[size=13pt]Nigeria disburses $4.7 bln to govt, plans wealth fund[/size]


By Camillus Eboh
ABUJA (Reuters) - Nigeria has distributed $4.7 billion in revenues and windfall oil savings to government for July, a massive disbursal which is likely to trigger a drop in bond yields and interbank rates next week, dealers said.

Africa's biggest oil and gas producer shares its revenues among three tiers of government each month -- federal, state and local -- and tops the disbursal up with a withdrawal from its windfall oil savings if there is a shortfall.

Accountant General Ibrahim Dankwambo said Nigeria had distributed 404.27 billion naira in revenues and $2 billion from its crude oil savings for last month, making up one of the largest monthly disbursals ever.

Around 80 percent of the liquidity in sub-Saharan Africa's second-biggest economy comes from public cash flows and the monthly allocations can trigger significant shifts in bond yields and interbank rates.

"We expect (interbank) rates to crash immediately part of monthly budgetary allocations to state and local governments hit the system, latest by Tuesday," one money market dealer said.

The disbursal comes five months before presidential and parliamentary elections in Africa's most populous nation. Government spending has traditionally risen in election years, leading analysts to question the quality of the expenditure.

Among the major recipients of the monthly revenue distributions are the country's 36 states, whose governors form a powerful caucus within the ruling People's Democratic Party (PDP) and who will be key to the outcome of the polls.

President Goodluck Jonathan, who is from the southern Niger Delta, has not yet announced whether he plans to contest but a bid would be controversial because a "zoning agreement" within the PDP dictates that power should rotate between the Christian south and Muslim north every two terms.

Continued . . .

[size=13pt]Nigeria distributes 404 bln naira revenues for July[/size]


ABUJA (Reuters) - Nigeria has distributed 404.27 billion naira from federal accounts to its three tiers of government for July, down 2.2 percent on the previous month, the country's accountant general said on Friday.
"The total revenue distributable for (July) including VAT is 404.273 billion naira," Accountant General Ibrahim Dankwambo told reporters after a meeting of the Federation Account Allocation Committee (FAAC) responsible for the disbursals.

The monthly distributions have a major impact on liquidity in sub-Saharan Africa's second-biggest economy and can trigger shifts in bond yields and interbank rates.

Continued . .

The same reserves we reportedly had about $40 Billion in excess oil funds in? 

Kobojunkie. I think you are wasting your time. No one here wants to challenge how the money is spent as long as ogre Jonathan is the one spending it.

@ topic.

We have a financial problem in Nigeria. We are the first country in the world that has money coming from all angles but don't know what to do with it and is hitting record deficit each year.That is the worst financial problem any nation could have!!!!!. I don't know much about finances but I do know we have a financial problem. Deficit is a huge problem. He can still buy the jet right? And the senators can keep getting 250mill/year right?

I am not asking anyone to challenge anything. I simply asked a question there since I am not an economist or really that learned in it. All I do is check the pluses and the minuses to figure out what is going on.

The post is like any other on nairaland, not about my person.

[size=13pt]The Nation Sinking Into Debt Again[/size]
http://allafrica.com/stories/201008130522.html


In the Daily Independent of Tuesday, July 27, 2010, P. 34, Thompson Ayodele And Olusegun Sotola, Two Public Policy Analysts Based in Lagos, Cautioned Against Any Relapse By the Government Into the Past Abuse of Foreign Loans As a Source of Corrupt Enrichment By the Ruling Elite.

I call on the reader to read the article, as well as mine on the same subject, and tell me why Nigerians should not rise to action against this unwarranted action by the government. The article by Ayodele and Sotola reported that the external debt now stands at $4.3 billion, and that in this year's budget, a total of $3.3 billion is expected to go into debt servicing alone. What is worrisome is that we should not have gone on this pathway again considering our past experience on foreign debt and how we only recently got out of its crushing burden.

Recently, I received an email from Dr. John H. Boer, one of the foremost activists in the Jubilee Movement on Debt Relief, who worked tirelessly to see that Nigeria became free from our past debt burden and enslavement - a goal that finally came to pass during the Obansanjo administration. Dr. Boer expressed great disappointment that Nigerians were not objecting to this new policy of going for more foreign loans, thereby increasing the country's debt profile again. Our past experience in external debt was so crushing and hopeless that ex-President Obasanjo said he was ready to step down as President if that was the sacrifice required to allow Nigeria get debt relief. This new direction by the government totally negates Obasanjo's aggressive and tireless action to get the country out of the debt trap.


