Highlights from Reuters coverage of Nigeria over the last seven days
In this week’s round-up: central bank levies $1.3bn charge on banks for loan target failure, South Africa and Nigeria agree trade deals, lawmakers increase 2020 budget outline, and 19 freed from baby factory.
- Nigeria’s central bank has levied a charge on 12 banks for a total of more than 400 billion naira ($1.3 billion) for failing to increase loans to meet a regulatory target, three banking sources and one of the lenders told Reuters. The central bank asked lenders in July to maintain a ratio of lending out at least 60% of deposits by September or face a higher cash reserve levy, part of measures aimed at getting credit flowing in Africa’s biggest economy. The cash reserve requirement in Nigeria is 22.5%. However, the regulator has said that banks which fail to meet its new minimum loan target will face a higher cash reserve requirement equal to 50% of the lending shortfall. The funds will go into the cash reserve requirement and will not be available to the banks, the spokesman said. Lenders have asked the central bank to review the charge because the regulator did not stick with the cut off date it published when the policy was announced, one banking source told Reuters. The central bank has been seeking to boost credit to businesses and consumers following recession in Nigeria, but lending has yet to pick up. With growth slow, banks prefer to park cash in risk-free government securities rather than lend to companies and consumers. Since the 2016 recession, lenders have done little to expand credit in Nigeria, blaming a weak economy after a 2014 oil price crash and a currency crisis that made loans go sour. Analysts fear growing credit quickly could weaken asset quality and capital buffers.
- South Africa and Nigeria signed 30 trade and cooperation agreements, weeks after a wave of violence against Nigerian nationals in Johannesburg and Pretoria had strained relations between Africa’s top two economies. Presidents Cyril Ramaphosa and Muhammadu Buhari, at the conclusion of a two-day visit by the Nigerian leader, said they regretted the violence and subsequent retaliation in Nigeria against South African businesses, pledging instead to deepen trade ties. Ramaphosa said the two countries had sealed 32 bilateral agreements and memoranda of understanding covering trade and industry, science and technology, defence, agriculture and energy. Nigeria accounts for 64 percent of South Africa’s total trade with the West African Region and is one of its largest trading partners on the continent. In September, mobs armed with makeshift weapons attacked businesses and homes owned by foreigners, leading to at least 10 deaths, dozens of injuries and up to 400 arrests. “The recent acts of xenophobic attacks on our compatriots and other Africans in South Africa are shocking to me, Nigerians and indeed Africa. It was an embarrassment to the continent,” Buhari told a town hall meeting with Nigerians living in South Africa during his visit.
- Nigerian lawmakers increased the value of the country’s 2020 budget outline to 10.729 trillion naira ($35 billion) based on expectations of higher oil prices. The legislature passed a medium-term expenditure framework that increased the anticipated oil price to $57 per barrel from a previous $55 per barrel. That pushed the budget up from 10.002 trillion naira. The document is a plan Nigeria uses to prepare its annual budget. The finance minister submits the framework to the legislature, which must then approve the document.
- Police in the commercial capital, Lagos, have freed 19 women and girls who had mostly been abducted and impregnated by captors planning to sell their babies. The girls and women, aged from 15 to 28, had been brought from all over Nigeria with promises of work, Lagos police said on Monday. Four babies were also found. “Baby factories”, as such premises are widely known, are most common in parts of eastern Nigeria. “The young women were mostly abducted by the suspects for the purpose of getting them pregnant and selling the babies to potential buyers. The girls were tricked with employment as domestic staff in Lagos,” said Lagos police spokesman Bala Elkana. “Boys are sold for 500,000 naira ($1,630) and girls for 300,000 naira ($980).” One of the freed women, who did not want to be named, said she had been impregnated by her boyfriend and told by her aunt that there was a job for her in Lagos. She said a woman to whom she was introduced had induced her labour when she was seven months pregnant. “After being in labour for three days, that was when police raided the place and took all of them. The baby came out weak and finally died,” she told Reuters.
