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Nigeria’s economy: Preview of the week ahead

This week’s major risk event will be Thursday’s annual meeting at Wyoming where leaders from major central banks gather

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Nigeria's economy: Preview of the week ahead | News Central TV
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Lingering concerns over a global recession will continue influencing market sentiment in the week ahead, with world equities, emerging markets and riskier currencies in the direct firing line.

Although treasury yields are recovering from record lows, the movements in bond markets are poised to be closely monitored by investors.

In Nigeria, there will be a strong focus on the second-quarter GDP report which should provide fresh insight into the health of the Nigerian economy.

A disappointing figure is seen fuelling expectations over the Central Bank of Nigeria cutting interest rates. Markets are predicting growth of 1.8% during the second quarter of 2019.

READ: Will oil prices help or harm Nigeria’s economy in Q3?

Across the Atlantic, Dollar traders will be closely looking at July’s FOMC minutes for clues on the future pace of rate cuts. Market expectations over a September rate should rise if the minutes are presented with a dovish touch.

However, some are still questioning whether the Fed will move forward with further rate cuts given how US retail sales grew 0.7% in July and the latest job report suggested moderate growth. 

This week’s major risk event will be Thursday’s annual meeting at Wyoming where leaders from major central banks gather. If major central banks express a readiness to cut interest rates further and implement new quantitative easing programs, the mood across markets has the potential to improve.

READ: Gold: Positioned to thrive in low-interest-rate environment

Appetite towards Gold will be influenced by trade developments, the Dollar’s valuation and global growth concerns. The precious metal could still hit $1550 once bulls can secure control above $1530.

The views expressed in this piece are the author’s own and do not necessarily reflect News Central TV’s editorial stance.

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Op-Ed

Insecurity, Revolts and the Insurance Industry

In most cases, the corporate entities take on fire and burglary insurance for their buildings but more often, individuals never “insure” properties.

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In an industry that is yet to be fully grasped by the average Nigerian on the street, the insurance industry is pretty much uncharted and untapped territory. Yet, its place in a bustling city like Lagos, Nigeria’s commercial capital cannot be downplayed.

Its growing awareness has been triggered by the recent wave of awakening that swept across the country, beginning from Lagos.

It soon spread to other parts of the country and in diaspora, leading to a movement dubbed #ENDSARS.

This movement against police brutality championed by youth in one of the world’s most populous cities was a cry for every man, a conversation tha had been ongoing, although not taken to the streets in form of protests.

The month of October saw an unprecedented display of oneness and solidarity by the Nigerian youth, as they took to the streets, including notable places like Oshodi, Surulere, Alausa and the Lekki Toll gate demanding an end to police brutality.

Unfortunately, this movement was cut short on October 20, 2020, with the alleged shooting and sporadic killings taking place at the Lekki tollgate, now dubbed “The Lekki Massacre.”

NC Reports #Endsars Aftermath in Ikoyi

Like something out of a horror movie, what followed was widespread destruction, including looting and arson at notable malls, stores, bus parks, police stations, banks, as well as a prominent television station.

In most cases, the corporate entities had taken on fire and burglary insurance for their buildings but more often, individuals never “insured” properties.

In a highly religious country, the phrase “God is my insurance” is widespread. Ironically the big churches in the city of Lagos insure their buildings.

Now individuals who were caught in the crossfire of wanton destruction of lives and property have to start all over again. The loss of cars, stores, commercial goods and other property means that they have to begin to save up money to replace these valuables.

In case these properties were insured, individuals would have only had to make claims and receive reimbursements.

Are insurance companies doing their bit to ensure that people are adequately informed about the benefits and cost benefits of insurance? Does the poverty index play a critical role in the unacceptance of insurance in the country? Do these companies pay their “claims” to clients? Are insurance companies able to thrive in this sort of environment, especially with fraudulent claimants who want to use their insurance providers as a money-making scheme?

Christmas is here now. How are insurance companies dealing with pending claims which arose as offshoots of the #ENDSARSPROTESTS, inflation, ridiculous dollar to naira exchange rate, as well as the drunk driving episodes that characterise the Christmas frenzy and claims from insurance buyers?

