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Why President Buhari signed the Nigerian Financial Intelligence Unit Bill

President Muhammadu Buhari has appended his signature to the NFIU Bill.

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Nigeria’s President, Muhammadu Buhari, on Wednesday appended his signature to the Nigeria Financial Intelligence Unit Bill (NFIU); thereby making it an act of law.

The newly signed law establishes the NFIU as the central body (independent of all other anti-graft agencies including the EFCC), which will be responsible for the collection, analysis, and dissemination of financial intelligence reports to law enforcement agencies.

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As part of its responsibility to monitor all suspicious financial transactions in the country, the NFIU will also work in accordance with the global fight against money laundering and terrorism financing.

Speaking on the development, the President’s Senior Special Assistant on National Assembly Matters, Senator Ita Enang, told journalists that the NFIU will serve as the Nigerian version of the global Financial Intelligence Units (FIUs).

Prior to this time, the NFIU was domiciled in the Economic and Financial Crimes Commission (EFCC). It will now work as an autonomous unit, operating from the Central Bank of Nigeria (CBN).

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“The Act establishes the NFIU as a central body in Nigeria responsible for the receiving, requesting, analysing and disseminating of financial intelligence to agencies and other relevant authorities to enable the institutions act on same. The agency is an independent and operationally autonomous institution domiciled in the Central Bank of Nigeria.” – Enang

Background to the signing of the bill

President Buhari’s signing of the NFIU bill followed the earlier passage of the same bill by the National Assembly; a move that was widely celebrated by financial experts in the country.

Recall that the 2017 passage of the NFIU bill by the Nigerian senate helped to avert the country’s expulsion from the Egmont Group

As at the time the bill was passed by the lawmakers, Nigeria was already suspended from the Egmont Group due to the country’s failure to legally separate the NFIU from EFCC; and by so doing giving it the necessary independent status that it deserves.

Note that the Egmont Group is a united body of 155 Financial Intelligence Units (FIUs) which serves as the platform for the secure exchange of expertise and financial intelligence towards the fight against money laundering and the financing of terrorism. Nigeria joined the organisation in 2005, but was not granted full membership until 2007.

Why President Buhari signed the bill into law

The President signed the bill because it is beneficial to the country. As we reported earlier, Nigeria risked being expelled from the Egmont Group, a development that would have portended lots of negative implications for the country.

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Some of these negative implications are briefly discussed below:

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  • Negative implication on Nigeria’s fight against corruption, seeing as an expulsion from the global FIUs would have meant that the country would no longer have access to financial intelligence from sister agencies outside the country.
  • Nigerian banks would be unable to issue ATM cards by Mastercard and Visa.The banks’ card income will also take a hit, coming at a time when yields on money market instruments are dropping.
  • Banks may also have to access foreign trade lines and loans at a premium, making such funds slightly more expensive for them. This added cost will be in turn passed to businesses and customers.
  • E-commerce businesses in Nigeria would also be affected by Nigeria’s possible expulsion from the Egmont Group, seeing as their business models are primary online-based. In other words, they would be forced to rely on cash for transactions, which comes with higher processing costs. The expulsion could also throw a spanner in the Central Bank of Nigeria’s bid to improve financial inclusion.
  • Worst still, Nigeria’s possible expulsion from the Egmont Group would force Nigerians to rely on cash for transactions abroad in the absence of cards. This could then push the average Nigerian to the parallel market, seeing as official markets limit the amount of cash one can buy per quarter. Parallel market rates are more expensive than official rates. Nigerians spend a large proportion of foreign exchange on upkeep for their wards schooling abroad, hospital bills, and personal travel allowance. Pressure on the parallel market then leads to a depreciation in its rates. Parallel rates will become more expensive. This then makes regular transactions even more expensive for the average Nigerian.

Emmanuel holds an MSc. in International Relations and a B.A in Philosophy & Logic, both from the University of Ibadan. He is a communications professional. As a Lead Business Analyst at Nairametrics, he focuses mostly on quoted companies, their products/services, and the economy in which they operate. Emmanuel is also experienced in the areas of corporate communication, brand communication, corporate storytelling, public relations, business research, management/strategy, etc. You may contact him via his email- emmanuel.abara@nairametrics.com.

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Coronavirus

How to access CBN’s healthcare grant

The disbursement under the Scheme shall be made to beneficiaries in tranches subject to approved milestones achieved.

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The Central Bank of Nigeria (CBN) has issued the guidelines to its Healthcare Sector Research and Development Intervention Scheme (HSRDIS).

The grant was designed to help strengthen the public healthcare system with innovative financing of research and development (R&D) in new and improved drugs, vaccines and diagnostics of infectious diseases in Nigeria.

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This was disclosed by CBN via its site in Saturday and seen by Nairametrics. The guideline stated that the HSRDIS is designed to trigger intense national R&D activities to develop a Nigerian vaccine, drugs and herbal medicines against the spread of COVID-19.

It stated, “It would also curb any other communicable or non-communicable diseases through the provision of grants to biotechnological and pharmaceutical companies, institutions, researchers, and research institutes.

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The Scheme is intended to boost domestic manufacturing of critical drugs and vaccines to ensure their sustainable domestic supply and reduce the bulk manufacturing costs of the drugs, herbal medicines and vaccines in Nigeria.

READ MORE: FG to reduce raw materials import by N3trillion

Source of fund

According to the apex bank, the Scheme shall be funded from the Developmental Component of the Micro, Small and Medium Enterprise Development Fund (MSMEDF).

Grant Limit
While Research activities would not access more than N50 million, development/Manufacturing activities will access more than N500.0 million.

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CBN emphasised that the disbursement under the Scheme shall be made to beneficiaries in tranches subject to approved milestones achieved.

