Current Time: July 24, 2014 21:00:05pm Last Update: July 24, 2014 18:00:57pm
Forum | Conference | Concepts | Research | TrueColour | Business Developemnt         
Live Streaming | iWitness | Register | Login | Subscribe         

Stock Watch:
News Section >

News Update (October 7, 2009 11:47 AM...)

Nigeria proposes N2.46 trillion budget for 2010


Istanbul, Turkey (WorldStage Newsonline) - With less than three months to the end of the year, the Federal Government of Nigeria has concluded to present a budget of about N2.46 trillion to the National Assembly for the year 2010 as against N3.1 trillion this year.

The Minister of Finance, Mr Mansur Muhtar who gave the estimate yesterday in Istanbul, Turkey, the venue of this years World Bank/ IMF meetings, said about N860 billion would be for capital expenditure as against N1 trillion in this year's budget while recurrent expenditure would cost about N1.6 trillion.

The minister who yesterday assumed the chairmanship of the Board of Governors of the International Monetary Fund and the World Bank for the 2010, said the priority of the budget would be to build on the success of this year's. He said while government is committed to achieve 6000 mega watt of electricity by the end of the year, the challenge of getting gas to run the power stations would be a priority in the next year budget.

Speaking at joint press conference with the Governor of the Central Bank of Nigeria, Mallam Sanusi Lamido Sanusi, Muhtar responded to the question of the late and poor implementation budget, saying the National Assembly had given assurance to exercise it oversight functions in the monitoring budget execution.

Responding to the role of the CBN on the banks it recently bailed out, Mallam Sanusi said the apex bank was not the one running them and would not be responsible for selling them if there is the need for that.

He said the CBN had done its part in the interest of depositors and that the appointed chief executives would be reporting to the boards of the banks as in a normal management, board relationship.

On the state of the economy which has become a dumping ground for imported goods, Sanusi said it was not necessarily due to tariff problem, but lack of basic structure such as power, roads, conducive environment, among others.

He cited the example of the auto industry which has collapsed, saying that there was no way the country could produce cars when it was not producing flat sheet and other parts. He said those that were to supply the local content ended up importing the parts and put Nigerian labels. He was hopeful that if the challenges were addressed, the nation's industrialisation would take off.

In another forum organised by African Business Round Table for policy makers to discuss Good Governance, Investment Climate and the Challenge of Increasing Capital Flow to Africa, the Executive Chairman of the Economic Financial Crimes Commission, Chief Mrs Farida Waziri, curiously titled her paper as 'Barbarians Within the Gate: The Need for International Cooperation', and vowed to make the Nigerian financial sector a no go area for fraudsters.

Presenting the collaboration model between the EFCC and the Central Bank of Nigeria (CBN) on recovery of bad loans and reform of the banking sector, to the international community as an effective mechanism to achieve a transparent financial system, she defended the involvement of her organisation so far and vowed that the crack down on fraudulent bankers, stockbrokers and others would continue.

Confirming the recovery of N114 billion (about $700 million) bad loans from the debtors of the banks whose managements were recently sacked by the CBN along with the filling of 188 count charges against four chief executives and 11 directors of the banks, she said these results had justified the EFCC intervention.

On the choice of the title of her paper, the EFCC boss said Barbarians within the Gates evoked the image of Roman times when barbarians flooded the empire and undermined it from within.

It is beyond cavil that the meltdown witnessed by the global financial system was in no small way caused by financial renegades that have undermined the system from within and caused it to collapsed.

In Nigerian case, she said bankers, stockbrokers and all sorts of gurus and high ranking officers had been far from transparent with transaction.

She said at face value, there should be no basis for the EFCC's involvement in the recent banking sector cleansing and recovery of debts, but that the section 7 (2) of the legislation establishing it stated that the EFCC shall be the coordinating agency for the enforcement of the provisions of; the Failed banks (Recovery of Debts) and Financial malpractices in Banks Act 19194; the Blanks and other Financial Institutions Act (BOFIA) 1991.

These two laws alone should suffice to justify the involvement of an organisation like the EFCC in the bank cleansing exercise and the recovery of loans by the Central Bank of Nigeria. However, it may be necessary to go beyond that. The general issues arising from the exercise in Nigeria have shown that margin loans, other forms of loans facilities and infraction by lenders, are the critical areas that rogues within the system utilised.

On margin loans, she said while the CBN circular BSD/DO/CIR/04/2004 prohibited a bank from financing the acquisition of its own shares, investigations by the EFCC established that banks were financing the acquisition of their shares.

