The ActionAid has raised the alarm that Nigeria’s economy might face a major fiscal crisis with the increasing financing of fiscal deficit with borrowings.
In a statement by the non-governmental organisation yesterday, after a virtual meeting to review the state of the nation by its General Assembly, members lamented that the fiscal deficit financed mostly by domestic and foreign borrowings has widened with high debt service payments, estimated at more than half of federally collected revenues. This, it noted poses major fiscal risk to Nigeria’s economy.
Other observations from the meeting were that Nigeria was faced with an unprecedented wave of different, but overlapping security crises – from kidnapping to extremist insurgencies – lamenting that almost every corner of the country has been hit by violence and crime with the growing insecurity being closely linked to the high rate of poverty in the country.
Attendees at the meeting also described as unhealthy the ongoing strike of medical doctors across the country, being the fourth time since the outbreak of the COVID-19 pandemic, with some of the doctors saying they were being owed salaries for several months.
They lamented that many Nigerian media outlets had been reporting that patients – some with COVID-19 symptoms – were being turned away at short-staffed hospitals.
They, however, said the ongoing Review of the 1999 Constitution offers the opportunity for Nigerians to shape the constitution with the goal that it reflects the desires and aspirations of the citizens.
It stressed that some of the provisions to be considered vital for the uplifting the citizens out of the present socio-economic challenges included socio-economic and cultural rights as contained in chapter two of the country’s constitution; issues of gender equality and a thorough reform of the Nigeria Police.
They observed that the Twitter ban by the federal government has had severe economic costs, stating that it was a step backwards for civic engagements and threatens the civic space which has continued to shrink in recent years.
They, however, recommended that the rising public debt, unemployment, inflation, and high cost of living required the immediate embracing of fiscal federalism in absolute terms, noting that this would enable the country to break the vicious cycle of poverty, eliminate the wholesale dependence on oil which makes Nigeria a monolithic economy.
They also advised that tackling the nation’s current security challenges required increasing the manpower and welfare of all security agencies and equipping them with modern combat equipment, skills, and training, urging the government renew its partnership with neighboring countries to enhance intelligence exchange and information sharing that would help in quelling the insurgency and other sundry crimes, while calling for the state-of-the-art combat Tucano and Alpha jets newly acquired to be deployed immediately to help in further neutralizing the criminal elements with precision and bring the protracted insurgency to an end.
They urged the federal and state governments to explore different models to improve the work environment for medical practitioners, adding that health insurance must be made mandatory with sound mechanisms to prevent corruption for universal health care coverage.
MTN Nigeria compensates subscribers for network downtime
MTN Nigeria Communications Plc has announced compensation for its subscribers to make up for the network disruptions experienced last Saturday.
On Saturday, 9th October 2021, MTN Nigeria users witnessed hours of network disruption caused by an outage that left customers without a connection.
Olutokun Toriola, Chief Executive Officer, MTN Nigeria, apologised again to customers for the inconvenience, stating that new measures were being implemented to mitigate a repeat of such an event.
“On behalf of the entire MTN team, I want to start with a heartfelt apology. We are truly sorry for the disruption this caused for so many in our MTN family. We know that millions of people rely on us to stay connected to their loved ones, to manage their businesses, to coordinate their lives. We take that responsibility, and privilege, very seriously. That’s why we are putting new measures in place to make sure we never experience anything like last Saturday again,” said Toriola.
On the cause of the outage, the CEO stated that it was due to an error that shifted all 4G customers onto the 3G band and impacted the whole network, adding that the technical teams were able to rectify the problem.
“Our technical teams have traced the cause of the problem to an error that shifted all our 4G customers onto the 3G band. This overloaded the 3G band, causing a domino effect that impacted the whole network.
“Our engineers were able to resolve the problem. I know that recently other technology companies have suffered outages. I want to reassure you that last Saturday’s event is in no way connected to those. This wasn’t sabotaged, it was a regrettable error.’’
