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Fitch Affirms Nigeria’s FCID Rating, Retains Stable Outlook On Reforms
Fitch Ratings has affirmed Nigeria’s long-term foreign-currency issuer default rating at ‘B-‘ with a stable outlook, citing the reforms being implemented by the administration of President Bola Tinubu.
A year ago, the global rating agency lowered the country’s credit score to ‘B-‘ from ‘B’ and attributed the downgrade to continued deterioration in government debt servicing costs and external liquidity despite high oil prices in 2022.
It also affirmed this in May this year.
“Reform progress since President Bola Tinubu’s government came to power in May 2023 has been faster than we anticipated at our last review,” it said in a statement, citing the removal of fuel subsidies, the unification of the multiple exchange rate windows and the devaluation of the naira.
However, there has recently been some backtracking on reforms, notably a lower degree of price discovery in the FX market than in late June, raising doubt about the strength of this positive momentum, Fitch said.
“In addition, new data on the Central Bank of Nigeria (CBN) suggests its net foreign-exchange position is substantially weaker than we previously understood,” it said.
The country’s rating is constrained by weak governance, structurally very low non-oil revenue, high hydrocarbon dependence, security challenges, high inflation, low net FX reserves and ongoing weakness in the exchange-rate framework, according to the rating agency.
Fitch views Tinubu’s cabinet, particularly Finance Minister, Wale Edun, and the new CBN governor as supportive of reform.
“However, there are still sizeable socio-political challenges to implementation, including an acceleration in inflation, which could account for recent backtracking of some reforms,” it said.
Fitch said FX shortages has continued to weigh on economic activity and further FX liberalisation, and deter foreign capital.
In October, the CBN lifted the ban on providing FX for imports of 43 items, and began this week to clear nearly $6.7billion of unmet FX forwards.
“However, there has been a renewed widening of the gap between the official and parallel exchange rates since July with a premium of over 30 percent over the official rate.
“Average daily FX turnover at the official exchange rate window has fallen back to near April 2023 levels (well below pre-pandemic), at $95million in September,” the agency said.
Fitch flagged a lack of detail on a recent government announcement to raise $10billion of FX, including whether this includes World Bank budget support loans of $1.5billion.
It said the country’s public debt (excluding CBN loans) has a fairly long average maturity of 9.7 years.
It said: “The securitisation of N23trillion of CBN loans at a lower interest rate of 9 percent has helped contain general government interest costs, but at near 42 percent of revenues, overall interest expenditure is well above the ‘B’ median of 10.9 percent.
“We expect much lower recourse to CBN financing in 2023-2024 than in 2022, although there is a risk demand from the domestic banking sector turns out to be weaker than expected, despite its ample liquidity and strong deposit growth (38 percent in 1H23 year-on-year).”
Fitch forecasts general government debt/GDP to stabilise at 43.9 percent of GDP in 2024-25, having risen from 35.2 percent at the end of 2022 on the depreciation of the naira.
“We project GDP to slow to 2.6 percent in 2023, from 3.3 percent in 2022, and to expand 3.2 percent in 2024 driven by the services sector and higher oil production.
“Nigeria’s already structurally high inflation rose to an average of 25.5 percent yoy in 3Q23, from 20.3 percent yoy in 3Q22, partly reflecting fuel subsidy removal and naira devaluation,” it said.
The Rivers State Chief judge, Justice Simeon Chibuzor Amadi has granted pardon to six inmates standing awaiting trial at the Port Harcourt maximum correctional center.
The six lucky inmates granted pardon on Tuesday by the state Chief Judge included Nwekeala Chizoba, Samuel Emmanuel, Aniete Kelvin, Ebube Fubara and Goddey Okpara who were on awaiting trial as murder suspects and have all spent between 10 years to seven years in the custody without a proper information filed against them in the court.
Justice Amadi during a special gaol delivery exercise last Tuesday at the Port Harcourt Maximum Correctional Centre opined that the special gaol delivery was part of activities lined up to commomerate the 2024/2025 legal year in the State and restated the commitment of the state judiciary in decongesting the correctional centre and ensuring that those inmates who are not supposed to be there are removed from the custody.
The state chief judge stressed the need for all stakeholders to work together to build a society that supports rehabilitation and gives a second chance to anyone or group of people who have fallen short of the expectation of the law and have been punished accordingly.
He stressed that the National Judicial Council(NJC) encourages judges to pay more attention to criminal matters to enable them to decongests the correctional facilities, noting that since his assumption into office, his administration has been able to reduce the number of inmates in Nigerian Correctional Centres and the Port Harcourt Correctional Centre in particular, to less than 2,000 as against the over 4,000 inmates previously in the faculty.
