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Nigeria searches for $7 billion to combat COVID-19 issues

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The Nigerian government has drafted several requests to international lenders requesting a total number of $6.9 billion in order to keep their economy afloat as well as continue their battle against the novel Coronavirus.

 

Although the country has not seen too much of the virus, compared to Europe and the United States at least, the government still decided to impose a 2-week shutdown in order to prevent the spread. Currently, the country has 232 confirmed cases and 5 deaths in total, but more cases are expected in the coming weeks.

Who is Nigeria asking for help?

The Nigerian government has addressed multiple international lenders. These include the International Monetary Fund ($3.4 billion), the World Bank ($2.5 billion) and the African Development Bank ($1 billion).

 

All of this was announced by the Minister of Finance, Zainab Ahmed herself.

 

However, considering the serious economic implications of the Coronavirus, many Nigerian politicians believe that asking these organizations for a loan is not the right thing to do at the moment.

Criticism has been heard of the Nigerian government for worrying about the economy much more than the pandemic spreading across the country, and only imposing the shutdown just a couple of days ago.

 

Although it is true that most of the funds requested from these international organizations will be dedicated to keeping the economy alive before the pandemic stops, it needs to be highlighted that Nigeria is still in serious danger of having the virus spread out of control.

 

Although most commercial states are on lockdown, there are some regions in the country where movement is relatively free.

Why is Nigeria asking for so much?

The next big question is finding out why Nigeria needs so much money and where most of it is going to be spent. It’s quite an easy question to answer. Nigeria is the largest oil producer on the African continent, which means that it is going to dedicate these funds to solidifying that position well into the future.

 

You see, the COVID-19 didn’t only topple stock prices of large corporations worldwide, it also seriously impacted oil prices, which were already significantly weakened well before the outbreak.

 

To put this in perspective. The Nigerian government devised a national budget when oil prices were around $59 per barrel. The price is somewhere in the range of $30 per barrel nowadays, and demand keeps on dropping as fewer people drive or use oil-consuming machinery and technology.

 

Due to this massive change in pricing, the Nigerian government had to adjust by cutting costs during 2020, but that is simply not enough. Having your country’s biggest income effectively be cut more than half is a serious hit to all of the plans created not only for that year but for the future.

Criticism floats up once more

Naturally, whenever a government plan has some kind of issues that could have been avoided, there will always be opposition members or just freelance politicians criticizing these policies. In this case, it’s very hard not to agree with what is being said in most of the cases.

 

Most of the politicians were advocating a more diverse economy, investments into different industries rather than re-investment into the oil. Tricks that have worked in the past are not necessarily going to work in the future, and considering oil is a finite resource, Nigeria is seriously advised to look into diversification.

 

And this is not only about Nigeria as well. The largest oil-exporting countries in the world such as Norway, Saudi Arabia, the UAE, and even the United States have considered this issue seriously.

But most surprisingly, there are countries that normally don’t have too large of oil production for export that are already deviating away from the commodity, and in that sense, Germany is a perfect example.

What can Nigeria learn from Germany

Naturally, it’s very hard to compare these two economies as Germany is a production powerhouse that has already diversified beyond anything that Nigeria could achieve in the next decade or so, but there are still some nice hints as to what could be changed.

 

Let’s talk about taboo industries as an example. In this sense, both Nigeria and Germany have quite a lot in common. Banning or discrediting taboo industries such as gambling, for example, is present in both countries, but both of them have seen huge demand for these services.

 

The difference is seen when we look at the actions taken by both countries. Germany, for example, does not charge any fines to its citizens playing online roulette or any other game of chance. The only fine goes to the company providing this service. In Nigeria, it’s a bit different as the country has only a few companies operating in the country which tend to be untrustworthy in terms of service and tax.

 

Germany is easily able to pinpoint websites that provide these services and fine them pretty much on a monthly basis. This pretty much acts like a monthly tax which is always fixed. It’s a small loophole, but mutually beneficial nonetheless.

