Business
Nigeria suspends anti-graft central bank governor
LAGOS – Nigerian President Goodluck Jonathan suspended Central Bank Governor Lamido Sanusi on Thursday, removing an increasingly outspoken critic of the government’s record on tackling rampant corruption in Africa’s leading energy producer.
Currency, bond and money markets stopped trading because of the uncertainty created by the suspension. Trading in the naira currency resumed after the central bank intervened with dollar sales, by which time debt markets were closed.
The intervention enabled the naira to rebound from a record low of 169 to the dollar to 165, dealers said, its biggest one day swing since a December 2009 devaluation.
Sanusi, who was due to end his term in June, had been presenting evidence to parliament that he said showed the state oil company Nigeria National Petroleum Corporation (NNPC) failed to remit $20 billion that it owed to federal government coffers. NNPC has repeatedly denied Sanusi’s allegations.
Deputy Governor Sarah Alade was appointed acting governor, presidential spokesman Reuben Abati said on Thursday.
“Lamido Sanusi’s tenure has been characterized by various acts of financial recklessness … inconsistent with the administration’s vision of a Central Bank propelled by the core values of focused economic management,” Abati said, without providing details of the acts.
Jonathan nominated the managing director of Zenith Bank Godwin Emefiele to be the next central bank governor. If Emefiele wins the Senate’s approval, he will start in June, when Sanusi’s term would have expired, the head of its finance committee Senator Ahmed Makarfi told Reuters.
Sanusi told broadcaster CNBCA that he was proud of what he had done, and he hoped the economy would not be hurt by his suspension.
Asked whether it was politically motivated, he said: “It’s not for me to comment. I think the answer to that is obvious.”
INVESTOR BACKLASH
Analysts predicted that foreign investors would now be active sellers of assets in Africa’s second biggest economy, just when it had been attracting more interest than ever for the huge potential of its 170 million population and a backlog of work needed to update its inadequate infrastructure.
“The suspension will come as a significant shock to foreign portfolio investors, whose willingness to invest in Nigeria was very much influenced by the transparency and anti-inflation credibility associated with Sanusi’s policies,” said Razia Khan, head of Africa research at Standard Chartered.
Makarfi said a full removal of Sanusi would need Senate approval, but that the presidency had made no such request.
“The president has the prerogative under our laws to suspend him,” without the Senate’s consent, he said.
The governor himself questioned the legality of the move.
“It’s important to establish the point legally … because if not established, then the very next governor of the central bank can be suspended for any reason, and the independence of the central bank is totally undermined,” he said.
Sanusi, a career banker, earned a reputation as monetary policy hawk while governor from June 2009 – raising interest rates, tightening liquidity and aggressively defending the naira with frequent foreign exchange auctions.
“Sanusi has been the face of naira stability,” Nwabueze Okonne, a Nigerian currency trader, told Reuters.
The stock market was down 1.47 percent by 0929 ET.
The governor’s suspicion of massive fraud at the heart of one of the world’s most opaque national oil companies has brought him into conflict with the administration of President Jonathan a year before elections. Jonathan was already under pressure from several corruption scandals and a failure to quell an increasingly violent Islamist insurgency in the north.
Oil provides 90 percent of foreign exchange in Nigeria and around 80 percent of government revenues.
“MORALLY FLAWED”
In a letter leaked in December, Sanusi said almost $50 billion in revenues from oil exports from January 2012 to July 2013 had not been remitted to the federation account. He later lowered the estimate to $20 billion.
It was not the first time that high-profile figures have put the spotlight on corruption during Jonathan’s presidency.
Jonathan’s one-time mentor and former president Olusegun Obasanjo said in a letter leaked in December that it would be “morally flawed” for Jonathan to seek a second term in 2015, saying corruption under his tenure was worse than that of General Sani Abacha, the military dictator who looted billions from the treasury and stashed it in Swiss bank accounts.
Jonathan rejected that criticism, and he frequently retorts that corruption in Nigeria is being exaggerated by his enemies.
The governor made a name for himself two months into the job when he rescued nine Nigerian banks in the wake of a financial crisis that nearly caused a wave of bankruptcies. He bailed them out and forced out eight of their chief executives.
In doing so he made a rare example of some of Nigeria’s most powerful people. Critics said he was getting too big for his boots when last year he began using bi-monthly policy meetings to lampoon the government for reckless spending.
Yet his aristocratic lineage – he is heir apparent to the throne of Kano, traditionally one of West Africa’s most powerful Islamic caliphates, with a history going back to mediaeval times – had made him seem untouchable.
However, his exposure of what he said was severe malpractice at the state oil company spooked debt investors worried about government squandering of oil revenues during election cycles. Sanusi says graft is slashing foreign currency reserves.
