Monday, September 21, 2015

Nigeria's President Buhari: Not On Anyone’s 100 Day Clock – A Look at His Current Economic & Anti-Corruption Efforts

This two-part FEEEDS Blog Series on Nigerian President Buhari’s time in office (on the eve of his UN visit) provides an analysis of his game plans (Buhari Doctrine); how they are working thus far, and what we might expect as his administration tries to address issues surrounding both the country's economic and security environments.

We start with, Part One, examining the positives and challenges in the economic-investment sectors for a country which boast having Sub-Saharan Africa's (SSAfrica) largest population (178 million) and economy (Nigeria rebased in 2014), although it is struggling to get its financial footing back, and keep investors engaged. Here is today's environment:
-- Key source of revenue and foreign reserves – from the oil sector – has been hit by massive drops in world oil prices;

-- Unemployment remains high (hovering around 7.6 percent) in the 15-34 median age range, where youth and female populations clock-in at around 60 million and 80 million respectively;

-- Devaluation pressures remain high on the country's currency (naira); raising cost for the private sector and daily living needs.

Despite these economic struggles, Nigeria is still considered a go-to frontier capital market; and, remains one of the most important investment destinations in SSAfrica along with Kenya, South Africa, and Ethiopia. It is important to keep in mind that most – not all – of the current economic challenges pre-date the May 29 inauguration. However, that being said, it is now Buhari's Administration's responsibility to both address and resolve.
A Closer Look - Current Business & Investment Environment:

The private sector from China, United States, India, Brazil, and Europe still see Nigeria as a premier investment destination. What makes Nigeria attractive for these foreign businesses? Answer…return on investment (ROI).  The average ROI, (despite risks noted below), can average 28-36 percent -- matched with Nigeria's largely untapped consumer market for good and services. There are specific sectors which provide the greatest returns and/or are growth areas for goods and services. There are seven sectors (not in priority order), from FEEEDS' perspectives that are the most notable for foreign investors:

1.) Power – Nigeria partially-privatized its power sector (generation and distribution) in 2013, giving foreign investors an opening. With this, other attendant opportunities were also created for soft and hardware, and skills transfer (i.e. equipment, metering, asset management, and technical assistance). Nigeria barely produces 2-3 thousand megawatts per day. While, daily power needs are estimated at 40-50 thousand megawatts for consistency in service delivery. Although potential ROI is great, so are risks around poor transmission to the national grid, heavy debt service on acquired national assets, lack of technical production capability, and concern over timely  payments.
2.) Information Communication and Technology (ICT) - Nigeria has the largest number of mobile phone users in SSAfrica with 100 million out of 650. Any ICT investor focused on innovative mobile services, and smartphone hardware, can take advantage of Nigeria’s market. Smartphone penetration is only 27 per cent, as most Nigerians still primarily have feature phones.

3.) Natural Gas – Nigeria has roughly 180 trillion cubic tons of untapped natural gas – making it one of the largest in the world.  This nascent sector remains ripe for services, infrastructure, and developing  gas fields.
4.) Agriculture – About 70 per cent of Nigeria's population lives and works in this sector. It remains underserved as it lacks infrastructure, modernization, insufficient commodity production or food processing, and poor rural-to-urban transportation services. All of these sub areas are good investments; high ROI will be a bit delayed given how far behind the sector lags. But if you are playing the long game this is where to be.

5.) Manufacturing - Nigeria has the odd triangulation of a low manufacturing base, large population, and a growing middle class consumer market all at once. Thus, manufacturing of any product (non-edible or edible) will have ready-made customers.
6.) Extractive industries – Extraction of fossil fuels (petroleum) remains Nigeria’s main export resource, despite low world oil prices. Nigeria also has a wealth of other natural minerals from iron ore (200 million tons of proven reserves), coltan (key for cellphone and appliance manufacturing) gold, silver, zinc, etc.

7.) Housing – There is a 17 million affordable  housing deficit. Meaning if you are poor or unemployed you either do not have adequate housing or housing at all. Although, the sector is ripe for investment, the government will need to move forward with frameworks that provide some form of sovereign guarantees. This will help spur construction financing and mortgage guarantees – two key impediments, thus far, affecting building starts. Nigeria’s new (2013) Mortgage Refinance Corporation, NMRC, also needs these two issues addressed so it can begin to support projects meeting its mission. To date, NMRC has not had a case/project it can approve.
Doing Business in Nigeria – What You Should Know?
Despite the opportunities and high potential for ROI, what are the basics you should know, particularly regarding ease of doing business, and the lack of consistent (and by some accounts unclear and unfriendly) monetary policies. Recently the World Bank 2015 Ease of Doing Business Report  rated Nigeria low, 170 out of 189 countries reviewed on their transparent and friendly business practices. In 2014 Nigeria was ranked 175, so it has improved a bit. Nigeria’s Central Bank (CBN), in its efforts to support the country’s floundering currency -- the naira, under devaluation pressure -- has made it increasingly difficult for both foreign and Nigerian businesses to do transactions in convertible currencies such as dollars or euros. That being said, the positives on this action are: Nigerian companies have to provide the CBN with foreign company business information and contract payment amounts in order to obtain foreign exchange to pay partners or clients. This is an important transparency element in the anti-corruption tool box for both the country and foreign partners.