 

In Nigeria though, the trust in government-approved companies is fading as people switch to unlicensed platforms, thus depriving the authorities of tax and information. It would be much better for the local government to either allow commercialization of gambling or introduce a similar system as in Germany.

Back to the topic – will Nigeria get the funds it is requesting?

There is one thing to consider. Nigeria is a country that has the capacity to repay the debt it is asking the IMF and other organizations for, but the question is whether these organizations will be able to deliver.

 

There are quite a lot of middle eastern and central Asian countries that have requested the same organizations for financial assistance, therefore some serious budgeting is to be expected.

 

It’s unlikely for every country to get what they asked for, but some funds could be covered. One real issue that Nigeria could face is a serious deficit in what it asked for. At that point, there will be no other way than asking China for financial assistance, and that is something that Nigeria could simply not afford at this point, considering how much it already owes to China.

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FG Targets Production Of Locally Made Vehicles By Dec

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The Minister of Industry, Trade and Investment, Dr Doris Uzoka-Anite, has affirmed that Nigeria now has the capacity and materials to manufacture Made-In-Nigeria cars for local use and export.
With the enabling environment being provided by the government, she said manufacturers should be held responsible if the cars are not rolling out by December 2024.
Currently, Nigeria produces less than 10 per cent of the vehicles used in the country.
Last year, Nigeria’s vehicle assembling industry, estimated to be worth around N302billion, tanked to a new low due to increasing production costs and weakened demand for locally assembled automobiles.
According to the Manufacturers CEOs Confidence Index, activities of motor vehicles and miscellaneous assembly deteriorated further below the benchmark (50 points) from 48.6 to 46.7 points.
But speaking at the Automotive Component Manufacturers meeting in Abuja, she noted that the automobile industry is faced with both challenges and opportunities.
A statement issued last Friday by the Director of Information and Public Relations, Adebayo Thomas, said, “In a significant move aimed at fostering sustainable growth and development in Nigeria’s automobile industry, the Federal Government has issued a clarion call to all stakeholders, including manufacturers, dealers, regulatory bodies, and other players in the automobile ecosystem.
“The call comes as part of a broader strategy to enhance the sector’s contribution to the nation’s economy.”
Encouraging the stakeholders to key into the Nigerian Automotive Development Policy, the Minister said, “As far as we are concerned, the auto industry is now set to go.
“We are counting on all stakeholders to make that happen. If we do not produce made-in-Nigeria cars before the end of this year (December), it will be your fault, because I am sitting down here giving you all the assurances that this administration has created the enabling environment to make sure that the auto policy kicks off.”
Anite emphasised the need for collaboration among manufacturers, dealers, regulatory bodies, and other players in the automobile ecosystem, saying by working together, they can address challenges, streamline processes, and drive innovation.
She also urged stakeholders to maintain high-quality standards across the board, including vehicle manufacturing, safety features, emissions control, and after-sales services.
Stringent adherence to quality, she said, will boost consumer confidence and attract investment.
The minister assured all that the government would continue to encourage increased investment in research and development, adding that, innovations in electric vehicles, fuel efficiency, and alternative energy sources are critical for long-term sustainability.
On local content, she also emphasised the importance of promoting local content by sourcing materials and components locally.
By doing this, she said, the sector can create jobs, reduce import dependency, and contribute to economic diversification
In his introductory comments, the ministry’s Permanent Secretary, Nura Rimi, emphasised the significance of team action and shared vision as outlined in the Nigerian Automotive Development Policy.
He also urged stakeholders that the country “will overcome obstacles and unleash the full potential of Nigeria’s automotive component sector.”
He encouraged NADDC and other stakeholders to use the chance to form alliances, explore new areas of collaboration, and devise ways to catapult the automotive components manufacturing industry to new heights of success.
The statement added, “The government’s charge underscores the pivotal role stakeholders play in shaping its trajectory. Their commitment to sustainable practices will drive Nigeria’s automotive sector towards a brighter and more prosperous future.
“Environmental Responsibility: Stakeholders are reminded of their environmental responsibilities. Sustainable practices, recycling, and eco-friendly manufacturing processes are essential for a greener future.”

