NIGERIA

Buhari suspends two key aids linked to corruption
President Muhammadu Buhari has suspended two key aides over an alleged contract scam and for keeping an unauthorised stash of cash in a private home. According to a Daily Mail report the presidency said Buhari ‘has ordered an investigation into the allegations of violations of law and due process made against the Secretary to the Government of the Federation (SGF), David Babachir Lawal, in the award of contracts in the north-east.’ Lawal was also suspended from office ‘pending the outcome of the investigations.’ The report says last year, Lawal, a top-ranking member of the administration and a Buhari confidant, was alleged to have awarded contracts running into millions of naira to companies in which he had interests, within the Presidential Initiative on the North East (PINE). He denied the accusations. The money was part of government funds meant to rehabilitate the victims of the Boko Haram insurgency in the northeast. The report says Buhari has also suspended Ayo Oke, the head of the National Intelligence Agency (NIA), one of the country’s spy bodies, pending an investigation into the discovery of a stash of cash in a private apartment in the upscale Ikoyi area of Lagos. This was after the country’s anti-graft agency, the EFCC, seized over $43m in cash during a raid on the apartment. The money has been claimed by the NIA, prompting Buhari to order an investigation ‘to enquire into the circumstances in which the NIA came into possession of the funds, how and by whose or which authority the funds were made available to the NIA’. The report says the suspension of the two top aides is seen as a litmus test for Buhari who came to power in 2015 vowing to stop the plunder of state funds by corrupt politicians and public officials.

PINE was set up to coordinate the government’s response to the humanitarian crisis in the northeast where 4.7m people, many of them refugees from the Islamist insurgency by Boko Haram, are on the brink of famine and survive on rations, reports Reuters Africa. Alleged corruption and mismanagement have threatened to intensify the situation, one of the world’s largest humanitarian crises, say critics of the government’s handling of the northeast.  A three-man committee, headed by the vice president, is to conduct both investigations and submit its report to the president within 14 days.

Shehu Sani, the senator heading the committee that exposed the contract frauds at PINE, has commended Buhari for suspending Lawal. Also commenting on the move, Peoples Democratic Party Senator from Edo State, Matthew Urhoghide is quoted in a Premium Times report as saying that the suspension meant both executive and legislative arms were working cooperatively to check corruption. ‘We are all complimenting each other’s effort in fighting corruption, and that is the truth,’ Urhoghide said.

The first surprise was the huge pile of cash: more than $43m in US dollars, stacked in hundreds of neatly wrapped bundles in the filing cabinets and wardrobes of an empty apartment in Nigeria’s biggest city. But, reports The Globe and Mail, the next surprise was even more shocking. After the money was discovered in a raid by Nigeria’s anti-corruption agency, it was the national spy agency that claimed ownership of it. Many tenants of the upscale apartment building in Lagos, including the unit where the massive hoard of cash was found, were reported to be high-level officials and politicians. The report says it was the latest evidence of the vast web of official corruption in Nigeria, where billions of dollars in oil revenue have been siphoned off by a politically connected elite in recent years, even as poverty and hunger have climbed to disastrous levels. The report adds that it’s also not the first report of corruption in the northeast where millions are suffering from the Boko Haram conflict. In 2015, Buhari alleged that government officials had looted more than $2bn in funds intended for weapons to fight Boko Haram, causing thousands of Nigerians to die needlessly. He said the money disappeared into ‘fictitious and phantom’ military contracts, in which the ammunition and equipment was never provided.

During his campaign for the presidency and since taking office two years ago, Buhari has reiterated his anti-corruption campaign as a pillar of his administration. But, says a Quartzreport, while his public rhetoric galvanised the Economic and Financial Crimes Commission (EFCC), Nigeria’s anti-graft agency, his actions, when presented with a chance to mop out corruption within his own government, haven’t always matched his rhetoric. The report says, however, with two high-profile suspensions of two government officials this week, that has changed. Initially, Buhari resisted calls to sack his SGF as recommended by Nigeria’s Senate.
Daily Mail
Reuters Africa
Premium Times
The Globe and Mail
Quartz

