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External Debt: Buhari’s theory of servicing debt with scarce revenue destructive; I won’t sustain it: Tinubu “Can we continue to service external debts with 90% of our revenue?” Mr Tinubu asked. “It is a path to destruction. It is not sustainable.”

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By Lateef Taiwo

President Bola Tinubu on Sunday said his administration will not continue to set Nigeria on a path to destruction by servicing external debt with the country’s scarce revenue.

Mr Tinubu said this while declaring open the annual conference of the Nigerian Bar Association at MKO Abiola Stadium, Abuja, according to a statement by his spokesperson, Ajuri Ngelale.

Although Mr Tinubu did not specifically refer to former President Muhammadu Buhari, the previous administration had serviced external borrowings with the country’s revenue.

“Can we continue to service external debts with 90% of our revenue?” Mr Tinubu asked. “It is a path to destruction. It is not sustainable.”

“We must make the very difficult changes that are necessary for our country to get up from slumber and be respected among the great nations of the world,” Mr Tinubu stated.

The president said the reforms his government has embarked upon were necessary for the country’s growth.

“We cannot have the country we desire without the reforms we have initiated. It is painful at the beginning, in the short and medium term, but we must do what we have to do to take this nation to its great destiny.

“It is not about you, and it is not about me. It is about our generations yet unborn, for whom we must bequeath a great and prosperous country,” he affirmed.

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Mr Tinubu’s party man, Mr Buhari, ruled the country for eight years from 2015 to 2023, which critics described as some of the worst years under democratic rule.

With massive borrowings by the Buhari regime in eight years, Nigeria’s debt profile hit N46 trillion, according to Debt Management Office.

Throughout his eight years in office, Mr Buhari justified debt accumulation, claiming loans are obtained for infrastructural development.

Speaking on Buhari regime’s borrowing spree, former President Olusegun Obasanjo, whose administration got Nigeria’s debt cleared, wondered what the funds were used for.

The former president condemned the continuous borrowing by the Mr Buhari regime, saying accumulating debt for future generations is “foolish” and “criminal.”

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Business and Economy

Nigerian Minister laments low investment in Infrastructure

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By Iyojo Ameh

Minister of Budget and National Planning, Senator Atiku Bagudu on Friday said the country has not invested enough in infrastructural development.

According to him, several problems been encountered recently by Nigerian are as direct results of under- investment in several multi- dimension infrastructure.

The minister spoke at the National Assembly during an interactive session with the Senate committee on Appropriation under the chairmanship of Senator Olamilekan Adeola.

The minister was invited to provide insight into the N6.2 trillion supplementary appropriation approval for the 2024 budget by the National Assembly as requested by President Bola Tinubu.

Bagudu commended President Tinubu for the political will yo confront the infrastructure deficit by seeking the N3.2 trillion to fund the projects which include the Lagos – Calabar coastal highway, the Sokoto – Badagry highway and the Trans- Sahara highway.

He commended the President for his confidence that the projects when completed will increase economic activities and shore up the nation’s revenue base.

He added that the projects will encourage massive transformation apart from strengthening economic realities.

The minister while trying to douse the agitation of members of the committee on the fate of other deplorable roads and uncompleted roads projects in their various constituents said the federal government has not abandoned any of the ongoing projects.

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Bagudu categorically stated that the government is not giving priority attention to the innovative projects at the expense of other road projects.

He assured that the Federal Executive Council will continue to consider and give financial approval to other roads as funds are available.

The minister though did not give a detailed statement of the supplementary approval, gave a sectoral overview of both the N3.2 trillion of the Renewed Hope Infrastructure Projects and the N3 trillion increase in the recurrent component of the budget.

Chairman of the Senate Appropriation Committee, Senator Adeola the government has full capacity to finance the 2024 budget.

He , however implore the minister to make available to the committee a full detail and breakdown of the N6.2 trillion approval as soon as possible.

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Business and Economy

Economy : CBN announces indices on growth and stability …As Senate interfaces with the CBN Gov

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By Iyojo Ameh

The Central Bank of Nigeria on Friday in Abuja , rolled out indices , signaling improved growth and stability of the Nation’s economy.

This is as the apex bank through its Governor , Olayemi Cardoso , assured Nigerians of better days ahead .

Rolling out the growth and economic stability indices during statutory engagement with the Senate Committee on Banking , Insurance and other Financial Institutions , the CBN Governor said : ” The
spread between official and BDC rates has narrowed significantly from N162.62 in January to N47.22 in June 2024, indicating successful price discovery, increased market efficiency, and reduced arbitrage opportunities.