The Federal Government's opening of a new chapter in external debt with the World Bank and its allies is terribly bad news and totally unbelievable. This move is so offensive that someone has said that the way to address it soonest is to take the FG to court, or even better, take the FG together with IMF, World Bank and others to the World Court in the Hague for banditry. This is the opinion of someone who is sad that our government has not learnt from our past experience on external debt.

Where does the reader stand on this matter? Should we take it that Nigerians do not object to this new direction, as expressed by Dr. Boer, or that we haven't heard of it? What action do you suggest?

Jesus! Is this the same excess account Mr.Obasanjo left bulging with crazy dollars before he left power!?!?

lol. . .

Una go fear fear. Austerity under Yaradua and yet no money in the coffers

[size=13pt]Nigeria needs clear policy on excess crude account – IMF
Tuesday, 27 April 2010[/size]
http://www.businessdayonline.com/index.php?option=com_content&view=article&id=10466:nigeria-needs-clear-policy-on-excess-crude-account--imf-&catid=85:national&Itemid=340


Barely one week after the Federal Government hinted of establishing a sovereign wealth fund (SWF) to replace the excess crude account (ECA), the International Monetary Fund (IMF) has advised on the need for a clear cut policy on the use of the excess fund coming from the sale of crude oil in the international market. According to the IMF, a clear cut policy on the excess crude account will assist Nigeria to “really pursue more countercyclical policies.”

Excess crude account was ostensibly conceived to domicile funds saved from excess foreign exchange earned as a result of increase in oil prices over and above budgeted price benchmark.

Antoinette Monsio Sayeh, director of the IMF’s African department while commenting on Nigerian economy in the April 2010 regional economic outlook for sub-Saharan Africa (SSA) said IMF has indeed been encouraged by the movement on some aspects of the reform challenges in Nigeria since Acting President Goodluck Jonathan came into office.

Nigeria, according to IMF, has used significant amounts of what was in the excess crude account, and “we think, of course, that it was a timely response to the crisis. That’s why you build reserves, to have the ability to then tap into them when you need to - when there are unforeseen circumstances. We have seen movements on the challenges around the financial sector restructuring and resolution, and, in particular, recent progress on the establishment of an asset management company (AMC) that will help to recover and restructure the banking system.”

“Some progress also in terms of getting the Petroleum Industry bill (PIB) moving through parliament, also very encouraging. So, we very much expect to be working to continue to provide advice and support to the government in the course of the months ahead, and hope that it allows Nigeria to continue to make progress on the huge challenges that it continues to face,” IMF stated.

Meanwhile, IMF underscored the fact that sub-Saharan Africa (SSA) has not been immune from the global downturn, as “we’ve been saying all along, but that it has in fact proven to be significantly more resilient than in the case of previous downturns.”

“The first point to make is that the slowdown looks to be mercifully brief. We now project output to expand by some 4.75 percent in 2010, compared to an estimated 2 percent in 2009. And provided that the global economy continues to improve, we think that growth in the region should accelerate even further to about 5.75 percent in 2011. So, this is a much better picture of course than we had painted a year ago. Our growth estimates for 2009 and the projections for 2010 have been revised upwards, .5 percent to 1 percent, largely reflecting the much faster recovery in global economic activity than we had expected a year ago. And with the recovery now well under way, we think the risks - downside risks have receded somewhat,” IMF stated.

Secondly, IMF observed that middle-income and oil-exporting sub-Saharan African countries faired much worse and were significantly affected by the downturn.

[size=13pt]Salary increase may cause inflation -MPC *As external reserves decline by $25bn *Declining reserves not a problem -CBN [/size]
Written by Samuel Ibiyemi and Gbola Subair, Abuja
Tuesday, July 6, 2010

THE Monetary Policy Committee has said that the proposed salary increase for the civil servants had the tendency of increasing inflationary pressure on the economy, just as the apex bank said the declining external reserves posed no threat to the Nigerian economy.


Governor of CBN, Mallam Lamido Sanusi, addressing a press conference after the 71st Monetary Policy Committee meeting in Abuja, on Monday, stated that the down trend in the domestic price level could be attributed to a number of factors, including the continuing underperformance of the monetary aggregates with the associated constraints demand, adequate food supply, stable exchange rates and improvement in the availability of petroleum resources, amongst others.


