New Nigerian Newspapers Online Edition

AFRICA IN THE GLOBAL RECESSION

ESTIMATED to last for at least 18 months, depending on the amount of funds pumped into the world economy, the crisis in the global financial markets was precipitated by three failures, namely regulatory and supervisory failure in advanced economies, failure in risk management in the private financial institutions and failure in market discipline mechanisms. What was derisively regarded about two years ago as small town America sub-prime loans problem has now metamorphosed into multi-billion-dollar bank crashes, nationalization of legendary business concerns and outright intervention by several governments to bail out banks. There is no gainsaying the fact that the world’s economic landscape of being drastically redrawn by the colossal loss of fortune by both banking and non-banking financial institutions and the near wipe-out of the middle class borrower. The magnitude of the credit collapse and its multiplier-effect is estimated to be in excess of trillions of United States Dollars in the world’s net surplus and donor countries or the OECD nations.

Lending credence recently to Africa’s vulnerability World Bank’s Managing Director for Africa and the Middle East Dr. Ngozi Okonjo-Iweala and UN Secretary-General Ban Ki-Moon both painted a gloomy picture of the disastrous consequences on Africa. Said Okonjo-Iweala who was at one time Nigeria’s Finance Minister: “I think the first thing is to also remember that before this financial crisis there have been the food, fuel and fertilizer crisis.”

As a matter of fact, the need to formulate a policy to boost local food production with a view to resolving the food crisis cannot be overemphasized. According to the Central Bank of Nigeria (CBN) 65 per cent of Nigerians are currently underfed because they lack access to the quantity and quality of food required for healthy and productive life, while inflation persists in the country with official statistics on food items rising from 6.6 per cent last year to about 12.4 per cent this year. In Togo and Liberia food inflation is still about 25 per cent and in Ethiopia it is up to 92 per cent at the moment. So it is in several African countries and this is a problem.

“If the developed countries go into recession and emerging markets like India and China also experience the same thing, then you will begin to see some impact on African exports because the prices of export commodities will begin to go down and demand will be falling. That means African countries will be getting lower revenue than they used to get,” said Okonjo-Iweala at the just-concluded IMF/World Bank meeting in Washington DC.

Needless to say, African economies are commodity-based. In a nutshell the spillover effects could assail the profile of capital inflow and programmes and trade with African countries. And for the UN Secretary-General, “The ad hoc manner in which governments have had to respond to the management of the crisis is reflective of serious lacunae in the current world financial system.” He called for deep and systemic reforms of institutions and economies to halt the tide.

Given that the oil industry sources its funds off-shore and the financial crunch has seen the collapse of many hitherto strong financial institutions, oil and gas operations may soon be severely hampered by limited access to funding. Prior to the economic meltdown oil companies found it difficult to source funds for marginal field projects owing to the unsavoury perception the Niger Delta crisis has given Nigeria’s oil industry, the mainstay of the country’s economy. Not surprisingly an inter-ministerial committee has begun reworking the 2009 budget, a fall-out of the threat posed by the global decline in crude oil prices, and even though the committee has not arrived at a final oil benchmark, indications point to a benchmark lower than that used for 2008 budget. The proposed 2009 budget will be anchored on a daily crude production of 2.3 million barrels per day (bpd) as against the 2.45 million bpd at a benchmark price of 59 dollars while recurrent, overheads and capital expenditure are being pruned down in the budget.

Not helping matters is the fact that most people invest by buying stocks, bonds and other financial instruments, and if there is financial crisis in the economy the people would lose confidence in the banks and begin to look for safe havens. By extension if banks do not have money to loan the oil companies, their operations would be adversely affected, since there would be limited probability for credit lines to be extended to any company. Although Africa’s ‘saving grace’ for now is said to be because its banks and other financial institutions are not seriously linked with organisations in developed economies that are facing the squeeze, African countries need to do their own bit. The World Bank is forecasting for 2009 that commodity prices will go down between 20 - 25 per cent compared to the previous forecast. This is one possible way that the continent might be negatively impacted.

Africa’s leadership should take its cue from countries battling to forestall economic recession by being pro-active, as the disastrous consequences can’t be wished away.

Hajj 2008

EARLY November, intending pilgrims will commence the journey to Saudi Arabia in order to perform this year’s hajj. Hajj which is one of the pillars of Islam is expected to be performed by Muslims who can afford to do so at least once in a life time. Over the years, the holy trips have been dogged by problems that hindered smooth transportation of pilgrims to and from the holy land. It is against this ugly backdrop that we urge all the relevant agencies to promptly tidy up the loose ends in preparation for the hajj airlift in a few weeks’ time.

To start with, it is hoped that the National Hajj Commission (NAHCON), which is coordinating all hajj activities, has effectively addressed the problematic areas of pilgrims’ accommodation in Medina and Mecca as well as transportation. The five air carriers approved for this year’s hajj must be properly screened to ensure that they are fit to safely airlift pilgrims. The issue of keeping to schedule is equally important as delay in the airlift, particularly after the hajj, has always exposed the pilgrims to hardship at Abdul-Aziz International Airport, Jeddah. It is good to note that the Nigerian Civil Aviation Authority (NCAA) has warned airline operators against acts that will obstruct the smooth transportation of pilgrims to and from Saudi Arabia. We can no longer tolerate airlines that default; so those found not to be air worthy must be promptly dropped before the commencement of the exercise, while any that performs shoddily should be sanctioned appropriately. It is worth emphasizing here that Nigeria ought to carefully study how countries like Bangladesh, Indonesia and Malaysia with large Muslim population successfully conduct the mass movement of pilgrims in and out of Saudi Arabia during each hajj.