“The stock of external reserves increased to US$36.89 billion as of July 16, 2024, compared with US$33.22 billion at end-December 2023, driven largely by receipts from crude oil related taxes and third-party receipts.

” In Q1 2024, we maintained a current account surplus and saw improvements in our trade balance.

“Our external reserves level as at end-June 2024 can finance over 11 months of import of goods and services, or 14 months of goods only. This is significantly higher than the prescribed international benchmark of 3.0 months, indicating a strong buffer against external shocks.

“The banking sector remains robust and diverse, comprising twenty-six commercial banks, six merchant banks, and four non-interest banks. Key indicators such as capital adequacy, liquidity, and non-performing loan ratios all showed impressive improvements, underscoring the sector’s growing stability and resilience.

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“The equity market has shown impressive performance, with the All-Share Index rising by 33.81 per cent and market capitalization expanding by 38.33 per cent from December 2023 to June 2024, reflecting growing investors’ confidence.

“While we are encouraged by these positive trends, the CBN remains vigilant and committed to implementing policies that support sustainable growth in our financial markets, while maintaining overall economic stability”

He added by assuring the committee members , that required measures and strategies , have been mapped out to confront emerging challenges .

“To combat inflation, we have implemented a comprehensive set of monetary policy measures. These include raising the policy rate by 750 basis points to 26.25 percent, increasing Cash Reserve Ratios, normalizing Open Market Operations as our primary liquidity management tool, and adopting Inflation Targeting as our new monetary policy framework.

“In the area of banking supervision, the CBN has taken decisive actions to ensure the safety, soundness, and resilience of the banking industry.

” Key measures include intervention in three banks, revocation of Heritage Bank’s license, increasing minimum capital requirements, and enhancing AML/CFT supervision.

” We also introduced new frameworks for Cash Reserve Requirements and cybersecurity and prohibited the use of foreign currency collaterals for local currency loans.

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“We are in the process of reviewing the Bank’s micro and macroprudential guidelines to reinforce the resilience of financial institutions in Nigeria to withstand tightened conditions, thus creating a secure and attractive investment climate.

“We have signaled our plans to re-capitalize deposit money banks in Nigeria to improve capital inadequacy and their capacity to grow the economy.

“Our ultimate goal is to create a more stable, resilient, and efficient financial system that can better serve the Nigerian economy, while adhering to international best practices”, he said .

Earlier in his opening remarks , the Chairman of the Committee, Senator Adetokunbo Abiru said the overall purpose of the interaction , ” is to update the commiittee on efforts, activities, objectives and plans of the Bank with respect to monetary policy”

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Business and Economy

Airlines, Banks, Media Outlets Hit as Global IT Outage Wreaks Havoc

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By Iyojo Ameh

A global tech outage, seemingly linked to issues at cybersecurity firm CrowdStrike and tech giant Microsoft, disrupted operations across multiple sectors on Friday, impacting airports, airlines, media outlets, and banks.

The outage caused significant disruptions in airport and airline IT systems, leading to grounded flights and widespread service interruptions.
Notably, Sydney airport has seen flights halted, United Airlines has ceased operations, and the London Stock Exchange Group’s platform has encountered disruptions.

In Germany, Berlin airport experienced IT problems, causing delays in check-ins due to technical faults.

Also, rail transportation has not been spared, as the UK’s Govia Thameslink Railway reported widespread IT issues across its network, leading to potential cancellations and delays.

The company is actively investigating the root cause and has urged passengers to check their journeys before traveling.

Australia’s Telstra Group also reported service disruptions.

Meanwhile, in a post on X, CrowdStrike CEO George Kurtz said the outage was not a “security incident or cyberattack.”

He said it was connected to a “defect found in a single content update for Windows hosts.” He said the issue has been “identified, isolated and a fix has been deployed.”

Also, Microsoft said in a statement on X that “the underlying cause has been fixed,” however, residual impacts continue to affect “some Microsoft 365 apps and services. We’re conducting additional mitigations to provide relief.”

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The affected services include PowerBI, Microsoft Teams, and OneDrive for Business, among others. The tech giant is working on mitigation efforts and has already restored some services.

However, this global IT outage highlights the interconnected nature of modern digital infrastructures and the widespread impact that technical disruptions can have across various industries.

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