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Economy & Politics

3 bank directors resign from NESG in protest to CBN immunity letter

No fewer than 3 directors of the NESG resigned following a spat between the group and the CBN.

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3 bank directors resign from NESG in protest to CBN immunity letter

Nairametrics can authoritatively confirm that some members of the board of directors of the Nigerian Economic Summit Group (NESG) have voluntarily resigned from their position.

Their resignation appears to be related to the recent spat between the NESG and the CBN following a controversial press release that purportedly claimed Godwin Emefiele was seeking immunity. The report also attacked the recent macroeconomic policies approach of the CBN in ensuring economic stability.

READ: CBN reviews minimum interest rates on savings deposit to 1.25%

Back Story: Nairametrics earlier reported the CBN’s reaction to wide-ranging claims made against it by the NESG which suggested that section 51 of a proposed Banking and Other Financial Institution (BOFIA) Bill sought immunity for the CBN Governor, Godwin Emefiele.

The official press statement released by the CBN aimed at allaying some of the fears raised by the group which majorly bothered on its policy trust and issues such as its agricultural borrowing programme, immunity clause among others. The CBN, while admitting to taking extraordinary measures in order to stabilize the economy, fact-checked the issues raised by NESG.

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READ: Forex crisis: Those patronizing parallel market will lose money – CBN Governor

However, the much-publicized and controversial attack on the apex bank did not go down well with some of the directors, who are upset that they were not carried along before the press release was issued. This is according to information provided to Nairametrics by a reliable source with knowledge of the resignations. Nairametrics reliable gathers that as a response of disapproval to the criticisms of the CBN, at least three bank directors namely – Kennedy Uzoka, the Group Managing Director of UBA Plc; Adesola Adeduntan, Managing Director of First Bank and Abubakar Suleiman, Managing Director of Sterling Bank Plc abruptly tendered their resignations on Wednesday.

Responding to the harsh criticism and demand by the group to review the recently enacted BOFIA Act, the chairman of The Senate Committee on Banking, Insurance and Other Financial Institutions, Senator Uba Sani challenged the competence of the group. He said that the group lack the moral right to comment on the amendment of the BOFIA Act, especially when the Act went through public hearing and received thirty-two (32) memoranda in support. He described NESG’s critique as ”a shock and disappointment”.

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We further gathered that the group’s last statement on Tuesday with the caption ‘Matters of Urgent Attention’, which did not have the approval of members of the Board, is what appears to have irritated most of the members and causing the disaffection amongst them. The Nigerian Economic Summit Group (NESG) is a non-profit, non-partisan private sector organization with a mandate to promote and champion the reform of the Nigerian economy into an open, private sector-led globally competitive economy.

 

2 Comments

2 Comments

  1. Etomi Steven

    September 10, 2020 at 2:06 pm

    How can you say the whole board didn’t know? Lies. They are scared for their business, fear of the regulator.

  2. NIB

    September 10, 2020 at 6:23 pm

    Is this a Political, Religious or Economic? Bill. Hm! No comment.

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Economy & Politics

Recession: Economy should be redirected from wasteful consumption to productivity – Peter Obi

Peter Obi has warned that that the current recession could be worse than that of 2016, because debt raised by the administration was not properly invested.

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Recession: Economy should be redirected from wasteful-consumption to productivity — Peter Obi

Former Governor of Anambra State, Peter Obi, has said that Nigeria needs to trim the unnecessary expenditure on its budget and redirect the economy towards a production-based one. He also warned that that the current recession would be worse than that of 2016, because debt raised by the administration was not properly invested.

Peter Obi disclosed this in a social media statement on Sunday and in an interview with Channels TV.

READ: Afrinvest cautions FG on World Bank’s EoDB ranking

(READ MORE: Nigeria is in a weak financial position to absorb recession shocks —Bismark Rewane)

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“For Nigeria to pull itself out of this economic recession, the 2nd in the last 5 years, there’s a compelling need to cut the pork out of the budget and expenditure at all levels of government and redirect the economy from a wasteful consumption-based one to a productive economy,” he said.

