Connect with us

Archives

Nigeria must take hard choices for survival – CBN

Published

on

  • As Minister tells MTN to drop lawsuit over fine

Central Bank of Nigeria (CBN) has said that Nigeria must make hard choices for survival as low government revenues from oil sources continues.

CBN Governor, Godwin Emefiele, who disclosed this yesterday at the end of the Monetary Policy Committee, MPC’s, meeting in Abuja, said the country would have to contend with hard and uncomfortable choices until the economy transits to more sustainable sources of revenue, consistent with the current economic realities.

He said: “It is imperative to brace up for a longer period of low government revenues from oil sources, which would necessitate hard and uncomfortable choices as the economy transits to more sustainable sources of revenue, consistent with the economic realities and strategic objectives of the country. In the circumstance, certain tradeoffs must be envisaged and duly accommodated.

“In view of the foregoing, the imperative for consistently sound and coordinated macroeconomic policy has become inevitable. In the medium term within which monetary policy is cast, the need to allow policy to produce the desired outcomes becomes a key consideration in the policy mix.”

Emefiele, who spoke broadly on key developments at the global and domestic environment, including inflation and foreign exchange rate dynamics, predicted slower growth of the domestic economy in the current quarter when compared with the corresponding period of last year.

He hinged the projections on the current global oil price trend, which is projected to hold low over the medium to long term, with the attendant implications for government revenue and foreign exchange earnings.

The CBN Governor pointed out that given the headwinds in the domestic economy and the uncertainties in the global environment, the MPC decided by a unanimous vote to retain the MPR, at 11 per cent; CRR at 20 per cent; Liquidity Ratio at 30 per cent; the asymmetric corridor at +200 basis points and -700 basis points.

On the raging controversy over the desirability or otherwise of naira devaluation for the economy, Emefiele said the country would maintain the status quo for now, adding however that the Committee was already working on different scenarios or models which would be looked into based on developments in the economy.

We will look at scenarios under different crude prices. And we will continue at management and monetary policy committee. We will continue as much as possible to continue to share our thoughts with the fiscal authorities with a view to harmonising our positions to ensure that notwithstanding the drop in crude prices that we are able to continue to run government and continue to do business.

“So far, we have seen this now for almost about 14 months and there is no green light yet at the end of the tunnel. We will continue to be alive to our responsibilities to continue to ensure that both monetary and fiscal authorities work together towards ensuring that we provide for all the needs of Nigerians,” he added.

He noted that despite the current challenges, the Committee remained guided by evidence underpinned by credible data in its holistic evaluation of the emerging scenarios and in its assessment of policy choices.

According to him, the Committee believes that given sound and properly coordinated monetary, fiscal, and external sector policies, there was wide room for optimism about the medium to long term macroeconomic prospects for the economy, especially, given the clarity in the policy direction of the administration, the various interventions in the real sector; gradual improvement in the power sector, and the reinvigorated fight against corruption.

He reported on the Committee’s acknowledgment of the continued liquidity surfeit in the financial system stemming partly from the recent growth-stimulating monetary policy measures, as well as the tendency of the banks to invest excess reserves in government securities, rather than extend credit to the needed sectors of the economy.

Emefiele explained that that challenge necessitated the Committee’s decision, urging Deposit Money Banks, DMBs, to improve lending to the real sector, as part of their patriotic obligations to the country. He said MPC also emphasised the necessity of coordination between monetary and fiscal policies as a prerequisite for resolving the nation’s economic problems, particularly, steering the economy away from oil dependency.

In the meantime, South African cellphone operator MTN should drop its legal action over a $3.9 billion fine imposed in Nigeria to help facilitate talks on a possible settlement, the Nigerian telecommunications minister said on Tuesday.

The Nigerian Communications Commission (NCC) slapped a $5.2 billion fine on MTN in October for failing to disconnect users with unregistered SIM cards but after weeks of negotiations reduced it by 25 per cent.

Reuters reported that MTN, which makes about 37 percent of its revenue from Nigeria, then filed a suit in the West African country questioning NCC’s legal grounds for imposing the penalty.

“I’m not aware of any out-of-the-court settlement,” telecoms minister Adebayo Shittu told reporters.

Shittu said President Muhammadu Buhari will have the final decision on the matter, adding that MTN might be advised to withdraw the court case filed against the fine.

“If they withdraw it creates a better environment, an environment where there is no stress or pressure on either side,” he said.

A judge in Lagos, Nigeria’s commercial capital, last week gave the company until March 18 to try to reach a settlement with the Nigerian authorities over the fine. The prospect of a lower fine boosted MTN shares.

The fine equates to more than twice MTN’s annual average capital spending over the past five years.

Nigeria has been trying to halt the widespread use of unregistered SIM cards amid worries these are being used for criminal activity, including by the militant Islamist group Boko Haram.

National Mirror with additional report from Tribune

Archives

WAIVER CESSATION: Igbokwe urges NIMASA to evolve stronger collaboration with Ships owners

Published

on

…Stresses the need for timely disbursement of N44.6billion CVFF***

Highly revered Nigerian Maritime Lawyer, and Senior Advocate of Nigeria (SAN), Mike Igbokwe has urged the Nigeria Maritime Administration and safety Agency (NIMASA) to partner with ship owners and relevant association in the industry to evolving a more vibrant merchant shipping and cabotage trade regime.

Igbokwe gave the counsel during his paper presentation at the just concluded two-day stakeholders’ meeting on Cabotage waiver restrictions, organized by NIMASA.

“NIMASA and shipowners should develop merchant shipping including cabotage trade. A good start is to partner with the relevant associations in this field, such as the Nigeria Indigenous Shipowners Association (NISA), Shipowners Association of Nigeria (SOAN), Oil Trade Group & Maritime Trade Group of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA).

