A Week in Nigeria: 16 November
Highlights from Reuters coverage of Nigeria over the last seven days
In this week’s round-up: Nigeria and neighbouring countries form border force to tackle smuggling, Visa acquires stake in ‘unicorn’ payments company Interswitch, security agency denies opening fire on supporters of detained activist, and the thinking behind a pidgin opera.
- Nigeria and neighbouring countries Benin and Niger have agreed to set up a joint border patrol force to tackle smuggling between the West African countries, they said in a communique. Foreign ministers from the three countries met to discuss smuggling following a decision by regional giant Nigeria, which has Africa’s largest economy and biggest population, to close its land borders to trade until at least 31 January 2020. Nigeria launched a partial border closure in August to tackle smuggling of rice and other goods. And last month the head of customs confirmed that all trade via land borders had been halted indefinitely. The joint communique from the meeting at the secretariat of regional bloc ECOWAS in Nigeria’s capital, Abuja, said the Benin and Niger delegations had appealed for the immediate re-opening of Nigeria’s borders. The concerns were noted and the delegates agreed on the “establishment of a joint border patrol team comprising the police, customs, immigration, navy and state security services of the three countries”, the communique said. The force will hold its first meeting in Abuja on 25 and 26 November and will later advise on the re-opening of the borders. The delegates also agreed that the ministers of finance and trade from the countries would set up a committee to promote intra-regional trade, and said they would ensure people crossing their borders would display travel documents recognised by the Economic Community of West African States regional bloc. Since taking office in 2015, Nigerian President Muhammadu Buhari has introduced policies aimed at curbing imports and smuggling, to boost local production. Geoffrey Onyeama, Nigeria’s foreign minister, shared details of the communique and a video in a series of tweets.
- Fuel stations along Nigeria’s land borders have closed and prices have spiked after customs authorities banned deliveries of petroleum products to stations within 20 kilometres (12 miles) of the border in an attempt to curb smuggling. Border communities have complained about the move however, prompting Nigeria’s lower chamber of parliament on Tuesday to call on the customs service to lift the indefinite ban. Nigeria, Africa’s top crude oil producer imports most of its refined fuel due to the moribund state of its refineries. Some 10–20% of Nigerian fuel is then smuggled to neighbouring countries, according to the Major Oil Marketers Association of Nigeria, as gasoline is heavily subsidised in the country. The border closure issue has prompted lively conversations on social media.
- Visa plans to acquire a “significant minority” stake in payments platform Interswitch, the Nigeria-based company said. Interswitch did not provide financial details in its statement but Sky News reported on Sunday that Visa would buy a 20% stake for $200 million. That would value Interswitch at $1 billion, giving it “unicorn” status — a term for tech companies with a valuation of a billion dollars or more. Visa will join Helios Investment Partners, TA Associates and IFC as the primary shareholders in Interswitch. Andrew Toree, Visa’s regional president for Europe, the Middle East and Africa said that Africa — the world’s second-fastest growing banking market according to a 2017 McKinsey report — is a “priority region” for the company. Interswitch has long been expected to launch an initial public offering (IPO) to allow the original investors to offload part of their stakes in the company. Founded in 2002 by Nigerian entrepreneur Mitchell Elegbe, Interswitch also owns Verve — the largest domestic debit card scheme in Africa — and Quickteller, a consumer payments platform that enables money transfers, bill payments and mobile and internet air time purchases. Quickteller processed over 42 million transactions monthly as of 31 July — the equivalent of more than 560 billion naira ($1.82 billion). The value of mobile money payments in sub-Saharan Africa grew by more than 15% from 2017 to 2018, according to industry group GSMA, to $26.8 billion.
- Campaigners calling for the release of a Nigerian activist and former presidential candidate who remains in detention despite having been granted bail said security agents opened fire on them — an allegation that was denied by the Department for State Security. Omoyele Sowore, who ran for president as a minor candidate in the February election in which former military ruler President Muhammadu Buhari secured a second term in office, was arrested in August for calling for a revolution. In September Sowore pleaded not guilty to charges of treason, money laundering and harassing the president. He was granted bail on 4 October but he has not been released because the DSS says the conditions have not been met. Supporters of Sowore, who founded Nigerian online news organisation Sahara Reporters, staged a protest at DSS headquarters in the capital, Abuja, on Wednesday during which they said the security agency’s officers opened fire on them. But the claims were denied by the DSS. “Despite serial and unwarranted provocations, the Service, as a professional and responsible Organisation, did not shoot at the so-called protesters,” the DSS said in a statement. Sowore’s continued detention has prompted some to criticise Buhari over his administration’s record on human rights, particularly a lethal crackdown on followers of a Shi’ite leader who has been detained by the government since 2015 without a trial. Nigerian campaign groups issued a statement in which they said “violent attacks” on protesters at DSS headquarters show that Buhari “is running a dictatorship again”. Buhari was Nigeria’s head of state between December 1983 and August 1985, after taking power in a military coup. He was also replaced by the military.
