In recent security news, the 333 Artillery Barracks in Maiduguri, Borno was attacked by Boko Haram insurgents on 13 July. The Cable quotes military sources as saying that the insurgents stormed the town around 11:20 pm, firing shots into the barracks. The soldiers responded immediately but the insurgents had already surrounded the barracks, according to a source. The barracks is close to the Nigerian Air Force base in the city. Boko Haram had initially attacked some parts of the town before heading to the barracks and abducted some travellers on Maiduguri-Damaturu road. In Kaduna, at least 24 people have been killed and several others injured after gunmen attacked three communities in Zango Kataf LGA. While security authorities have not confirmed the incident, the Chairman of the local government, Hon. Elias Manza, says suspected Fulani militia first attacked Chibob village on Friday night and killed nine people with many others seriously injured and houses razed to the ground. He said similar attacks were carried out in Sabon Kaura village where 15 people were killed, with the third attack at Ungwan Audu village on Sunday night left several houses and farmlands burnt with many injured. Finally, two naval officers were killed on 9 July along the Abuja-Lokoja-Okene highway. The two naval officers, a male and a female, were shot dead at about 1800 hours. The attack, by suspected robbers, occurred five days after an Army captain was killed in the same location. The army captain, GSM Abubakar was killed on the same road while his mother and wife were reportedly kidnapped.

The office of the Nigerian Financial Intelligence Unit (NFIU) has been attacked and computers destroyed by unnamed persons who were allegedly plotting to frustrate the probe of the Economic and Financial Crimes Commission and the ongoing investigation of its suspended chairman, Ibrahim Magu. According to ThisDay reports, the NFIU office which is inside the Aso Rock Presidential Villa was burgled and at least seven computers containing sensitive financial information were taken away and others badly damaged in the attack believed to have happened overnight but discovered Friday morning. Some NFIU officials on Thursday appeared before Justice Ayo Salami’s panel, which is investigating allegations against Magu. The panel had also requested for the transaction history of a Kaduna-based bureau de change, sources told TheCable as the BDC which allegedly has links to the suspended EFCC boss, has recently transacted businesses worth over ₦500 billion in different currencies — ₦336 billion, $435 million and €14 million. However, the NFIU officials told the panel that by operational protocols, they don’t go about with sensitive documents. The officials then advised members of the panel to visit their office Friday morning, to sight the documents requested for. However, before the panel members got to the NFIU office in the morning, the room where the documents were kept in computers was broken into. NFIU was only recently severed and is the agency that investigated all the allegations of financial malfeasance against Magu. The Director-General of NFIU, Modibbo Hamman-Tukur, met with President Muhammadu Buhari to report the incident, a situation sources said, resulted in the president’s decision to approve Magu’s suspension. Meanwhile, the panel, led by Ayo Salami, former president of the court of appeal, was also told that an unnamed Lagos-based pastor who is very close to Magu has ₦573 million in his bank account. The pastor will be invited by the panel for questioning.

The Federal Government has come under criticism in recent times for a rising debt profile, which stood at ₦28.63 trillion as of Q1 2020, according to the National Bureau of Statistics (NBS). The nation’s data body says ₦3.69 trillion was incurred last year alone. External debt stood at ₦9.99 trillion (34.89 per cent) while ₦18.64 trillion or 65.11 per cent was domestic debt. Observers note that the size of the domestic debt stock may adversely affect private-sector borrowing. Most states, like the Federal Government, have adjusted their 2020 budgets, in response to the COVID-19 pandemic and its impacts on revenues. But even with the adjustment, no state wants to bite the bullet and roll back expenditure to suit lean income profiles. A ₦5.37 trillion (almost 50 percent) deficit billed to be funded by “domestic and foreign borrowing” in the just-signed 2020 national budget may push the economy to the precipice. In another fiscal development, the Central Bank of Nigeria has stopped the processing of Form M, a mandatory documentation process aimed to monitor goods brought into Nigeria, for the importation of maize or corn into the country. The CBN on 13 July directed banks and those permitted to trade foreign exchange in the country to stop processing the document, which was created by the Federal Ministry of Finance and the financial regulator, to also enable the collection of import duties where applicable to the imported goods. Explaining the rationale behind this directive, the bank, in a circular signed by its director in charge of the Trade and Exchange Department, O.S. Nnaji noted that it was to boost local production of the farm product.