The biggest gap in accounting is for $8.5 billion the NNPC says it retained from revenues during the 19-month period to cover subsidies it was owed on importing gasoline and kerosene.
Sanusi also says some of the $6 billion that the NNPC’s producing arm, NPDC, earned during the period should have been submitted to government accounts. Instead, he says, it has been funneled into private hands through special deals given to oil companies. NPDC denies this.
– REUTERS
Nigeria’s Gross Domestic Product (GDP) grew by 3.46% year-on-year in the third quarter of 2024, marking a strong performance compared to the 2.54% growth recorded during the same period in 2023 and 3.19% in Q2 2024, according to the latest data from the National Bureau of Statistics (NBS).
The growth was largely fueled by the services sector, which expanded by 5.19% and contributed 53.58% to the overall GDP.
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“The performance of the GDP in the third quarter of 2024 was driven mainly by the services sector,” the NBS stated in its report.
Key areas in this sector, including financial institutions, telecommunications, and trade, played significant roles in the economy’s growth.
The agriculture sector, while still positive, showed a slight slowdown, growing by 1.14%, compared to 1.30% in Q3 2023.
The industrial sector, however, posted a notable recovery, increasing by 2.18%, a marked improvement from the 0.46% recorded in the same quarter of 2023.
In nominal terms, Nigeria’s GDP at basic price for Q3 2024 reached N71.13 trillion, a substantial 17.26% increase from the N60.66 trillion recorded in Q3 2023.
“This performance is higher when compared to the third quarter of 2023, which recorded an aggregate GDP of N60,658,600.37 million, indicating a year-on-year nominal growth of 17.26%,” the NBS added.
The non-oil sector also showed strong performance, growing by 3.37% in real terms during Q3 2024, outperforming the 2.75% growth seen in the same quarter of 2023 and exceeding the 2.80% growth recorded in Q2 2024.
“The sector was driven in the third quarter of 2024 mainly by financial and insurance (financial institutions); information and communication (telecommunications); agriculture (crop production); transportation and storage (road transport); trade; and construction, accounting for positive GDP growth,” the NBS explained.
Despite the growth in the non-oil sector, its share of the total GDP decreased slightly to 94.43%, compared to 94.52% in Q3 2023, though it remained higher than 94.30% in Q2 2024.
The oil sector, in contrast, recorded a 5.17% year-on-year growth in Q3 2024, reversing the -0.85% decline seen in the same period in 2023.
However, growth slowed from the 10.15% recorded in Q2 2024. The NBS reported that Nigeria’s oil production averaged 1.47 million barrels per day (mbpd) during the third quarter, a slight increase from 1.45 mbpd in Q3 2023 and 1.41 mbpd in Q2 2024.
Family-owned businesses (FOBs) can continue to drive economic success, create value for shareholders, and positively impact their communities worldwide by staying true to their core values and adopting strategic practices that prioritise long-term growth, efficiency, and resilience.
This was part of the submission made by the Group Executive Director of Dangote Industries Limited, Halima Aliko-Dangote, during the Forbes Global CEO Conference in Bangkok, Thailand.
Halima, who is also the Executive Director, Family Office, spoke at the panel session on Family Business: Looking at the Next Frontier, opined that family-owned businesses have demonstrated exceptional resilience, navigating challenges and thriving over multiple decades.
Other speakers include the Managing Director and CEO of Worldwide Hotels, Carolyn Choo; the Managing Director of Damen Yachting, Rose Damen, a third-generation family shareholder of Damen Shipyards Group; and Co-Chairman of B.GRIMM Pharma, President of B. Grimm Joint Venture, and Board Member of B. Grimm Power, Caroline Link.
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According to her, success in family-owned businesses starts with shared values, goals, governance policies and alignment adding that reputation is part of ‘family capital’.
She maintained that governance structure, adherence to core values, customer satisfaction, optimization of shareholder value, meritocracy, integrity, leadership, brand equity, diversification/growth, philanthropy and preserving generational wealth play key roles to the success of our businesses.
Halima revealed that Dangote Group’s governance policies do not allow board and management to operate in silos as each business unit has at least three independent directors who offer a holistic view.
On other factors of success for Dangote Group, Halima emphasized, “We family-owned businesses have to stick to our tradition of asset rich-cash moderate or as my father will correct me, asset rich-cash poor. We as Dangote perpetuate a profitable business with strong values and strong governance structure. We make money while building our nation by contributing heavily to the global economy, creating massive jobs, thinking of our great grand kids and contributing excessively to humanity.”
Highlighting the significant contribution of FOBs to the global economy, Halima noted that studies by Mckinsey showed that they account for more than 70% of global GDP, generate annual turnovers of between $60 trillion and $70 trillion, and provide around 60% of global employment.
