N791 billion disbursed to farmers: CBN

 

The Central Bank of Nigeria (CBN) says it has disbursed N791 billion to over three million farmers across the 36 states under its Anchor Borrowers’ Programme (ABP).

The director of the Development Finance Department of the bank, Yusuf Yila, disclosed this on Friday in Abuja during an interaction with journalists.

Mr Yila said the apex bank had reduced the interest rate on loans from nine per cent to five per cent to encourage more farmers to have access to the credit.

The ABP was launched on November 17, 2015, and was designed to provide farm inputs and cash to Small Holder Farmers (SHFs).

The programme was intended to link anchor companies involved in food processing and SHFs of the required key agricultural commodities through commodity associations.

He added that the programme had helped farmers improve their yields, especially maize, from initial two metric tons per hectare, to five metric tons per hectare, while that of rice to four metric tons per hectare.

Mr Yela stated that the bank was also investing in reducing post-harvest losses of farm produce by encouraging dry season farming, describing it as “better in reducing such losses.

“Agriculture works better in the dry season because you cannot control water during the rainy season, but you can control it during the dry season by using irrigation. The bank is also building silos and irrigation dams to reduce losses,’’ he said.

Mr Yila further explained that the apex bank had disbursed about N312 billion in energy infrastructure support through the National Mass Metering Programme.

He noted that the programme was initiated to bridge the six million metering gap in the country, adding that 670 thousand meters had been distributed nationwide.

“We are also ensuring value addition in the scheme by ensuring the meters are not fully imported but assembled in Nigeria,” said Mr Yila. “By that, we are creating thousands of jobs and also supporting economic diversification.’’

(NAN).

Experts report on why Naira depreciates despite CBN intervention

By Michael Okakor:

The President, Association of Bureau De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, has blamed the recent depreciation of naira on the speculators’ resistance by the banking industry.

The president revealed on Saturday in Lagos that the refusal of some banks to sell the invisibles such as personal and business travel allowances frustrated naira recovery.

The ABCON chief said that the CBN had recently accused the banks of frustrating its policies.

Naira depreciates as central bank moves to intervene again

The naira on Wednesday depreciated sharply to N465 per dollar in the parallel market due to upsurge in demand for dollars importers travelling to China.

Investigations revealed that the parallel market exchange rate rose from N448 per dollar on Tuesday to close at N465 per dollar at the close of business on Wednesday, indicating N17 depreciation.

CBN sells $180 million forex to boost liquidity

The Central Bank of Nigeria (CBN) yesterday released additional $180 million to the forex market to further ease business transactions in the country.

The intervention was done in two phases – an $80 million offer for Personal Travel Allowance (PTA), school fees and medicals at the inter-bank market and $100 million Wholesale Forwards Market sell, which by the new policy, is reduced to maximum of 60-day tenor.

Reps chide Emefiele over information on $17bn crude proceeds

 

House of Representatives

The House of Representatives yesterday chided the Central Bank of Nigeria (CBN) Governor, Godwin Emefiele over his alleged failure to furnish the lawmakers with details of the proceeds of crude oil sales between 2011 and 2014.

Abdulrazak Namdas, Chairman of the House ad hoc committee probing into the issue, said CBN’s failure to provide such details was delaying probe of undeclared crude oil exports in those years.

CBN reintroduces charges on cash deposits, withdrawals

The Central Bank of Nigeria on Thursday announced the reintroduction of bank charges on certain categories of cash deposits and withdrawals, three years after it stopped the charges.

The reintroduction of the charges was contained in a circular to all Deposit Money Banks posted on the website of the CBN.

Interbank rate jumps to 50% on CBN forex sales

The overnight lending rate rose sharply to around 50 per cent on Friday, from an average of 4.5 per cent on Thursday, after the Central Bank of Nigeria debited commercial banks’ accounts for special foreign exchange sales.

The CBN had on Monday asked banks to submit bids for a “special currency auction” to clear the backlog of matured outstanding dollar obligations for selected sectors of the economy, which include airlines, fuel importers and manufacturing firms.

Forex traders said the central bank sold “funded forwards of two to five months tenor” dollars to the targeted sectors at an auction this week and required them to pay for the dollar sale on Friday.

The CBN is yet to disclose the amount sold but currency traders said the cost of borrowing among banks climbed because of a scramble for funds among commercial lenders to pay for the forex purchases, Reuters reported.

