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Economy & Politics

Okonjo-Iweala shares her plans for WTO, if appointed

It is important to listen to the concerns of America, China, Europe, Africa, Asia.

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Okonjo-Iweala joins South Africa's presidential economic advisory council as nation struggles with recession

A lot of people (Africans and non-Africans) were not surprised when President Muhammadu Buhari nominated a two-time Minister of Finance, Dr Ngozi Okonjo-Iweala as the next Director-General of the World Trade Organisation. The reason is quite simple, her negotiating skill is immeasurable and her records speak.

If given an opportunity to serve, Okonjo-Iweala said she is ready to contribute her quota to the world economy. In her interview with Manuela Saragosa on Business Daily on BBC, she reeled her plans and what makes her the right candidate for the job.

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On the reason she wants to lead WTO, the former Managing Director, Operations, World Bank said she believe it is an opportunity to serve all the countries in the world. Her words, “I believe WTO is one of the most important multi-lateral bodies in the world despite the challenges it faces and the reforms that need to be done. I believe it is very relevant for the economic development, growth and sharing of prosperity in the world.

“I want the job because I think I have the skills for it. I think the organization needs some reforms to make it relevant for times we are in and I have a reputation as a strong reformer. I have actually written a book titled ‘Reforming the Reformable,’ where we undertook certain reforms with a team in Nigeria. I am also a person with strong negotiation skills. I have a career of over 30 years for constantly been involved in negotiating an important agreement between countries.”

READ MORE: Develop Homegrown Solutions, Human Capacity and Invest in Agriculture to Rebuild Africa; Experts say at UBA Africa Day Conversations

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US and China war

On how she intends mending the fence between the US and China, she did not hesitate to outline what she thought was the problem and how to tackle them. She admitted that the task would be challenging but insisted it is what she relishes.

She said, “I relish the challenge of being able to build trust and I do hope that be an objective arbiter between US and China and as well as other member countries, I can help to find what the common interests are.

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“I believe the Americans know that they have benefitted over time from the WTO and the World Trading System and other countries have also benefitted. I think what is involved is being a good listener. It is important to listen to the concerns of the Americans, China, Europe, Africa, Asia and try to bring them to the table around a common interest. I strongly believe that this world we face today, we need a forum where one can bring common interest together. In spite of all the words we hear, there is a need to bring people together and bring trust around a shared interest.”

What the job means for Africa

She explained that the job is extremely important for Africa because the continent has never held the position and African countries feel they can benefit better from the World Trading System. She added that the continent has negotiated a monumental agreement, which is the African Continental Free Trade Agreement, to strengthen the economies of the continent and enable them to trade with each other better and enable them to face the trading system of the world together.

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“Africa’s trade is about 3% of the world trade and that needs to increase. Having an African at the WTO is something that will benefit Africa but the intention I have is to make sure that all parts of the world benefits,” she added.

READ ALSO: African Development Bank joins Nasdaq sustainable bond network

Impacts of COVID-19 on African economies

Okonjo-Iweala pointed out that the virus has really illustrated and exhibited some of the trends that are on-going in the world. According to her, the WTO can make contributions, as African nations look at the supply chain and wonder what they will do about the health equipment, medical supplies and others.

She said, “I am quite worried and the reason is that African countries felt the economic impact of the pandemic first before they felt the health impact. The prices of commodities like Oil fell by 60% between December 2019 and March 2020. At that same time, there was a capital flight out of the continent, remittances fell, tourism fell. For the first time in 25 years, the continent’s economies were supposed to contrast by about 2%, so it is a heavy impact.

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“The second thing is that the lockdowns and social distances took a tow on the economies. It also has an impact on informal sector workers, who have not been able to earn on a daily basis. It has impacted the lives of household and ordinary people.”

Debt relief for Africa

Though the former Finance Minister appreciated the G-20 for the Debt standstill given to Africa, she explained that the debt standstill, which was shifted to the end of 2020, would not be sufficient. As far as she is concerned, China should be able to extend the standstill for a couple of years to enable the continent to look at the Debt sustainability issues.

DG’s Selection process

General Council Chair, David Walker of New Zealand informed members on 20 May 2020  that the appointment process for the next Director-General would formally commence on 8 June with nominations accepted from that date until 8 July.

