The Central Bank of Nigeria (CBN) governor, Mr Godwin Emefiele, says maintaining stable exchange rate to avoid depreciation of the Naira is better than building foreign reserve buffers.
Emefiele told newsmen on Sunday that this was part of the outcome of the Nigerian delegation’s meetings with investors and institutions at the International Monetary Fund (IMF) and World Bank Group (WBG) Annual Meetings in Bali.
He said that all frontiers and developing markets have suffered not just depreciation, but had also lost reserves.
“We are very conscious of the need to build buffers but unfortunately I must say that we are in the period where it will be difficult to talk about building reserve buffers.
“We can only build reserve buffers if we want to hold on to the reserve and then allow the currency to go, and wherever it goes is something else.
“So it is a choice we have to make and at this time the choice for Nigeria is to maintain a stable exchange rate so that businesses can plan and we do not create problems in the banking system assets.”
According to him, like other emerging markets nations, Nigeria has also lost reserves but only marginally because it had managed to sustain stability in its foreign exchange market.
The CBN governor said that the IMF and the World Bank advised that nations should build country specific policies and fiscal and structural reforms that would boost economic growth.
Mrs Zainab Ahmed, Minister of Finance, said the World Bank’s Human Capital Development Index (HCI) ranking, which placed Nigeria low at 44 per cent on stunting, was disheartening and depressing.
She, however, said that the Federal Government saw the rating as a wake-up call.
“We admit that this pervasive action was due to long years of under-investment in human capital, which we have before now realised and for which we have been addressing.
“Apart from major policy actions, some decisive actions are being taken to address the situation.”
According to her, the delegation held meetings with the two rating agencies-Fitch and Moody’s and presented to them the summary and synopsis of the recent economic and financial developments in Nigeria.
She added that it was an opportunity for the rating agencies to be able to objectively evaluate Nigeria’s credit.
Ahmed said she also met the IMF Managing Director, Ms Christine Lagarde and discussed Nigeria’s economy in view of the 2019 general elections.
She assured Lagarde that the election year would not pose any threat to the nation’s economic prospects.
Mr Udoma Udo Udoma, Minister of Budget and National Planning, said that to improve HCI, the nation had improved budgetary allocation to health and education.
He said that allocation to education moved from N22.5 billion in 2015 to N102.9 billion in 2018.
He added that allocation to health was reviewed from N26.6 billion in 2015 to N86.49 billion in 2018.
He said also that N55.19 billion had been added to the health budget in 2018 through the National Health Act.
The World Bank and IMF have endorsed Zimbabwe’s plan to clear more than $2 billion in foreign arrears, the finance minister said, adding that the lenders had also backed his two-year economic recovery programme.
President Emmerson Mnangagwa has promised to revive the struggling economy, pay foreign debts that the country has defaulted on since 1999 and end Zimbabwe’s international pariah status gained under Robert Mugabe’s near four-decade rule.
Finance Minister Mthuli Ncube, who is attending the International Monetary Fund (IMF) and World Bank meetings in Bali, Indonesia, said in a statement his plans to clear the arrears to the World Bank, African Development Bank and European Investment Bank had been accepted.
“All the cooperating partners and creditors present uniformly expressed their support for Zimbabwe and its arrears clearance Road Map,” Ncube said. He did not give details and none of the creditors had an immediate comment.
The lenders and Western donors urged Ncube to “judiciously” implement his two-year economic recovery programme announced last Friday, the statement said.
Ncube’s plan will see cuts in government spending and its wage bill, and privatisation of loss-making state-owned firms.
Zimbabwe, which adopted the U.S. dollar after hyperinflation left its own currency worthless in 2009, is gripped by acute shortages of cash dollars. Prices of basic goods and medicines have risen in the last few days.
At the heart of its economic problems is a $17 billion domestic and foreign debt, a $1.8 billion trade deficit that has worsened dollar shortages and lack of confidence in the ruling party by citizens still traumatised by hyperinflation.
Prices of basic goods, medicines and drugs, building materials and public taxis have risen by at least 50 percent in the last week.
The economic crunch is increasing political tension after a July vote that was supposed to lay the foundation for Zimbabwe’s recovery was instead followed by turmoil that left six people dead after an army crackdown.