The country is in its first recession in 25 years, caused by low global oil prices, which have cut the supply of dollars needed to fund imports.

Attacks by militants on pipelines in the Niger Delta since January have cut crude output, reducing dollars earned.

The dollar shortage in the country has caused many companies to halt operations and lay off workers, compounding the economic crisis.

The naira has traded at around 305.5 naira to the dollar on the official interbank market since August, while it was quoted at 495 to the dollar on the parallel market on Friday.

The financial market is closed until Wednesday due to public holidays over the Christmas period.

CBN to unveil N30bn agric/SME fund in January

Godwin Emefiele

The Central Bank of Nigeria has said it will, together with the Deposit Money Banks, set up a new fund to boost agriculture and the Small and Medium-sized Enterprises in the country, targeting at least N30bn for the first year.
The Governor, CBN, Mr. Godwin Emefiele, disclosed this on Saturday at a press briefing after the eighth Bankers’ Committee annual retreat in Lagos.
He said the Agriculture/SME Fund would be unveiled on January 1, 2017, but the money would not be available until around March or April after the DMBs’ audited accounts would have been presented to the public.
Emefiele, who is also the Chairman of the Bankers’ Committee, said the committee would continue to promote an efficient and stable economy to deliver price stability, financial system stability, financial inclusion and economic growth.
According to him, the committee has defined goals for 2017 to include supporting government’s efforts to develop adequate infrastructure to engender viable and productive SMEs, and increasing access and cost of funding, particularly to the agriculture and manufacturing SMEs.
He said, “We will identify opportunities to provide funding and necessary support for agriculture and manufacturing SMEs, including structures and systems to improve the ease of regulatory compliance.
“The central bank will, together with the banking sector, establish an agriculture/SME fund from contributions of a portion of profit after taxes of Deposit Money Banks as a deliberate strategy to support the funding and access to finance by the SMEs and primary agriculture.”
The governor said the modality for the fund, which will operate as an equity fund, would be worked out by the Bankers’ Committee and communicated in due course.
He said the committee would continue to focus on capacity building and expansion as well as deepening awareness of available information infrastructure.
The communiqué issued at the end of the retreat, “Efforts will include providing industry-focused SME financial skills curriculum to develop financial and business capacity; promoting the need for capacity building; promoting the use of payment systems; providing shared structures for basic financial records; and providing the use of new and existing financial infrastructures for access to credit.
“Over the next few days, the Bankers’ Committee will finalise the strategy, governance framework action plan and assign responsibilities for implementation of the committee’s programme for 2017 that will achieve the desired results and outcomes.”

Punch

We’re not allocating dollars, says CBN

The Central Bank of Nigeria says it is not allocating United States dollars as it has set up an interbank foreign exchange market for anyone interested in buying the greenback through Deposit Money Banks.

The Acting Director, Corporate Communications, CBN, Mr. Isaac Okorafor, said this in an emailed statement on Sunday.

Though Okoroafor did not state the object of his reaction, the Emir of Kano, Sanusi Muhammad II, had on Friday said the country’s foreign exchange management lacked credibility.

“There is one rate for petroleum marketers, there is inter-bank rate, there is another for money market operators such as Western Union and MoneyGram, there is the Bureau De Change rate, and there is a special rate that you get when you call the CBN for a transaction,” he said.

Sanusi, a former Governor of the CBN, spoke at a policy dialogue forum organised by Savannah Centre for Diplomacy, Democracy and Development in Abuja.

“It is not true that the CBN allocates dollars. There is nowhere in the world that the central bank sits by and allows vicious speculators to solely distort the value of its currency endlessly,” Okoroafor said.

According to him, all central banks intervene to buy or sell in the market to ensure that local currencies are protected from dubious attacks.

Okorafor said, “The channels for advice and contribution of ideas on the current economic situation by all patriotic Nigerians are open. It is rather unfortunate that some people have chosen to play to the gallery and to make statements to disparage those in leadership at this time in total insensitivity to the larger interests of the Nigerian economy.

“We should not forget that the seed of our current economic crisis was planted by the failure of those who occupied public offices in the past but failed to act in the long-term interest of the Nigerian economy. It is easy to criticise from outside.”

He said the CBN would continue to explore reasonable avenues to find solutions to the current economic situation.

Okorafor said, “The challenge we face today is a choice between pandering to the established interest in Nigeria’s speculative economy and the protection of the wages of the real stakeholders who work hard on fixed incomes and are the core victims of naira depreciation.

