have heard three names suggested: Amina Mohammed, former Special Economic Advisor to the President and currently Special Advisor on Post-2015 Development Planning to the United Nations Secretary General, Ban Ki-moon; the former Governor of Ekiti State, Kayode Fayemi, who has also been suggested as Foreign Minister; and former Lagos State Governor Babatunde Fashola.

It seems that Buhari has had to grapple with the Federal Character provisions, which require one minister from each of the 36 states to promote regional diversity. Secondly, he has also had the directly contradictory input of the Transition Committee, led by veteran official Ahmed Joda, which advised drastically cutting the size of the government (AC Vol 44 No 13, Atlantic crossing). Then Buhari had to find a balance between technocrats and politicians. Additionally, he has had to consider equitable representation for the various parties that make up the APC, as well as find good candidates from states, mainly in the Niger Delta and south-east, where the previously governing People's Democratic Party (PDP) still holds sway.

Some of the delay was due to the search for candidates who could meet Buhari's demands for personal probity. He has also gone for candidates who have kept away from headline scandal but who have nevertheless lived in the less-than-perfect world of Nigerian politics.

Heading the political side of the list is a strong triumvirate of younger ex-governors: Fashola (Lagos), Rotimi Amaechi (Rivers) and Fayemi (Ekiti), who all made big contributions to Buhari's APC election victory as directors of Fund-raising, Campaigning, and Policy and Strategy respectively, are at its core. With the new Kaduna Governor Nasir el-Rufai outside but nearby, they will be influential voices in policy and governance.

They are set to work effectively with the respected Osinbajo to deliver on campaign promises and institutional reform. Yet Amaechi's appointment – depending on the powers of the ministry he is given – may prompt fresh tensions in oil-producing Rivers State, where his arch-rival, Ezenwo Nyesom Wike, engineered a victory in the recent elections which is now being tested in the courts. The trio of ex-governors have all made it through despite attempts to undermine their qualifications and probity.

Mentor and rival 
In the case of Fashola and Fayemi, these questions seem to have emanated from the camp of their mentor-turned-rival, Bola Ahmed Tinubu. They are perceived as tactical allies of Senate President Abubakar Bukola Saraki in his tussles with Tinubu, so the vetting of the triumvirate may itself become politicised. However, to defuse these tensions, Buhari nominated Tinubu's ally, Lai Mohammed (Kwara). As APC Spokesman, Mohammed has been a thorn in the side of the PDP for years. He now has the chance to bring his talents into government, most naturally in the Information portfolio.

The interest of the older generation of former PDP figures who worked with ex-President Olusegun Obasanjo (and indirectly, that of the former President himself) is underlined in the inclusion of former PDP Chairperson (2001-2005) Audu Ogbeh and more convincingly, Amina Mohammed (Gombe). Obasanjo chose her to help Nigeria to meet the UN's Millennium Development Goals. With extensive experience in grassroots development projects, she will be a key asset in maintaining strong support for the government in the north.

Ogbonnaya Onu (Ebonyi) has to help to win over the south-east, where the APC lacks traction, as well as to represent the former All Nigeria People's Party faction, which he chaired, in the APC. Former Anambra Governor Chris Ngige is the other key south-east representative. Despite his mixed record in office, he is perhaps the APC's biggest name in that region.

Emmanuel Ibe Kachikwu from Delta is a surprise inclusion, having already been chosen as the new Managing Director of the Nigerian National Petroleum Corporation. He is likely to become junior petroleum minister, taking the day-to-day running of the portfolio as Buhari has already said he will take the Oil Ministry himself. Kachikwu apparently lobbied for a policy role to push his ideas for reform of the oil and gas sector: these include privatisation of up to 51% of the NNPC's assets, including its four refineries. He was keen to go ahead with an early sale of the refineries but Buhari overruled this, we hear. The benefits of the new centralised control of the oil and gas industry is that it will make Buhari and Kachikwu directly responsible for reform and for ending the mind-boggling corruption in the sector: if that doesn't happen, Nigerians will quickly draw their own conclusions.

