Nigeria’s new start is in danger of derailing – Financial Times

President Muhammadu Buhari submits his budget for 2016 to the Senate chamber (file photo)

Nigeria’s journey from bankrupt, pariah state to Africa’s largest economy helped to fuel a surge in optimism about the continent over the past 15 years. Now there is a danger that its latest troubles will trigger a bout of despair. As one seasoned investor puts it: “Nigeria, with help from South Africa, is killing the African story.”

Part of that story was hyperbole — notably the broad-based nature of the continent’s revival. While there was a boom in services, investment flows and an expansion of the middle class, growth in many states was largely jobless, and underpinned by soaring world prices for commodity exports. This was especially true in Nigeria, which still depends on crude oil for more than 90 per cent of hard currency earnings and typically around two-thirds of state revenues.

Since the fall in oil prices, the cracks in Nigeria’s economy have quickly reappeared. Starved of fuel, electricity and foreign exchange the economy is grinding to a halt. Businesses are laying off staff in droves.

In turn, confidence in President Muhammadu Buhari, elected a year ago on a wave of hope, is evaporating. There are no easy answers to the dilemmas his government faces. Many were in the making long before he won elections, promising to crush corruption, invest in infrastructure and create jobs.

The challenge is exemplified by the fuel crisis — the worst in living memory. Because state-owned refineries have been mismanaged for so long, Nigeria relies on imports of fuel. This is one reason Mr Buhari is so reluctant to devalue the naira currency — fixed at an unrealistic level against the dollar, which does not fluctuate with Nigeria’s changing fortunes. The resulting distortions have eroded the commercial case for importing fuel and created a gaping spread between parallel and official exchange rates that encourages the very corruption Mr Buhari has vowed to stop.

Devaluation would be no panacea. It would hasten the depletion of foreign reserves and push up the pump price of petrol, unless government resumes paying subsidies it can ill-afford. The elimination of the subsidy might, on the other hand, trigger riots.

It is a tough choice and an even tougher political environment to make it in. Nigerians are impatient for the gains they voted for and have little appetite for further pain. Mr Buhari squandered an opportunity to act early on when he enjoyed the goodwill of the public. But the painful measures required to set Nigeria’s economy on a sustainable growth path become no more palatable the longer he delays.

Without investment Nigeria will neither continue growing nor diversify from its crippling dependency on oil. Yet no investor will put money into an economy at one exchange rate, knowing that to take it out again might require losing a third of its dollar value.

This week, China has offered help with a currency swap, and the promise of $6bn in infrastructure loans. The terms of these deals are not yet clear. But they could go some way towards plugging an $11bn budget deficit. The danger is that, together with the modest recent rise in oil prices, China’s help will encourage Mr Buhari to defer the tough decisions once again.

The president wants to eliminate the wasteful patronage on which venal elites have thrived and create an economy more dynamic in creating jobs for the masses. These are laudable long-term aims for which his government has yet to articulate a convincing strategy. In the meantime, however, the short term is pressing. No economy can survive without fuel, electricity or foreign exchange.

Nigeria’s Buhari vows crackdown after pipeline attacks in Delta

Nigerian President Muhammadu Buhari, second left, talks with Chinese officials during a meeting at the Great Hall of the People in Beijing, April 13, 2016.

BEIJING (Reuters) – Nigeria will crack down on groups responsible for recent pipeline attacks in the oil-producing Delta region, President Muhammadu Buhari said on Wednesday.

Pipeline attacks and violence have been on the rise in the southern swampland since authorities issued an arrest warrant in January for a former militant leader on corruption charges.

“We will deal with them the way we dealt with Boko Haram,” Buhari said during a visit to China, referring to jihadists who have been waging an insurgency to set up an Islamic state in the north.

The army has recaptured much of the territory Boko Haram had held since Buhari took office in May 2015, though the group still stages suicide bombings.

“I hope this message will reach the vandals and saboteurs who are blowing up pipelines and installations,” he said.

Last month gunmen blew up an oil pipeline belonging to Italy’s ENI in the Delta, a region which provides much of Nigeria’s oil production, killing three workers, according to officials.

In February militants staged a sophisticated underwater attack on a Shell pipeline, shutting down the 250,000 barrel-a-day Forcados export terminal.

Buhari has extended a multi-million dollar amnesty signed with militants in 2009, but he has upset them by ending generous pipeline protection contracts.

The militants, like other Delta residents, demand a greater share of oil revenues.

PATIENCE

Addressing Nigerians living in China, Buhari also asked for patience for his plans to end endemic graft and to diversify the oil economy.