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READ ALSO: Fidson’s plan to dominate the pharmaceutical space in the next 10 years

Timeframe

Timeframe given to research activities was not more than two years from the date of release of fund and Development/Manufacturing activities are not more than one (1) year from the date of release of fund.

Who is eligible:

Candidate vaccines undergoing pre-clinical testing or trials shall not be
eligible for consideration under this Scheme.

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But candidate vaccines undergoing clinical testing or trials shall be eligible for consideration under the Scheme if considered to have high potential to cross the clinical trial stage and prospects of scale by the Body of Experts (BoE).

It stated, “In applying for the grant, the applicant shall be required to have conducted pre-clinical testing of the candidate drugs, herbal medicines and vaccines, and obtained certification from relevant health authorities for further research and development.

“Special consideration shall be given to candidate drugs, herbal medicines and
vaccines with high scientific merit against emerging infections and contribute to the development of the Nigerian vaccine.”

Modalities

The applicant(s) shall submit its application, with relevant documentation of validation from relevant health authorities, trial results, patent registration details (if any) and development timetable to the Body of Experts (BoE).

“The BoE shall evaluate applications and recommend to the CBN. CBN shall review for documentation adequacy and completeness.

“Upon approval, the approved grant sum shall be released to the applicant’s
account with any PFI of his/her choice. The beneficiary shall submit periodic progress report on the project to the CBN.

“The CBN shall have proprietary right over all financed R&D outcomes or
products. Equally, licensing protocol for the mass manufacturing of developed
drugs, phytomedicines and vaccines shall be defined by the BoE in accordance with
the World Health Organisation’s current Good Manufacturing Practices (cGMP),” it added.

 

 

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Business News

Possibilities of a second wave of COVID-19 infections Limits U.S dollar gains

American dollar ended the week cumulatively lower as the possibilities of the second wave of COVID-19 pandemic limited its upside. 

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Possibilities of a second wave of COVID-19 infections Limits U.S dollar gains

The American dollar index closed on Friday up at 0.18% to 96.93.

However American dollar ended the week cumulatively lower, for a third straight week, as uncertainty about America’s economy limited its upside.

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The uncertainties about the economic outlook and the possibilities of a second wave of COVID-19 infections had capped the greenback’s gains, Chuck Tomes, portfolio manager at Manulife Asset Management said in an interview with CNBC.

What is the importance of the dollar index?  The American Dollar Index tracks the U.S dollar strength relatively against a bouquet of other major currencies around the world, such as (Japanese yen, Euro, British pounds sterling, Swedish krona, Canadian dollar, Swiss Franc).

(READ MORE: Again, U.S dollar slumps against major currencies, investors become optimistic about global demand)

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Nigerians hoping to meet foreign exchange debt or payment obligations, transactions via the U.S dollar to countries like France, United Kingdom, Australia, Germany Japan, would have the need to pay fewer dollars to fulfill such transactions.

“Today you’ve seen better-than-expected economic data coming out of the U.S. in terms of the jobs numbers.   

“The reaction on the back of that has been expectations of better growth coming out of the U.S. as well as a steepening yield curve, both of which have provided a lift to the dollar.” Chuck Tomes added.

Possibilities of a second wave of COVID-19 infections Limits U.S dollar gains

However, some currency analysts in a report to CNBC said the good macroeconomic gains recorded on Friday in America might not be repeated soon.

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“While this was no doubt a great jobs report, a lot of good news was already priced in. Future estimates and expectations on the economic rebound are likely higher from here and therefore harder to meet or beat,” said Matt Miskin, co-chief investment strategist at John Hancock Investment Management. 

Patricia

 

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Business News

NPA to receive shiploads of petroleum products and food items in Lagos port

Among the expected items to be received are frozen fish, base oil, general cargo, bulk salt, bulk clinker, butane gas, bulk wheat and soya beans.

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Nigerian Ports Authority, NPA, Hadiza Bala-Usman, Maritime, Ports, Badagry deep seaport, NPA, LADOL collision intensifies, as they throw counter-accusation over contract 

The Nigerian Ports Authority (NPA) will receive 16 ships laden with petroleum products, food items and other goods over the next 14 days.

According to its publication, `Shipping Position,’ which was released on Saturday, the receipts of the shipment will last from June 6 through June 20.

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According to the publication viewed by NAN, the ships are expected to arrive at the Lagos Port Complex.

Among the expected items to be received are frozen fish, base oil, general cargo, bulk salt, bulk clinker, butane gas, bulk wheat and soya beans.

READ ALSO: NPA and BUA Group dispute to affect 1000 jobs, $500,000 monthly revenue 

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The NPA also noted in its publication that 23 ships had arrived the ports, waiting to berth with containers, general cargo and petrol, while 17 other ships were at the ports discharging containers, petrol, butane, bulk fertilizer, bulk wheat, general cargo and frozen fish.

What you should know

When the World Health Organisation declared COVID-19 a pandemic, and several industries started shutting down, the Nigerian government took the decision to leave Nigerian ports operation in line with stipulated guidelines.

This was done to prevent further contraction in the economy, as the economic implications of shutting down the seaports in an import-dependent economy were considered unsavory.

READ ALSO: NPA Decommissioning of Port Harcourt Terminal: We’ll vigorously defend, protect our rights – BUA Group

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The government decided that, just like the food and healthcare sectors, the ports were to be considered essential too since there was a need to keep a steady import of foods, refined petroleum products, raw materials for the local industries, finished consumer goods and most importantly, drugs for the healthcare system.

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Managing Director of the NPA, Hadiza Bala-Usman, also suspended applicable terminal storage fees on consignments for an initial period of 21 days effective 23 March, and agreed to fast-track the clearance of over 1,500 overtime cargoes as part of its efforts to promote ease of business.

 

 

 

 

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