Re: Lesson 101 to Biya on how to manage economy under democracy

Martin

Those are things that happen in a country where there is a minimum of
consensus on governancce. But here, we have a country whose minimal
consensus is built around pilferage graft amd blackmailing.

NOTHING WILL WORK

Aaron

On 5/29/13, Tumasang Martin <tumasangm@hotmail.com> wrote:
> Macro Indices, reforms show democracy as benefitting economy
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> Wed, 2013-05-29 00:00
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> Fourteen years of democracy (1999 – 2013), have left a
> positive legacy of reforms and macro-economic stability for Nigeria,
> BusinessDay
> analysis of available CBN, IMF, World Bank and NBS data has shown.
> Nigeria's economy expanded six-fold to $273 billion in
> 2012, from $45 billion in 2000 with an average Gross Domestic Product (GDP)
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> growth rate of 8.3 percent for the period, as new industries such as
> telecommunications helped boost growth.
> Income per head in 2000 which was $378 dollars rose by
> 357 percent to $1,731 by 2012, while Net Foreign Direct Investment (FDI) of
> $1.1
> billion grew to $6.1 billion by 2012.
> Nigeria which suffered from periodic bouts of hyper
> inflation in the 1990's, with CPI touching a high of 75 percent in 1995,
> has
> managed to bring inflation somewhat under control in the 14 year period,
> with
> current inflation rate in single digits at 9.1 percent.
> Macro stability also benefitted fundamentally from the
> fiscal reforms put in place by finance Minister Ngozi Okonjo-Iweala in her
> first
> term by capping the deficit at 3 percent of GDP, and more recently, from the
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> tighter monetary policy regime put in place by the Central Bank of Nigeria
> (CBN).
> The reforms that revamped the domestic bond market have
> also led to macro stability.
> Moribund until 2003, the domestic bond market today
> finances much of the FG budget deficit and some long term infrastructure
> projects.
> The size of the domestic bond market in 2011 was N9.5
> trillion ($60 billion), made up of AMCON bonds (57.42 percent), FGN bonds
> (37.21
> percent), Sub nationals (3.58 percent) and Corporate bonds (1.79 percent).
> The value of transactions in the domestic fixed income
> market is up four-fold since 2006, reaching a value of N14.7 trillion at the
> end
> of 2010, from an almost negligible level in 2000 according to data from
> investment firm Vetiva Capital.
> Meanwhile, the nations yield curve has extended from
> three months to 20 years, with 3yr, 5yr, 10yr and 20 year bonds routinely
> issued
> by the Debt Management Office (DMO).
> This has eliminated so called 'ways and
> means' (money printing) deficit financing, rampant in the eighties and
> nineties,
> and a major source of inflation. It has also attracted offshore investor
> interest in naira denominated assets.
> "As a result of the increased flow from offshore
> investors, the naira is stable. This has helped too, with macroeconomic
> stability, and acts as a check on policies that should continue to guarantee
>
> stability," Razia Khan, regional Head of Research, Africa, at Standard
> Chartered
> Bank said.
> The nation's public debt which stood at 84 percent of
> GDP in 2000, is down to 14.7 percent in 2012, while gross external debts at
> $6.3
> billion at the end of last year is down 80 percent from the $31.4 billion it
> was
> in the year 2000.
> The nation's foreign exchange reserves are also up 340
> percent to $44.2 billion at year end 2012, from $9.9 billion in 2000.
> The pension reform enacted in the period has led to the
> accumulation of long term funds with Nigeria pension funds having N3
> trillion
> ($19 billion) worth of assets at the end of 2012, up from negligible levels
> at
> 2000.
> Other reform efforts in the period include the
> elimination of most of Nigeria's external debt to the Paris and London
> clubs,
> which has seen gross external debt fall to 2.3 percent of GDP from 70
> percent of
> GDP in 2000.
> The privatisation of major government enterprises also
> eliminated waste and led to the rise of Nigerian private sector-led
> conglomerates, such as Dangote Cement and the nation's major banks.
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--
Aaron Agien Nyangkwe
Journalist-OutCome Mapper
P.O.Box 5213
Douala-Cameroon
Telephone +237 73 42 71 27

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