IMF warns Nigeria of growth risks and volatile forex market
The International Monetary Fund (IMF) warned Nigeria its economy needs urgent reform in a report that highlighted the risks to growth for the recession-hit country and the dangers of a volatile foreign exchange market. Business Day reports that the document outlines a raft of failings in Nigeria’s handling of Africa’s largest economy and could affect talks over at least $1.4bn in international loans. It strikes a more critical tone than the IMF’s board recently adopted, though that also said Nigeria should lift its remaining foreign exchange restrictions and scrap its system of multiple exchange rates. The report says the Washington-based fund’s analysis came on the same day that President Muhammadu Buhari held a launch ceremony for a flagship economic recovery plan. But the IMF said the plan, criticised by economists for including few concrete measures, is not enough to drag Africa’s biggest economy out of recession. If Nigeria’s economy is to recover, ‘much more needs to be done’.

But Nigeria will easily achieve its target of $3.5bn foreign borrowing in 2017 as improved oil output helps the economy to recover from 2016’s contraction, the first since 1991. Business Day reports that this is according to Moody’s Investors Service vice-president and senior analytical adviser for Africa, Aurelien Mali, who said: ‘The international financial institutions are ready to support Nigeria.’ ‘As long as it is project-based lending, the funding will be available from lenders such as the African Development Bank, and the budget support from the World Bank will come on top of that,’ he said. Nigeria has proposed a record 7.3trn naira ($23.1bn) budget for 2017 to boost infrastructure investment and help its economy recover from a contraction of 1.5% in 2016, the first such slump in 25 years. The government has been negotiating $1.25bn in budget support from the World Bank and expects to get the remaining $400m of a $1bn credit facility from the African Development Bank, Mali said. Nigeria can raise the rest from bilateral and multilateral partners and also from lenders through commercial loans and or even a sukuk bond, he said. The report says Moody’s rates Nigeria’s debt at B1, four levels below investment grade.
Business Day
Business Day

Nigeria again raises issue of illicit capital flows at Washington meetings
Nigeria has again urged developed countries to stop providing safe havens for corrupt individuals and their illegal funds, reports The Guardian, Nigeria. The issue of the recovery of stolen funds from Nigeria was raised at the ongoing International Monetary Fund (IMF)/World Bank Group Spring meetings in Washington DC, by Minister of Finance, Kemi Adeosun. Adeosun is quoted as saying: ‘To improve non-oil revenues, we have to address illicit capital flows. When stolen money is transferred from Nigeria, or other African countries, there are too few questions asked by those countries that receive the funds, but when we identify those funds as stolen and seek to recover them, there are too many questions being asked. There is money sitting in foreign bank accounts that we have spent a fortune over a decade trying to recover. Such money could deliver significant value for Nigeria as we seek to increase spending on critical infrastructure and establish a basis for long-term sustainable growth.’
The Guardian, Nigeria

Senate to debate oil industry reform Bill
Nigeria’s senate will debate a long-awaited oil industry reform Bill after receiving the draft law, the latest step in efforts to overhaul the energy sector in Africa’s largest economy. Reuters Africa reports that the legislation is part of proposed reforms that make up the sprawling Petroleum Industry Bill, which has been in discussion for over a decade and redrafted many times but has yet to be passed into law. President Muhammadu Buhari, who took office in May 2015, made passing the legislation a priority as part of an attempt to crackdown on the mismanagement and corruption that has held back the country’s energy sector. Oil sales account for two-thirds of government revenue in the OPEC member state. The Bill’s acceptance into the upper house marks the closest it has yet come to becoming law, said Senate President Bukola Saraki. Once the senate has approved the Bill, it will be sent to the lower chamber of parliament. With the approval of both, the final version will be sent to the president to be signed into law.
Reuters Africa