The latest crisis was triggered by fiscal and monetary changes announced on Oct. 1, including a 2 percent tax on money transfers and separation of cash dollars and foreign inflows from bond notes and electronic dollars, that caused the collapse of the surrogate currency on the black market.
When the changes were announced, $100 in bond notes was worth $49 cash dollars but was worth only $26 on Wednesday.
In a separate statement, Ncube said the bond note and electronic dollars would remain officially pegged at 1:1 to the U.S. dollar as the government seeks to protect people’s savings.
He said the government would also gazette rules protecting foreign dollar inflows to ensure the money was not taken by the central bank or government, good news for mines outraged by the U.S. dollar shortages.
On Wednesday, some shops and restaurants, including the local franchise of fast-food chain KFC had closed their outlets because some suppliers of goods and medicines were demanding cash dollars. – Reuters
Informal settlements continue to remain a significant component of many cities in the developing world. UN Habitat describes them as lacking security of tenure, not having durable housing and short of basic services. Globally, almost one billion people are hosted in informal settlements. This is expected to increase to 1.5 billion by 2020.
In sub-Saharan Africa, about 60% of all urban residents reside in slums and their level of deprivation is considered to be comparatively severe. In view of the recent urbanisation trends on the continent, much of the projected urban population growth is expected to be absorbed by slums.
In spite of this reality, slum dwellers continue to be marginalised, brutalised by the state and forcefully evicted. They are also frequent victims of demolitions and displacements. However, slums are critical for the future wellbeing of many urban residents across the continent because they provide a refuge.
This is true in Accra where close to half of the city’s population live in informal settlements.
In this article, we shed light on the broader dynamics of urban housing, and the rental regime that has pushed many people into the informal settlements. We argue that slums are more than just marginalised spaces of abject poverty and neglect.
Accra’s housing crisis
Housing in Accra is something of a paradox: a boom in supply for the wealthy, and scarcity for those at the lower ends of the income strata.
According to the Ghana Housing Profile, 60% of all urban households in Ghana occupy single rooms. Only 25% of households own a house. The remainder either rent or live rent-free in a family house. Urban housing is also regarded as very expensive.
Because of a lack of affordable, decent and secure shelter for the low-income population it’s generally accepted that there’s a housing crisis in the Ghanaian capital. This crisis was instigated by the withdrawal of the state as an active provider of housing.
The state withdrew following the adoption of the World Bank and International Monetary Fund’s structural adjustment programs introduced in the 1980s. At that point market-led policy became the mainstay in housing provision. The private rental housing market was commercialised resulting in a boom in profit-driven housing production that targetted high-income residents.
Exclusive apartments, gated communities and high-end residential units mushroomed across the poorly controlled housing landscape.
Can upgrading slums help solve the crisis?
About 45% of Accra residents live in some form of slum housing. These areas are overcrowded, have limited access to piped water and poor sanitation facilities. But this is only part of the picture. Slum housing means more to local residents than the stereotypical depictions of deprivation and poverty.
Urban slums like Old Fadama allow many people to escape the near homelessness that Accra’s housing crises creates.
Old Fadama is the largest informal settlement in the city of Accra. In media and political circles it is often cast as dystopian. But for many it’s the one of the few places they can be assured of access to cheap and alternative housing while still remaining close to core services in the city of Accra.
This informal settlement sits on public land that was initially acquired by the Government of Ghana for the Korle Lagoon Ecological Restoration Project. The project was abandoned and the land remained undeveloped until the 1980s when the informal settlement began.
Since then the population has grown substantially. Between 2004 and 2007, for instance, the population doubled from 24,000 to 48,000. The most recent data suggests that nearly 80 000 people now live in the area.
This exponential growth can be attributed to the fact that Old Fadama provides cheap, centrally located housing. Moreover, not all housing is substandard. Relatively better-quality houses can be found in unplanned areas at more affordable prices than other areas in Accra.
Old Fadama is an entry point to basic housing for those in both low-paid formal and informal employment. For many in this slum, access to cheap housing in the city’s economic heartland has made it possible to capitalise on their capabilities, and enabled them to try and move out of poverty.
Policy and project experimentation
There’s an urgent need for targeted interventions around slum housing in Accra. Fortunately, the 2015 National Housing Policy, and the newly established Ministry for Inner City and Zongo Development, are good starting points. Both emphasise support for the urban poor and low-income housing.
