Finance Minister Okonjo-Iweala warns of economic recession

Minister of Finance and Co-ordinating Minister for the Economy, Dr. Ngozi Okonjo-Iweala, has warned of a difficult time ahead as she told the Federal Executive Council meeting in Abuja, yesterday, that "government should buckle up and prepare for a possible recession" in the economy.

Her warning came on the heels of the approval of a new visa regime by the Federal Executive Council.

Finance Minister, Mrs. Ngozi Okonjo-Iweala discussing with the Health Minister, Dr. Christian Chukwu (l); Housing Minister, Ms. Amal Pepple and the Solid Minerals Development Minister, Arc. Musa Sada during the weekly meeting of the Federal Executive Council at the State House, Abuja. Photo by Abayomi Adeshida

Okonjo-Iweala, who gave the warning during the weekly meeting at the Presidential Villa cited the slide in the price of crude oil as well as the dire economic situation inSpainand Greeceas possible trigger for another round of global recess.

Minister of Information, Mr Labaran Maku, who conveyed the Minister of Finance's warning quoted her as saying: "Nigeriamay not be so lucky to avoid recession this time as it did during the last economic meltdown and urged the Federal Government to put up measures that will help mitigate the effect of such economic melt down."

According Maku, the Coordinating Minister, however, explained that occasional delays in meeting government's obligation to creditors was not a sign of weakness in the economy, adding: "Our economy is sound."

New visa regime

According to Maku, the new visa regime is driven by economics to boost investment, tourism, generate employment and fight terrorism.

Maku, who briefed State House correspondents alongside his colleagues Minister of Interior, Abba Moro and Minister of Health, Onyebuchi Chukwu, saidNigeriawas emulating countries that had tried to make it easier for potential investors by liberalizing their visa policy.

One of the highlights of the new visa regime, the minister explained, was the possibility of some visitors to the country to accessNigeria's visa at various international points of entries into the country.

He said the policy was based on the assumption and dynamics of constantly changing international economy and the need forNigerianot to be left behind in the drive by nations to attract more highly resourceful, wealthy portfolio investors.

Minister of Interior, Abba Moro, who gave further insight into the new visa policy stated: "The assumption and dynamics on the basis of which we had our old policy have changed in line with the realities of our time.

"Most significantly is the fact that we have been in recent time witnessing security challenges in our country and it becomes necessary that we must attack the problem from all sides and the way you enter and get out ofNigeriaconstitute a very vital component of fighting internal security."

He added: "Today, we have a new visa regime that contains some innovations in the sense that new elements are being introduced in line with the strategic interest ofNigeriaand of course most other areas still have to be based on the principle of reciprocity.

Visa at entry point

"We now have visa at entry point. So, if a businessman, a tourist or a business delegation or a government delegation has reason to visitNigeriaat short notice to do business with Nigeria and if by any coincidence we don't have embassy in such country, such delegation or group can come toNigeriaand obtain their visas at point of entry particularly at international airports. Of course, this is without prejudice to ensuring our internal security.

On the abuse of expatriate quota

On the abuse of expatriate quota in the past, the Interior Minister said government had introduced appropriate check mechanism that would make it easier to monitor compliance with expatriate quota under the new regime.

"For every expatriate that is employed, two Nigeria under studies must be employed. If you are coming toNigeriawith $500,000, for instance, in addition to those employed to understudy, you will be expected to employ between 30 to 50 Nigerians.

"We have admitted there has been difficulty in enforcing the expatriate quota before now but with the automation with the business department of the interior ministry, we will enforce expatriate quota."

New E-Health Policy

The other decision by Council was the approval of a new E-Health Policy also known as Regulatory and Business Practices Improvement and Information Management for the National Health Insurance Scheme (NHIS).

Maku explained that the "Minister of Health, Professor Onyebuchi Chwukwu had proposed in his memo to Council for approval to procure an e-platform as part of the e-governance to enable NHIS to function more effectively and improve manual work and make the programme more efficient".

The project is based on the need to promote an efficient plateform for scaling up the installation and implementation of an electronic network that will facilitate transactions between NHIS and other stakeholders in the sector such as Health Management organizations HMO, Health Financiers, Enrollees, Banks and Insurance companies.

He said 60 per cent of the fund is expected to be provided by the International Finance Organisation IFC and the World Bank, while the federal Government will provide the balance 40 per cent.

The IFC grant, which is unconditional amounting to $1,368, 964.45 represents 60 per cent of the total cost, while federal government will provide $554,785.78, representing 40 per cent of the total cost of the project.

Council also approved the rehabilitation of the G17 unit of Ugheli plant expected to deliver 100MGWts of electricity to the country.

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Video - Air Nigeria grounded for safety checks

Air Nigeria, the national carrier and second-largest airline of the West African nation, has been grounded for safety checks.

The move comes days after one of the country's worst air crashes resulted in the deaths of all 153 people on board.

Thousands of Air Nigeria passengers are now left stranded as rumours of financial troubles and an engineers' strike adds to the challenges facing the carrier.

The most damning claims, however, come from John Nnorom, former finance director, who says the airline's engineers are under commercial pressure to certify unfit aircraft for travel.

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Air Nigeria operations suspended

The Nigerian Civil Aviation Authority (NCAA) has suspended Air Nigeria operations, just as the agency conducts thorough auditing on its aircraft.

Our correspondent gathered that the NCAA took the decision because Air Nigeria had not flown its aircraft in the past week following a strike by its pilots and engineers.

Air Nigeria only resumed operations some five days ago after the pilots and aeronautic engineers under the auspices of the National Association of Aircraft Pilots and Engineers (NAAPE) had called off a one week old industrial action.