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Waive Tax On Electronic Imports, Women Engineers Appeal To Tinubu

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The Association of Professional Women Engineers of Nigeria (APWEN), Lagos Chapter, has called on President Bola Tinubu to exempt the importation of electronic components from taxation for inventive engineers.
Chairman of APWEN, Ms Atinuke Owolabi, said this a in statement yesterday in Lagos, in commenration of the 2024 World Creativity and Innovation Day, with the theme: “Step Out and Innovate”.
The Tide source reports that World Creativity and Innovation Day is a global UN Day, celebrated on April 21, to raise awareness about the importance of creativity and innovation in problem solving.
This is with respect to advancing the United Nations’ sustainable development goals, also known as the global goal.
Owolabi explained that such a measure would significantly enhance technological progress, support local innovators, and elevate Nigeria as a leading hub for innovation globally.
She stated that in a world marked by dynamic challenges and unprecedented opportunities, creativity and innovation stand as the driving forces behind progress and transformation.
According to her, women engineers recognise the critical role that innovation plays in shaping our societies and driving sustainable development.
”On this occasion, we affirm our commitment to fostering a culture of creativity and innovation within our organisation and the broader engineering community.
”Together, let us step out, innovate, and inspire the next generation of women engineers to reach even greater heights of achievement and impact.
”We believe that by stepping out of our comfort zones and embracing new ideas, technologies, and approaches, we can unlock innovative solutions to the complex challenges facing our world today,” she said.
According to her, the theme: ‘step out and innovate’, serves as a call to action for women engineers everywhere to break barriers, challenge conventions.
She noted that it would also pioneer groundbreaking solutions that would propel them toward a brighter and more sustainable future.
Owolabi disclosed that in celebration of the World Creativity Day, APWEN Lagos had inaugurated an artificial intelligence club tailored for female engineering students and young engineers.
She said that the proactive initiative aimed to inspire and equip young engineers with cutting-edge technological insights.
Th chairman said, “Additionally, we already have a 200-capacity hall to set up a resource, technology, and innovation hub to empower women and girls in engineering.
”This endeavour serves as a catalyst for encouraging aspiring female engineers to embrace innovation and stay abreast of emerging trends in the field.
”APWEN Lagos stands united in its dedication to promoting diversity, inclusivity, and excellence in engineering.
“We encourage all female engineers to seize this opportunity to unleash their creativity, explore new frontiers, and make an indelible mark on the world.”

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Pan-Igbo Group Hails Dangote Group For Reducing Diesel Price

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A pan-Igbo group, Ndigbo Unity Forum (NUF), has commended the Chairman of the Dangote Group, Alhaji Aliko Dangote, and his management for reducing the price of diesel from N1,600 to N,1000 per litre.
The Tide’s source reports that diesel is the major fuel used by heavy duty vehicles and generating sets to transport goods as well as run industries across the country.
The President of NUF, Mr Augustine Chukwudum, told The Tide’s source in Enugu, yesterday, that Dangote’s timely response to suffering masses of Nigerians, going through hell to get a meal a day, “is highly commendable”.
According to Chukwudum, Nigerians need to appreciate the patriotism of Dangote since what he has done will go a long way in reducing prices of goods, especially food stuff which has gone out of the reach of the poor.
He called on Nigerians, who wish and pray always for the betterment of the country, to appreciate and thank God for answering their prayer through Dangote’s move.
“It is clear that if Dangote Refinery starts fully and gets all the crude oil needed from Nigeria, the prices of petrol, kerosene and diesel will further reduce.
“We commend President Bola Tinubu for being a listening President and supporting the Dangote Group on our crude oil needs.
“We appeal to Tinubu to encourage Dangote by providing the company with crude oil at a reduced rate as we have been demanding,” he said.
Chukwudum said that this move and subsequent further reduction, would bring industries in comatose back to life, jobs created for unemployed youths and reduction in crime as well.
“We call on governors of oil-producing Anambra, Imo and Abia States to bring investors, who shall build refineries in each of the states to refine thousands of barrels of crude in commercial quantities,” he said.

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