Notwithstanding this, the MPC reiterated its earlier position on the threat of inflationary pressure arising from several factors, including the effect of salary increase in the civil service and the rising food prices against the backdrop of famine in neighbouring Niger Republic.


However, the apex bank has reiterated the readiness of the Monetary Policy Committee (MPC) to continue to monitor price developments, with a view to taking appropriate measures to stem any inflationary threat and ensure that the downside risk of inflation growth was minimised.


The CBN governor said the external reserves were $34 billion in 2008, but went down to $9 billion in 2009, thus showing a decline of $25 billion.


With $9 billion external reserves, the CBN governor said this could finance imports for 16 months, adding that there was no cause for alarm on the development.


According to him, Nigeria should count itself lucky for the external reserves, citing the example of the United States, whose external reserves could only finance imports for three months.


Explaining the reason for the declining reserves, Mallam Sanusi said Nigeria's external reserves swelled up when oil price was about $140 per barrel and a daily production of about 2 million barrels per day, adding that with oil price as low as $40 per barrel, nothing short of declining external reserves should be expected.


Reviewing the domestic economic conditions in the first quarter of 2010, the CBN boss said the year-on- year headline inflation declined to 11.0 per cent in May 2010 from 12.5 per cent in April and 11.8 per cent in March.


Similarly, the CBN governor said core inflation fell to 8.8 per cent in May 2010, from 9.8 per cent in April and 9.5 per cent in March.


He said the capital market was still showing some signs of recovery as the all-share index increased from 20,827.17 in December 2009 to 25,554.35 as of June 23, 2010.


In the same vein, he said market capitalisation equities increased by 24.9 per cent from N4.98 trillion to N6.28 trillion over the same period.


The number of deals, volume and value of shares traded, according to him, also increased by 16.34, 19.23 and 100 per cent respectively.


On the global scenes, the committee noted that market anxiety over the fiscal position of several European area countries was posing new challenges for the world economy, even as global economic recovery remained fragile


To address the weak fiscal position, Mallam Sanusi said governments in these countries had started unwinding the fiscal stimuli by cutting spending.


However, he said such cut in government's spending might have serious implications for growth and employment and might lead to a double dip recession, with possible effects on the global economy.


The Federal Government recorded $25 billion shortfall in foreign exchange earnings from oil and non-sector in 2009, as inflation dropped to 11 per cent at the end of May 2010.


This is also as the Central Bank of Nigeria (CBN) announced plans to retain Monetary Policy Rate (MPR) at six per cent and projected 7.74 per cent as overall gross domestic product (GDP) for 2010.


Sanusi, at the end of MPC meeting in Abuja, on Monday, said the drop in external reserves to $37.63 billion on June 23 was as a result of the shortfall of $25 billion in the nation's foreign exchange earnings in 2009.


He blamed the steady fall in foreign exchange earnings on low oil prices and crisis in the Niger Delta.

However, Sanusi said the MPR would remain unchanged at six per cent as a result of the stability in exchange rate and continuing under-performance of monetary aggregates since the beginning of the year.


According to him, developments in interest rates structure indicated that the retail lending rates were still relatively high, though they were declining.


Similarly, he noted that the weighted average savings rate dropped marginally to 2.92 per cent in May 2010 from 3.36 per cent in December 2009, while the consolidated deposit rates declined to 3.30 per cent in May 2010 from 6.13 per cent in December 2009.


He added that the spread between the average maximum lending rate and the consolidated deposit rate widened to 19.27 per cent in May 2010 from 17.34 per cent in December, 2009

http://odili.net/news/source/2010/jul/6/601.html

bk.babe97y:

Jesus! Is this the same excess account Mr.Obasanjo left bulging with crazy dollars before he left power!?!?

Maybe we should ask late yaradua but i think jonathan would be more helpful prolly may wave his immunity for investigation to take place.i weep for nigeria

Kobojunkie:

The same reserves we reportedly had about $40 Billion in excess oil funds in? 

bk.babe97y:

Jesus! Is this the same excess account Mr.Obasanjo left bulging with crazy dollars before he left power!?!?

No it isn't. The foreign reserves managed by the Central Bank is different to the Excess Crude Account. The foreign reserves are worth over $40 billion. The excess crude account is what this thread is about.