     We are equally concerned about the shabby environments of some hajj camps and urge the various state pilgrim boards to provide amenities like water and shelter for people who will soon start trooping to designated airports to await airlift. To avoid over-crowding at camps, pilgrims whose flights are due should be notified through the electronic media to report at specific times, just as it is done in Kaduna State.

    We implore intending pilgrims in rural areas not to rush to camps out of anxiety but listen attentively to their radio or keep in close contact with hajj officials resident in their domain for information. The pilgrims boards must, however, be commended for efforts in enlightening people about the religious rites to be performed in the holy lands as well as how to conduct themselves. Our pilgrims must be mindful of the fact that they will be mingling with people from different backgrounds and as such should be patient and tolerant throughout the duration of the pilgrimage. Grievances or complaints should be channelled through the appropriate authorities. Demonstrations or any other unruly behaviour that will dent Nigeria’s image must be avoided. Intending pilgrims should also steer clear of prohibited items. We must caution pilgrims not to squander their money on unnecessary shopping but reserve substantial amount for feeding in order to remain fit for the physical challenges they will confront. It is those who embark on a shopping spree on arrival that suffer most towards the end of the exercise.

   Finally, our pilgrims should obey simple rules of hygiene to keep healthy. They should also be good ambassadors of the country. Officials whose duty it is to facilitate the well-being of pilgrims should be on the alert to their responsibilities. We enjoin pilgrims to pray for the progress of Nigeria.

AU PEACEKEEPING FORCE

THE African Union (AU) recently approved the training of a standby force for peacekeeping in the region with the signing of a Memorandum of Understanding (MOU) to that effect between it and African Peace Support Trainers Association (APSTA). The president of the association, Rear Admiral John Jonah, who announced this at a media roundtable in Abuja, noted that the force, meant for rapid deployment of troops to troubled areas in Africa and the training of such force, was long overdue. Former Nigerian Head of State and APSTA patron, General Abdulsalam Abubakar, who also hailed the development said it would go a long way towards restoring peace in the hot spots of Africa and the entire region.
New Nigerian acknowledges this as a very welcome and timely development for the crises-ridden African continent not only because it would give effect to a long-cherished but mainly dreamt of idea for fellow Africans to tackle own security and peace problems, but also enable prompt deployment of forces to flash-points largely located around neighbourhoods. In addition, it is a laudable and worthy investment as the force would be in a far better stead, provided they are adequately equipped, than the ubiquitous but ill-informed United Nations Peacekeeping troops, to appreciate the issues at stake and the terrain in areas where they are deployed. Again, since the UN forces cannot be everywhere and do already have their hands full in troubled spots in other parts of the world, an African standby force would provide ready pool of personnel within easy reach to dash to assigned flashpoints. However, while those in authority go about working the modalities for the take-off of the African force, as well as the knitty-gritty of the choice and location of its headquarters, base stations and contributory ratios et cetera, we hasten to point out other critical issues which may pose challenges to it and must be sorted out well before the inaugural or first deployment.
Peacekeeping is all abut logistics and finances or funds deployment. The standby force we envisage must be fully mobilized, kitted and well-heeled or oiled to take on an adventure of this magnitude in a region where all manner of rebel movements practically hold sway and everyone to ransom. Troops should therefore be equipped with, among others, state-of-the-art communication gadgets, artillery, helicopters and ammunition not only good enough to match the warring factions' arsenals, but also face the challenges of the difficult, mostly dangerous terrain and jungles of Africa. The African Union members have to make great sacrifices to fund and equip the peace force to avoid the mistake of making the troops sitting ducks to rampaging and well armed rebels and other hideous forces spread across the continent. The countries' governments must be ready to honour commitments in all respects, as well as co-operate through the diplomatic and other channels towards the implementation of all agreements aimed at the peaceful resolution of conflicts for the overall development of the region. Historical, colonial, regional linguistic and other divides should not be allowed to constitute cogs in the wheel of progress in this common mission to end the equally common but deteriorating humanitarian crises on the continent occasioned by conflicts and wars.
However, New Nigerian believes that side by side with this spirited efforts at peacekeeping, African leaders owe a responsibility to address the root causes of conflicts, wars and crises which compel brothers to take up arms against each other. Among the inherent, persistent and time weary causes are the sit-tight syndrome, power struggle and politics of exclusion among the leaders. There is also the fundamental issue of good governance and service delivery to the people, as well as the core matter of endemic illiteracy, hunger, poverty, diseases and unemployment which had continued to retard the growth and development of the poor citizenry, the nations and the continent at large. This calls for a great deal of change of heart on the part of the leadership, and would go a long way towards nipping in the bud potential crises. In essence, therefore, this is a clarion call to conflict prevention through mechanisms which more effectively address these problems and bring succour to the people. This is the only sure way to guarantee peace for development.
We call on the leaders of nations in the AU to, as quickly as possible, give effect to the standby peace force for deployment to areas of immediate need and to augment or complement the United Nations peace keepers where necessary. We are mindful of the death and destruction wrought in lingering and new trouble spots such as the danger posed by a new rebel group in Bunia in the North-East of the Democratic Republic of Congo.