The Chair will inform WTO members of nominations as soon as they are received. After 8 July, Chair Walker will issue to members a consolidated list of all candidates. Shortly after the nomination period has closed, candidates will be invited to meet with members at a special General Council meeting, present their views and take questions from the membership.

Patricia

Abiola has spent about 14 years in journalism. His career has covered some top local print media like TELL Magazine, Broad Street Journal, The Point Newspaper. The Bloomberg MEI alumni has interviewed some of the most influential figures of the IMF, G-20 Summit, Pre-G20 Central Bank Governors and Finance Ministers, Critical Communication World Conference. The multiple award winner is variously trained in business and markets journalism at Lagos Business School, and Pan-Atlantic University. You may contact him via email - [email protected]

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Economy & Politics

Over 20% of N-Power beneficiaries are now business owners – FG

The Minister emphasized the President’s vision of lifting 100 million Nigerians out of poverty.

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Over 20% of N-Power beneficiaries are now business owners - FG

The Minister of Humanitarian Affairs, Disaster Management and Social Development, Sadiya Umar Farouq, has said that about 109,823 beneficiaries of the N-Power programme now have their own businesses.

This represents about 22% of the 500,000 Nigerians that have benefited from this programme since its inception.

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This was disclosed in a statement by the Minister’s Special Assistant on Strategic Communications, Mrs Halima Oyelade on Saturday, July 4, 2020. She said that the beneficiaries of Batch A and B of N-Power have established businesses in their communities.

READ MORE: Why Federal Government disengaged 2,525 N-Power beneficiaries

The Minister in the statement said, “Statistics like this gives me joy and once again, I want to say congratulations; I look forward to hearing amazing testimonies and meeting beneficiaries of this programme who will be doing great things in the future”.

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She emphasized President Muhammadu Buhari’s vision of lifting 100 million Nigerians out of poverty in the next 10 years by creating opportunities that would improve the productivity of Nigerian youths for entrepreneurship or employment.

Going further the minister said, “Thus, the need to find ways to engage them is of utmost importance. However, the commencement of the enrolment of Batch C was predicated on the need to give more Nigerian youths the opportunity to benefit. This is because, keeping only 500,000 beneficiaries for four years defeats the purpose of Mr President’s vision, hence the need to scale up and was in no way meant to be punitive.”

While acknowledging the beneficiaries’ contributions, Farouq said, ‘’You are our model N-Power beneficiaries. Please avail yourselves of all opportunities provided by government like interest-free loans and leverage on those opportunities while using N-Power as a stepping stone”.

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The minister said the ministry is working at resolving some of the challenges facing the programme which include delays in the payment of stipends, beneficiaries not showing up at their places of primary assignments and people accessing the programme while gainfully employed elsewhere.

The minister also assured beneficiaries that outstanding payments would be made and transition plans were ongoing and would be duly communicated to them on their platform.

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Some of the beneficiaries of the programme gave good testimonies about the impact of the programme in their lives and all expressed their gratitude to the Federal Government for the opportunity.

Nairametrics has reported the opening of application portal for batch C of the programme with effect from 11.45 pm on June 26, 2020. There have been over 3 million applicants that have shown interest in batch C of the programme in about a week.

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Economy & Politics

Nigeria’s debt rises to $79.5 billion, as debt to revenue ratio worsens

According to data obtained from DMO, $27.66 billion (N9.9 trillion) is the total external debt.

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Nigeria's Debt to revenue ratio, DMO suspends April 2020 FGN savings bond offer

Nigeria, Africa’s largest economy’s total public debt rose to $79.5 billion (N28.63 trillion) as of the first quarter of 2020, which is March 31, 2020. This represents a 15% increase from the figure that was recorded for the corresponding period in 2019, which was about $69.09 billion (N24.94 trillion).

This was disclosed in a latest publication by the Debt Management Office (DMO) on Friday June 3, 2020.

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Nigeria has seen its debt stock rise sharply in recent years as the country tries to fund infrastructural and developmental projects and boost its fragile economy, which has been in and out of recession. The country’s economy has been projected to fall into recession again, due to the adverse impact of COVID-19 that has seen oil prices crash globally.

