The Central Bank of Nigeria’s (CBN) current coverage delivered to take away 1/3 events from getting access to its SMIS foreign exchange window thru FORM M foreign exchange purchases is allegedly predicted to translate to disruption of the deliver chain of the commercial enterprise community.
This became disclosed via way of means of the Director-General of Lagos Chambers for Commerce and Industry, Dr Muda Yussuf, all through an interview on TVC recently. According to him, the implementation of the coverage could translate to the disruption and dislocation of over 80% deliver chain of the commercial enterprise community.
He defined that the improvement could create greater troubles than it might solve, as sports of small commercial enterprise proprietors buying and selling withinside the home financial system could be seriously affected.
He said; “Small corporations don’t have the potential to connect to the authentic manufacturers of those things, due to the fact those intermediaries play the position of aggregating the call for of those small corporations, after which they move on to shop for in bulk from authentic components and manufacturers because the CBN referred to as them after which promote in smaller quantities to the SMEs.”
Back story: It became said whilst the CBN issued a round getting rid of shopping for agents/groups or any 1/3 events from getting access to its SMIS foreign exchange window thru FORM M foreign exchange purchases.
In a round dated August 24, 2020, the apex banks informed that “Authorized Dealers are herby directed to desist from the outlet of Form M whose fee is routed thru a shopping for company/agent or every other 1/3 events” efficiently getting rid of 1/3 events or middlemen from transacting in foreign exchange offers in its authentic SMIS window.
The relevant financial institution defined that its selection became primarily based totally at the want to “make sure prudent use of our forex sources and put off incidences of over-invoicing, switch pricing, double managing charges, and avoidable expenses which can be in the long run surpassed to the common Nigerian consumers”.
Sentiments concerning the coverage
On the flip-side, the professional sees the coverage compounding the deliver chain disruptions, as it’s far impractical to anticipate all importers of uncooked materials, device, and different inputs to shop for immediately from the closing manufacturer or supplier, specially in an financial system pushed via way of means of SMEs.
Victims of the coverage
According to a National Survey of MSMEs in Nigeria in 2017, SMEs and different Micro organisations have been the high drivers of the financial system, as they together presented a complete employment contribution of 59,647,954 persons, which include proprietors, (76.5% of country wide workforce) in 2017, they contributed 49.78% of the GDP and 7.64% of exports.
Yusuf defined that with SMEs and different small corporations incapacitated to have a right away transaction with manufacturers of machines and device producers abroad, the most effective choice they’ve is to shop for from intermediaries.
He emphasised the want for intermediation withinside the commercial enterprise area for the survival of those corporations, as the dearth of intermediation could result in deliver chains disruption, and this will irritate the effect of the pandemic on corporations and the financial system as a whole, as lots of those corporations could be absolutely cut-off.
Though, the LCCI boss lauded the CBN for the stairs it has taken to mitigate and cut down abuses withinside the forex market, he emphasised that “this coverage negates the present day laudable efforts of the CBN to make sure commercial enterprise continuity, sustainability, and recovery.”
He then referred to as for warning withinside the bid to cushion coverage inconsistency that can irritate in addition distortions. As the brand new coverage conflicts with the letters and spirit of the Economic Sustainability Plan of the Federal Government.
The DG of LCCI concluded that the coverage became now no longer sustainable, because it created distortions, transparency troubles, corruption, and drives foreign exchange and global change transactions underground, and into the casual area.
He hopes that the brand new coverage on fee can be urgently reviewed to keep away from in addition disruptions to corporations and the financial system.
Lagos to totally close Third Mainland Bridge again ahead of full reopening
Lagos State Government has announced a 24hour closure of the Third Mainland Bridge from midnight Friday, February 26.
The Lagos State Government has announced that it will shut down the Third Mainland Bridge for 24 hours from midnight Friday, February 26 to midnight Saturday, February 27.
The expected total closure of the bridge is to enable the contractors to move the equipment used for its rehabilitation and maintenance ahead of the full reopening of both the Oworonshoki and Adeniji bound lanes open to traffic.
The disclosure is contained in a statement issued by the Lagos State Commissioner for Transportation on Wednesday, February 24, 2021.
Oladeinde, therefore, advised motorists approaching the Third Mainland bridge from Ogudu, Alapere and Gbagada to use Ikorodu Road, Jibowu and Yaba, as alternative routes, while Iyana Oworoshoki-bound traffic from Lagos-Island, Iddo, Oyingbo, Adekunle and Yaba are to use Herbert Macaulay Way, Jibowu and Ikorodu Road as alternative routes.
