Nigeria's president vowed on Tuesday to recover billions of dollars allegedly stolen by officials and restore financial "sanity", accusing previous governments in Africa's biggest economy of throwing the rulebooks "to the dogs".
Muhammadu Buhari's strong words came after a meeting with the governors of Nigeria's states, in which they said they were 658 billion naira ($3.3 billion) in debt and needed federal government support to offset a funding crisis.
Zamfara state governor Abdulaziz Yari Abubakar said the governors had suggested three ways out: the government could refund money spent on federal projects such as roads, banks could extend existing loans to up to 20 years, or the government could share out oil revenues usually saved in the so-called Excess Crude Account (ECA).
The president, who took office last month after defeating Goodluck Jonathan in Nigeria's first transfer of power through the ballot box, vowed to recover billions allegedly stolen by public officials.
"There are financial and administrative instructions in every government parastatal and agency. But all these were thrown to the dogs," Buhari said in a statement after meeting the governors in the capital Abuja.
"The next three months may be hard but billions of dollars can be recovered, and we will do our best," he said. "We will restore sanity to the system."
RUNNING ON EMPTY
Several states borrowed in the domestic bond market and from banks to fund infrastructure projects. But the price of crude, which represents 80 percent of Nigeria's revenue, has since plunged, leaving the government unable to pay bills or salaries.
The naira currency has fallen sharply despite the central bank spending billions of dollars to try and prop it up.
Gross revenues distributable to the three tiers of government - federal, state and local - hit a five-year low in April due to frequent shutdowns of oil and export terminal pipelines and depressed crude prices.
Government revenues distributed for May rose to 409.3 billion naira, up 5.4 percent from the previous month, but the Finance Ministry said oil pipeline shutdowns continued to hamper earnings.
Details of Nigeria's economic and financial position would be published within four weeks, Buhari said.
He said the government would look into whether ECA funds could be used to cover unpaid salaries after saying on Monday that treasury coffers were "virtually empty".
The ECA had $2.078 billion as of June 23, the Finance Ministry said.
Standard Chartered's head of Africa research, Razia Khan, said that the level of state debt was "especially problematic".
"While an early release of the ECA may provide a partial solution, it is not yet known how much Nigeria will have managed to accumulate in its ECA in recent months."
Reuters
Tuesday, June 23, 2015
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President Muhammadu Buhari says national treasury virtually empty
Nigerian President Muhammadu Buhari, who took office last month, said his government is facing severe financial strain from a Treasury that’s “virtually empty” and billions of dollars in debts.
The government is under “so much pressure” that it’s unable to even regularly pay some state workers, Buhari told reporters on Monday in the capital, Abuja. “This is the bad management that we find ourselves in.”
Buhari has yet to name a cabinet since being sworn in as president of Africa’s largest economy on May 29 after defeating Goodluck Jonathan in elections. He took over as a plunge in crude prices forced the government to scale back budgeted spending and devalue the naira while foreign-currency reserves fell. The government relies on crude for about 70 percent of its income.
“It’s just saying the obvious,” said Akintola Owolabi, a senior lecturer of accounting and finance at Lagos Business School. “We all know about the reckless abandon with which the last regime carried out its affairs.”
Former military ruler Buhari, 72, swept Jonathan from office in March elections by pledging to end endemic corruption and Boko Haram’s rebellion in the north that has killed thousands in its six-year campaign to impose its version of Shariah law.
The central bank has been using its foreign reserves, which fell to $29 billion as of June 18 from $34.5 billion at the start of 2015, to help defend the local currency. Still, the naira has declined 7.8 percent against the dollar over the same period.
Growth in the economy is forecast by the International Monetary Fund to slow to 4.8 percent this year from 6.3 percent last year.
Bloomberg
The government is under “so much pressure” that it’s unable to even regularly pay some state workers, Buhari told reporters on Monday in the capital, Abuja. “This is the bad management that we find ourselves in.”