Beyond extending time-bound subscriptions for its customers and as a way to further compensate its customers, the telecom giant said that customers on the MTN network have received a refund for the data and airtime that they used between 12noon and 7pm on Saturday, 16th October 2021.
“While we can’t give you back the time you lost last Saturday, we can give you back what you spent yesterday. Every customer on the MTN network has received a refund for the data and airtime that they used between 10 am and 3 pm yesterday. We hope it shows how much we value our customers.
“You truly are our most important focus. We all have challenges, each and every one of us – young or old, personally or professionally. What matters is how we respond. With you by our side, we will continue to improve and grow. Thank you for all your support. Thank you for walking with us over the last 20 years. We look forward to the next 20 and more with you,” Toriola stated.
IMF cautions as crypto market value surpasses N820trn
Financial experts with the International Monetary Fund (IMF) have called for caution and regulation as the total market value of all the crypto assets surpassed $2 trillion (N820 trillion) – a 10-fold increase since early 2020.
The experts, Dimitris Drakopoulos, Fabio Natalucci and Evan Papageorgiou, in an article on the IMF’s blog, warned that many of these entities lacked strong operational, governance and risk practices.
They noted that crypto assets offered a new world of opportunities but warned that along with the opportunities come challenges and risks.
The trio explained that crypto exchanges, for instance, have faced significant disruptions during periods of market turbulence, adding that there are also several high-profile cases of hacking-related thefts of customer funds.
The financial experts argued that consumer protection risks remain substantial given limited or inadequate disclosure and oversight.
“For example, more than 16,000 tokens have been listed in various exchanges and around 9,000 exist today, while the rest have disappeared in some form.
The extent of the adoption of crypto assets is difficult to measure, however, surveys and other measures suggest that emerging markets and developing economies like Nigeria may be leading the way.
US may sanction IOCs in Nigeria, others for Hydrocarbon production
International Oil Companies (IOCs), which insist on ramping up production of fossil fuels in Africa may face the risk of regulatory action from the United States.
This was disclosed by the country’s Deputy Special Presidential Envoy for Climate, Jonathan Pershing.
If the US makes good its threat, it will be a major blow to Nigeria, Angola, Congo and other oil-producing countries in Africa, which have intensified efforts to attract foreign investors to fund major hydrocarbons projects on the continent.
In August, President Muhammadu Buhari finally signed the Petroleum Industry Act (PIA) to spur competition in the sector as well as attract foreign investments.
But with the position of the US, many of the expected funding for Nigeria’s fossil fuels may be stranded since oil companies would be circumspect about putting their dollars in the upcoming projects.
Western fossil fuel companies planning to develop new projects in Africa would then need to consider the significant risk of regulatory action vis-à-vis the returns on investment in Africa.
Speaking from South Africa, the US envoy urged western investors to consider whether fossil fuels were a good commercial opportunity anymore in Africa or anywhere else.
“There’s a risk of regulatory … and financial activities, and I believe that’s getting more and more explicit. If you are a company looking to invest in oil and gas, you have to ask yourself…‘am I going to be left with a stranded asset?’ I would not bet very strongly on a fossil fuel future,” he said.
Pershing, who was speaking at a virtual media briefing, after being asked about the current rush by western oil and gas companies to develop deposits in Africa, noted that even China had committed to stop building overseas coal plants.
Africa accounts for just 3.8 per cent of greenhouse gas emissions, according to the non-profit Carbon Disclosure Project, but Pershing noted it was the fastest-growing continent.
It could, he said: “leapfrog” older carbon-based technologies and embrace renewables, just as it skipped wired telecoms in many places and went straight for wireless.
“Africa doesn’t need to move in the direction of the West’s high-carbon intensity. It can move directly beyond that,” he said.
His comments came despite the United States itself being a major producer and exporter of oil and gas, with recent growth driven by output from shale fields, a Reuters report said.
The US envoy is visiting several African countries as part of efforts to raise global climate ambition ahead of the United Nations COP26 Climate Summit in Glasgow, Scotland next month.
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