The Commissioner assured that traffic management personnel would be deployed along the affected routes to minimize the impact of the shutdown and address any traffic impediments during the closure.
He was also full of commendation for Lagosians for their cooperation during the prolonged repair works of the bridge and assured that the bridge is now safe for use by everybody.
What you should know
- The Federal Government had on July 24, 2020, announced the partial shutdown of the Third Mainland Bridge for a period of 6 months for another round of rehabilitation works.
- This was extended by an extra one month due to disruption caused by the #EndSARS protests last year, when the re-opening date moved to February 15, 2021.
- The Federal Government later announced that the bridge, which was to reopen on February 15 will no longer be opened as work was expected to commence on the casting of the last expansion joint on the bridge before it will be finally reopened.
- The 11.8km bridge, which was commissioned in 1990 by the then Military President, Ibrahim Babangida, is the longest of the 3 bridges connecting Lagos Island to the Mainland.
FG urged to sell-off “unproductive” Ajaokuta Steel Plant
The FG has been urged to sell the moribund Ajaokuta steel plant located in Kogi State.
The Federal Government has been urged to sell the moribund Ajaokuta steel plant located in Ajaokuta, Kogi State. The FG was advised to sell the defunct facility to the private sector, which would be more capable to turn the massive structural investment into a profitable venture.
The call was made by the Chairman and Managing Director of Energy Services Limited, Chief Sunny Onuesoke who spoke to newsmen in Warri after visiting the plant last week.
He lamented that no Nigerian would feel good about the country after visiting the $8bn structural investment which has never“produced a single bar of steel since reaching 98% completion as far back as 1994.”
On his visit to the plant, he reported that it was a very emotional experience for him.
“I went there, I cried and asked what exactly is the problem?” he said.
He reflected on the numbers associated with the moribund Ajaokuta steel Plant from its flag off in 1979 to date.
- 3.9bn was budgeted for the resuscitation of the facility in 2016
- 4.27bn was budgeted for the same purpose in 2017
Onuesoke said that successive governments have plunged about $8bn into the complex since 1979. He lamented that the FG has been wasting the huge sum of N2 billion for payment of staff salaries every year for doing nothing.
“Why would anyone continue to pump money into an unproductive enterprise? Why do government keep promoting, paying staff salaries, pensioning, and retiring them?
“Why does government spend an appropriation budget on the maintenance of a plant that is not working? How do you maintain a non-commission plant?” Onuesoke queried.
The Ajaokuta steel plant has been in a moribund state for four decades with no concrete plans on the ground for its full resuscitation.
What you should know
- It was earlier reported on the 3 key reasons why the Ajaokuta Steel Plant has remained moribund for more than 4 decades. You can find them here
- The Ajaokuta steel company was constructed by the Soviet Union in 1979 under a cooperation agreement with Nigeria, the complex reached 98% completion by 1994.
SEC denies knowledge of Oando shareholder’s court case
SEC has denied ever being served with court processes with respect to the purported matter at the FCT High court.
The Securities and Exchange Commission (SEC) has denied the claim by one of Oando Plc’s shareholders, Engr Patrick Ajudua, that he won a court case against the capital market apex regulator.
SEC disclosed in a statement it issued and seen by Themoneymetrics on Wednesday that there was never a time it was served with court processes with respect to the purported matter at the FCT High court.
It stated, “The attention of the Securities and Exchange Commission (the Commission) has been drawn to several publications in the media, where it is reported that a shareholder of OandoPlc, purportedly obtained a judgment from the Federal Capital Territory High Court against the Commission.
“The Commission wishes to inform the general public that it was never at any time served with court processes with respect to the purported matter at the FCT High court. The Commission will consequently take all necessary steps to verify and set aside the purported decision of the said Court.”
The attention of the Commission has been drawn to several publications in the media, where it is reported that a shareholder of OandoPlc, purportedly obtained a judgment from the FCT High Court against the Commission. Full Statement –> https://t.co/olT2FpxaEK
— SEC Nigeria (@SECNigeria) February 24, 2021
What you should know
- On Tuesday, Ajudua, reportedly won a legal suit, which was filed at the High Court of the FCT against SEC, according to Our source.
- He filed that the directive of the SEC suspending Oando’s Annual General Meeting is in breach of his right to freedom of association as guaranteed under Section 40 of the Nigerian Constitution and Articles 9, 10 & 11 of the African Charter on Human and Peoples Rights.
- In the said hearing presided over by Honorable Justice O. A Musa, all cases filed were granted in his favor.
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