“Already, Nigerians are waking up to the call to be more productive and look inwards, and to be less dependent on the importation of foreign goods and services.

(PUNCH)

Expect more policies – CBN tells banking industry

The Central Bank of Nigeria (CBN) has said it will be churning out more policies in the banking industry to drive the nation towards economic recovery even as it affirmed that there is no love lost between the fiscal and monetary authorities.

Governor of the CBN, Godwin Emefiele said while the two authorities are working together in addressing the economic challenges of the country, the fiscal authority is being constrained by bureaucracy.

Citing the example of the $30 billion bond which the federal government is seeking legislative approval to raise and which has met hiccups, Emefiele said the CBN is not held back by such constraints. Consequently, he said operators in the financial industry should be prepared to see more policy issuance that would be geared towards reviving the economy.

Emefiele who was represented at the quarterly meeting of the Chief Audit Executives of Banks held in Lagos at the weekend by his Special Assistant on financial markets, Emmanuel Ukeje, said, “in this era of change and challenge, you will notice and should continue to expect a stream of policy initiatives from the CBN. Our objective is to use monetary policy tools, sectoral preferences in resource allocation and other forms of intervention to drive our national economic recovery.”

The CBN governor in his keynote address on “Changing Business Environment: The Role of Internal Auditors” said Deposit Money Banks are critical players for the realization of the overall thrust of the Government and CBN, and as such are expected to faithfully implement apex bank’s policies and guidelines.

Emefiele who urged bank audit executives to play their own role towards ensuring that Nigerian banks remain healthy and stress-free so that they can absorb any unexpected shocks, said, “as is the case in all systems and climes, some people including bankers and customers, may be tempted to take undue advantage of the occasional loopholes that may arise in the course of the expected policy readjustments. As internal auditors, you must not allow or encourage this. I encourage you to insist that your banks, as institutions, comply fully with all CBN Guidelines; and raise a warning flag when they fail to do so.”

He noted that at this crucial point in Nigeria’s financial history when money is scarce and there is a noticeable decline in the purchasing power of the people, there was need for stakeholders in the economy to collaborate in order to turn the current situation into future prosperity.

He outlined areas that should engage the attention of the executives over the next couple of years, stressing that banks must maintain good internal control, ethical practice and sound risk management, adding that Nigerians expect this, especially at a time of challenging operating environment.

“Therefore all the necessary measures for capital adequacy and indices of sound risk management must be in place and fully enforced. As internal auditors, you must all be proactive, look out for any factors that could destabilize the system, quickly identify and deal with them. You must pay particular attention to banks and customers operating in risk-prone and highly volatile sectors of the economy,’’ he said.

The CBN governor also urged audit executives to be very vigilant and guard against fraud, because as internet penetration continues to gather steam in Nigeria, greater volumes of transactions will be consummated online; and on various electronic formats and platforms.

Telecoms workers fault CBN gov for urging call tax

The Nigeria Union of Postal and Telecommunication Employees on Tuesday faulted the Central Bank Governor, Mr. Godwin Emefiele, for advising GSM service providers to tax calls above three minutes.

NUPTE President, Sunday Alhansan, told the News Agency of Nigeria in Abuja that the tax would worsen the economic problems being experienced by Nigerians.

Emefiele had suggested that Federal Government should impose taxes on phone conversations that last more than three minutes, as a way of generating revenues.

The CBN governor said that the tax would cushion the effects of the economic recession and could raise additional revenue for the country.

Alhassan said the suggestion is “counterproductive.”

“The people you want to tax are also affected by the recession; and if you say that they are to be taxed, definitely you are asking people to stop making calls.

“And when they stop making calls, the GSM operators are going to be affected and once they are affected, there will be drop of some of their lines.

“What is going to happen is that they are going to sack their workers.

“So, that is why such a suggestion should not be brought up in the first place because it will cause more harm than good to the people,’’ he said.

Alhassan called on the Federal Government not to listen to any neo-liberal advice that would expose Nigerians to further hardships.

He called on the government to fashion out innovative ideas of creating sustainable employment that would bring succor to the people and not by taxing citizens the more.

“What we are telling the government is that it should look for succor for the people, the common man is not finding it funny.

“Our advice is to stop this idea of imposing tax on calls above three minutes, as it is not going to do anybody any good,” Alhassan said.