The former military ruler was elected last year on a ticket to “fix” a country stricken by mismanagement. His government has come under fire for fuel shortages and a lack of action as the 2016 budget has been held up by wrangling with parliament.

“We hear proposals for short cuts or quick wins,” he said. “However, all we need to do is look at our history to know that there are no quick wins or short cuts in fixing Nigeria.”

A slump in oil revenues has whacked public finances in Africa’s biggest economy. Buhari has also faced criticism for rejecting a devaluation of the naira, which analysts have said deters investment.

“Clearly, our vision of a diversified and inclusive economy will not be achieved overnight,” he said. “It will be a long, and in some cases, painful journey.”

Nigeria pirates kidnap Egyptian, Filipino

Lagos – Pirates attacked a cargo vessel off the coast of Nigeria and kidnapped two crew members, a maritime expert confirmed on Thursday, in the latest high-seas strike in the Gulf of Guinea.

The CMA CGM Turquoise, managed by Dioryx Maritime in Greece, was stormed late on Monday as it travelled between Nigeria’s commercial hub Lagos and Douala in Cameroon.

It was the second attack in one day: early Monday pirates kidnapped six crew members of a Turkish cargo ship, the M/T Puli, according to the Nigerian Navy.

“This attack – like most others off the Niger Delta – was carried out at night and carried an element of surprise,” Dirk Steffen, from the Denmark-based Risk Intelligence firm, told AFP, referring to the later attack.

“The crew mustered in the citadel after the attackers had boarded the ship, but two crew members – the Filipino 2nd officer and the Egyptian electrician – did not make it there in time and were seized by the attackers”, he said in an email.

The Liberian-flagged vessel, chartered by French shipping company CMA CGM, was attacked at 20:56 (19:56 GMT), 28 nautical miles from the coastline of the oil-rich Niger delta region.

Steffen, the director of maritime security at Risk Intelligence, said the target was unusual and indicated the pirates were aiming at kidnapping rather than hijacking tankers for their fuel cargo.

The Gulf of Guinea is increasingly becoming a piracy hotspot and Risk Intelligence has recorded 32 offshore attacks for Nigeria alone this year.

Steffen linked the increase to the winding down of an amnesty scheme to former Niger Delta militants, who demanded a fairer share of oil revenue through kidnapping and sabotage in the 2000s.

It also reflected a trend of a decrease in abductions and offshore piracy in the region around elections. Nigeria held presidential and parliamentary polls last year.

Video appears to show some of Nigeria’s kidnapped girls alive

In this July 30, 2015, file photo, women and children rescued by Nigerian soldiers from the Islamic extremist group Boko Haram in the northeast of Nigeria, arrive at the military office in Maiduguri, Nigeria. (Photo: Jossy Ola, AP — In this July 30, 2015, file photo, women and children rescued by Nigerian soldiers from the Islamic extremist group Boko Haram in the northeast of Nigeria, arrive at the military office in Maiduguri, Nigeria.
(Photo: Jossy Ola, AP

Jane Onyanga-Omara, USA TODAY | A video released Wednesday appears to show some of the Nigerian schoolgirls who were kidnapped by the Boko Haram militant group two years ago alive.

The video, obtained by CNN, was sent to negotiators by the Islamist militants as proof that the girls were alive, according to the broadcaster.

CNN showed the video, which is believed to have been made in December, to Rifkatu Ayuba, whose 17-year-old daughter Saratu was among those taken.

“My Saratu!” she cried. “I felt like removing her from the screen,” she added. “If I could, I would have removed her from the screen.”

Nigerian Information Minister Lai Mohammed told CNN the government was reviewing the video.

Boko Haram kidnapped 276 girls from their school in Chibok, northeastern Nigeria, on the night of April 14, 2014. A number later escaped the militants, but 219 remain missing, prompting the launch of the “Bring Back Our Girls” campaign, which captured the world’s attention.

Amnesty International said its activists were joining demonstrations in the Nigerian capital of Abuja on Thursday to call for the return of the girls, and thousands of other people abducted by Boko Haram. Last week, the Nigerian military said its soldiers rescued 11,595 civilians from the militants since Feb. 26.

“Few of us can begin to comprehend the suffering of parents who have not seen their daughters for two years,” said M.K. Ibrahim, director of Amnesty International Nigeria.

“In addition to the Chibok schoolgirls, today we also remember all those abducted, killed and displaced. Two years on, the Chibok girls have come to symbolize all the civilians whose lives have been devastated by Boko Haram.”

