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Business News

World Bank’s $2.5bn loan will hurt Nigeria’s economy – LCCI 

The LCCI has reacted to World Bank’s plans on disbursing another fresh loan of $2.5 billion or N767.3 billion to Nigeria.

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LCCI, CBN, Cashless policy, World Bank’s $2.5bn loan will hurt Nigeria’s economy - LCCI , LCCI to produce data on Nigeria’s economy , LCCI urges FG to create favourable economic policies to drive growth , LCCI wants taxes scrapped on solar equipment, says its alternative source to power 

The Lagos Chamber of Commerce and Industry (LCCI) has reacted to World Bank’s plans on disbursing another fresh loan of $2.5 billion or N767.3 billion to Nigeria saying it would further hurt the economy. 

The Director-General of LCCI, Muda Yusuf said that a fresh debt would be severe on Nigeria’s already fragile economy as it would hike the cost of debt servicing and stifle developmental projects. 

[READ MORE: LCCI calls for economy reform]

Recall that Nairametrics reported that Nigeria reportedly approached the World Bank for another loan of $2.5 after the last $2.4 billion given by the bank.

More details: According to Yusuf, another foreign loan could lead to high inflation rate, stunt gross domestic product growth and increase unemployment. 

“With the World Bank saying it is in talks with Nigeria for a fresh loan of $2.5 billion, which coincided with the Debt Management Office’s announcement that the Federal Government would obtain an additional foreign loan to the tune of $2.7 billion (N824.82 billion)

“This development calls for concern bearing in mind that in three years, Nigeria’s debt profile rose from $10.32 billion in June 30, 2015 to $22.08 billion as of June 30, 2018. With this additional loan, the country’s foreign debt would increase and would invariably increase the overall debt portfolio of the country which stood at N24.39 trillion as at December 31, 2018. 

“Already, the Federal Government proposed to spend a total of N2.14 trillion on debt servicing in the 2019 fiscal year which is 27% of revenue. So this fresh World Bank loan will further increase sporadically the amount of that of 2020 to be dedicated for servicing debts.” Yusuf said. 

While trying to proffer solutions, the LCCI boss explained that foreign loans were the reasons government could not channel more funds appropriately to developmental projects in the country since huge amounts were always provided for servicing debts. 

He, however, stated that the private sector was expecting government to cut down its debt and seek other ways of raising funds, by rigorously promoting new investments to increase revenue. 

Particularly, he believed that cost of governance in the country was still too high and should be reduced in order to free more revenue to run the country’s economy. 

Nigeria’s debt profileAs previously reported by Nairametrics, Nigeria’s rising debt has attracted wide criticisms both locally and internationally. For example, the International Monetary Fund (IMF) questioned Nigeria’s ability to repay its N24.9 trillion debt. 

Nigeria is largely faced with revenue shortfalls as the output and price of oil, fell in the past five years. 

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The IMF had also expressed concern about the rollover risks, arguing Nigeria’s capacity to refinance debt might drop in the future. 

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Meanwhile, the Federal Government has since rebuffed such claims, stating that the nation’s debt burden is sustainable. 

[READ ALSO: LCCI reacts to CBN’s new cashless policy, says time frame is disruptive]

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The Federal Government also disclosed that Nigeria spent a whooping N1.11 trillion to cover debt service obligations in the first six months of the year 2019. 

More debt on the horizon as the Minister of Finance, Budget and National Planning, Mrs Zainab Shamsuna Ahmed, disclosed that the sum of N1.7 trillion will be borrowed to finance the 2020 budget. 

 

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Chidinma holds a degree in Mass communication from Caleb University Lagos and a Masters in view in Public Relations. She strongly believes in self development which has made her volunteer with an NGO on girl child development. She loves writing, reading and travelling. You may contact her via - [email protected]

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Appointments

Greenwich Merchant Bank appoints Bayo Rotimi as MD/CEO

Bayo Rotimi has been appointed the new MD/CEO of Greenwich Merchant Bank.