- Thousands of people with mental health conditions are held in chains in institutions across Nigeria, Human Rights Watch said in a report in which it urged the government to ban the practice. The findings come as authorities have taken action against informal Islamic schools and rehabilitation centers whose inmates have been subjected to widespread physical abuse with many held in chains. Some 1,500 people have been freed in raids since late September. Human Rights Watch (HRW) said its researchers visited 28 mental health facilities in Nigeria’s capital and 8 of the country’s 36 states, between August 2018 and September 2019 during which interviews were conducted with 124 people. The researchers found many people were shackled with iron chains, around one or both ankles, to heavy objects or to other detainees. This was happening in a range of institutions including federal psychiatric hospitals, state hospitals and state-owned rehabilitation centers, churches and Islamic centers. HRW said staff chained adults and children in 27 out of 28 facilities visited. Some people were chained for a few days at a time as punishment, or for weeks or months to prevent them from moving or leaving.
- Pneumonia killed more than 800,000 babies and young children last year — or one child every 39 seconds — despite being curable and mostly preventable, global health agencies said. Nigeria, India, Pakistan, the Democratic Republic of Congo and Ethiopia accounted for more than half the children who died of pneumonia last year — most of them babies who had not reached their second birthday. In a report on what they described as a “forgotten epidemic”, the United Nations children’s fund UNICEF, the international charity Save The Children and four other health agencies urged governments to step up investment in vaccines to prevent the disease and in health services and medicines to treat it. Pneumonia is a lung disease that can be caused by bacteria, viruses or fungi. Its victims have to fight for breath as their lungs fill with pus and fluid. It can be prevented with vaccines, and treated with antibiotics and — in severe cases — with oxygen, but in poorer countries, access to these is often limited.
- Nigeria is producing 1.6 million-1.7 million barrels per day (bpd) of crude oil, the chief operating officer of the Nigerian National Petroleum Corp said, adding that the country would continue to comply with OPEC output cuts. Nigeria’s output of crude and condensate is at 2 million bpd, he said. The Organization of the Petroleum Exporting Countries had granted Nigeria a higher output target under an OPEC-led deal to limit supply following efforts by Africa’s largest exporter to tweak the agreement to accommodate its expanding oil industry. Nigeria started participating in the deal this year, having been granted an exemption from previous OPEC cuts. More broadly, we reported that lower prices and increasing competition for investment are driving many African states to make it easier and cheaper for overseas companies to keep their oil and gas output flowing. From Ghana to Gabon, governments are adjusting terms to lure picky investors who are also increasingly concerned about long-term demand for fossil fuels as renewable energy gains ground. The shift follows declining oil production in Angola and Cameroon and disappointing bid rounds in Ghana. It also marks a recognition that the era of $100 per barrel oil is over. Nigeria stands in contrast to that approach. Last week the continent’s top crude oil producer increased the amount oil companies pay the government for offshore production, while an overhaul of its oil and gas terms has languished for more than a decade.
- This week we also reported a warning by the International Energy Agency which said the Organization of the Petroleum Exporting Countries and its allies face stiffening competition next year. It adds urgency to the next month’s policy meeting of the oil producer group, of which Nigeria is a member. “The OPEC+ countries face a major challenge in 2020 as demand for their crude is expected to fall sharply,” the Paris-based agency said in a monthly report. The IEA estimated non-OPEC supply growth would surge to 2.3 million barrels per day (bpd) next year compared to 1.8 million bpd in 2019, citing production from the United States, Brazil, Norway and Guyana. “The hefty supply cushion that is likely to build up during the first half of next year will offer cold comfort to OPEC+ ministers gathering in Vienna at the start of next month,” it added.
- “I think more people will be able to understand the opera and feel less intimidated …because I think opera is for everyone,” said Helen Epega, the composer of an opera performed in pidgin. Nigerian-born Epega, 38, spent most of her formative years in Britain before returning home in 2008. Her ‘Song Queen: A Pidgin Opera’ — for which she cites Fela Kuti and Katie Bush as musical influences — debuted in London’s Royal Opera House in 2015, where she added elements of Cockney slang to the libretto. It transferred to Cape Town the following year and now she is performing it for the first time in her home country. It tells of a family of ethereal singers who try to maintain peace and balance in the world’s realms through their songs.
- Nigerian stocks rose 1.84% to a five-week high on Thursday, powered by banking shares, as local investors shut out of a treasury auction poured money into shares instead. The index, which is down 16% so far this year, rose to a level last seen in October, as Nigeria’s top 10 banking shares jumped 7.04%. The central bank last month barred local investors from participating in its Treasury bill auctions, in a bid to draw more foreign interest to boost dollar liquidity and prop up the naira. On Thursday, the central bank auctioned 300 billion naira worth of open market securities, traders said. But with local investors shut out of the sale — the second since the ban was introduced — they had to seek alternative places to park their money. One fund manager, who said he had been investing in cash and bank deposits since the central bank announcement, said he thought the treasury auction ban could be relaxed soon as excess liquidity affects the markets.
- Moroccan phosphate producer OCP Group expects a planned $1.3 billion ammonia plant in Nigeria to start producing in late 2023, a senior company official said. The plant will be built in southeast Nigeria where gas suppliers have been identified, Mohammed Hettiti, head of OCP Nigeria, told Reuters on the sidelines of a conference in Rabat, without giving details. The factory is part of OCP’s push to step up investment in phosphates-based fertilisers in Africa. It has plans for other plants in Ethiopia and Ghana.
- And, finally, back to Nigeria’s relationship with its neighbour Benin. The Super Eagles were only able to scrape a 2–1 home win over their tiny neighbours on the opening day of qualifiers for the 2021 African Cup of Nations. Nigeria went behind after nine minutes in Uyo where Stephane Sessegnon scored for Benin but a penalty from Victor Osimhen and the winner from Samuel Kalu ensured a narrow win.