Mariory:

No it isn't. The foreign reserves managed by the Central Bank is different to the Excess Crude Account. The foreign reserves are worth over $40 billion. The excess crude account is what this thread is about.

How sure are you that we still have $40 billion in our reserves? Last check, it was down to about $9 billion or so.

[size=13pt]Nigeria loses $20bn to capital flight – CBN[/size]


LAGOS —CENTRAL Bank of Nigeria, CBN, said, yesterday, that Nigeria lost $20 billion to the global financial crisis through capital flight.
Director, External Reserves Management Department, Mallam Lamido Yuguda, who disclosed this in an interview with Bloomberg News agency, in Abidjan, said that the apex bank would soon increase the minimum level of external reserves to cover 12 months of import.

Yuguda who spoke ahead of the African Development Bank’s annual general meeting in Abidjan, May 27 and 28, said the country’s reserves currently covered about 18 months of import needs, adding that the increase from the present level of six months was meant to cushion the economy if there were further crises.

He said: “We are looking to increase that, given our experience during the crisis. A country like ours needs a very good cushion. We have a very open capital account.”

Yuguda said the global financial crisis resulted in capital flight of $20 billion in Nigeria in 2009, noting: “The crisis was a wake-up call for the central bank. It called on Nigeria to hold a buffer over and above six months of import cover.

There was a massive flow of capital out of the country.”

He also said the apex bank might reduce its Euro reserves if the euro currency continued to decline, adding that CBN held 15 percent of its foreign currency reserves in euros and almost 80 percent in dollars,

The euro slumped 8.1 percent against the dollar since the beginning of this month as concerns mounted that Greece’s debt crisis might spread to other nations in the euro zone.

Yuguda said: “We have about 15 percent of euro in our portfolio and that’s enough to make us concerned. We don’t change because of short-term developments. If there are long-term concerns then we’ll change it.”

The euro dropped as much as 1.9 percent to $1.278, yesterday, and was trading at $1.222 as of 1:17 p.m. in London.
Nigeria’s foreign reserves dropped to $39.8 billion on 19 May, 2010 from $41.1 billion a month earlier, the Central Bank of Nigeria said on 21 May. Reserves declined from a high of $58.3 billion in March 2008 as crude oil prices fell.

The CBN director said the bank was also reviewing the types of assets it invested in, given rising debt levels in Europe, adding: “Credit risk and country risk have become quite important. We are looking at all these risks and opportunities.”
The African Development Bank, Vanguard learnt, was considering creating a bond fund that central banks in Africa can invest part of their reserves in.

Banks lack knowledge of concept

Meantime, CBN has announced that it was in the process of reviewing licences of some microfinance banks in the country, citing a complete lack of understanding of the ideal and the methods for operating such banks.

The Deputy Governor in charge of Financial Sector Stability, CBN, Dr. Kingsley Moughalu said at the maiden Microfinance Certification Training Programme of Operators of Microfinance banks, organized by the CBN in conjunction with the Nigeria Deposit Insurance Corporation, NDIC, and the Small and Medium Enterprises Development Agency of Nigeria, SMEDAN, yesterday, in Abuja that the reason for the collapse of the some microfinance institutions in the country was poor corporate governance, non-adherence to best practice and ownership problems.

He said: “In the course of on-site and off-site supervision of the microfinance banks, so many issues bordering on corporate governance, adherence to best practice and ownership problems were identified.

“In addition, the banks had performed poorly due to lack of proper understanding of the microfinance concept, method and best practice, and lack of proper orientation on how to deliver microfinance services.”

Other challenges faced by microfinance bank operators, according to Muoghalu, included poor understanding of provisions of the guidelines of the microfinance policy and regulatory framework, and high rate of non-performing director-related facilities.

“Some of the directors, our investigations have shown, have over-bearing influence on management staff, who themselves lack relevant skills and knowledge in various microfinance lending models and operational service delivery models,” he stated.

CBN issues new guidelines on margin trading
LAGOS— THE Central Bank has issued new guidelines on margin trading, in an apparent bid to avert a repeat of the abuses and sharp practices that bedevilled margin trading in the run up to the capital market collapse.

The Financial Services Regulation Coordinating Committee, FSRCC, which issued the new guidelines, said this followed the Committee’s meeting on Friday May 21, 2010.