Buhari has yet to name a cabinet since being sworn in as president of Africa’s largest economy on May 29 after defeating Goodluck Jonathan in elections. He took over as a plunge in crude prices forced the government to scale back budgeted spending and devalue the naira while foreign-currency reserves fell. The government relies on crude for about 70 percent of its income.
“It’s just saying the obvious,” said Akintola Owolabi, a senior lecturer of accounting and finance at Lagos Business School. “We all know about the reckless abandon with which the last regime carried out its affairs.”
Former military ruler Buhari, 72, swept Jonathan from office in March elections by pledging to end endemic corruption and Boko Haram’s rebellion in the north that has killed thousands in its six-year campaign to impose its version of Shariah law.
The central bank has been using its foreign reserves, which fell to $29 billion as of June 18 from $34.5 billion at the start of 2015, to help defend the local currency. Still, the naira has declined 7.8 percent against the dollar over the same period.
Growth in the economy is forecast by the International Monetary Fund to slow to 4.8 percent this year from 6.3 percent last year.
Bloomberg
Suicide bombers kill 30 in North Eastern Nigeria
Two girls blew themselves up on Monday near a crowded mosque in northeast Nigeria's biggest city, killing about 30 people, witnesses said.
It is the fourth suicide bombing this month in Maiduguri, which is the birthplace of the Boko Haram Islamic extremist group.
Fishmonger Idi Idrisa said one teenager exploded as she approached the mosque crowded with people from the nearby Baga Road fish market, performing afternoon prayers during the holy month of Ramadan.
The second teen appeared to run away and blew up further away, killing only herself, he said.
Civilian defense fighter Sama Ila Abu said he counted at least 30 corpses as he helped collect the dead.
Both men said said there were many injured.
Boko Haram has kidnapped hundreds and hundreds of girls and women and the numbers of female suicide bombers has raised fears that it is using the captives in its campaign.
A military bomb disposal expert has told the AP that most bombs carried by girls and women have remote detonation devices, meaning the carrier cannot control the explosion.
Boko Haram has stepped up attacks since Nigeria's new President Muhammadu Buhari announced the military command center is moving from the capital Abuja to Maiduguri in Borno State.
The attacks come as Nigeria and its neighbors are preparing to strengthen a multinational army that this year drove Boko Haram out of towns and villages where it had set up a so-called Islamic caliphate.
But bombings and hit-and-run attacks have continued, along with cross-border raids.
On Thursday, a group of the extremists attacked two towns in neighboring Niger, killing at least 40 people, the government said.
In its first attack on Chad, suicide bombers a week ago attacked two buildings including the national police academy in N'Djamena, killing at least 33 people.
AP
It is the fourth suicide bombing this month in Maiduguri, which is the birthplace of the Boko Haram Islamic extremist group.
Fishmonger Idi Idrisa said one teenager exploded as she approached the mosque crowded with people from the nearby Baga Road fish market, performing afternoon prayers during the holy month of Ramadan.
The second teen appeared to run away and blew up further away, killing only herself, he said.
Civilian defense fighter Sama Ila Abu said he counted at least 30 corpses as he helped collect the dead.
Both men said said there were many injured.
Boko Haram has kidnapped hundreds and hundreds of girls and women and the numbers of female suicide bombers has raised fears that it is using the captives in its campaign.
A military bomb disposal expert has told the AP that most bombs carried by girls and women have remote detonation devices, meaning the carrier cannot control the explosion.
Boko Haram has stepped up attacks since Nigeria's new President Muhammadu Buhari announced the military command center is moving from the capital Abuja to Maiduguri in Borno State.
The attacks come as Nigeria and its neighbors are preparing to strengthen a multinational army that this year drove Boko Haram out of towns and villages where it had set up a so-called Islamic caliphate.
But bombings and hit-and-run attacks have continued, along with cross-border raids.
On Thursday, a group of the extremists attacked two towns in neighboring Niger, killing at least 40 people, the government said.
In its first attack on Chad, suicide bombers a week ago attacked two buildings including the national police academy in N'Djamena, killing at least 33 people.
AP
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