He advised government to look at ways of utilising looted funds that was returned to its coffers for economic development. 

(NAN)

CIBN, Skye Bank pledge cooperation

The Chartered Institute of Bankers of Nigeria is exploring new ways to forge a partnership with Skye Bank Plc and enhance economic growth.

The President/Chairman of Council, CIBN, Prof. Segun Ajibola, stated this when he led the council on a courtesy visit to the management of Skye Bank in Lagos.

He said the delegation was on a mission to seek areas of mutually beneficial cooperation between the bank and the institute.

While soliciting the support of players in the banking industry for the institute, Ajibola urged members to continue to contribute to the enhancement of the banking profession.

He lauded the Group Managing Director/Chief Executive Officer of the bank, Mr. Tokunbo Abiru, for the leadership qualities he had demonstrated in strengthening the operations of the bank since he assumed office.

In a statement by the lender on Sunday, Ajibola was quoted as inviting the management of the bank to the forthcoming annual bankers’ dinner.

The CIBN president had earlier enumerated the vision of the institute under his leadership as being guided by seven Cs, which he gave as capacity building, certification, codification, communication, creativity, consolidation and constructive engagement.

He further stated, “The seven Cs is intended to transform and enthrone a contemporary institute that is responsive, reliable and resourceful in all areas of its mandate, scholarship, professionalism, relevance, ethical and result-oriented.

Financial Expert Calls For Customer Protection To Promote Stability

The Nigeria Deposit Insurance Corporation (NDIC) has organised a stakeholders meeting for the business community in Kano State, as part of efforts to enlighten bank customers and other consumers of financial services on their rights.

The Managing Director of the NDIC Umar Ibrahim said Nigeria is in dire need of a positive attitude to revamp the economy in which customer protection will help promote financial stability in the country.

The aim of the town hall meeting, conceived to address the concerns and expectations of depositors especially small depositors who may lack or have limited capacity to fight for their rights in the complex financial system of modern banking.

A representative of the Central Bank of Nigeria, (CBN) Tijani Zakirai said the Apex Bank has been working with the NDIC and other stakeholders in the effective mobilization of bank customers across the country, but the lack of a sustained sensitization and enlightenment program remains a major hindrance to the country’s financial inclusion.

Meanwhile, traders and many other members of the Kano business community raised various financial and business questions why the regulatory authorities offered advises.

While the NDIC promises to sustain the program on annual basis, most people in hope to see more of this gathering for strong and effective financial system in the country.

CBN sets May 2017 for interchange fee regime execution

The Central Bank of Nigeria (CBN) has set May 1st 2017 for implementation of the new interchange fee regime for operators in the payment cards industry.

In a circular dated November 1st but posted on its website yesterday, the apex bank stated that as from that date, the interchange fee will replace the Merchant Service Charge (MSC), adding that Merchants and Acquirers will be required to negotiate the MSC, while it (CBN) will control the interchange fees paid by Acquirers to the Card Issuer and other regulated service providers.

Director, Banking & Payments System Department, Mr. Dipo Fatokun, who signed the circular, stated that the interchange fee was introduced as a result of the limitations of the MSC regime and the objectives of the Payments System Vision 2020.

He said: “CBN hereby gives a period of six months, starting from November , 2016 to stakeholders to sensitise their merchants on the changes expected, and for card schemes to reconfigure their systems to the new pricing structure.

The interchange regime will commence live operations effective 1st May, 2017.”

The CBN Director noted that the introduction of the new pricing regime would bring about: “even greater payment card issuance and utilisation, investment in loyalty programmes and the expansion of acquirer network infrastructure across the country.”

He stated that modalities for aspects of the implementation of the new regime would be developed and communicated by the Nigeria Interbank Settlement System (NIBSS), within three months from the date of the circular .

Naira may not fall below 475

Economic and financial experts say the naira may not fall below 475 against the United States dollar between now and end of December.

They based the prediction on declining dollar demand and efforts being made by the Central Bank of Nigeria to boost supply of foreign exchange.

The experts spoke in separate interviews on the outlook of the naira.

“It appears the exchange rate has got to the peak, which is something around 470/dollar. I think  the naira may not go beyond 475/dollar between now and end of December,” a currency strategist at Ecobank Nigeria, Mr. Kunle Ezun, said.

He added that holidaymakers returning to Nigeria for Christmas would also make dollar supply to increase.

According to Ezun, this will reduce the currency volatility created by dollar scarcity.

