A Week in Nigeria: 2 June
Highlights from Reuters coverage of Nigeria over the last seven days
In this week’s round-up: President Buhari has low-key inauguration as second term begins, financial regulator punishes CEO of oil firm Oando, northwest banditry drives 20,000 to seek refuge in Niger.
- President Muhammadu Buhari was sworn in for a second term at a low-key inauguration ceremony in which he surprised many by not delivering a speech. The 76-year-old former military leader faces a long list of challenges, including combating a sluggish economy, high unemployment and a decade-old Islamic insurgency. His four-year first term, in which he rarely gave public addresses, was overshadowed by speculation about his health and marked by a long absence abroad for medical treatment. But he won February’s election with 56% of the vote — albeit on a turnout of just 35.6%. Buhari will need to create jobs if he is to turn around the country’s fortunes over the next four years. Nearly a quarter of the workforce is unemployed and most of its 190 million people live on less than $2 a day. Buhari now has a second chance to turn campaign promises into policies aimed at stimulating economic growth. The retired general's critics said he was missing in action when Africa’s biggest economy was reeling from the recession it sank in to in 2016 — the first in 25 years — after prices of its main export oil fell. They point to his refusal to disclose details of an ailment that caused him to seek treatment in Britain for five months in 2017. His supporters said he ran an effective administration and delegated to his deputy when overseas. But some felt the lack of a speech didn’t augur well for a more open, dynamic second term performance by the president.
- The presidency had, prior to the ceremony, said the event would be understated with celebrations reserved for 12 June. That is the day on which Democracy Day, which commemorates the return to civilian rule in 1999, is observed.
- The presidency’s communications team reiterated the message of deferred celebrations following the response to the inauguration.
- Tackling insecurity across much of Nigeria is already a priority. The military is fighting jihadist group Boko Haram and an offshoot linked to Islamic State in the northeast, while contending with communal violence over grazing land in central states. This week the United Nations refugee agency said a surge of bandit attacks and other violence in the northwest, primarily in the states of Zamfara and Sokoto, has forced 20,000 to flee to neighbouring Niger since April. “This is not Boko Haram-related in any way,” UNHCR spokesman Babar Baloch told a media briefing. “People are reportedly fleeing due to multiple reasons, including clashes between farmers and herders of different ethnic groups, vigilantism, as well as kidnappings for ransom,” he said. Some people took to social media emphasising the importance of security, arguing that it had been a major problem in Buhari’s first term.
- Reviving Africa’s biggest economy stands alongside security as the most widely touted challenge ahead in Buhari’s second term. Nigeria’s economy grew by 1.93% last year, its fastest pace since the recession. Growth of 2.1% is forecast by the International Monetary Fund (IMF) for this year, though that would be among the slowest rates in Africa. Two days before his inauguration, Buhari began the week by signing an 8.9 trillion naira ($29 billion) budget for 2019 into law. Approved by lawmakers last month, the budget is based on estimated oil production of 2.3 million barrels a day, an assumed crude price of $60 per barrel and an exchange rate of 305 naira to the dollar. The planned deficit of 1.9 trillion naira represents 1.37% of GDP.
- Nigeria’s financial watchdog said it had barred the CEO of oil firm Oando, Wale Tinubu, from directing public companies for five years over financial infractions — though he dismissed the charges as unsubstantiated. Nigeria’s Securities and Exchange Commission (SEC) said it had found “certain infractions of securities and other relevant laws”, during an investigation into the company. Those included: “false disclosures, market abuses, misstatements in financial statements, internal control failures and corporate governance lapses,” the SEC added in a statement. The commission also listed “poor board oversight, irregular approval of directors’ remuneration, unjustified disbursements to directors and management of the company (and) related party transactions not conducted at arm’s length.” The watchdog said it had ordered a number of Oando board members to resign and refund “improperly disbursed remuneration” to the company. The company and some unnamed individuals and directors would also have to pay financial penalties, it added, without going into further details. Tinubu said he had been shocked by the statement. “Oando is of the view that these alleged infractions and penalties are unsubstantiated (and) invalid,” he told Reuters. The company “was not given the opportunity to defend itself, see, review and respond to the forensic audit report” that the SEC produced, he added.
- Staying on the subject of probes, MTN Nigeria said it is under investigation by the Nigerian financial crimes agency over its listing last month, although it “has not been accused of any wrongdoing” by the Economic and Financial Crimes Commission. The listing of MTN Nigeria, a unit of South African telecoms firm MTN Group, made it the second-largest firm on the Nigerian Stock Exchange, and since then its share price has risen from 90 naira to 140 naira.
- Nigeria will cut the level of sulphur allowed in imported fuels this year, according to oil trading sources, but the cap is still 10 times above what health campaigners urge. In oil-for-product exchange contracts, state oil company NNPC has asked for diesel and gasoline at a maximum of 500 ppm sulphur, trade sources said. NNPC last year outlined a plan to gradually cut the allowed sulphur to 50 ppm for diesel and 150 ppm for gasoline by the end of 2019, from 3,000 ppm and 1,500 ppm, respectively. The United Nations Environment Programme and health campaigners have pressed West African nations to ban fuels above 50 ppm due to evidence of significant health problems associated with the emissions. The health impacts are particularly acute in dense urban areas such as Lagos. Thus far only Ghana has made good on the pledge to cut the imported sulphur cap to 50 ppm.
- Finally, a World Bank study found that helping women find jobs or raise their incomes in Nigeria can put them at heightened risk of violent abuse by boyfriends, husbands and the public. The study aimed to assess the risks of the Nigeria For Women project, a $100 million programme to improve women’s livelihoods by providing grants, skills training and business advice. It found there was a substantial risk of “backlash”, particularly by intimate partners, as women gain independence or their financial contributions increase, said Varalakshmi Vemuru, a lead social development specialist at the World Bank. “As soon as you see women showing independence… people feel threatened,” she told the Thomson Reuters Foundation.