Buhari required by September 15, all ministries use their CBN accounts, called Treasury Single Account, for all government monies. Meaning, ministries cannot deposit government funds into commercial banks – a past practice where it is believed substantial state wealth disappeared. Ministries’ compliance thus far has been good.

Always in Nigeria there is a flip side. The Nigerian commercial banks, previously holding these funds now have to scramble to find new business to counter huge losses resulting from these transfers. Banks already have started to lay off employees adding to the 7.5 per cent unemployment rate. Most affected will be bank workers in the mid-ranks in their prime wage earning years (25-35).

On the federal budget, reports are Nigeria will move to a clean-slate 2016 "zero-basing," linking needs and costs, and that Buhari's "look ahead" focus will be on infrastructure development, social needs, manufacturing, and job creation.

President Buhari’s  Anti-Corruption Efforts; Economic Team:
FEEEDS also gives Buhari high marks for his unwavering commitment to address endemic corruption. In addition to his above actions, he has publicized his personal wealth (good first tone-setting step); appointed new leadership to the problematic National Petroleum Company (NNPC); worked to carefully vet senior appointments; and, asked foreign governments, including the U.S. to help return $150 billion in stolen state wealth. He is famously known for saying “I belong to everyone; I belong to no one,” underscoring his intolerance for the two forces of evil behind stolen state wealth – corruption and influence peddling.*

For sure Buhari inherited nearly empty national coffers, a struggling currency, coupled with ever-declining world oil prices. However, he is being very systematic and thorough in the formulation of his new government.  This includes deciding who his economic team will be and how they will address current economic issues. We will have to wait for finance minister appointment, and what the full economic vision might be. There is a little ankle biting that he is going too slow ("Baba Go-Slow" or Father Goes Slow, nicknamed by some) to appoint ministers. We also have an additional underlying theory: he may not want to have to negotiate with ministers on vision and direction, putting everything in place first, and then handing them his game plan.

Either way, FEEEDS gives him high credit for taking his time. As deep as the two evils of corruption and influence peddling run, it is prudent to carefully vet. Buhari never put himself on the artificial, but politically-expected “first 100 days” clock. Okay, 8-9 months from now, we might take a different view. Let’s get good, unencumbered folks (from past or present questionable deeds) on board, and go from there.   
Buhari said he would be "steady" in truly setting the tone for a new, reborn Nigeria to achieve its full economic, investment, development, democracy-leadership roles, so given what he inherited, let's give him more time to get there.

Part Two will focus on Current Political-Security Positives & Challenges
*From Buhari's Inaugural speech
A FEEEDS Blog Spot

Wednesday, September 9, 2015

Remarks at the Homecoming Memorial for Ambassador Adebowale Adefuye – By Ambassdor (Dr.) Robin Renee Sanders