The Chief Executive Officer, Cowry Asset Management Limited, Mr. Johnson Chukwu, said due to declining economic activities, demand for forex was gradually reducing.

This, coupled with efforts being made by the regulator to boost forex supply, will make the naira-dollar exchange rate to remain around the 470 mark in the coming weeks, according to him.

The President, Association of Bureau De Change Operators, Alhaji Aminu Gwadabe, said efforts being made by the CBN to boost supply would make the naira to appreciate in coming months.

He said, “The CBN Governor, Mr. Godwin Emefiele, met with the International Money Transfer Organisations in London on Saturday. The government is trying to woo these operators to enable them to bring more forex into the country. This will boost supply. Already, the exchange rate which the IMTOs can sell dollars to the banks has been increased from 336 to 375.”

He added, “At the association level, we have created committees that will check sharp practices in the market. All these will yield result.”

Naira weakens to 470 on fresh dollar shortage

The naira tumbled to 470 against the United States dollar on Wednesday, down from 455 on Tuesday as fresh dollar shortage hit the official and parallel foreign exchange markets.

The local currency has been relatively stable, hovering around 455 against the greenback in the last one week.

This came after Travelex and First Bank of Nigeria Limited commenced sale of foreign exchange to Bureau De Change operators following the Central Bank of Nigeria’s approval.

Forex traders, however, said on Wednesdays that the scheme had failed to ease the biting dollar shortage in the country.

“What we get from Travelex is not sufficient,” one trader told Reuters, referring to the demand in the market.

At the official market, the naira closed at 305.50 per dollar, a level it had maintained for more than two months, supported by the CBN interventions.

Earlier, the CBN asked international money transfer operators to sell dollars directly to the BDC operators to boost liquidity and narrow the gulf between the parallel market and the official market rates.

Travelex sells around $15,000 to 1,000 retail currency outlets weekly, but the amount is a fraction of what is required to cover the demand from individuals and small businesses.

Dollar shortages have caused many firms to halt operations and lay off workers, compounding an economic crisis exacerbated by the fall in global oil price, which accounts for 70 per cent of Nigeria’s budget revenue.

The CBN has struggled to support the naira as the nation’s external reserves continue to fall. Traders said the naira had been testing new lows as they tried to find thresholds where liquidity could begin to return.

At N300/dollar, no need for fresh devaluation – Emir Sanusi

The Emir of Kano and former governor of the Central Bank of Nigeria (CBN), Muhammad Sanusi II, has said that the naira, at 300 to a dollar, needs no fresh devaluation.

Sanusi said all the CBN needs to do is to make the Bureau de Change (BDC) segment of the market liquid, and watch the gap between official and parallel market close, with investors bringing in more forex.

“My public position is that if the Central Bank can improve on its management of foreign exchange, provide liquidity to the parallel market, get a convergence between the BDC rate and the official rate, also keep these yields where they are, that will help to attract the foreign exchange that we need to stabilize in the short term,” he told Daily Trust.

“While I think the naira is undervalued, certainly if you look at the purchasing power parity, when you look at the nominal exchange rates, when you look at the rate of inflation, it stands to agree that even at 300, the naira will be slightly undervalued.

“Fundamentally, I think the exchange rate is where it’s supposed to be. What is obviously the problem, is not the fundamentals, it is the managing of the regime, so that people will have the confidence that we are indeed having a flexible exchange regime and also that we are closing the gap between the official and the parallel market rates, and that could only happen when we have liquidity within that segment.”

He said the central bank decided not to sell forex to BDCs, adding that the segment of the market where the naira is trading at 470 to 490 is a very shallow segment, which however has impact on the entire market.

“What you said is for N470-N490 to the dollar might be a very small volume in transactions, but it does have the impact of creating the impression that it creates a huge gap.

“So if we could just provide liquidity to that segment and close that gap it will help a lot. But in terms of where the naira is today, there is no need for any further devaluation as far as the fundamentals are concerned but we have to take steps to address confidence.

“We spent one year defending an exchange rate regime that everybody knew would not work. It has been tried by Chavez in Venezuela, tried by Mugabe in Zimbabwe and Rawlings in Ghana.

“It never works so everybody knows it will not work for Nigeria, unless oil prices miraculously rebound. So the real issue is the confidence issue, which is convincing the world that we had an error in the past and it has been corrected now.”