A statement by CBN’s Head of Corporate Communications, M. M. Abdullahi, said the new guidelines were that banks aggregate exposure to margin lending should not exceed 10 percent of total loans and advances.


http://www.vanguardngr.com/2010/05/26/nigeria-loses-20bn-to-capital-flight%E2%80%94-cbn/

[size=13pt]Salary increase may cause inflation -MPC •As external reserves decline by $25bn •Declining reserves not a problem -CBN[/size]


THE Monetary Policy Committee has said that the proposed salary increase for the civil servants had the tendency of increasing inflationary pressure on the economy, just as the apex bank said the declining external reserves posed no threat to the Nigerian economy.
Governor of CBN, Mallam Lamido Sanusi, addressing a press conference after the 71st Monetary Policy Committee meeting in Abuja, on Monday, stated that the down trend in the domestic price level could be attributed to a number of factors, including the continuing underperformance of the monetary aggregates with the associated constraints demand, adequate food supply, stable exchange rates and improvement in the availability of petroleum resources, amongst others.

Notwithstanding this, the MPC reiterated its earlier position on the threat of inflationary pressure arising from several factors, including the effect of salary increase in the civil service and the rising food prices against the backdrop of famine in neighbouring Niger Republic.

However, the apex bank has reiterated the readiness of the Monetary Policy Committee (MPC) to continue to monitor price developments, with a view to taking appropriate measures to stem any inflationary threat and ensure that the downside risk of inflation growth was minimised.

The CBN governor said the external reserves were $34 billion in 2008, but went down to $9 billion in 2009, thus showing a decline of $25 billion.

With $9 billion external reserves, the CBN governor said this could finance imports for 16 months, adding that there was no cause for alarm on the development.

According to him, Nigeria should count itself lucky for the external reserves, citing the example of the United States, whose external reserves could only finance imports for three months.

Explaining the reason for the declining reserves, Mallam Sanusi said Nigeria’s external reserves swelled up when oil price was about $140 per barrel and a daily production of about 2 million barrels per day, adding that with oil price as low as $40 per barrel, nothing short of declining external reserves should be expected.

Reviewing the domestic economic conditions in the first quarter of 2010, the CBN boss said the year-on- year headline inflation declined to 11.0 per cent in May 2010 from 12.5 per cent in April and 11.8 per cent in March.

Similarly, the CBN governor said core inflation fell to 8.8 per cent in May 2010, from 9.8 per cent in April and 9.5 per cent in March.

He said the capital market was still showing some signs of recovery as the all-share index increased from 20,827.17 in December 2009 to 25,554.35 as of June 23, 2010.

In the same vein, he said market capitalisation equities increased by 24.9 per cent from N4.98 trillion to N6.28 trillion over the same period.

The number of deals, volume and value of shares traded, according to him, also increased by 16.34, 19.23 and 100 per cent respectively.

On the global scenes, the committee noted that market anxiety over the fiscal position of several European area countries was posing new challenges for the world economy, even as global economic recovery remained fragile

To address the weak fiscal position, Mallam Sanusi said governments in these countries had started unwinding the fiscal stimuli by cutting spending.

However, he said such cut in government’s spending might have serious implications for growth and employment and might lead to a double dip recession, with possible effects on the global economy.

The Federal Government recorded $25 billion shortfall in foreign exchange earnings from oil and non-sector in 2009, as inflation dropped to 11 per cent at the end of May 2010.

This is also as the Central Bank of Nigeria (CBN) announced plans to retain Monetary Policy Rate (MPR) at six per cent and projected 7.74 per cent as overall gross domestic product (GDP) for 2010.

Sanusi, at the end of MPC meeting in Abuja, on Monday, said the drop in external reserves to $37.63 billion on June 23 was as a result of the shortfall of $25 billion in the nation’s foreign exchange earnings in 2009.

He blamed the steady fall in foreign exchange earnings on low oil prices and crisis in the Niger Delta.
However, Sanusi said the MPR would remain unchanged at six per cent as a result of the stability in exchange rate and continuing under-performance of monetary aggregates since the beginning of the year.

According to him, developments in interest rates structure indicated that the retail lending rates were still relatively high, though they were declining.

Similarly, he noted that the weighted average savings rate dropped marginally to 2.92 per cent in May 2010 from 3.36 per cent in December 2009, while the consolidated deposit rates declined to 3.30 per cent in May 2010 from 6.13 per cent in December 2009.