However, it makes it all the more important for the government to establish an independent regulatory authority for oil and gas, with full access to independent and detailed audits, to monitor the management of all the NNPC and corporate operations, both national and international, in the country.

Lieutenant General Abdulrahman Bello Dambazau (Kano), who has a British doctorate in criminology, was Chief of Army Staff during the delicate presidential transition from Umaru Musa Yar'Adua to Goodluck Jonathan. He represents not only an old-style military establishment keen to restore the army's prestige but the northern elite itself. It would be a surprise if he were appointed to any ministry other than Defence or perhaps Police Affairs.

Senator Hadi Abubakar Sirika is a long-time associate of Buhari's from his Congress for Progressive Change party and home state of Katsina. Aisha Jummai Al-Hassan narrowly missed out on being Nigeria's first female state governor in Taraba in the polls earlier this year and has a federal appointment as consolation. Nasarawa technocrat Jibril Ibrahim is one of the least 'political' choices, with a long history of technical achievement in surveying and administering land and property titles in the Federal Capital Territory and nearby. Abubakar Malami (Kebbi) is one of six lawyers on the list, alongside Oyo's Adebayo Shittu, Plateau's Solomon Dalong, Udo Udoma, Fashola and Al-Hassan, and could be a candidate for attorney general if the idea of fellow Senior Advocate of Nigeria Fashola as the country's chief prosecutor prompts too much protest from Tinubu.

However, the Federal Character algebra also leaves some possibilities out, which is of special concern when it comes to the under-weight economic team. Unless some states get two ministers, the talented and widely-tipped former Federal Inland Revenue Service Chief Executive, Ifueko Omoigui-Okauru, is marked out of the game by the inclusion of orthopaedic surgeon Osagie Ehanire from the same Edo State. In the same terms, Kachukwu's inclusion lessens veteran economic commentator Pat Utomi's chances of representing Delta. Then Ngige's appointment for Anambra slims the chances of former CBN Governor Charles Soludo, who had been a vocal critic of former Finance Minister Ngozi Okonjo-Iweala. Udoma's main value may in fact be political: as a PDP floor-crosser he can trump the most effective and well-funded opposition figure, Governor Godswill Akpabio, in his home state.

With portfolios yet to be allotted and at least 15 slots yet to be announced, a lot is yet to emerge. Those slots left empty for now include Kogi and Bayelsa, where hotly-contested state elections will soon take place and where ministers may be chosen in the light of the results. 

Copyright © Africa Confidential 2015

At last a cabinet, and now for the policies
Africa Confidential, Vol 6 No 20


President Muhammadu Buhari set out his governance and security priorities during a short address at his inauguration on 29 May.1 However, he failed to ensure that his chosen candidates won the most senior offices in the national assembly. This will make it harder for him to pass his reform agenda and increases the risk of policy delays. During his inauguration, Buhari:

  • Emphasised the curtailing of corruption, but pledged that there would be no “paying off old scores” 2 in an apparent attempt to reassure members of former president Goodluck Jonathan’s(2010-2015) administration that he would conduct a political witch-hunt;3
  • Criticised Nigeria’s record of governance, accusing politicians of behaving “like spoiled children breaking everything and bringing disorder to the house”.4 Buhari pledged to revamp the judiciary and revise Nigeria’s federal structures to improve the relationship between the federal government and states;5
  • Announced that the government would move its command centre for forces fighting Boko Haramfrom Abuja to Maiduguri (Borno State) to improve coordination and decision-making.6 Buhari also pledged to overhaul the security services’ rules of engagement to “avoid human rights violations in operations”.7Buhari announced that the federal government would continue to “invest heavily” in the Niger Deltaas the region’s amnesty programme ends in December.

There are, however, already questions about Buhari’s political acumen.8 His failure to announce a cabinet and fill key positions including secretary to the federal government (a key office as it is responsible for the effective implementation of government policies and programmes) has triggered popular concern that Buhari’s reform agenda has stalled before it even started.9

“Considering that this was Buhari’s fourth attempt at the presidency, I would have thought he would have a good idea who his personal staff like the chief of staff should be; he had people functioning in these roles during the campaign who he could appoint. Nigerians need to see and know that the government is moving.” 10

Much of this criticism is unjustified. Buhari had already warned that it would take several weeks to form a government. Discussions continue behind the scenes over key appointments, and Buhari has submitted a provisional list of names for security clearance.11 It also reveals a misunderstanding of Buhari’s character.