African Union-conciliatory talks to end the long dispute among Egypt, Ethiopia and Sudan over Ethiopia’s Grand Renaissance dam project have ended without an agreement. Competition for the Nile Basin’s freshwater has been growing markedly for three decades with the negotiations over the Grand Ethiopian Renaissance Dam in Ethiopia have again foundered over the pace at which the country plans to fill the 74 billion cubic meter reservoir, stoking Egypt’s concern that it will lose control over its water supply to a regional upstream rival. According to sources, the countries and mutual neighbour Sudan submitted final reports to the African Union-led by South Africa, on Tuesday. The talks, Egypt’s Irrigation Ministry said, had concluded with continuing differences on the main issues regarding the filling and operation of the dam. The Horn of Africa nation has asserted what it says is its right to fill the reservoir, which is associated with a 6,000-megawatt power plant, at its own pace. However, Egypt regards an agreement as crucial before damming can begin. This is even as the Ethiopian Prime Minister Abiy Ahmed stands to lose support at home if he doesn’t move ahead with filling the dam, which he describes as vital for the nation’s economic development. In a letter dated 29 June to the Security Council, Egypt vowed to “uphold and protect the vital interests of its people” as it would see any unilateral filling as a threat to regional peace and security.


  • The attack on the military base is one in a long line of attacks on bases in the region by Boko Haram. But beyond that, taken together with the attack on travellers along the Maiduguri-Damaturu Highway, it creates a lot of uncertainty along the only free route into Maiduguri. An increase in terrorist activities along that route will mean that Maiduguri could be cut off along all land routes, leaving it only the option of air transport. More than that, it will mean further ceding of a large expanse of territory to the terrorists. While the terrorists will still be able to lay claim to these territories as theirs, the Nigerian government will be unable to govern, effectively making those areas stateless. These, and the apparent targeting of military personnel deep inside Nigeria’s Middle Belt, are clear evidence of deteriorating insecurity across the country. It does appear that the Abuja-Lokoja-Okene Highway is joining the Abuja-Kaduna Expressway as a hotspot of robberies and kidnappings. The Abuja-Lokoja-Okene route is, at the moment, the most viable and traversed land link between Abuja and Lagos. If urgent actions are not taken regarding this, it will increase the costs and risks of travelling along that route, which will have a knock-on effect on the economy at a time when it can ill afford additional pressure.
  • The attack on the NFIU’s office adds a new twist in what has become Nigeria’s biggest corruption scandal in recent years, or maybe ever. There is no way this incident can be divorced from the ongoing investigation of the embattled EFCC chairman – one now complicated by the President’s suspension of the agency’s directors, including those working with the Attorney-General of the Federation’s Office. While there are undeniable political undertones to this investigation, the attack on the NFIU and destruction of computer equipment creates the impression of evidence being destroyed in order to make convicting Mr Magu harder. While we think that it is unlikely that this burglary will seriously impede the work of the panel investigating Mr Magu, the situation should be watched closely, especially after the President suspension of the EFCC’s directors, in a bid to ensure that there are no roadblocks to the investigation as well as a show of political will to bring this to a conclusion. However, more than the political theatre surrounding Mr Magu, the burglary raises questions about how secure the presidential complex is if the NFIU office located within it can be burgled without any clues as to who is behind it. This is the second breach of security in the presidential villa in a few weeks. Three weeks ago, shots were fired during an altercation between the First Lady and the President’s Personal Assistant, an incident in which the perpetrators have been reinstated into their positions. It is of utmost importance that this breach of the security of the complex is investigated thoroughly, and end with not only having the perpetrators brought to book but ensuring all loopholes in the security are covered. This absence of consequences emboldens those who do not respect the sanctity of even the most secure locations in the country even in the middle of very public investigations.