He added that the spread between the average maximum lending rate and the consolidated deposit rate widened to 19.27 per cent in May 2010 from 17.34 per cent in December, 2009

[size=13pt]Salary increase may cause inflation -MPC As external reserves decline by $25bn Declining reserves not a problem -CBN[/size]

Source . . .


THE Monetary Policy Committee has said that the proposed salary increase for the civil servants had the tendency of increasing inflationary pressure on the economy, just as the apex bank said the declining external reserves posed no threat to the Nigerian economy.

Governor of CBN, Mallam Lamido Sanusi, addressing a press conference after the 71st Monetary Policy Committee meeting in Abuja, on Monday, stated that the down trend in the domestic price level could be attributed to a number of factors, including the continuing underperformance of the monetary aggregates with the associated constraints demand, adequate food supply, stable exchange rates and improvement in the availability of petroleum resources, amongst others.


Notwithstanding this, the MPC reiterated its earlier position on the threat of inflationary pressure arising from several factors, including the effect of salary increase in the civil service and the rising food prices against the backdrop of famine in neighbouring Niger Republic.

However, the apex bank has reiterated the readiness of the Monetary Policy Committee (MPC) to continue to monitor price developments, with a view to taking appropriate measures to stem any inflationary threat and ensure that the downside risk of inflation growth was minimised.

The CBN governor said the external reserves were $34 billion in 2008, but went down to $9 billion in 2009, thus showing a decline of $25 billion.

With $9 billion external reserves, the CBN governor said this could finance imports for 16 months, adding that there was no cause for alarm on the development.

According to him, Nigeria should count itself lucky for the external reserves, citing the example of the United States, whose external reserves could only finance imports for three months.

Explaining the reason for the declining reserves, Mallam Sanusi said Nigeria’s external reserves swelled up when oil price was about $140 per barrel and a daily production of about 2 million barrels per day, adding that with oil price as low as $40 per barrel, nothing short of declining external reserves should be expected.

Reviewing the domestic economic conditions in the first quarter of 2010, the CBN boss said the year-on- year headline inflation declined to 11.0 per cent in May 2010 from 12.5 per cent in April and 11.8 per cent in March.

Similarly, the CBN governor said core inflation fell to 8.8 per cent in May 2010, from 9.8 per cent in April and 9.5 per cent in March.

He said the capital market was still showing some signs of recovery as the all-share index increased from 20,827.17 in December 2009 to 25,554.35 as of June 23, 2010.

In the same vein, he said market capitalisation equities increased by 24.9 per cent from N4.98 trillion to N6.28 trillion over the same period.

The number of deals, volume and value of shares traded, according to him, also increased by 16.34, 19.23 and 100 per cent respectively.

On the global scenes, the committee noted that market anxiety over the fiscal position of several European area countries was posing new challenges for the world economy, even as global economic recovery remained fragile

To address the weak fiscal position, Mallam Sanusi said governments in these countries had started unwinding the fiscal stimuli by cutting spending.

However, he said such cut in government’s spending might have serious implications for growth and employment and might lead to a double dip recession, with possible effects on the global economy.

The Federal Government recorded $25 billion shortfall in foreign exchange earnings from oil and non-sector in 2009, as inflation dropped to 11 per cent at the end of May 2010.

This is also as the Central Bank of Nigeria (CBN) announced plans to retain Monetary Policy Rate (MPR) at six per cent and projected 7.74 per cent as overall gross domestic product (GDP) for 2010.

Sanusi, at the end of MPC meeting in Abuja, on Monday, said the drop in external reserves to $37.63 billion on June 23 was as a result of the shortfall of $25 billion in the nation’s foreign exchange earnings in 2009.

He blamed the steady fall in foreign exchange earnings on low oil prices and crisis in the Niger Delta.
However, Sanusi said the MPR would remain unchanged at six per cent as a result of the stability in exchange rate and continuing under-performance of monetary aggregates since the beginning of the year.

According to him, developments in interest rates structure indicated that the retail lending rates were still relatively high, though they were declining.

Similarly, he noted that the weighted average savings rate dropped marginally to 2.92 per cent in May 2010 from 3.36 per cent in December 2009, while the consolidated deposit rates declined to 3.30 per cent in May 2010 from 6.13 per cent in December 2009.