Ibrahim called on the government of President Muhammadu Buhari to do more to bring back the girls, protect civilians in northeastern Nigeria and ensure that children in the region can go to school.

“Those guilty of inflicting this unspeakable suffering must be brought to justice, once and for all,” he said.

Boko Haram, whose attacks on schools have forced thousands out of education, loosely translates as “Western education is forbidden” in the Hausa language that is spoken by millions of people in Nigeria and neighboring Niger.

Angry over lack of progress to resolve one of the highest-profile mass kidnappings in the world, Nigerians march in their country’s major cities

FILE- In this Monday, May 5, 2014 file photo, women attend a demonstration in Lagos calling on the government to rescue kidnapped school girls of a government secondary school in Chibok, Nigeria. A school mate says she cried with joy when she saw a Boko Haram video appearing to show some of Nigeria's kidnapped Chibok girls, with images of tearful parents recognizing their daughters, who have not been heard from since the mass abduction by the Islamic extremist group Boko Haram two years ago. (AP Photo/ Sunday Alamba, File) — FILE- In this Monday, May 5, 2014 file photo, women attend a demonstration in Lagos calling on the government to rescue kidnapped school girls of a government secondary school in Chibok, Nigeria. A school mate says she cried with joy when she saw a Boko Haram video appearing to show some of Nigeria’s kidnapped Chibok girls, with images of tearful parents recognizing their daughters, who have not been heard from since the mass abduction by the Islamic extremist group Boko Haram two years ago. (AP Photo/ Sunday Alamba, File)

By MICHELLE FAUL, Associated Press

LAGOS, Nigeria (AP) — Angry over lack of progress to resolve one of the highest-profile mass kidnappings in the world, Nigerians marched in their country’s major cities on Thursday to demand the safe return of girls who were abducted by Boko Haram extremists two years ago from a school in Chibok.

Nigerian Vice President Yemi Osinbajo was expected in the northeastern town of Chibok for the anniversary of the kidnappings, said Yakubu Nkeki, leader of a support group of parents of the kidnapped girls. He said the community is angry that their only school remains in ruins. Boko Haram firebombed buildings as they took off with girls.

Some 20,000 children in the town and its surroundings have no school to attend, Nkeki said Thursday as parents gathered at the ruins of the school to pray for the safe return of their daughters.

“Boko Haram has achieved its aim. They say they don’t want us to have Western education and our children don’t,” Nkeki said.

Two years ago, the Islamic extremists seized 276 girls who had gathered for science exams at the Government Girls Secondary School in the northeast town of Chibok. Some managed to escape, jumping off pickup trucks as the Islamic extremists drove them toward the Sambisa Forest. A total of 219 remain missing.

On Wednesday, CNN broadcast parts of a Boko Haram video of girls wearing the Islamic hijab, and CNN also aired its own images of tearful mothers, including one reaching out to a computer screen as she recognized her kidnapped daughter.

The video shows 15 of the girls — one with a mischievous grin, one looking uncompromising, downright defiant, and one downcast. One can feel the pain that shows in the eyes of many of them. They give the date of the video as Christmas, Dec. 25, 2015.

While Boko Haram is thought to have abducted thousands of people over the years, the mass abduction brought the extremist group to the world’s attention. The campaign hashtag #BringBackOurGirls went as far as the White House, used by U.S. first lady Michelle Obama.

CNN reported that the video was sent in December to negotiators trying to free the girls. CNN’s report included Information Minister Lai Mohammed saying the government is reviewing and assessing the video, which it apparently demanded as “proof of life” from Boko Haram.

Sen. Shehu Sani, who has been involved in past negotiations with Boko Haram about the Chibok girls, told The Associated Press he found the video credible. Nkeki, leader of the support group for parents of the Chibok girls, said he briefly saw part of the CNN video, in between power blackouts frequent in Nigeria, and “those are definitely our girls.”

There’s been no word from the Chibok girls since May 2014, when Boko Haram leader Abubakar Shekau said they had converted to Islam and threatened to sell them into slavery or forced marriage with his fighters.

Chart shows Nigerian President’s Gasoline Price Fix Isn’t Working

Paul Wallace | Bloomberg

President Muhammadu Buhari insists that removing a price cap on gasoline, which usually requires costly subsidies, would only hurt Nigerians. But they are already paying more since his government can’t police the system and most marketers, struggling to import refined fuel amid a shortage of dollars, are passing on higher costs to customers. While pump prices are meant to be 87 naira a liter (or $1.69 a gallon), they rose to 135.69 naira a liter in March, the highest level since the country’s National Bureau of Statistics began compiling such data in June 2014.