Good evening and condolences to the family, friends, colleagues and embassy staff of the late honorable Professor – Adebowale Adefuye.  When I paid my respects at the residence last weekend, I was asked by the family to say a few words this evening:
-- Because they thought I was one of the few Americans in Washington that knew Ade before he became Nigeria's Ambassador to the United States.
--Because  we were also professional colleagues (as part of my ambassadorship overlapped with his); and we worked together on a number of things – including the U.S.-Nigeria Binational Commission, the genesis for the current framework between our two governments;  
-- And, because, more importantly, I knew him as a friend -- a friend he called Omowale, which really meant a lot to me because it means "one who has come back home;" a friend who he could have quarterly chats with where there was no "ask," no "policy" discussion, no "request".  It was just that safe space… that space where, for any of us that have held these types of jobs, is ever so important.
I say all of that because tonight, I am going to speak in the "voice of a friend" in the "voice of someone who wants his wonderful wife of 40 years and his children to know just how "well" he was thought of here in the United States. Note I said the United States, not just in Washington.   In addition to the condolence call from President Buhari to Mrs. Adefuye, tributes of honor have come in from around the country, including from the U.S. Congress, and from all of you by your presence here this evening.
In sum Ade was:  A consummate, hard-working, dedicated diplomat who loved both his family and his country with an intense and fierce synergistic blend that made him . . . "tireless." He was clearly one of the most respected, active foreign diplomats in Washington from any region of the world. He was a son of the Continent for sure, and a nationalist for Nigeria and its people.  Even if you disagreed with him on some issues (and we did as friends do), you knew that his goal was always for Nigeria, for the well-being of his beloved nation; the best for Nigeria was ever upmost in his heart.
It is said that you can measure a person's life not by those who knew him, but by those who cared about him – family, friends, and colleagues.
So… Let's think about this full Chancery this evening as a sanctuary for the spirit.
--That was the person;
-- That was the Ambassador;   and,
--That was the dedicated and beloved husband and father. 
Rest in Peace my friend…My colleague as we honor the African tradition of calling your name three times (please join me) – Ade Adefuye, Ade Adefuye, Ade Adefuye.
Rest in peace, so that your family (Caroline, Tolu, Bunmi, and Baba) can transition to a world without you, but with the comfort and solace of knowing you are watching over them; {that you are never far away}, and that the memory of you will sustain them no matter what they face, no matter where they go -- you will always be there with them.

May Peace also be with everyone here this evening  – Thank you


Saturday, August 29, 2015

U.S. State Department:Passing of Nigerian Ambassador to U.S.,Professor Adefuye

Office of the Spokesperson

For Immediate Release
August 28, 2015
Death of Nigeria’s Ambassador to the United States
We were saddened to learn of the passing yesterday of Nigeria’s Ambassador to the United States, the Honorable Adebowale Ibidapo Adefuye.  Nigeria lost a distinguished ambassador who will be dearly missed.  On behalf of the people of the United States and President Obama, we express our deepest condolences to his wife and his family.
Over the past five years under Ambassador Adefuye’s leadership, we enjoyed a collaborative and open dialogue that yielded real results such as  the U.S.-Nigeria Bi-National Commission, a strategic dialogue that succeeded in expanding mutual cooperation across a broad range of shared interests.  Ambassador Adefuye helped build the Commission into a collaborative forum that has resulted in progress on issues critical to Nigeria’s and the United States’ shared future. 
A former Fulbright scholar and participant of the International Visitor Exchange Program, Ambassador Adefuye had a keen understanding of the United States and developed strong relationships with his American colleagues.  His last major assignment as Ambassador was to receive President Muhammadu Buhari and his delegation during the president’s official visit to the United States in July, during which President Buhari met with President Obama and other senior U.S. officials.  The success of this visit speaks to Ambassador Adefuye’s skill as a diplomat.  His tenure helped significantly strengthen the U.S.-Nigerian partnership.

Friday, August 28, 2015

Ambassador Sanders Statement on Passing of Ambassador Adefuye- Nigeria's Ambassador to the United States

It is with shock and sadness that I heard of the passing of the Honorable Ambassador Adebowale Ibidapo Adefuye earlier today (August 27, 2015), particularly since I had communicated with him on the evening of August 26.  He was well-respected throughout the United States, and particularly here in Washington D.C. for being a dynamic representative of his beloved nation -- The Federal Republic of Nigeria.

All of us who work on African and Nigerian issues here in the U.S. and in particular on Nigeria are still reeling from his sudden passing. He was known for his energy, effectiveness, and efforts to build long lasting bridges to ensure a strong U.S.-Nigeria bilateral relationship. He was a savvy diplomat on both US-Nigeria private sector and government-to-government issues. To that end, the current positive bilateral relationship building between our two nations today is in large measure due to his commitment and hard work. Americans considered him a friend of our nation, and as such, we, and myself in particular, send our heartfelt sympathies to his lovely wife and his children whom he loved deeply; to the entire Embassy staff; and, to the nation of Nigeria.  As his soul rests in peace with the ancestors may that provide some solace and peace to his beloved family at this most difficult time.  Sincerely Ambassador Robin Renee Sanders, CEO FEEEDS Advocacy Initiative, former U.S. Ambassador to Nigeria

Saturday, June 20, 2015

Amb. Sanders Discuss Issues for the African Union on CCTV

Dr. Sanders on China's CCTV discussing the June 2015 African Union (AU) Summit and issues facing the Continent important for the Summit to address. She highlights that the AU needs to be able to better translate their resolutions on the ground, and also have a more flexible, quick reaction to both new and ongoing crises, and also add more focus to the African migrant issue. Click the link to listen to her comments on CCTV's "The Heat," news magazine show