He added that the spread between the average maximum lending rate and the consolidated deposit rate widened to 19.27 per cent in May 2010 from 17.34 per cent in December, 2009

@Kobojunkie

Quote from the article u posted. . .

[size=14pt]Sanusi, at the end of MPC meeting in Abuja, on Monday, said the drop in external reserves to $37.63 billion on June 23 was as a result of the shortfall of $25 billion in the nation’s foreign exchange earnings in 2009.[/size]

LOL - fake economic analysts.

@Kobojunkie

Another quote from your article u posted on here. . it is apparent u dont even read what u post,u just choose to copy,paste and spam the thread. . it clearly tells u the CBN external reserves are at $39.8billion on may,2010. . .again your article not mine. . it will do u good to read an article, before u post. . .


[size=14pt]Nigeria’s foreign reserves dropped to $39.8 billion on 19 May, 2010 from $41.1 billion a month earlier, the Central Bank of Nigeria said on 21 May. Reserves declined from a high of $58.3 billion in March 2008 as crude oil prices fell.[/size]

@labiyemmy:

LOL - fake economic analysts.

If we hear say CBN Governor says, is he a fake economic analyst?

The CBN governor said the external reserves were $34 billion in 2008, but went down to $9 billion in 2009, thus showing a decline of $25 billion.

With $9 billion external reserves, the CBN governor said this could finance imports for 16 months, adding that there was no cause for alarm on the development.

According to him, Nigeria should count itself lucky for the external reserves, citing the example of the United States, whose external reserves could only finance imports for three months.

Explaining the reason for the declining reserves, Mallam Sanusi said Nigeria’s external reserves swelled up when oil price was about $140 per barrel and a daily production of about 2 million barrels per day, adding that with oil price as low as $40 per barrel, nothing short of declining external reserves should be expected.

Reviewing the domestic economic conditions in the first quarter of 2010, the CBN boss said the year-on- year headline inflation declined to 11.0 per cent in May 2010 from 12.5 per cent in April and 11.8 per cent in March.

Similarly, the CBN governor said core inflation fell to 8.8 per cent in May 2010, from 9.8 per cent in April and 9.5 per cent in March.

$9 billion according to CBN Governor in reserves . . . interesting!

[size=14pt]Nigeria’s foreign reserves rise to $38.2bn[/size]

Written by Odidison Omankhanlen and Olatunde Sanni, with Agency Reports
[size=13pt]Thursday, 19 August 2010[/size]

THE nation’s foreign exchange reserves rose around three per cent to $38.2 billion by mid-August from $37.1 billion at the end of last month, the Central Bank of Nigeria (CBN) said on Wednesday.

Forex reserves stood at $43.3 billion a year earlier, but have fallen sharply since then due to demand pressure from importers and a reduction in accruals from oil export revenues.

The CBN has maintained that the present level could finance more than 17 months of import.

Only last week, the Federal Government distributed $4.7 billion in revenues and windfall oil savings to state and local governments for July, a massive disbursal which is likely to trigger a drop in bond yields and interbank rates next week.

The government shares its revenues among three tiers of government each month - federal, state and local - and tops the disbursal up with a withdrawal from its windfall oil savings if there is a shortfall.

Accountant-General, Ibrahim Dankwambo, said Nigeria had distributed N404.27 billion ($2.7 billion) in revenues and $2 billion from its crude oil savings for last month, making up one of the largest monthly disbursals ever.

Around 80 per cent of the liquidity in the country comes from public cash flows and the monthly allocations can trigger significant shifts in bond yields and interbank rates.

Among the major recipients of the monthly revenue distributions are the country’s 36 states.

Dankwambo said a further $1 billion had been withdrawn from the excess crude account, a pillar of IMF-backed reforms into which Nigeria saves oil revenues above the benchmark price, to be set aside for the creation of a sovereign wealth fund.

The withdrawal leaves just $460 million in the excess crude account, compared to around $20 billion in early 2007, the start of the current presidential term.

Finance Minister, Mr Olusegun Aganga, a former Goldman Sachs executive appointed in March, had said that he wanted a sovereign wealth fund to replace the excess crude account, which has no clear constitutional basis.

But the fund has not yet been created and it was unclear where the $1 billion would be held in the interim.

http://www.tribune.com.ng/index.php/front-page-news/9917-nigerias-foreign-reserves-rise-to-382bn