She stressed the crucial role these businesses play in creating jobs, sustaining communities, and driving development in sectors such as manufacturing, education, healthcare, and infrastructure across the world.
“Family-owned businesses (FOBs) have proven to be resilient, weathering challenges and thriving across multiple decades. Despite facing external pressures, many FOBs not only survive but also grow, contributing significantly to the global economy in ways that are often underestimated or overlooked,” she said.
She also pointed out that family-owned businesses often employ two key approaches in preparing the next generation for leadership roles: internal and external capacity building. Regarding internal capacity building, Halima explained that many families create internship programmes for young family members interested in taking over the business or assuming leadership positions.
“In Nigeria, we train the next generation so they can grow organically to leadership roles in family businesses. My dad’s approach is for you to start from ground up knowing you will get to leadership role if you work hard and do your job right. These experiences make it easier for you to learn the ropes and be prepared for leadership role in the future,” she pointed out.
On external capacity building, Halima discussed the practice of sending younger generations to work in non-family businesses. This approach enables them to acquire new skills, learn better processes, and gain diverse perspectives that can benefit the family business in the long run.
Halima revealed that she started her career as an Analyst at KPMG before joining Dangote Industries Limited.
The approach, she explained “removes the familiarity tag as the young generation got employed as other people and supervised to monitor their performance. This has been a common avenue business families have chosen to pursue for many years, having their next generation spend three to five years working outside the family business before eventually joining with a new set of skills and business knowledge.”
Addressing the challenges of succession planning, Halima emphasised the importance of involving the younger generation in the business early on.
She suggested that this creates a space for open communication, where the next generation can share their thoughts, ideas, and aspirations, while the senior generation provides critical information to help the next leaders make informed decisions.
She stressed the need for a balance between tradition and innovation in family-owned businesses. While tradition provides continuity and stability, she noted that innovation is vital to staying relevant and competitive in the modern marketplace.
“Successful family businesses recognise the need to adapt to changing consumer preferences, technological advancements, and market trends. Family businesses often have a wealth of experience and deep-rooted traditions. They can also benefit from external expertise and fresh perspectives,” she concluded.
A total of 9,000 youths in the Niger Delta have acquired entrepreneurial skills under the LiveWIRE programme of The Shell Petroleum Development Company of Nigeria Limited (SPDC) since it was introduced in 2003 as part of efforts to boost employment opportunities among people aged 18 – 35 years.
It was gathered that the recipients were trained and supported with start-up grants and business mentorship enabling them to launch their own businesses and become employers of labour.
The latest training, sponsored by the SPDC Joint Venture which includes the Nigerian National Petroleum Company Limited, TotalEnergies and Nigerian Agip Oil Company, involved more than 1,000 young entrepreneurs from host communities in Rivers, Bayelsa and Delta states. They graduated last week in Port Harcourt having developed business plans and pitched them to experts as part of the training. 654 trainees were selected as best-performers.
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“We’re delighted at the success of the LiveWIRE programme,” SPDC Director and Head Corporate Relations, Igo Weli, said at the graduation ceremony. “This training is set aside for young people from our host communities which means they can also enjoy the benefits of the programme and join the teeming number of entrepreneurs, several of whom now have the chance to participate in SPDC’s business as vendors. LIveWIRE is one of many ways through which Shell and her partners are powering progress in Nigeria.”
The graduation ceremony featured a technical conference with the theme, “Unlocking Growth: Leveraging Policies to Build an Inclusive Tech Eco System in the Niger Delta.” The keynote speaker, Iyke Kemabonta, and panelists, Soala Jumbo, Davies Awongo, Kalada Briggs, Vivien Ene and Ezieke Amaefula, challenged the beneficiaries to grow their businesses, overcome environmental challenges and enable the Niger Delta to reap the rewards of the programme.
Trainees from the 2023 Regional LiveWIRE programme from Rivers, Delta, Bayelsa, Imo, Abia, Akwa Ibom, Cross River and Edo states also joined the graduation ceremony. Beneficiaries were inducted into the LiveWIRE Alumni Group by three previous participants who now run their own businesses — Precious Adeho, Queen Esther Bolou-Ebi and Kalada Briggs. The trio encouraged the recipients to use the opportunity as launching pads into international recognition and success.
In a notable achievement, five previous beneficiaries won the LiveWIRE International “Go and Trade Enterprise Linkage Award” which enabled them to embark on trade visits to London, Dubai, Malaysia, and neighboring Ghana. Livewire Nigeria also offers beneficiaries the chance to compete for the Global Shell LiveWIRE Top Ten Innovators Award which comes with huge rewards.
LiveWIRE is Shell’s global enterprise development initiative for small businesses and is active in 18 countries. As at 2023, the programme had trained about 3,400 people and helped create more than 1,200 jobs around the world.
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