The Media Assistant to the Director General of NCAA, Mr. Sam Adurogboye, who confirmed the suspension, said it was a routine action to allow NCAA look at the airline.

"It is a routine action to enable us look at them before allowing them to go back to operations having been on strike for days ,this is normal" he said.

Spokesman for Air Nigeria, Sam Ogbogoro, told our correspondent on phone that there was nothing out of the ordinary about the grounding of Air Nigeria aircraft.

He said that it was normal practice in civil aviation to conduct audits on aircraft once they have not been flown for some time; since Air Nigeria did not fly for a week, it was natural the aircraft are checked by NCAA.

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Finance chief Arunmah Oteh suspended

The head of Nigeria's stock exchange regulator, Arunmah Oteh, has been suspended pending an investigation into allegations of malpractice.

The decision of the regulator's board comes after a parliamentary committee recommended she be investigated.

Ms Oteh was given the job of cleaning up the stock exchange following a crisis in 2009 which saw stocks lose around 60% of their value in a year.

She has not officially been accused of any wrongdoing herself.

The BBC's Will Ross in Lagos says this not the first time a probe into fraud in Nigeria has turned into a circus of accusations and counter-accusations as the hunter turns hunted.

'Yachts and Rolexes'

When she was appointed more than two years ago, Ms Oteh promised to restore credibility in the stock exchange.

She said fraudsters who had caused share prices to collapse would be charged.

Following her suspension by the board of Securities and Exchange Commission (Sec), some analysts believe she is now being punished for treading on some powerful toes, our correspondent says.

"Some powerful people are fighting back," an analyst told our reporter.

Earlier this year at a committee hearing of the House of Representatives into the 2009 crisis, she detailed the alleged financial mismanagement she had uncovered at the Nigeria Stock Exchange.

Ms Oteh outlined incidents of false accounting, misappropriation and questionable transactions.

She said the stock exchange had spent more than $230,000 (£147,000) on a yacht and more than $1m on Rolex watches to be given out as gifts - much of which she said the previous management of the exchange had not accounted for - allegations they deny.

The same parliamentary committee then recommended she be investigated over the alleged mismanagement of funds to mark the 50th anniversary of the stock exchange, which were organised last year by the commission.

Ms Oteh had earlier defended her name at one point accusing the committee of being a "kangaroo court" and the lawmakers of soliciting bribes from her to stop their recommendation - which they deny.

The Sec board says Ms Oteh, who arrived at her office in Abuja on Tuesday morning to find the locks changed, is being sent on "compulsory leave" to allow for an independent investigation into the 50th anniversary allegations.

Her suspension will once again test investor confidence in Africa's second-largest economy, our reporter says.

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Al-Qaida blames Germany for German hostage death in Nigeria

Al-Qaida's North Africa branch has blamed Germany for the death of a German engineer killed during a military raid in Nigeria, though authorities in Europe apparently complied with at least one of the terrorist group's demands by releasing a prisoner it wanted freed.

German Edgar Fritz Raupach, kidnapped in January by gunmen in the north Nigeria city of Kano, died May 31 as soldiers launched a raid against the house where his abductors held him. Nigeria's military later said it had no idea gunmen held Raupach inside the home and that kidnappers stabbed him to death as the raid began.

Al-Qaida in the Islamic Maghreb, the terrorist group that claimed it held Raupach, issued a statement on an Internet forum this week saying the hostage's death came only after the German government refused to negotiate with it.

"Your government gave the green light for the operation," the message posted late Monday night reads.

However, the group, known by the acronym AQIM, had demanded that German officials release Filiz Gelowicz, a German woman convicted last year of supporting a foreign terrorist network. Gelowicz's husband was among a group convicted of plotting unsuccessfully to attack U.S. soldiers and citizens in Germany.

German officials released Gelowicz from prison in late April on probation after she served two-thirds of her sentence. In May, an unsigned advertisement appeared in The Daily Trust, the newspaper of record in Nigeria's north, showing a photograph of Raupach and messages in Arabic and English calling for him to be released. It remains unclear what went wrong in the negotiation or if there had been a demand for a ransom payment, which happens regularly in AQIM kidnappings.

In the message, first reported by the SITE Intelligence Group, AQIM also warned European governments to avoid "dealing in foolishness" during hostage negotiations, as that would endanger lives.

In Berlin, a government source said Tuesday that Nigerian authorities raided the house only in an effort to arrest terrorists, not as part of a rescue operation for Raupach.

"German authorities were not informed beforehand," the official said. "Nigerian authorities have already (said) ... they had no knowledge of the whereabouts of the German." The source spoke on condition of anonymity because of the sensitivity of the issue.

Gunmen kidnapped Raupach from a construction site in Kano, Nigeria's second-largest city, where he worked for Dantata & Sawoe Construction Co. Ltd. Raupach's kidnapping came days after a coordinated attack in the city by the radical Islamist sect in Nigeria known as Boko Haram killed at least 185 people.

AQIM released a statement in March claiming they had Raupach, as well as a video showing him disheveled and asking in German and English for his country to help win his freedom.

AQIM had not carried out operations previously in Nigeria, a multiethnic nation of more than 160 million people split largely between a Muslim north and a Christian south. However, security officials and diplomats say AQIM has loose links with Boko Haram, a locally focused sect that wants to implement strict Shariah law across Nigeria.

Boko Haram began its terror campaign with gun attacks from the backs of motorcycles. Last year, it started escalating its assaults with a string of suicide bombings targeting churches, government buildings, and even the United Nations headquarters in the capital Abuja. The sect has killed more than 560 people this year alone, according to an Associated Press count, while Nigeria's military and security forces appear unable to stop them from striking at will.

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