  • Nigeria’s elite continually demonstrates a lack of ability to assess a crisis and react in a way that will ensure the survival of the country, and the elite themselves. For years local and international analysts have raised the alarm at Nigeria’s low revenue collection rate relative to the size of the economy. Rather than take concrete actions to ramp up revenue collection, successive governments have opted for the easier option of borrowing to fund its thirst for unsustainable petrol and electricity subsidies, and the CBN has become more militant and continues to hem and haw at imports which has also served to make life harder for the majority of Nigerians while the elephant in the room remains in an ill-advised bid to manage the FX demand. The current economic crisis has had a significant impact on oil revenues which has caused state governments to pile pressure on the CBN to adjust the official USD/Naira exchange rate and thus increase revenues. This move, however, puts pressure on the government’s ability to service existing foreign debt or offset them at maturity. Nigeria’s Gross Domestic Product for the second and third quarters of 2020 is projected to be negative, according to new government figures. Going by that, the country’s government said Nigeria is heading for another recession in both quarters 2020. This will be the second recession in four years. On the maize matter, we are unsure that anyone is complaining of maize/corn glut so not exactly clear why the CBN wants to “protect maize farmers”. The data shows that Nigeria is already pretty self-sufficient in maize production. This policy, however, is likely to end up raising costs for poultry farmers – another catalyst for already high food inflation. Maize currently sits at ₦160k per ton and given the double whammy of COVID and the security situation Nigeria is going to experience a lower harvest in maize and soybeans. (as a lot of farmers could not plant coz of COVID), and at harvest, the big companies will be unable to import to cover this projected shortfall, driving up the prices. Already, yesterday, the Maize Association of Nigeria announced that the production of maize in Nigeria could drop by 25 percent this planting season. What follows is Economics 101: maize becomes scarce because demand is higher than supply, prices skyrocket, prices of chicken feed go up, chicken prices go up, egg prices follow, then inflation. It appears that the main driving goal of policymakers is to manage the FX rate to continue to score political points, as opposed to making the policy choices that enhance the wellbeing of the majority of Nigerians. Of course, ultimately, the FX rate moves, but not before Nigerians have their expenses permanently increased by the policies and defenders of said policy dig in even in the face of data showing it is not the optimal policy choice.
  • With the absence of an agreement, Ethiopia began filling the Grand Renaissance Dam on Wednesday in keeping with a decades-long schedule. This comes after several botched trilateral agreements. The disputes over the Nile are along two technical lines: drought mitigation measures and dispute resolution measures. Although Ethiopia’s proposed timetable to fill the dam in 5 – 7 years given average yearly rainfall has been accepted by Egypt and Sudan, the contention appears to centre around the drought mitigation strategy, which would require Ethiopia to service the other countries with water should there be a drought, a proposition Ethiopia has rejected. On dispute resolution, Egypt’s tone has been very conciliatory and it has proposed that should there be a need for dispute resolution in future, aggrieved parties can seek redress from the African Union (AU) through to the United Nations Security Council (UNSC). For Ethiopia, it was important for the three countries to address their dispute and if that fails the AU could arbitrate. At Cairo’s invitation, the US and World Bank were invited to be part of the negotiations, which remained unsuccessful as Ethiopia rejected the draft agreement. Sudan has played a key role during these negotiations as it prepared a draft agreement which was submitted to the AU. In putting together this draft agreement, each country suggested an independent observer, with Sudan choosing the EU, Egypt choosing the US, and Ethiopia choosing South Africa, which is leading the mediation on the behalf of the AU. This dispute is clearly not an engineering or hydrological one. Even though Egypt continues to maintain that Ethiopia cannot fill the dam without an agreement, this appears not to be the case according to international law. On the legal front, filling the dam would only constitute a violation if it creates significant harm to downstream nations. However, in this case, there appears to be no such harm, and Egypt and Sudan would be hard-pressed to find a legal solution to the problem as this is a political disagreement. Even with international pressure, Ethiopia looks set to continue with its timeline to fill the dam in July. Ethiopia believes Egypt’s fear that filling the dam would be detrimental to the follow of the Nile is unfounded, citing heavy projected rainfalls this year as an important motivation for its desire to start to fill the dam. Ethiopia seems to believe that the delay to reach a new agreement should not in any way affect its timetable, which it believes was covered under the previous agreement which permitted the dam’s construction in the first place. While armed conflict remains a remote prospect at the moment – some fringe Egyptian voices are openly calling for a military confrontation with a neighbour which it lost to the last time they went to arms in 1874 over control the Blue Nile – the stakes are too high to be ignored; regional and international partners should prevail on all affected parties to arrive at a sensible solution that works for everyone. The peace and prosperity of the Horn of Africa, historically an unstable region even by African standards is riding on it.