What is it like for insurance sales in Nigeria? What is the terrain like? What is the insurance / insurable culture in Nigeria?

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As Burkina Faso Heads to the Polls

Burkina Faso goes to the polls on Sunday. As the country smatters under security challenges,threats from extremist groups could prevent people from casting their votes on the day of the election .

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Ahead of the Presidential and legislative elections on Sunday, amid escalating extremist violence that’s harvested over 2,000 persons this year and leaving millions of others distraught and displaced from their homes, the land of upright men finds itself at another epochal threshold of history.

When results of the November 2015 elections were announced, they were greeted with respite and excitement. 

Most Observers adjudged it as the most transparent and democratic ever in the country. They ushered in the first elected civilian leader in nearly 50 years, President Roch Marc Christian Kaboré.

Roch Marc Christian Kaboré_CreditAFP

Earlier in the month at a rally in the country’s second most populous city, Bobo-Dioulasso, President Kaboré who is seeking a second five-year term promised to continue fighting until his country is secure.

Since taking office five years ago, Kaboré has been blamed for his inability to secure one of Africa’s most hopeful democracies.

Many had hinged their hopes on improved living standards, enhanced health care system, trial of the corrupt leaders, equity and social justice.

Credit_DW

Burkina Faso is almost slipping into a humanitarian disaster due to the debilitating activities of various terrorist attacks linked to al-Qaida and JNIM militants from neighbouring Mali.

Eddie Komboigo, head of the Congress for Democracy and Progress (CDP) is his major challenger. He belongs to the party of former President Blaise Compaore. Compaore’s overthrow by a popular insurrection in October 2014 brought to a halt, an authoritarian phase that had dogged the country for decades. 

Komboigo explained that Burkina Faso was in a “catastrophe” and blamed Kaboré for being averse to the use of enhanced intelligence-gathering approach, dialogue, and a more diplomatic approach in the fight against terror.  

Burkinabe gendarmes sitting on their vehicle in the city of Ouhigouya in the north of the country. Credit_ ISSOUF SANOGO/AFP via Getty Images.

Under the slogan, “let’s save the country”, a third contender in the person of Zephirin Diabre, candidate for the Union for Progress and Change party (UPC) is running against Kaboré for the second time. Diabre who challenged Kabore in 2015 secured 30% in the polls. He wants the fractured nation to reconcile and present a formidable front against the gunmen. In his words, “you can’t fight the war and win it if you’re not united and together.”

For a country which had spent 49 of its 55 years of independence under military rule, if this election runs smoothly, it will be the second time in its history that an election proceeds without incident.

Electoral process in Burkina Faso

In a statement issued by the Spokesman for UN Secretary-General António Guterres, the UN Chief commended the Government, the political leaders and citizens of Burkina Faso for “upholding an atmosphere of mutual respect throughout the electoral process, despite the challenges facing the country.”

He further called on stakeholders to maintain this posture and ensure that the elections are conducted and decided in a peaceful and credible manner.

 The winner of the polls will need at least 50% of the total votes cast to win. While Kaboré is projected to be re-elected, the opposition seeks to split the vote, deprive the President of an outright win in order to form a coalition behind the strongest candidate for a second round. The National Independent Electoral Commission (CENI) spokesperson says election results should be out between 48 to 72 hours after the completion of the polls.

This election will be a major test for the nation’s nascent democracy and a failure to ensure a transparent and peaceful election will offer terror groups operating in the region more material for its nihilist propaganda against the state.   

A wave of attacks in recent weeks has already threatens the legitimacy of the electoral outcome in the country as large swaths of the country will be unable to exercise its franchise.  Denying a large number of voters this inalienable franchise delegitimises the process and undermines the winner’s acceptability.

Burkina Faso’s voter apathy saw less than 2 million voters representing 10 percent of the population determine the emergence of President Kaboré.

Areas subsumed in violence account for at least 400,000 voters. According to its electoral commission, over 160,000 new voters, especially young adults were unable to get registered.

In spite of violence, many still thronged out to support their candidates

The mass disenfranchisement of this demography who are mostly rural voters and young people equally dents the legitimacy of the election. Any chance that opposition groups contest the election result or Extremist groups exploiting divisions within the country may throw the country into another round of highly destabilising deadlock.  