“Reports from insiders indicate that Buhari keeps a lot very close to his chest and is very much his own man. It would appear that Buhari’s reserve is mistaken for inaction.”12

Buhari is not prone to rushing decision-making.

“Buhari does not want to be rushed into making decisions; he is under an incredible amount of pressure from people either wanting their own appointments or offices for their preferred candidates. I don’t see the delay making appointments as a worrying sign but rather a desire to think things through logically and take time to consult.” 13

Once Buhari makes a decision, he is not liable to reverse it,

"There are only a few people who can persuade him once his mind is made up about something."14

There are, however, genuine concerns about the ability of members of Buhari’s All Progressives Congress (APC) to outmaneuver him. Buhari failed to ensure the victory of his chosen candidates for the position of senate president and house of representative speaker during their elections on 9 June. The senate elected Kwara Central (Kwara State) senator Bukola Saraki as its president.15 While Saraki is a member of the APC, he did not have the backing of the APC and required opposition People’s Democratic Party (PDP) support to win. Buhari was reportedly in a meeting with APC senators when Saraki engineered a vote by successfully arguing that the 57 senators present constituted a quorum. The APC leadership’s chosen candidate, Yobe North (Yobe State) senator Ahmad Lawan, was at the APC senators’ meeting, meaning Saraki was elected unopposed. Saraki, as a former governor of Kware State (2007-2011), was the founder of the Nigeria Governor’s Forum in 2007. Under former president Umaru Musa Yar'Adua (2007-2010), Saraki was influential as chair of the Nigeria Governor’s Forum.

“Saraki played a strong role in the Yar’Adua years and was influential on many policies, ministerial nominees.” 16

The House of Representatives on 9 June elected Yakubu Dogara, a PDP representative from Bauchi State, as its speaker.17 Dogara defeated APC candidate Femi Gbajabiamilaafter sufficient numbers of APC representatives ignored their party’s instructions to vote for him.

The appointments will make it harder for Buhari to pass his legislative agenda and his authority.

“Buhari will face considerably more wily political operators than Saraki within his inner circle. I am thinking especially of APC political godfather Raji Babatunde Fashola. You have Fashola maneuvering for a key behind the scenes position like chief of staff where publically he gets none of the criticism that Buhari will, but can keep pulling strings. You need to look at your history to understand Buhari’s position. Fashola was chief of staff to his predecessor as Lagos State governor Bola Ahmed Tinubu.” 18

Buhari has moved to temper expectations, claiming his age (72) means he needs additional support.19 This is a risky strategy if opponents use his age and public mistakes as a sign of weakness.

“Buhari has publically referred to the now defunct West Germany and Organization of African Unity. I certainly don’t think he’s senile or even an old man, it’s just that when on ‘autopilot’, he returns to his last administration 1983 – 1985.” 20

This article appears in Africa Risk Consulting’s Monthly Briefing on Nigeria. See website:

1 Punch NG, 29 May 2015.

2 Punch NG, 29 May 2015.

3 Punch NG, 29 May 2015.

4 Punch NG, 29 May 2015.

5 Punch NG, 29 May 2015.

6 Punch NG, 29 May 2015.

7 Punch NG, 29 May 2015.

8 Source, senior western diplomat, Lagos

9 Source, senior western diplomat, Lagos

10 Source, policy consultant, Nigeria

11 Source, investigator, Nigeria

12 Source, policy consultant, Nigeria

13 Source, policy consultant, Nigeria

14 Source, policy consultant, Nigeria

15 This Day, 9 Jun 2015.

16 Source, political analyst, Lagos

17 This Day, 9 Jun 2015.

18 Source, senior western diplomat, Lagos

19 The Guardian, 17 Jun 2015.

20 Source, political analyst


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