It also established that margins loans were actually used to artificially engineer the upward movement of the prices of the shares of banks.

This of course raised further the specter of insider trading and other allied criminal activities. Indeed investigations conclusively established that the margin loans were mostly availed to stockbroking firms prior to public offer of the shares of the banks with the intention of driving up the value of the shares of the banks.

She made a reference to a particular case of a stockbroking firm that got $50 million from three bans to mop up their shares.

She disagreed with the position of some analysts that the Nigerian stock market collapsed because of the massive withdrawal of offshore funds, arguing that the funds found their way into the country as a result of artificial returns and growth that the market offered the global investors.

These phenomenal growth and return were a function of share price manipulation by barbarians within the gates of the financial system and these offshore funds would otherwise never have been invested in the Nigerian markets in the first place.

On other loans and infractions by lenders, she said while these should not have attracted the interest of the EFCC, but where the loan process from application, through processing, to approval, disbursement, utilisation and finally repayment has a criminal flavour, then the EFCC will be involved because a criminal law has been flouted.

As a lesson for the international community, she said it was necessary from the point of view of law enforcement that there should be greater level of cooperation in respect of financial crimes.

I will suggest in this context that countries must resolve that as a matter of protocol, rather than upon request, Suspicious transaction reports that might impact on each other must be shared promptly.

For instance, if Country A gets a Suspicious transaction Report that has a Nigerian element, then Country A as a matter of protocol must share that Suspicious transaction report with Nigeria even where Nigeria has not made a request for such.

She said the EFCC had created a business hep desk called Transactions Clearing Platform (TCP) to help investors verify the genuineness of business proposal in the country.

The platform is staffed by dedicated officers of the EFCC and is informed by the need to ensure that any one who gets defrauded as a result of a fraudulent business proposal from Nigeria is as a result of failure to utilise the services of the EFCC through the TCP.

>>email to friend





Share |
0 comments made


Your comment on this News (Nigeria proposes N2.46 trillion budget for 2010 )





  Comment  
No comment made


Back


WorldStage News Online

Stakeholders seek independent economi...
October 13, 2009 02:47 PM
>>read more
Zain, MTV offer opportunity for billi...
October 13, 2009 02:42 PM
>>read more
Naira falls on low dollar supply, as ...
October 13, 2009 02:13 PM
>>read more
OPEC raises hope of 84.9mbpd world oi...
October 13, 2009 02:10 PM
>>read more
Shell to build world's biggest ship...
October 12, 2009 03:57 PM
>>read more
NIMASA emerges West Africas best ...
October 12, 2009 03:55 PM
>>read more
Nigerian Eagle Airlines introduces ne...
October 12, 2009 03:53 PM
>>read more
Guniness denies alleged relocation to...
October 10, 2009 05:16 PM
>>read more
UBA commences operations in Kenya...
October 10, 2009 05:07 PM
>>read more
Access Bank partners Hitv on broadcas...
October 10, 2009 04:45 PM
>>read more
Nigeria proposes N2.46 trillion budge...
October 7, 2009 11:47 AM
>>read more
Photo news (Oceanic Bank)...
October 6, 2009 10:58 AM
>>read more
IMF bails out sub-Saharan Africa with...
October 6, 2009 10:48 AM
>>read more
World Bank challenges Nigeria, others...
October 6, 2009 08:03 AM
>>read more
SAHCOL sold for N9.1b, new owner pays...
October 1, 2009 02:44 PM
>>read more
Oando Marketing floods market with ke...
October 1, 2009 01:03 PM
>>read more
Oceanic Bank gets new executive direc...
October 1, 2009 01:02 PM
>>read more
ETI names Nigerian as chairman...
October 1, 2009 12:59 PM
>>read more
BCC forecasts 19% drop in PAT to N18....
October 1, 2009 12:58 PM
>>read more
MTN-Bharti $24b deal talks collapse ...
October 1, 2009 12:55 PM
>>read more
CellTrust meets mobile banking requir...
September 29, 2009 04:50 PM
>>read more
MTN to deploy fibre, satellite infras...
September 29, 2009 04:48 PM
>>read more
Banking probe: More heads to roll...
September 29, 2009 04:47 PM
>>read more
Chinese firm may offer $50b for Niger...
September 29, 2009 04:46 PM
>>read more
Listing 2881 - 2904 of 2926 117 118 119 120   of  122
< Previous | Next >






ADVERTISEMENT