According to him, “as they release the deserving inmates, they affirm their commitment to justice, compassion and rule of law but that they must not forget the fundamental principles of justice delivery system which is truth and fairness, integrity and equality before the law.”
I encourage you all the released inmates to return to your families and become better citizens. You must not engage in action that will return you all back to prison. Let me say that while the judges show empathy to you all, it does not absolved individuals from being held accountable for actions against individuals, corporate organisations and state which the law frowns at, ”he stated
The Chief Judge thereafter stood down the exercise to enable the DPP to intervene to case files following the fact that majority of the persons listed to benefit from the exercise are facing murder charges and adjourned to a date that will come before December.
Earlier in his goodwill message, the outgoing state Comptroller of Nigerian Correctional Centre, Port Harcourt, Felix Lawrence, who was recently promoted to the rank of Assistant Controller General, commended the state judiciary led by Chief Judge, Justice Simeon Chibuzor Amadi for their continuous effort aimed at ensuring justice and decongesting the facilities.
Other activities lined up for the event included special church service at St Paul’s Cathedral , Anglican Communion, Rebisi Port Harcourt, inspection of guard of honour by the state Chief Judge mounted by officers of the Nigerian police and a special court session held at the ceremonial court hall.
By: AkujobiAmadi
The Director General of Rivers State Bureau on Public Procurement (RBoPP), Dr. Ine Briggs, has explained that the Sir Siminalayi Fubara administration plans to enforce transparency in governance through public procurement.
Speaking at a one-day Public Procurement Enlightenment workshop organised in collaboration with the State Local Government Service Commission for newly elected chairmen, vice chairmen, secretaries and leaders of legislative assemblies, Dr. Briggs said it is key for grassroot development.
She stated that the Sir. Fubara administration plans to reduce wastage and at same time infuse efficiency in public expenditure.
The RSoPP DG said the local government political office holders remain key drivers in the new vision hence the workshop is to arm them with knowledge on how to execute projects in tandem with needs of the people.
“ Your role in the prudent management of public resources is, therefore, not just administrative it’s the cornerstone of delivering the dividends of democracy. Every procurement decision you make must reflect a commitment to fairness, transparency and accountability” Dr. Briggs submitted.
One of the key goals of the administration she further reminded the participants was to use their offices to foster economic growth through public procurement.
She warned that the law establishing the agency empowers it to penalise defaulters, but that what is more important is voluntary compliance to the laws.
In addition to that, she said urged the local government council leaders that champion the practice and implementation of public procurement law.
On his part, Acting Chairman of Local Government Service Commission, Pastor GoodLife Ben Iduoku averred that the aim of the workshop is to arm key stakeholders in the local government system to generate new ideas, innovation and strategies in tandem with government policies and programmes.
The workshop dealt on various topics on procurement planning, methods, Understanding Bid Process, including types of Construction Contracts and law.
Some participants were awarded excellence and meritorious awards as part of the programme.
By: Kevin Nengia
The 19th anniversary of the National Association of Proprietors of Private Schools (NAPPS), Rivers State Chapter, recently ended in Port Harcourt in grand style, with participants from various schools including proprietors, the academia, civil society groups and top government functionaries charting the way forward for educational improvement.
The 19th NAPPS anniversary christened, ‘Innovation and Adaptation: Transforming Challenges Into Opportunities’ was held at Casoni Hotels, Port Harcourt.
In his remarks, the Chairman of the Rivers State Chapter of the association, Dr. Jaja Adafe Sunday expressed gratitude to the members and executives for their untiring efforts towards the achievements of the body.
He sought the intervention of government on the lingering crisis on the economy as it is affecting the running of schools.
He decried high cost of things including fuel and raw materials which has adversely affected the running of schools and payment of teachers.
Dr. Sunday hinted that the current economic situation in the nation is biting hard on the operations of schools, saying inflation, removal of fuel subsidy, fuel scarcity, poor electricity supply, tariffs and lack of government grants are some of the challenges faced by schools, and urged the members to brace up to the challenges, as it is the panacea to building a brighter future.
Guest speakers from the health sector and the academia thrilled the gathering on the essence of basic education which they said is the key to national development.
Former Dean of the Ignatius Ajuru University of Education, Professor Azuru and the Chief Medical Director of Meridian Hospitals, Dr. Odo Iyke were some notable guest speakers who delivered lectures at the occasion.
Some distinguished proprietors also got special recognitions and awards.
The 19th anniversary cake was cut by the Rivers State NAPPS Chairman with representatives of the state government assisting.