Nigeria’s government announced restrictions on 50 high-profile Nigerians, who it accuses of engaging in corrupt activities, preventing them from travelling abroad without any legal basis and a judicial authorisation on 13 October. The individuals, whose identities were not disclosed in a statement signed by presidential spokesman Garba Shehu, include those whose assets are valued at ₦50 million and above who are the subject of a corruption investigation or litigation. Shehu said the measure is part of the implementation of Executive Order Number 6 which seeks to ensure “that all assets within a minimum value of ₦50 million or equivalent, subject to investigation or litigation are protected from dissipation by employing all available lawful means, pending the final determination of any corruption-related matter.” He added that the financial transactions of these ‘persons of interest’ will be monitored by relevant agencies.
The Federal Government is ready to offer more of its assets for sale under the ongoing privatisation programme aimed at raising more money to implement the country’s 2018 deficit-based budget. Last month, the Nigerian Security Printing and Minting Company Limited was offloaded, with the CBN, already has a majority stake, emerging as the preferred buyer, given the national security implications of selling the company. CBN Governor, Godwin Emefiele, said that the Ajaokuta Steel Company of Nigeria is on the cart, first for a total review of the privatisation process and an eventual sale.
New data from the Nigerian Bureau of Statistics shows that inflation stood at 11.28 per cent in September from 11.23 per cent recorded in August on a year-on-year basis making this the second consecutive month of inflation rise after 18 consecutive months of decline. “On a month-on-month basis, the headline index increased by 0.84 per cent in September 2018, down by 0.21 per cent points from the rate recorded in August 2018 (1.05) percent,” the NBS said. “Urban inflation rate increased by 11.70 per cent (year-on-year) in September 2018 from 11.67 per cent recorded in August 2018, while the rural inflation rate increased by 10.92 per cent in September 2018 from 10.84 per cent in August 2018. The increase in food inflation was caused by increases in the prices of potatoes, yam, vegetable, fruits, meat, milk, cheese, egg, bread, fish and cereals. The Pastoral Conflict, and most recently, flooding in some parts of the country, have resulted in a drop in food production.
Niger Republic, through its shippers council, has opted to use seaports in the Republic of Benin and Ghana due to better reliability and efficiency of both as compared to Nigeria. The country, which still has an MOU with the Nigerian Shippers’ Council to ship transit cargo through Nigeria, now prefers to work with both countries. The Executive Secretary of the NSC, Hassan Bello, cited a number of hindrances shipping transit cargo through Nigeria, many of which have remained a major problem with the Lagos ports. Some of the issues raised are the lack of commitment on the part of the Nigerian Shippers’ Council to over-turn the amount of time wasted in positioning containers and processing documents, a lack of automation of processes, lacklustre and poor attitude of operators and government agencies to work towards customers, high port charges and inadequate improvement to existing infrastructure.
- The timing, wording and possible intent of the order banning some individuals from outside travel is puzzling when consideration is given to a few things. In practice, people under trial for corruption in Nigeria are already subject to passports seizures and the judicial approval of travel. The ban is also on very shaky legal ground – in 1999, the Supreme Court ruled in a case involving the Department of State Security that the Constitution protects the right to go abroad (under the freedom of movement clause) from executive interference which is not supported by an enacted law. The Executive Order 6, on which the travel ban is made is a mere executive directive and not an enacted law. In addition, it flies in the face of Justice Ojukwu’s judgement last week, who while upholding the constitutionality of the executive orders held that its powers must be exercised in accordance with the Constitution and pursuant of the orders of a competent court. On the political plane, Its issuance so close to elections speaks to a possibly punitive political intent that is unlikely to be ignored. Put simply, this ban overreaches, accomplishes nothing and is yet another blot on the administration’s stated commitment to the rule of law.
- On the proposed asset sale, a key performance indicator for corporate entities is the return on assets which compares the profit the company is generating to the capital it invested in assets. Whilst it is difficult to use this indicator to assess public sector companies, it is fair to assume that the use of assets to generate monetary and social returns in Nigeria is very poor. We, therefore, encourage the government to step up the ongoing drive to offload idle assets and generate funds for investment in more critical sectors.
- As the impact of base effect on inflation finally gives way, the impact of the various policies of the government on food production and importation, which has always kept food inflation high, is starting to have an effect on headline inflation numbers. SBM has repeatedly warned that the handling of the Pastoral Conflict would affect food prices and this has proven to be the case. Nigerians are not only getting poorer, but the key component of their expense basket is getting more expensive – a double whammy which will have political and social consequences in the medium to long term.
- We daresay that if the Nigerian Shippers Council had their way, they would circumvent shipping via Nigeria like Niger has done. From a geographic perspective, Nigeria is positioned to be the transit cargo shipment hub of West and Central Africa, serving most of the landlocked countries of the Sahel. But Nigeria is unable to efficiently handle its own domestic logistical needs, so talk of regional transshipment is moot at this point. While Nigeria has the largest economy in the region and will remain so for the foreseeable future because of its sheer size, as more countries take the decision to circumvent Nigeria in facilitating trade, the country will lose out on the positive network effects of creating and operating an intercontinental trade network like Belgium and Germany, thereby losing value for the citizens and the government. As long as Nigeria continues to measure port performance merely by revenue and not the speed and quality of customer service, the incentive to improve will not arise.