According to data obtained from DMO, $27.66 billion (N9.9 trillion) is the total external debt. This represents 34.89% of the total public debt stock. Whereas, $51.64 billion (N18.64 trillion) is the total domestic debt, which represents 65.11% of the total public debt.

READ MORE: Nigeria borrows N754 billion in 3-month, total debt now N25.7 trillion  

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The Federal Government accounts for 50.77% of the total domestic debt, which is $40.26 billion (N14.53 trillion), whereas the State Governments and Federal Capital Territory account for 14.34% of the total domestic borrowing which is $11.37 billion (N4.11 trillion).

Nigeria has been under a lot of fiscal crisis following the crash of oil prices triggered by the coronavirus pandemic. The oil sector accounts for about 90% of the country’s foreign exchange earnings and about 60% of its total revenue.

The country, which had lined up a series of debt issue this year, had to halt the external commercial borrowing due to oil price collapse. The Minister for Finance, Zainab Ahmed, had last week disclosed that the country would no longer go ahead with its Eurobond debt issue.

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READ ALSO: Lagos debt hits N39.6 billion, to borrow N97 billion more

The Nigerian government, for now, is focusing on the domestic markets and concessionary loans to help fund the 2020 budget deficit which is made worse by drop in revenue. In the recently approved 2020 revised budget, the federal government is expected to borrow N850 billion from the domestic market.

This rising debt has put a lot of pressure on the government’s resources as it spent $1.69 billion (N609,13 billion) to service its domestic debt in the first quarter of 2020 alone.

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Nairametrics had reported that Nigeria’s global rating is at risk due to the sharp rise in the country’s sovereign debt and a growing finance gap. According to a report from the global rating agency, Fitch Ratings, this could trigger a rating downgrade as policymakers struggle to stimulate growth and deal with the impact of low oil prices and sharp drop in revenue.

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According to Fitch, the country’s debt to revenue ration is set to deteriorate further to 538% by the end of 2020, from the 348% that it was a year earlier.

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Economy & Politics

Nigeria and US Authorities battle former Enron Nigerian Subsidiary over $80 million Yacht

Both Nigerian and American governments have opposed Enron Nigeria’s appeal. 

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19 years after the bankruptcy of Enron Corporation, one of the biggest corporate bankruptcies in American history, a former subsidiary of the company is battling Nigerian and American Authorities over the sale of a yacht valued at over $80 million acquired by Nigerian businessman Kolawole Aluko. 

The yacht was seized by the US Government in 2018 after prosecutors say it was bought with the proceeds of bribes paid to Nigeria’s former Minister of Petroleum, Diezani AlisonMadueke. 

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The yacht was later auctioned for $37 million in 2019. The Nigerian government also dropped claims to the proceeds of the sale recently and a Texas Court ordered all proceeds should be retained by the US Government. 

However, a former unit of the Bankrupt Enron, Enron Nigeria Power Holdings claims its entitled to the proceeds and demands $22 million in a bid to get an arbitration awarded to them against the Nigerian government for suspending a contract signed with Enron in 1999 to build and operate a Power plant. 

(READ MORE: Nigeria leads Africa combined in Q2 2020 on BTC P2P)

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Enron Nigeria claims the Nigerian government dropped claims to the proceeds of the yacht’s auction in an attempt to fraudulently transfer assets to stop creditors from accessing them. Saying Nigeria dropping its claims was a recognition of the factual and legal basis” in a DOJ court filing. 

Both Nigerian and American governments have opposed Enron Nigeria’s appeal. 

Enron Nigeria Power Holdings Ltd is owned by ex-Enron staff involved in the negotiations for the Power Plant contract in Nigeria and was bought out of bankruptcy for $750,000 in 2004 by a Cayman Islands registered company. 

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READ ALSO: N2trillion Mambila project: FG starts disbursement of compensation funds

An arbitration ruling in 2012 awarded Enron Nigeria Power Holdings $11.2 million including interest in damages against the Nigerian government. 

The DOJ says Mr. Aluko bought the yacht for $82 million in 2013 and funded a lavish lifestyle for Alison Madueke in exchange for NNPC contracts valued at over $1.5 billion. 

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Aluko and his business partner, Olajide Omokore are also accused of laundering illicit revenues into and through the United States

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