The local currency was trading at 450, 550, and 495 to the dollar, pound and euro, respectively, at the parallel market.

Naira shortage pushes interbank rate to 150%

Two days after commercial banks placed funds with the Central Bank of Nigeria to participate in last Friday’s currency forward auction, overnight interbank rate was quoted at a record high of 150 per cent on Tuesday.

Traders said few deals were done on Tuesday due to a shortage of naira on the money market, with banks unwilling to place funds among themselves until the result of Friday’s currency auction was published.

On Friday, the CBN held a two-month dollar forward auction to clear a backlog of demand from airlines, manufacturers and other companies, as the exchange rate crisis deepened.

Traders said the banks were later directed by the CBN to re-submit bids again on Monday.

It was learnt that rates spiked because banks were barred from the CBN’s repo window before any currency auction. The CBN had not announced result of the auction as of Tuesday.

“Most banks are not quoting rates because they are still waiting for the result of the FX auction,” one trader said.

The regulator has been tightening liquidity and intervening directly with dollar sales to banks to support the ailing naira, hit by the fall in oil prices, the nation’s economic mainstay.

Overnight rates closed at 128 per cent on Monday after they opened at 100 per cent, up from 14 per cent on Thursday.

The money market ended with no deals on Friday as lenders held onto naira to be able to participate at the auction.

The overnight interbank lending rate soared to a record high of 128 per cent on Monday on naira cash shortages after commercial banks  funded their account with the Central Bank of Nigeria to participate in last Friday’s currency forward auction.

Overnight rates opened at 100 per cent on Monday, traders said, after the money market ended on Friday with no deals as commercial lenders held onto naira to be able to participate in the auction, Reuters reported.

Overnight money had traded at 14 per cent on Thursday.

Economy: CBN Maintains 14% Interest Rate

Folasade Folarin(NAN): Nigeria’s Central Bank has retained the basic interest rates at 14 per cent. Governor Godwin Emefiele in announcing the decision of the Monetary Policy Committee (MPC) on Tuesday also urged the Federal Government to evolve robust fiscal policies in reviving the economy from recession.

Emefiele said the committee elected to retain the current policy, which is the Monetary Policy Rate at 14 per cent, Cash Reserve Ratio at 22.5 per cent and Liquidity Ratio at 30 per cent.

The Asymmetric Window was also retained at +200 and -500 point around the Monetary Policy Rate.

Emefiele said that the Committee acknowledged the weak macroeconomic performance and the challenges confronting the economy.

He said that the MPC had consistently called attention to the implications of the absence of robust fiscal policies to complement monetary policies in the past.

“The MPC reiterated the fact that monetary policy alone cannot move the economy out of stagflation.

“The MPC considered the numerous analysis and calls for rates reduction but came to the conclusion that the greatest challenge to the economy today remains incomplete fiscal reforms which raise costs, risks and uncertainty.

“The calls came mainly from the belief that reducing interest rates will spur credit growth, in the private and public sector, which will help provide liquidity to stimulate consumption and investment spending.

“The urgency of a monetary-fiscal policy retreat along with trade and budgetary policy, to design a comprehensive intervention mechanism is long overdue,” he said.

Emefiele said the Bank had since 2009, expanded its balance sheet to bail out the financial system and support growth initiatives in the economy, even though it was the work of the fiscal policy makers to do so.

He said nevertheless, the apex bank would continue to deploy its development finance interventions to complement the overall effort of fiscal policy towards reinvigorating the economy.
“The interest rate decisions of the bank are therefore anchored on sound judgment, fundamentals and compelling arguments for such policy interventions.

“The committee also feels there is the need to continue to encourage the inflow of foreign capital into the economy by continuing to put in place incentives to gain the confidence of players in this segment of the foreign exchange market.

“Consequently the Committee considers that loosening monetary policy now is not advisable as real interest rates are negative, pressure exists on the foreign exchange market while inflation is trending upwards.”

Emefiele said that Members of the committee emphasised that improved fiscal activities, especially the active implementation of the 2016 budget, payment of salaries by states and local governments, would go a long way in contributing to economic recovery.

He said that the committee urged the fiscal authorities to consider tax incentives as stimulus on both supply and demand sides of economic activities.

Emefiele said that based on available data, the committee agreed that the month-on-month inflation which was currently at a record high of 17.6 per cent would soon begin to come down.

He said harvests had started to kick-in for most agricultural produce and should contribute to dampening consumer prices in the months ahead.