- The Nigerian army released 25 children after clearing them of suspected ties with armed Islamist groups in the country’s restive northeast region, the United Nations Children’s Fund (UNICEF) said. It is not clear how many children in total have been drawn into armed groups, including Boko Haram, or how they have been recruited. UNICEF said 23 boys and two girls were released by the army and handed to authorities in Borno, the state worst affected by the insurgency. A total of 2,499 people, including 1,627 children have been cleared of association with non-state armed groups in Nigeria since 2016, UNICEF said. The latest release comes against the backdrop of widely reported cases of young people being held captive in Nigeria in differing circumstances. Aside from the baby factory raid in Lagos, around 400 boys and men - some as young as 5 and many in chains and scarred from beatings - were rescued last week from a building in the northern city of Kaduna that purported to be an Islamic school.
- Nigerian police plan to acquire stun guns and revise their rules of engagement in an effort to curb the use of deadly force, according to the inspector general of the force. Last month, a United Nations special rapporteur described Nigeria as a “pressure cooker of internal conflict” due to security problems and what it said was an excessive use of lethal force by police and military. Mohammed Adamu told a gathering of senior officers in the capital, Abuja, that he had “initiated actions” toward deploying less lethal weapons — commonly known as stun guns — for low-risk police operations. “This is with the intention of addressing public concerns on misuse of firearms by the police with its attendant consequences on lives and effect on the attainment of our community policing vision,” Adamu said, according to a copy of the speech distributed to media. And, on the subject of violence, gunmen kidnapped six schoolgirls and two staff members from a boarding school in the northern state of Kaduna, police said. Police said the girls and staff were taken in the early morning from a school called Engravers College in a remote area near the village of Kakau Daji in Kaduna state.
- Nigeria will make cuts to its crude oil output to comply with OPEC output targets, Nigerian National Petroleum Company chief Mele Kolo Kyari said. “Our non-conformity is clearly on the crude, and it’s not significant so when you spread it across all the assets it will not be a shock,” he said. The 14-nation Organization of the Petroleum Exporting Countries (OPEC) agreed in December with non-OPEC partners including Russia to reduce supply by 1.2 million bpd from the start of this year. OPEC’s share of the cut is 800,000 bpd, to be delivered by 11 members, with exemptions for Iran, Libya and Venezuela. According to a Reuters survey published this week, Nigeria had pumped beyond its quota by 265,000 bpd in September, more than any other OPEC state.
- The U.S. Justice Department has closed its investigations into alleged corruption by oil major Eni in Nigeria and Algeria without taking any action, the Italian energy group said. The justice department has described as “misleading” any implication that it closed the probe for lack of evidence and said the investigation could be re-opened if circumstances changed. Eni, the biggest foreign oil and gas producer in Africa, is currently on trial in Milan on graft allegations revolving round the acquisition of a giant Nigerian oilfield in 2011. In that case Eni and peer Royal Dutch Shell are accused of buying the OPL 245 offshore field for about $1.3 billion in a deal that spawned one of the industry’s largest graft scandals.
- Activist and former presidential candidate Omoyele Sowore pleaded not guilty at a court in Abuja to charges of treason, money laundering and harassing the president. State Security Service agents arrested Sowore in early August after he called for a revolution after a February election which he said was not credible. He ran for president in that election, in which former military ruler President Muhammadu Buhari secured a second term in office. Buhari has faced criticism for his administration’s human rights record, particularly a deadly crackdown on members of a now-banned Shi’ite group that a United Nations special rapporteur said involved the excessive use of lethal force. The government has rejected criticisms of its human rights record. Sowore, who also founded Nigerian online news organisation Sahara Reporters, faces seven charges including treason, money laundering and “cyberstalking” for allegedly sharing false information about Buhari that insulted him and incited hatred against him.
- Facebook said it removed several pages, groups and accounts on its platforms that were engaged in “coordinated inauthentic behavior”, originating from Nigeria, along with the United Arab Emirates and Egypt. A total of 211 accounts, 107 pages, 43 groups were removed from Facebook and 87 accounts were taken down from Instagram, Facebook said.The social media giant has recently been cracking down on such accounts after coming under fire in the last few years for its self-admitted sluggishness in developing tools to combat extremist content and propaganda operations. Earlier this year, it removed accounts from Iraq, Ukraine, China, Russia, Saudi Arabia, Iran, Thailand, Honduras and Israel.