Why are world powers unable to stop Boko Haram?

UNITED NATIONS —Two years ago Thursday, the world watched in horror as276 girls were abducted from their school in Chibok, Nigeria, by the group known as Boko Haram, a militant Islamist group that swears allegiance to the Islamic State of Iraq and Syria (ISIS).

Fifty-seven of the girls later escaped, but most have not — and the situation has only gotten worse. The kidnappings prompted a global campaign, #BringBackOurGirls, but experts say violence in the region has impeded the girls’ rescue and the world’s attention has shifted to other crises.

To show how dire the situation has become, the U.N. children’s agency, UNICEF, released a report on Tuesday showing that the number of children involved in suicide bombing has risen tenfold in the last year in the Lake Chad region, which includes Nigeria, Cameroon, Chad and Niger.

One in every five suicide bombings is perpetrated by a child. Three-quarters of them are girls as young as eight years old. They are victims, the U.N. says, of slavery and rape.

The report, “Beyond Chibok,” says 2.3 million people have been forced out of their homes in the last three years. And the other findings are equally grim.

“Boys are forced to attack their own families to demonstrate their loyalty to Boko Haram, while girls are exposed to severe abuse including sexual violence and forced marriage to fighters,” the report states. “Some are also used to carry or detonate bombs.”

Laurent Duvillier, spokesperson for UNICEF in West & Central Africa, told CBS News that the world was shocked by the 2014 abduction. “But what did not get so much attention is what happened after this: over 2,000 women and girls have been abducted since then in about four countries, not just Nigeria.”

Duvillier continued, “What we see today is that the humanitarian situation has seriously deteriorated. One year ago, on the first anniversary of Chibok, there were 800,000 people displaced; today, 1.3 million children alone are displaced, an increase of 60 percent.”

Duvillier and other experts on the ground say that military forces in all four countries have make gains, liberating areas and people, but the abductions continue and, as areas are liberated, the humanitarian need is even greater.

The report details the stigma associated with children who have been freed, some ostracized, others killed, out of fear that they might turn against their communities.

There is also a chronic nutrition crisis. Toby Lanzer, the Assistant Secretary-General and Regional Humanitarian Coordination for the Sahel of Office for the Coordination of Humanitarian Affairs (OCHA), told reporters at U.N. Headquarters on Tuesday that the world should take note, because a migration crisis may follow when the “poorest of the poor” are subject to such extreme violence, abuse, the effects of climate change, and malnutrition.

“The suffering of some 30,000 people in Bama was as acute as I have seen,” Lanzer said.

Deputy U.S. State Department spokesman Mark Toner said Tuesday the U.S. is delivering over $240 million in development and humanitarian assistance to the Lake Chad region.

Nigerian teachers and students protest over the Nigerian government's failure to rescue the abducted Chibok school girls, in Owerri, Nigeria, 09 May 2014. 276 girls were abducted from their school by the terror group Boko Haram. None of the girls have been found to date. EPA/STR — Nigerian teachers and students protest over the Nigerian government’s failure to rescue the abducted Chibok school girls, in Owerri, Nigeria, 09 May 2014. 276 girls were abducted from their school by the terror group Boko Haram. None of the girls have been found to date. EPA/STR

“The United States continues to assist the Nigerian government’s efforts to locate and bring home all those who have been kidnapped by Boko Haram with intelligence and advisory support,” Toner said.

“Boys and girls affected by Boko Haram violence are faced with an extremely difficult situation, but I would not qualify the situation as intractable; there are many actors, including the United Nations, engaged in trying to improve the protection of children in Nigeria and neighboring countries,” Leila Zerrougui, the Special Representative of the Secretary General for Children and Armed Conflict, told CBS News.

“The conflict’s impact on education is extremely concerning,” Zerrougi said. “Hundreds of thousands of children are missing out on their education. Recovering from personal trauma, from the trauma of conflict, is key to help the next generation build the peace they deserve.”

Nigeria says China offered $6 billion loan for infrastructure

President of the Federal Republic of Nigeria, Muhammadu Buhari (L) and Chinese President, Xi Jinping shake hands during a signing ceremony at the Great Hall of the People in Beijing, April 12, 2016. REUTERS/Kenzaburo Fukuhara/Pool

BEIJING (Reuters) – China has offered Nigeria a loan worth $6 billion to fund infrastructure projects, the Nigerian foreign minister said on Tuesday.