He also said that the current stance of monetary policy was expected to continue to help lock-in expectations of inflation which has started to improve with the gradual return of stability in the foreign exchange market.

In July, the committee increased the MPR by 200 basis points from 12.00 to 14 per cent, retained the CRR at 22.50 per cent and the Liquidity Ratio at 30 .00 per cent, among others.

The members said the decision was in recognising that the bank lacked the instruments required to directly jumpstart growth.

The committee was being mindful not to calibrate its instruments in such a manner as to undermine its primary mandate and financial system stability.

Nigeria Spends N596 Billion On Fuel Import in Six Months

Nigeria, in spite of the declining economic fortunes, spent N595.5 billion on the importation of fuel in the first six months of 2016, rising by N34.3 billion from the amount spent in the last six months of 2015.

According to data obtained from the National Bureau of Statistics, NBS, the country spent N276.226 billion on petrol import in the first quarter of 2016, while N319.28 billion was spent in the second quarter.

The NBS report showed that the amount spent on fuel importation appreciated by 6.1 percent, compared with N561.2 billion spent in the second half of 2015.

However, the report pointed out that the amount spent on fuel import in the first half of 2016 was 12.18 percent lower, which is N82.63 billion less than the N678.13 billion spent on fuel imports in the first half of 2015.

The report also highlighted that the country spent N1.24 trillion on the importation of fuel in 2015.

For the first half of 2016, the NBS disclosed that Nigeria recorded total imports of N3.57 trillion.

This meant that fuel imports accounted for 16.7 percent of Nigeria's total import in the first six months of 2016.

Also, data obtained from the Central Bank of Nigeria, CBN, revealed that the oil sector accounted for 19 percent of total foreign exchange disbursements of $5.85 billion by the CBN in the first quarter of 2016.

On the other hand, the CBN noted that in the second quarter of 2016, the oil sector accounted for 23.3 per cent of the $6.09 billion foreign exchange disbursed by the CBN in the second quarter of 2016.

Recently, though, the difficulty in accessing foreign exchange and the declining value of the naira had made imported fuel expensive, a development which had led to calls in some quarters for a further hike in the price of the commodity.

This situation was further worsened by the inability of the country to fix the refineries, making the country to rely mainly on importation and other arrangements entered into by the NNPC, for about 95 per cent of the country's fuel consumption.

Expectedly, the rising fuel imports had helped in no small measure in putting additional pressures on the country's foreign reserves and contributing to the worsening economic situation.

In an interview with Vanguard, Executive Director, Centre for Social Justice, CSJ, Dr. Eze Onyekpere, blamed Nigeria's inability to refine petroleum locally as one of the major factors responsible for the economic crisis the country has been plunged into.

He said, "We should rather be thinking of how to reduce the price of energy which has played a key role in ramping up the inflationary spiral of recent months.

"The reason for this suggestion is clear-- the foreign exchange regime that has seen Nigeria take a bashing and our failure to refine petroleum at home. Evidently, there is no official plan to change the trajectory of the story beyond the private sector-led Dangote refinery which preceded this administration."

Also speaking, Professor Chijioke Nwaozuzu, a Downstream Petroleum Economics & Policy Expert lamented that despite producing an average of 2.38 million barrels per day in 2011 and holding the title of Africa's largest crude oil exporter, Nigeria is nowhere near its productive potential, adding that ironically, Nigeria has to import refined fuel, due to its unproductive and inefficient oil refineries that operate at below 25 per cent of name- plate capacity.

According to Nwaozuzu, who is also Deputy-Director at Emerald Energy Institute for Energy & Petroleum Economics, Policy, & Strategic Studies, University of Port Harcourt, Nigeria's aged national refineries have the worst capacity utilization levels of all countries with refineries in Africa.

He said, We virtually import almost all the petroleum products we consume in Nigeria, and export all the crude oil we produce. In order to be self-sufficient in the supply of petroleum products, we require a refining capacity of about 750,000 barrels per day.

"The implication is that we need to construct new refineries with speed, because the government cannot afford to spend the meagre revenues accruing from crude oil sales on importation of refined products."

He further advised that to salvage the Nigerian economy from the doldrums, the Federal Government should increase in-country crude refining capacity for domestic self-sufficiency and export of petroleum products.

"For drastic economic development in the face of dwindling oil revenue, we must face the fact that, there are no easy options; there are only hard choices to be made," he surmised.