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Greenwich Merchant Bank has announced the appointment of Mr Bayo Rotimi as its new Managing Director/ Chief Executive Officer.

This is according to a notification made available on the bank’s social media handle, seen by Nairametrics.

As part of his responsibilities, Mr Rotimi is expected to provide leadership and direction to the management team and take charge in optimizing the company’s overall strategic objectives and operational performance, in a bid to deliver optimal value for stakeholders, without compromising quality and standards.

About Bayo Rotimi

Mr Rotimi is an experienced investment banking professional with over 27 years’ experience. He worked for various financial institutions such as Lead Merchant Bank and FCMB Capital Markets, where he rose through the echelons to become the CEO of the latter in 2008. Prior to his recent appointment, he was the chairman of the investment committee of ARM’s Discovery, Aggressive, Growth, Ethical, Money Markets, Fixed income and Eurobond funds with over N110 billion under management.

What they are saying

Commenting on the recent development, Chairman of Greenwich Merchant Bank, Kayode Falowo said: “Bayo’s track record and pedigree speaks for itself and offers a reassuring nexus between the corporate ideals that Greenwich is reputed for and proactive dynamism required to stay on the cutting-edge of innovation, product development and stakeholder satisfaction.”

What you should know

  • Recall that Greenwich Trust Limited was officially renamed Greenwich Merchant Bank in September 2020, after obtaining regulatory approval from CBN to operate as a Merchant Bank.
  • Greenwich Merchant Bank Limited was incorporated on the 25th of February, 1992 and subsequently commenced operations in June 1994.

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Sports

Police raid FC Barcelona’s Camp Nou, ex-President, three others arrested

Spanish police raided the headquarters of F.C. Barcelona, seizing evidence and detaining four people.

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Mossos d’Esquadra, Catalonia’s regional police force has carried out a search on Monday morning on all the offices of the Spanish giants, FC Barcelona and reportedly arrested four people in the process.

The raid carried out by the Police was in search of evidence in relation to the “Barcagate” social media scandal that happened in February, where the Catalan giants allegedly paid third party companies to produce disparaging contents about some people including former players that are opposed and critical of former president, Bartomeu’s administration. A similar raid was also carried out in the club last year June.

The companies allegedly hired by the Spanish giants include I3 Ventures SL, NSG Social Science Ventures SL, Tantra Soft SA, Digital Side SA, Big Data Solutions SA and Futuric SA. There were allegations made that I3 Ventures SL were behind fake social media accounts despising as Barcelona fans that produced disparaging contents about the likes of Victor Font, the club’s presidential candidate. It also attacked high profile players like Lionel Messi and Gerard Pique and also former players like Xavi, Guardiola, etc.

According to reports, those arrested were former Barcelona president, Josep Bartomeu; the club’s chief executive, Oscar Grau; Roman Gomez Ponti, the head of legal services and Jaume Masferrer, an adviser to Bartomeu. The decision to arrest them was not the court’s decision. The arrests were made by the exclusive decision of the Mossos d’Esquadra. The Instructing Court number 13 in Barcelona which is in charge of the case only ordered for a search.

The Catalan giants have been mired in political turmoil and debt prompted by the coronavirus pandemic and this further stains the club’s image.

The raid comes less than a week before the club’s presidential elections are to be held which is coming up on March 7. Three candidates – Victor Font, Joan Laporta and Toni Freia – are on the final ballot for the crucial vote.

In a statement, Barcelona has offered to give their full collaboration regarding the ongoing investigations.

The club stated: “Regarding the entry and search by the Catalan Police force this morning at the Camp Nou offices by order of the Instructing Court number 13 in Barcelona, which is in charge of the case relating to the contacting of monitoring services on social networks, FC Barcelona have offered up their full collaboration to the legal and police authorities to help make clear facts which are subject to investigation.

“The information and documentation requested by the judicial police force relate strictly to the facts relative to this case.

“FC Barcelona express its utmost respect for the judicial process in place and for the principle of presumed innocence for the people affected within the remit of this investigation.”

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