In August an electoral code triggered a law that says, in the event of “force majeure” (unanticipated situations preventing the organisation of elections in part(s) of the country), the election may continue based on the results from polling stations that remain open.

This supposes that election results will be considered binding even if people are unable to vote in parts of the country.

That is not all, two years ago, the National Assembly changed the electoral code to prohibit the use of widely used ‘consular cards’. The card issued by the Embassy to Burkina Faso citizens registered in its jurisdiction serves as voter registration document.

This year however, citizens must switch to a national ID card or passport. For those who do not have any, a new passport costs as much as 110,700 CFA Francs and not everyone currently has these documents. These modifications may keep thousands of persons from voting.

Burkinabé denizens in hard hit areas are apprehensive about exercising their franchise as terrorist groups continue to warn them against voting. Few days ago, terrorists backed groups took credit for the murder of 14 soldiers in Oudalan province. Another attacker threw an explosive into a mosque in the capital, Ouagadougou where many were injured.

Read also Court Clears 13 for Burkina Faso Presidential Election

Although similar incidents should be expected around polling stations, against voters, passers, and against authorities, the country’s security network must be on alert to ensure that the radical elements do not dictate the tempo of the polls.

The deployment of significant military reinforcements to flashpoints, probable hotspots and strategic locations around the country may offer reprieve for many and see a slightly higher number thronging out to entrust their fate and lives in a process that may, in the next five years mean life or death for them.

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Welcome to Lagos Where We Fight Fire with Laxity

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Hypocrisy is the homage vice pays to virtue – François de la Rochefoucauld once quipped this in a salon in Paris many years ago. I dare say that is indicative of the way the richest state in Nigeria responds to fire emergencies; yet, we all call for reforms and “statism”.

The recent fire and other fires that have inundated lagos have shown that the fire service in Lagos needs a revamp and I put this at the doorstep of the state.

It has to be said that one of the vestiges of a modern society is a quick emergency response mechanism that is swift and reliable.

Ruddy Giuliani became a cult hero as result of his leadership shown during the September 11 incident in New York. He emboldened the fire fighters on ground, provided leadership at ground zero and was there on ground himself. Because New York had invested properly in their emergency response team, by the time the dust on September 11 settled, every child in America wanted to be a firefighter and the country rallied around them.

If we claim Lagos is a megalopolis and the city of all cities, I expect nothing less from Lagos. The case, as experienced in recent times, has been different. I see Lagosians more concerned about taking photos of burnt property for Instagram rather than saving lives. I see a mammoth, yet useless, sympathetic crowd that swells from side to side preventing emergency workers from saying lives. It is at times like these ones I loathe the citizenry’s disposition to emergencies the most.

I think Nigerians need to be trained on how to be useful during emergencies. What I see more often is a crowd hindering rescue efforts, leading to the loss of lives – in one case a police officer.

I have seen a fire fighting force that was ill equipped but continuously fought, gallantly, to put out the fire while eye witnesses resorted to the use of buckets of water to quench the fire.

We are not entirely a write-off because I have seen first responders equally working gallantly to put out a fire that gutted property worth millions of Naira in the heart of Lagos, the economic capital of Nigeria even though I didn’t see Governor Sanwo-Olu. Correct me if I am wrong, please.

It is shocking how a recently constructed big market doesn’t have a simple fire hydrant and that begs the question is Lagos really ready for a megapolis label?

It is easy for the government to slam taxes on citizens but the infrastructure of Lagos is similar to that of 18th century France. It is almost inconceivable that we do not have emergency fire provisions for some buildings, including, wait for it, government assets.

How many government parastatals have effective fire hydrants and fire blankets? Our safety culture is dead and we don’t have an active fire service because we have failed as a state to invest in emergency response infrastructure.

Don’t even get me started on the expensive apartments you live in in Ikoyi or Victoria Island. I’ll wager there isn’t any adequate emergency infrastructure on ground.

We keep playing with fire and when the same fire comes out to play, we, out of fear, forget everything else in a hurry. There is a litany of emergency woes staring at us stark in the face but we seldom learn from them.

As we say, God help us.

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