Shell had knowledge of oil bribery scheme – emails show
Executives of petroleum giant Shell knew it was party to a vast bribery scheme that robbed Nigeria of $1.1bn, according to corruption watchdog Global Witness – a claim that has been denied by Shell. According to a Mail & Guardian report, Global Witness and Finance Uncovered said Shell executives knew that money earmarked for a controversial oil deal was being used to bribe senior Nigerian officials. They were referring to the 2011 purchase by oil giants Shell and Eni of OPL 245, an offshore oil bloc estimated to hold nine billion barrels of crude, for $1.3bn. The deal saw the Nigerian government act as an intermediary between the oil majors and Malabu Oil and Gas, a Nigerian company allegedly controlled by former petroleum minister Dan Etete. The report says allegations of corruption and bribery have mounted since the deal was signed, forcing Shell and Eni to maintain repeatedly that they acquired the rights to the lucrative bloc in line with Nigerian law. But email exchanges between Shell management cited in the Global Witness report suggest that Shell was aware that the OPL 245 money was probably going to be funnelled to individuals, including Etete and then-president Goodluck Jonathan. The leaked emails come as Shell and Eni are facing intense scrutiny in connection with the deal.

Nigeria’s lower house of parliament has, meanwhile, set up a committee to investigate the circumstances surrounding the award of OPL 245, Reuters Africa reports. Courts in Nigeria and Italy are investigating the purchase of the offshore block which was initially awarded in 1998 to Malabu Oil and Gas, in a disputed deal, before Royal Dutch Shell and Eni were awarded the rights in 2011. The House of Representatives mandated the committee to ‘conduct a thorough examination of the process and circumstances surrounding OPL 245 and identify culpability of any persons, groups or organisations,’ committee chairman Razak Atunwa said. ‘The committee is aware of recent information that have come to light, both nationally and internationally, indicating that former President Goodluck Ebele Jonathan may have been complicit in the controversial OPL 245 deal,’ Atunwa said. The committee was ‘considering inviting him to give evidence’ on the grounds that he ‘may well be in a position to assist it with its inquiries’.
Mail & Guardian
Reuters Africa

World Bank credit line to boost mining sector
The World Bank has approved $150m credit to help increase the mining sector’s contribution to the Nigerian economy, says a Daily Trust report. The senior communication officer of the bank, Olufunke Olufon said that the project would help to establish a strong foundation for mining sector development in the country. Olufon said that credit would also enhance competitiveness by improving information infrastructure and knowledge of mining. She said that it would equally help in strengthening key government institutions and foster domestic investments in the sector. ‘The project will help develop measures for formalising; regulating and inventorying artisan and small-scale mining; facilitate the flow of mineral transactions and facilitate access to finance. It will facilitate access to technology and equipment; increase knowledge and support the mining and processing of the minerals in accordance with best practices,’ Olufon said. She added that environmental and social protection would also be enhanced by the credit line.
Daily Trust

Abuja airport reopens
Nigeria has reopened the airport in the capital Abuja, following a six-week closure for runway repairs that disrupted international air traffic to the country, reports Business Day. During the shutdown, authorities diverted flights to Kaduna, a provincial airport 160km away, where carriers, including British Airways, Lufthansa and South African Airways, refused to fly on security grounds. The report says Abuja is the political nerve centre of Africa’s most populous nation and a major business hub in the continent’s biggest economy. There have been no official estimates of the economic impact of the closure, but Abuja International Airport handled 812 flights in December 2015, the last month for which the Federal Airport Authority of Nigeria (FAAN) has figures. The comparative figure for Kaduna was 12. Announcing Abuja airport’s re-opening, FAAN spokesperson, Henrietta Yakubu, said: ‘The rehabilitation of the runway was completed 24 hours ahead of schedule.’
Business Day

Military destroy illegal refineries in the Niger Delta
Nigeria’s military has announced that it has destroyed 13 illegal refineries in the restive Niger Delta oil hub, in an operation in which two soldiers died in clashes with ‘sea robbers’. Military authorities are quoted in Reuters Africa as saying that there are hundreds of illegal refineries in the region, which process stolen crude from oil company pipelines. The Nigerian government said earlier that it plans to legalise illicit refineries as part of an attempt to bring peace to the production heartland of crude oil, but it is unclear when it will put the plan into action. Major Abubakar Abdullahi, a military spokesperson, said troops ‘discovered and destroyed 13 illegal refineries’ while on patrol in the Iyalama Adama axis of Rivers state. The two soldiers were killed in the Ijawkiri general area, in Rivers state, he said. The report says makeshift refineries, usually hidden in oil-soaked clearings, support tens of thousands of people locally. Nigeria’s navy chief has said that 181 illegal refineries were destroyed last year, 748 suspects were arrested, and crude oil and diesel worth 420bn naira ($1.3bn) was confiscated. The military shut down around 50 bush refineries in the first few weeks of 2017.
Reuters Africa

