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Nigeria: Anti-graft agency EFCC raids Dangote offices

Published

4 months ago

January 5, 2024

Nigeria’s anti-graft agency, the Economic and Financial Crimes Commission (EFCC), has carried out a raid on the headquarters of Dangote Industries Limited in Ikoyi, Lagos, amidst an ongoing investigation of forex management by the Central Bank of Nigeria under former governor, Godwin Emefiele.

The Dangote Group, owned by billionaire Aliko Dangote, and 51 other companies are the subject of an investigation by the anti-graft commission into purported preferential forex allocations under the Emefiele-led CBN. The anti-graft agents were present at the Dangote offices, according to two high-ranking EFCC officials, though they would not comment on why.

Nigeria is currently looking for more investments to help boost its economy which is struggling partly due to the foreign exchange crisis largely between 2015-2023, an era which saw the country’s currency, Naira, fall into one of the worst-performing currencies in the world.

As of June 15, the country’s gross foreign exchange reserves were $34.62 billion. However, as of December 1, 2023, the foreign exchange reserves decreased to $32.97 billion, based on data from the CBN.

The country maintained several exchange rates up until June 2023, which analysts claimed was a factor in market volatility, fluctuations, and distortions in the allocation of foreign exchange. The government has sought to stabilize the economy with two major policy actions: the removal of the fiscal bleeding in petrol subsidies and the unification of the exchange rate.

One of the officials said, “I can confirm that our men are there, but I can’t comment on the reason for their presence there.”

According to sources, the anti-graft commission had previously written to the 52 businesses, asking them to submit documentation proving how they had allocated and used foreign currency that had been sold to them at official rates over the previous ten years.

Forms A and M, which described the forex allocations made to the companies between 2014 and June 2023, were requested by the EFCC from the firms.

The last eight years have seen an audit of Nigeria’s financial and fiscal status. The apex bank under Emefiele is accused of depositing public funds in foreign currencies in as many as 593 bank accounts in the US, the UK, and China without the board of directors’ and the CBN Investment Committee’s consent, according to recent findings by Jim Obazee, Special Investigator on the CBN and Related Entities.

Related Topics:Central Bank of Nigeria Dangote EFCC Featured Foreign exchange Nigeria

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Nigeria’s growth forecast for 2024 remains 3.3%— IMF

Published

1 hour ago

May 10, 2024

Ifeoluwa Dada

The International Monetary Fund (IMF) has upheld its projection of a 3.3% growth rate for Nigeria’s economy in 2024, an increase from the 2.9% recorded in the previous year. This prognosis is based on the improvement observed in the services and commerce industries.

According to the IMF, the economic prospects in Africa’s most populous country and leading oil producer remain difficult, with a 40% increase in food price inflation in March, which has raised concerns about food security.

“If Nigeria grows at 3.3% that is just above the population dynamics, which is a big challenge,” IMF mission chief for Nigeria, Axel Schimmelpfenning, told journalists.

President Bola Tinubu has implemented extensive reforms since assuming office around one year ago. These measures include reducing expensive petrol and power subsidies and depreciating the naira currency twice within a year to decrease the difference between the official and secondary market exchange rates.

According to the Fund’s projection, fuel subsidies could amount to 3% of GDP this year since the rise in pump prices has not matched their dollar cost. Schimmelpfennig stated that policymakers are determined to gradually eliminate these subsidies within the next one or two years.

“The reforms are focused on how to raise that growth so that Nigerians can see real impacts on their living standards,” Schimmelpfenning said.
Global ratings agencies have reviewed Nigeria’s economic outlook upwards due to the impact of reforms, with Fitch the latest to revise Nigeria’s outlook to positive from stable on May 3.

“We think a lot has happened. We also have to recognise that the problems built up over many years were quite severe. We can’t expect that everything is going to be resolved overnight,” he added.

Schimmelpfenning emphasized the importance of expanding a cash transfer program and increasing government income to enhance the country’s capacity to deliver services to its population.

The IMF commended the Central Bank of Nigeria (CBN) for its recent implementation of interest rate hikes as a means to control rapidly increasing inflation. The IMF also emphasized the importance of using data-driven methods to further tighten interest rates.

The International Monetary Fund (IMF) has advised the Central Bank of Nigeria (CBN) to increase its foreign exchange reserves. Additionally, the IMF has suggested that the CBN should establish a clear and fair framework for foreign exchange interventions, with the primary goal of mitigating excessive short-term fluctuations in the market.

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IMF, DR Congo agree on final review of loan deal

Published

21 hours ago

May 9, 2024

Ifeoluwa Dada

The International Monetary Fund (IMF) says it has achieved a staff-level agreement with the Democratic Republic of Congo (DRC) over the final assessment of a $1.5 billion loan program.

The fund however emphasized the importance of the DRC effectively handling the funds obtained from a modified mining agreement. This brings Congo closer to successfully fulfilling an IMF program for the first time. Prior agreements have been disrupted due to concerns regarding the absence of openness and clarity in its extensive mining industry.

“Performance under the (three-year) program has been generally positive, with most quantitative objectives met and key reforms implemented, albeit at a slow pace,” the Fund said in a statement.

Upon receiving approval from the IMF board, the accord will enable the release of a final instalment of approximately $200 million. The IMF has highlighted the need for the world’s leading cobalt provider, which is also the third-largest copper producer, to include the beneficial effects of the recently modified Sicomines joint venture with Chinese businesses in its updated budget law for 2024.

“In addition, mechanisms will need to be put in place or reinforced to ensure the proper use and governance of these funds,” the Fund said.
President Felix Tshisekedi advocated for revising the 2008 infrastructure agreement with Sinohydro Corp and China Railway Group, aiming to enhance the advantages for Congo. A contract was executed in March.

“The IMF is concerned about the mechanisms for using this money and has asked for it to be paid into the public treasury accounts rather than being managed by an agency as has been done in the past,” a finance ministry official, who requested anonymity, told Reuters.

As part of the IMF program, Congo was required to disclose mining contracts. Last week, Congo finally revealed the updated terms of the Sicomines agreement, which state that the Chinese side will invest approximately $7 billion in infrastructure, contingent upon high copper prices.

According to a 2023 report by Congo’s national auditor, just $822 million out of the projected $3 billion for infrastructure investments was distributed under the earlier version of the agreement.

The amended agreement still contains provisions that Congolese and international civil society organizations perceive as unfavourable to Congo. One of the benefits that Sicomines enjoys is the exemption from tax payments until the year 2040.