He mentioned in his TV interview that Nigeria should emulate other countries trying to pull out of the economic mess by concentrating on improving monetary and fiscal policies.

READ: NBS hits back at Prof Hanke, says Nigeria’s inflation is not 33%

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READ: Surviving the looming recession in the Nigerian tech space

He said that the October protests were signs that politicians needed to sit up in order to arrest the situation before it gets worse.

“Every other country is discussing the recession and how to pull their people out of poverty. So, what we should do now is concentrate on the monetary and fiscal policies to start pulling people out of poverty.

“If you see what happened with the recent protests, you could see that we are heading into a problem. And I want our energy to be concentrated on that problem. The politicians, the class where I belong, should do more seriously, across party lines, to be able to arrest the situation before it gets out of hand,” he said

(READ MORE: Nigerians pay heavy price as laptop scarcity bites harder)

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He also stated that priority should be on putting food on the table now instead of discussing the 2023 elections.

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“For me, it is in discussing how do we put food on people’s table. Elections will come and we can see how to select the best. But let’s deal with the recession we have just entered before 2023.

“This recession is going to be worst than in 2016 because the monies we borrowed then were not properly invested.

READ: NNPC, only Nigerian company to cut losses by N800 billion in one financial year – GMD

“What we need now is to go into a vigorous regime of formulating implementable and measurable monetary and fiscal policies to drive ourselves out of the present situation,” he said.

What you should know 

Nairametrics reported that Nigeria’s Gross Domestic Product (GDP) in real terms declined by -3.62% (year-on-year) in Q3 2020, thereby marking a full-blown recession and second consecutive contraction from -6.10% recorded in the previous quarter (Q2 2020).

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Former Vice President of Nigeria, Atiku Abubakar, had warned that Nigeria must stop borrowing for anything other than essential needs. He added that very non-essential line items in the proposed 2021 budget must be expunged in a bid to kick-start the economy from a recession.

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Economy & Politics

Recession: Nigeria must stop borrowing for anything other than essential needs – Atiku

Atiku Abubakar has advised the Federal Government to expunge non-essential line items from the proposed 2021 budget.

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Biden should widen the AGOA for integration with the AfCFTA - Atiku, Intels denies NPA statement, Nigerian Ports Authority and Intels, Atiku Abubakar, Atiku claims he has big plans for private sector investment in infrastructure, Coronavirus: Atiku calls for petrol pump price reduction, stamp duty suspension

Former Vice President of Nigeria, Atiku Abubakar has warned that Nigeria Nigeria must stop borrowing for anything other than essential needs, he also added that very non-essential line items in the proposed 2021 budget must be expunged and others in a bid to kick start the economy from a recession.

Atiku disclosed this in a social media statement on Sunday, titled: “We Must Exit This Recession With Precision”.

Atiku said he received confirmation of Nigeria’s slide into recession for the second time in five years with a heavy heart. He urged that the poor economic environment could have been avoided if his ideas of cutting costs of governance were incorporated.

“This could have been avoided had this administration taken heed to patriotic counsel given by myself and other well-meaning Nigerians on cutting the cost of governance, saving for a rainy day, and avoiding profligate borrowing.

“Yes, the COVID-19 pandemic has exacerbated an already bad situation, however, we could have avoided this fate by a disciplined and prudent management of our economy.

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” It serves no one’s purposes to quarrel after the fact. We must focus on solutions. Nigeria needs critical leadership to guide her back to the path of economic sustainability,” he said.

Atiku warned that Nigeria’s proposed 2021 budget is no longer feasible as the Federal Government does not have the budget to afford heavy luxuries. He, therefore, urged the government to expunge every non-essential line items from the budget.