Gasoline quality standards to increase
Nigeria will increase quality standards for its imported gasoline, diesel and kerosene from 1 July, a change health campaigners have long said is necessary to protect citizens from toxic fuel. Reuters Africa reports that according to an environment ministry official and information from the Standards Organization of Nigeria, all imported diesel from 1 July can contain a maximum of 50 ppm sulphur, while gasoline and kerosene can contain a maximum of 150 ppm. Nigeria’s current import standards are 3,000 ppm on diesel and 1,000 ppm on gasoline. The report says West African nations had promised higher quality fuel late last year as part of a UN Environmental Programme (UNEP), but details on the timeline and precise implementation had been unclear. Ghana had targeted an even earlier deadline, but sources said it had not yet finalised its new fuel requirements or issued a fresh timetable.
Reuters Africa

CBN cuts paperwork to improve ease of doing business for SMEs
The Nigerian central bank has cut the amount of paperwork small and medium-size businesses must provide to buy dollars, to improve liquidity and the ease of doing business and help narrow the gap between official and black market exchange rates, reports The Times of India. Faced with a shortage of dollars and numerous requirements to fulfil when buying hard currency from the central bank, most small and medium-size enterprises (SMEs) use the black market instead, even though the naira currency is much weaker there. To address this, the central bank said it was switching to a new application form for those seeking to buy forex at its official window that would require only an invoice and account details of the suppliers providing the goods to be bought with foreign currency. The bank said that the changes were taking immediate effect.
Times of India

Nigeria’s recession weighs on Ecobank’s results
Africa’s Ecobank, which operates in nearly 40 African countries, said a recession in Nigeria and a strong US currency had caused it to report a loss for 2016, sending its shares 5% lower. According to Business Report, Nigeria accounts for 40% of Ecobank’s revenues and is in its second year of recession, brought on by lower oil prices which has caused chronic dollar shortages, frustrating businesses and households. ‘Our group revenues remained resilient despite a tough year of macroeconomic headwinds including a weaker economic environment, particularly in Nigeria, and the strengthening of our reporting currency – the US dollar,’ Ecobank said.
Business Report

IN COURT

Airline refusing to pay salary, despite court order
The troubled Nigerian airline, Chanchangi, and top officials of the National Industrial Court are at the centre of an alleged conspiracy to deny a retired pilot, Eric Adegbite, 67, his due benefits, several years after serving the company. According to a Premium Times report, Adegbite who worked for the airline for nine years resigned in 2010 after working for several months without a salary. He approached the Lagos division of the industrial court in 2012 for payment of his salary and retirement benefits. The report says according to court documents, two years after the litigation commenced, judgement was delivered in his favour. It says that the MD of the airline, Trevor Worthington, and a director, Bello Chanchangi, did not deny indebtedness to Adegbite, However, three years after the judgement and seven years after the pilot retired from the company, the victim has not been paid his dues.
Premium Times

WEST AFRICA

NIGERIA

Nigeria lags other West African countries in human development
The UN Development Programme (UNDP) has released its 2016 human development index report which rated Gabon, Ghana and a host of other countries above Nigeria. The report surveyed a total of 188 countries. According to a Nigerian Bulletin report, while Nigeria ranked 152 – the position it occupied last year, Gabon was placed at 109. Equatorial Guinea was 135 on the list, and Ghana and Zambia maintained the 139th position. Nigeria emerged the 17th most developed country in Africa, and 13th most developed country in sub-Saharan Africa. In the report, Nigeria was placed under the ‘low human development’ group out of its four levels of human development group. The 2016 human development report focused on ‘communities that have been left behind, despite development progress over the last 25 years’. Ojijo Odhiambo, the economic adviser, Nigeria and ECOWAS, UNDP, said Nigeria needs to redouble its effort in making sure that it addressed the factors that were impeding its improvement on the index. Some of these include issues of inequality, education, discrimination among women, promotion of social inclusion and accountability, as well as the upholding of human rights.
Nigerian Bulletin
Report