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Economy

Credit Rating Agency Foresees Statism as Core Principle of Buhari’s Second Term Agenda

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By Eric Elezuo

Agosto and Co, Credit Rating agency saddled with the responsibility of providing unbiased expert analysis of various industries in the Nigerian Economy as well as gathering information about the market size and potential of an industry, its key players, competitors, products and financial condition amongst others, has said that there is a great tendency that the second term of President Muhammadu Buhari, will be channeled towards statism as a principle of government.

The agency, after thorough research centering on the line of actions of the administration’s first term and the prevailing economic situation, settled with the fact that the administration will tend to control all avenues of business in the economy, thereby making it a state controlled economy.

It made this remarks in a published document titled “Buhari Version II (2019—2023): Economic Perspectives” 

The research noted that “while the demand management policy of the Central Bank remains the biggest symbol of Mr. Buhari’s statist stance, there are quite a number of seemingly innocuous illustrations that support this assertion.”

It went on to elaborate these illustrations to include: “Firstly, some of the germane bold market reforms in the ERGP document such as the review of the pricing mechanisms for the key prices (exchange rates, electricity tariffs and petrol prices) to reflect fundamentals have been largely ignored. This has left the country with a burgeoning fiscal deficit (currently only three basis points shy of the 3% guidance in the Fiscal Responsibility Act).

“The second argument to demonstrate the statist stance of this administration would be the
abortion of its own reform programs. For instance, the planned concession of the major international airports in Lagos, Kano, Port Harcourt and Abuja by this administration and the cold trail of the process buttress this argument.”

Among other permutations, the research wondered if Buhari will continue with ‘his pursuit of statist policies or will he require a Damascene moment to metamorphosise from being a
reflexive statist into a free-marketer?’

Buhari has just been re-elected for a second tenure in office in an election that is still being contested in court by the main opposition candidate and party, Alhaji Atiku Abubakar and the Peoples Democratic Party (PDP).

Below is a detailed PDF copy of the research and its findings…

Agusto&Co_Economic_Newsletter_Buhari_Version_II_2019-2023_Economic_Perspectives

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Economy

Naira Makes More Recovery, Sells at N1,453/$1

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The Naira continued its appreciation at the official market on Thursday, March 21, 2024 to close at N1,453.28/$1, according to data from the Nigerian Autonomous Foreign Exchange Market (NAFEM).

This represents an appreciation of N39.33 when compared to the N1,492.61/$1 it closed on Wednesday, March 20, 2024.

The intraday high was N1,598/$1, while the intraday low was N1,300/$1, representing a wide spread of N298/$1.

Similarly, the Naira appreciated against the dollar at the parallel window to trade at N1,500/$1, this represents an appreciation of N20.00 as against the N1,520 /$1 it traded the previous day.

The Naira also appreciated slightly against the British Pound to trade at N2,000/£1 as against the previous trading day’s price of N2,020/£1 representing a gain of N20 for the local currency.

The Canadian dollar, however, closed flat against the naira to trade at N1,270/CA$1 same as the N1,270/CA$1 it traded the previous day representing a decline of N20 in the local currency.

The Naira gained N30 against the Euro to trade at N1,670/€1 as against the previous closing price of N1,700/€1.

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Economy

Naira Gains Against Dollar, Trades at N1,603/$1

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The Naira, Tuesday continued its recovery against the American dollar as it traded at N1,603.38/$1, data from the Nigerian Autonomous Foreign Exchange Market (NAFEM) window has shown.

This represents a gain of N15.48 when compared to the N1,617.96/$1 it closed on, on Monday, March 11, 2024.

The intraday high was N1,637/$1, while the intraday low was N1,425.35/$1, representing a lean spread of N211.65/$1.

Meanwhile, the Naira gained N12 against the dollar at the parallel market as the local currency appreciated to N1,603/$1 as against the N1,615 /$1 it traded the previous day. As it stands, the naira is trading at the same rate at both official and parallel windows.

The Naira, however, slumped against the British Pound to trade at N2,050/£1 as against the previous trading day’s price of N2,030/£1 representing a loss of N20 for the local currency.

After about two weeks of closing flat against the Canadian dollar, the naira slumped massively to trade at N1,300/CA$1 on Tuesday, representing a decline of N150 when compared to the N1,150/CA$1 it traded the previous day.

The Naira lost N35 against the Euro to trade at N1,740/€1 as against the previous closing price of N1,705/€1 representing a loss of N35 for the local currency.

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Economy

Binance to Close Shop in Nigeria, Stops Transaction, Trading in Naira

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By Reuters – Binance will stop all transactions and trading in Nigeria’s local currency after March 8 amid a country-wide crackdown on crypto exchanges that have been blamed by authorities for feeding a black market for foreign exchange.

It will stop supporting withdrawals after Friday and any remaining balances in Nigerian Naira will be automatically converted into Tether – a stablecoin whose value is pegged to the U.S. dollar.

Last week, Nigerian authorities detained two Binance senior executives on undisclosed charges as part of the crackdown.

They were still in custody, their local lawyer said before a parliamentary committee on Monday.

Source: Reuters

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