“We must act now, by taking necessary, and perhaps painful actions. For a start, the proposed 2021 budget presented to the National Assembly on Tuesday, October 8, 2020, is no longer tenable.

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“Nigeria neither has the resources, or the need to implement such a luxury heavy budget. The nation is broke, but not broken. However, if we continue to spend lavishly, even when we do not earn commensurately, we would go from being a broke nation, to being a broken nation.

“As a matter of importance and urgency, every non-essential line item in the proposed 2021 budget must be expunged.

“For the avoidance of doubt, this ought to include estacodes, non-emergency travel, feeding, welfare packages, overseas training, new vehicle purchases, office upgrades, non-salary allowances, etc,” Atiku said.

The former Peoples Democratic Party presidential candidate added that the budget must focus on essential items including human development investments and policies that increase the purchasing power of Nigerians.

” Nigeria ought to exclusively focus on making budgetary proposals for essential items, which include reasonable wages and salaries, infrastructural projects, and social services (citizenry’s health, and other human development investments)”

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” Additionally, we have to stimulate the economy, by investing in human development, and increasing the purchasing power of the most vulnerable of our population. Only a well-developed populace can generate enough economic activity for the nation to exit this recession.”

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Atiku called on a monthly stimulus package to poor Nigerians which he adds should be funded not by debt but by adding a 15% tax to luxury purchases.

He said, ” For example, a stimulus package, in the form of monthly cash transfers of ₦5000 to be made to every bank account holder, verified by a Bank Verification Number, whose combined total deposit in the year 2019 was lower than the annual minimum wage.

” How will this be funded? By more profligate borrowing? No. I propose a luxury tax on goods and services that are exclusively accessible only to the super-wealthy. A tax on the ultra wealthy to protect the extremely poor.

“A practical approach to this is to place a 15% tax on all Business and First Class tickets sold to and from Nigeria, on all luxury car imports and sales, on all private jets imports and service charges, on all jewellery imports and sales.”

“And above all, Nigeria must stop borrowing for anything other than essential needs. Again, for the avoidance of doubt, borrowing to pay salaries, or to engage in White Elephant projects, is not an essential need.

“If we keep borrowing, we stand the risk of defaulting, and that will make recession a child’s play because we will lose some of our sovereignty.

What you should know 

Nairametrics reported that Nigeria’s Gross Domestic Product (GDP) in real terms declined by -3.62% (year-on-year) in Q3 2020, thereby marking a full-blown recession and second consecutive contraction from -6.10% recorded in the previous quarter (Q2 2020).

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Economy & Politics

Nigeria’s economy dips into second recession in 5 years 

NBS data for Q3 2020 shows a dip of 3.62% in real GDP, confirming the Nigerian economy has officially fallen into a second recession in 5 years.

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Nigerian economy and its many problems

The data released by the National Bureau of Statistics (NBS) for Q3 2020 shows a dip of 3.62% in real GDP for Nigeria, which strongly confirms that the Nigerian economy has officially fallen into a second recession in 5 (five) years, since 2016, when the economy contracted by 1.62%. 

READ: Boosting IGR; A necessity for states to avoid total dependence on FAAC allocations

The decline in the GDP for Q3 2020 is not unconnected with low activities both at the domestic and international levels which hugely affected the economic growth during the quarter as a result of several lockdown measures to contain the COVID-19 pandemic all over the world. 

READ: Honeywell reports N300 million pre-tax profits in Q2 2020

The non-oil sector contributed a huge chunk of the real GDP in Q3 2020 with 91.27%, higher than its share of 90.23% in Q3 2019 and 91.07% in Q2 2020, while the oil sector contributed 8.73%, though a decrease in its contribution of 9.97% in Q3 2019 and 8.93% in Q2 2020. 

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READ: NBS hits back at Prof Hanke, says Nigeria’s inflation is not 33%

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READ: Citibank: Bitcoin could skyrocket by $300,000 in 2021

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