Additionally, civil society groups are experimenting with collective self-help housing– such as the Amui Dzor Housing and Infrastructure Project implemented by the Ghana federation of the urban poor in collaboration with the government and UN Habitat– for low-income groups. In view of this, we suggest that there is a need to combine policy support with project experimentation for house improvement in urban slums.
This should be considered as part of a housing program that involves state leadership in providing ‘real’ affordable housing. There is also a need to provide funds for social housing, enforce regulation of the rental market, and support the informal housing sector. This would add up to a solid commitment towards every citizen’s right to decent, secure and affordable housing.
Seth Asare Okyere, Assistant Professor, Division of Global Architecture, Graduate School of Engineering, Osaka University; Jerry Chati Tasantab, PhD Candidate, School of Architecture and Built Environment, University of Newcastle, Australia, and Matthew Abunyewah, Casual Academics and PhD Candidate, School of Architecture and Built Environment, University of Newcastle
Shipping goods to Nigeria by sea from the United States can leave a big hole in your pocket.
Analysis on overseas cargo and freight costs by MoverDB, an online resource for international shipping, shows that the cost of shipping both 20-foot and 40-foot containers to Lagos ports from New York is the most expensive globally. The report covers the shipping costs from New York and Los Angeles to 47 port cities globally.
The high costs of shipping to Nigeria do not correlate with distance. For instance, shipping from New York to Nigeria is nearly double the cost of shipping to South Africa even though Nigeria is closer, by nautical miles, to New York compared to South Africa.
|Port city||20-foot container (from New York)||40-foot container (from New York)|
|Zayed (United Arab Emirates)||$1,723||$2,572|
|Buenos Aires (Argentina)||1993||2975|
|Cape Town (South Africa)||2542||3795|
|Auckland (New Zealand)||2645||3949|
|Jeddah (Saudi Arabia)||3086||4606|
|Apapa, Lagos (Nigeria)||4982||7436|
Much of the high costs of shipping to Nigeria is tied up in entrenched inefficiency at its local ports. For starters, Nigeria has very few functional ports even though its economy—Africa’s largest—continues to rely heavily on imports. The slow pace of inspections and offloading of shipping arrivals means that congestion and bottlenecks are nearly perpetual in Nigeria’s biggest port in Apapa, Lagos. The ports’ inefficiencies have for years enabled and incentivized corruption from official and unofficial middle men promising to clear goods for a “fee”.
Last year, in a bid to ease import and export flow, the government launched reforms at the ports. The government worked to clear the ports of local touts who extort bribes and also mandated that the Apapa port run 24-hour operations. Yet, despite a federal executive order, neither measure has been fully implemented, according to a regular user of the port.
While the shipping prices in MoverDB’s report are accurate as of early 2017, anecdotal evidence suggests the reality hasn’t changed much since the reforms were introduced. Indeed, inefficiencies at the ports remained primed to allow clearing agents continue to play a key role in processing goods for importers while likely in cahoots with local customs officers. ”You can try to clear your container yourself but the problem is that customs will frustrate you. You have to go through an agent.” says the regular user, who asked not to be named as he still has to work with officials at the port.
Source: Quartz Africa
Twenty people have been arrested as police press a manhunt for Africa’s youngest billionaire who was kidnapped in Dar es Salaam two days ago, a minister said Saturday.
Mohammed Dewji, who at 43 is Africa’s youngest billionaire, was snatched by gunmen as he entered a hotel gym in Tanzania’s economic capital on Thursday morning.
“Up until now, 20 people have been arrested,” Interior Minister Kangi Lugola told reporters, without giving any detail on their identities. “Security forces are working day and night” to find him.
Officials have implicated the involvement of foreigners, saying he was taken by “whites”. Dewji is chief executive of the MeTL Group which operates in some 10 countries and has interests in agriculture, insurance, transport, logistics and the food industry.
According to Forbes, he is worth $1.5 billion (1.29 billion euros) and ranks 17th on the list of African billionaires. Between 2005-2015, he served as a member of parliament and in 2013, he became the first Tanzanian to grace the cover of Forbes magazine. Two years later, he was named Forbes’ Africa Person of the Year.
Dewji is also the main shareholder in Tanzania’s Simba FC football club.