As stealing gets difficult…..

Also published in Daily Trust

The recent revelation by President Muhammadu Buhari that more than two trillion naira were saved in just three months, thanks to his administration’s commitment to the Treasury Single Account (TSA), is greatly encouraging, considering the sheer amount of the funds saved, which is equal to about one-third of Nigeria’s total budget, and which would have otherwise ended up in the personal bank accounts of some corrupt civil servants and politicians.

Likewise, the recent detection of more than two hundred thousand ghost workers on the federal government payroll, which, by implication, means saving billions of naira that some unscrupulous civil servants have been systematically stealing over the years as purported salaries, allowances and other entitlements of such ghost workers, proves the efficiency of the Bank Verification Number (BVN) technology, which greatly facilitates President Buhari’s anti-corruption drive.

Budget financing: Counting on recoverable loot

Also published in Daily Trust

As oil-dependent countries continue to adopt cost-saving measures and pursue alternative revenue generation and/or augmentation policies to tackle the economic impacts resulting from the persistent fall in crude oil prices globally, the level of anxiety that characterizes the approach of each country in this regard varies according to the extent of its economic vulnerability.

Unsurprisingly, therefore, countries, which have been able to use their oil revenues in the provision of adequate economic infrastructure, and have been able to make substantial progress in economic diversification (e.g. the UAE that has been able to reduce its dependence on oil by 70%,) are coping with the situation quite comfortably by simply implementing further economic diversification strategies having already had the economic infrastructure necessarily needed in order to achieve effective and sustainable economic diversification.

Meeting with Mr. President

Also published in Daily Trust  

On the last day of President Muhammadu Buhari’s recently concluded three-day official visit to the United Arab Emirates, I was among a group of UAE-based Nigerian professionals, businessmen and students who had an audience with him at the ultra-luxurious Emirates Palace Hotel in Abu Dhabi, the capital city of the UAE.

Though the event ran quite smoothly, however, organizationally speaking, it left a lot to be desired anyway, which was though disappointing, it wasn’t actually surprising after all especially for those familiar with the way Nigerians generally organize events.

Circumstances of forex crisis

Also published in Daily Trust

Though the recent decision by the Central Bank of Nigeria (CBN) to stop selling foreign exchange (forex) to bureau de change (BDC) firms in the country triggered an instantaneous and dramatic further depreciation of the naira, which in turn worsens inflation, it’s hard to propose any other measure to save the country’s alarmingly dwindling foreign-exchange reserves from which the CBN used to regularly sell foreign exchange to the BDCs.

Besides, economically speaking, selling foreign exchange by the CBN to the BDCs isn’t sustainable in the long run, after all. Moreover, according to the CBN, it’s only in Nigeria that currency exchange operators depend on government for hard currency supply. In any case, what can’t be denied is that, the scheme never served the economic purpose for which it was introduced.

Subsidy removal: The UAE experience

Also published in Daily Trust

Now that it increasingly appears that the controversial fuel subsidy regime in Nigeria will almost certainly soon be abolished, my experience, so far, following similar removal here in the United Arab Emirates has greatly dispelled my worries about its impacts on the cost of living. After all, even before its removal, the subsidy regime here was already transparent and the fuel supply management was already perfectly efficient, contrary to what obtains in Nigeria where it is characterized by monumental corruption and operational mediocrity. 

Like other crude oil producing countries where oil remains their primary source of revenue, the UAE government’s finances have been affected by the dwindling oil prices in international markets, hence it opted for the removal of fuel subsidy in order to save the huge amount of funds spent on the subsidy in favour of investment in more beneficial and sustainable economic endeavours. The new deregulated fuel price regime came into effect on August 1, 2015. Consequently, ever since then, on the 28th of each month the prices of diesel and petrol for the following month are announced based on crude oil prices in international markets.