The announcement came as both countries signed a currency swap deal to boost trade. Nigeria has been in talks with China on an infrastructure loan for months.

Nigeria is Africa’s largest economy and its top oil producer. But its public finances have suffered as the price of crude oil dropped around the world.

Although President Muhammadu Buhari wants to triple capital spending in 2016, he also needs to plug a projected deficit of $11.1 billion.

“It is a credit that is on the table as soon as we identify the projects,” Nigerian Foreign Minister Geoffrey Onyeama told reporters after Buhari met Chinese President Xi Jinping. “It won’t need an agreement to be signed. It is just to identify the projects and we access it.”

There was no immediate comment from China.

Lin Songtian, director general of the Chinese foreign ministry’s African affairs department, had earlier said Nigeria would be able to benefit from a $55 billion package for Africa, which mostly consists of concessional grants or export lines.

The Industrial and Commercial Bank of China Ltd (ICBC), the world’s biggest lender, and Nigeria’s central bank also signed a deal on yuan transactions.

“It means that the renminbi (yuan) is free to flow among different banks in Nigeria, and the renminbi has been included in the foreign exchange reserves of Nigeria,” Lin said.

Nigeria had said it was looking at panda bonds – yuan-denominated bonds sold by overseas entities on the mainland – to fund the deficit, saying they that would be cheaper than Eurobonds [nL5N17C0EL].

TRADE

Nigeria’s central bank has said it plans to diversify its foreign exchange reserves away from the dollar by switching some into yuan. It converted up to a tenth of its reserves into yuan five years ago.

Lin said a framework on currency swaps has been agreed with Nigeria, making it easier to settle trade deals in yuan. China has signed similar swap agreements with countries ranging from Kazakhstan to Argentina to promote wider use of its yuan.

Beijing also signed agreements to develop infrastructure in Nigeria, part of a drive to deepen its ties with Africa.

ICBC agreed a $2 billion loan to Dangote, the company owned by Africa’s richest man, Aliko Dangote, to fund two cement plants it plans, he told Reuters.

China’s Xi told Buhari there was huge potential for economic cooperation in areas like oil refining and mining, according to Xinhua, China’s official news agency.

In a speech to business leaders, Buhari said both countries wanted to work together in agriculture, fishing and the manufacturing of cars, construction materials and textiles.

Nigeria suffers the deepest cut from IMF downgrades

Nigeria's economic woes are going from bad to worse(Reuters/Akintunde Akinleye) — Nigeria’s economic woes are going from bad to worse (Reuters/Akintunde Akinleye)

Among the countries whose growth forecasts were put on the chopping block by the International Monetary Fund on Tuesday, Nigeria suffered the steepest downgrade.

The fund now expects Africa’s most populous nation to grow 2.3 per cent this year, compared to the 4.1 per cent growth it had previously forecast in January.

As the continent’s largest oil producer, Nigeria has been hit hard by the collapse in oil prices, with its currency, the naira, coming under immense downward pressure.

Underscoring the country’s challenges, MSCI warned last week that it was considering removing Nigeria from its Frontier Markets Index, potentially dealing a huge blow to the its ability to attract foreign investment.

The IMF also took the red pen to its forecasts for Brazil and Russia. The two are on track to be this year’s worst performing big emerging economies this year, with Brazil now expected to contract 3.8 per cent and Russia predicted to shrink 1.8 per cent.

Full summary below:

Police seal off Nigeria Football secretariat as leadership crisis deepens

The football house has been closed down by the security operatives following recurring crisis after Friday's court ruling in Jos. — The football house has been closed down by the security operatives following recurring crisis after Friday’s court ruling in Jos.

Nigeria Police Force took over the Nigerian Football Federation headquarter in Abuja on Monday as the leadership crisis took a new twist .

Goal learnt that security operatives sealed off the nation’s footballing secretariat barring staff of the NFF from accessing the complex which also houses the Federal Road Safety Commission, FRSC.

This is the second time in space of two years the police will be taking over the NFF building.

A Federal High Court ruling last Friday in Jos dismissed election that brought Amaju Pinnick led board into power and ordered that Chris Giwa to assume office immediately.

Giwa’s faction announced the appointment of a new acting General Secretary and heads of departments alongside new heads of standing committees.

While Pinnick’s group claimed they have appealed against the ruling and were granted the stay of execution against their removal from office.

The court however, announced May 30, 2016 for next hearing of the relisted suit between Giwa’s board, the NFF and sports minister.

Though some NFF staff were later allowed into the secretariat premises on proper identification with no official granted entry aside the general secretary Sanusi Mohammed.

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