“A cursory look at their vision, mission and objectives, show that they are willing to improve the maritime sector, not just for their members but for stakeholders in the maritime economy and the country”.

Adding that it is of utmost importance for NIMASA to have a through briefing and regular consultation with ships owners, in other to have insight on the challenges facing the ship owners.

“It is of utmost importance for NIMASA to have a thorough briefing and regular consultations with shipowners, to receive insight on the challenges they face, and how the Agency can assist in solving them and encouraging them to invest and participate in the maritime sector, for its development. 

“NIMASA should see them as partners in progress because, if they do not invest in buying ships and registering them in Nigeria, there would be no Nigerian-owned ships in its Register and NIMASA would be unable to discharge its main objective.

The Maritime lawyer also urged NIMASA  to disburse the Cabotage Vessel Financing Fund (CVFF)that currently stands at about N44.6 billion.

“Lest it be forgotten, what is on the lips of almost every shipowner, is the need to disburse the Cabotage Vessel Financing Fund (the CVFF’), which was established by the Coastal and Inland Shipping Act, 2003. It was established to promote the development of indigenous ship acquisition capacity, by providing financial assistance to Nigerian citizens and shipping companies wholly owned by Nigerian operating in the domestic coastal shipping, to purchase and maintain vessels and build shipping capacity. 

“Research shows that this fund has grown to about N44.6billion; and that due to its non-disbursement, financial institutions have repossessed some vessels, resulting in a 43% reduction of the number of operational indigenous shipping companies in Nigeria, in the past few years. 

“Without beating around the bush, to promote indigenous maritime development, prompt action must be taken by NIMASA to commence the disbursement of this Fund to qualified shipowners pursuant to the extant Cabotage Vessel Financing Fund (“CVFF”) Regulations.

Mike Igbokwe (SAN)

“Indeed, as part of its statutory functions, NIMASA is to enforce and administer the provisions of the Cabotage Act 2003 and develop and implement policies and programmes which will facilitate the growth of local capacity in ownership, manning and construction of ships and other maritime infrastructure. Disbursing the CVFF is one of the ways NIMASA can fulfill this mandate.

“To assist in this task, there must be collaboration between NIMASA, financial institutions, the Minister of Transportation, as contained in the CVFF Regulations that are yet to be implemented”, the legal guru highlighted further. 

He urged the agency to create the right environment for its stakeholders to build on and engender the needed capacities to fill the gaps; and ensure that steps are being taken to solve the challenges being faced by stakeholders.

“Lastly, which is the main reason why we are all here, cessation of ministerial waivers on some cabotage requirements, which I believe is worth applause in favour of NIMASA. 

“This is because it appears that the readiness to obtain/grant waivers had made some of the vessels and their owners engaged in cabotage trade, to become complacent and indifferent in quickly ensuring that they updated their capacities, so as not to require the waivers. 

“The cessation of waivers is a way of forcing the relevant stakeholders of the maritime sector, to find workable solutions within, for maritime development and fill the gaps in the local capacities in 100% Nigerian crewing, ship ownership, and ship building, that had necessitated the existence of the waivers since about 15 years ago, when the Cabotage Act came into being. 

“However, NIMASA must ensure that the right environment is provided for its stakeholders to build and possess the needed capacities to fill the gaps; and ensure that steps are being taken to solve the challenges being faced by stakeholders. Or better still, that they are solved within the next 5 years of its intention to stop granting waivers”, he further explained. 

Continue Reading

Archives

Breaking News: The Funeral Rites of Matriarch C. Ogbeifun is Live

Published

on

The Burial Ceremony of Engr. Greg Ogbeifun’s mother is live. Watch on the website: www.maritimefirstnewspaper.com and on Youtube: Maritimefirst Newspaper.

Continue Reading

Archives

Wind Farm Vessel Collision Leaves 15 Injured

Published

on

…As Valles Steamship Orders 112,000 dwt Tanker from South Korea***

A wind farm supply vessel and a cargo ship collided in the Baltic Sea on Tuesday leaving 15 injured.

The Cyprus-flagged 80-meter general cargo ship Raba collided with Denmark-flagged 31-meter wind farm supply vessel World Bora near Rügen Island, about three nautical miles off the coast of Hamburg. 

Many of those injured were service engineers on the wind farm vessel, and 10 were seriously hurt. 

They were headed to Iberdrola’s 350MW Wikinger wind farm. Nine of the people on board the World Bora were employees of Siemens Gamesa, two were employees of Iberdrola and four were crew.

The cause of the incident is not yet known, and no pollution has been reported.

After the collision, the two ships were able to proceed to Rügen under their own power, and the injured were then taken to hospital. 

Lifeboat crews from the German Maritime Search and Rescue Service tended to them prior to their transport to hospital via ambulance and helicopter.

“Iberdrola wishes to thank the rescue services for their diligence and professionalism,” the company said in a statement.

In the meantime, the Hong Kong-based shipowner Valles Steamship has ordered a new 112,000 dwt crude oil tanker from South Korea’s Sumitomo Heavy Industries Marine & Engineering.

Sumitomo is to deliver the Aframax to Valles Steamship by the end of 2020, according to data provided by Asiasis.

The newbuild Aframax will join seven other Aframaxes in Valles Steamship’s fleet. Other ships operated by the company include Panamax bulkers and medium and long range product tankers.

The company’s most-recently delivered unit is the 114,426 dwt Aframax tanker Seagalaxy. The naming and delivery of the tanker took place in February 2019, at Namura Shipbuilding’s yard in Japan.

Maritime Executive with additional report from World Maritime News

Continue Reading

Editor’s Pick

Politics