In the latest turn of events in Niger Republic, the military junta, which deposed President Mohamed Bazoum in a July 26 coup, has agreed to embrace dialogue in resolving the resulting crisis in the West African country.

Following a meeting with the Intervention Team of Nigerian Islamic leaders, General Abdourahmane Tchiani, the head of the Niger military junta, has consented to engage in diplomatic discussions with the Economic Community of West African States (ECOWAS).

The Islamic scholars were led by Bala Lau, national chairman of Jamatul Izalatu Bida Waikamatu Sunnah, and met with Tchiani for several hours in Niger’s capital, Niamey.

The new development follows a series of failed attempts by ECOWAS leaders headed by Nigerian President Bola Tinubu to resolve the crisis through diplomacy, prompting the regional group to opt for military intervention.

Ali Mahamane Lamine Zeine, the Prime Minister of Niger Republic, stated that General Tchiani had approved the initiation of discussions with ECOWAS and expressed hope that the diplomatic discussions would take place in the coming days.

As stated in a Sunday release signed by Lau, the coup leader and Islamic scholars engaged in deliberations encompassing various matters, including the request from ECOWAS leaders for the reinstatement of former President Bazoum.

“We have agreed and the leader of our country has given the green light for dialogue. They will now go back and inform the Nigerian President what they have heard from us…. we hope in the coming days, they (ECOWAS) will come here to meet us to discuss how the sanctions imposed against us will be lifted,’’ Zeine said.

Though the ECOWAS had resolved to use military action to restore Bazoum to power, the bloc, which has ordered the deployment of its standby troops, is holding back due to overwhelming antiwar calls. The Nigerian Senate and the majority of ECOWAS Parliament members have rejected the move for military intervention, calling for a diplomatic approach.

Given the situation, Islamic clerics, northern elites, and traditional rulers have moved to initiate discussions with the junta in a bid to open the way for diplomatic discussion.

Lau explained that the religious leaders, acting on behalf of President Bola Tinubu, arrived in Niger to fulfill their request for intervention. He noted that their purpose was to initiate a meaningful conversation, aiming to persuade the junta leader and other military figures involved in the coup to opt for a peaceful resolution of the crisis rather than resorting to conflict.

The delegation reportedly spent several hours with Tchiani in Niger’s capital Niamey, deliberating on all the issues, including the demand by ECOWAS leaders that former President Bazoum be reinstated.

Following the discussion, Tchiani was said to have apologized for shutting the door to dialogue earlier on. Nonetheless, he expressed his disappointment over ECOWAS leaders’ failure to listen to their perspective before issuing an ultimatum for their resignation.

He contended that the coup was undertaken with good intentions, asserting that their actions were aimed at averting an impending threat that could have impacted both Niger Republic and Nigeria.

Furthermore, he extended an apology for not affording the team led by former Head of State General Abdulsalami Abubakar (rtd), which was dispatched by President Tinubu, the requisite attention. He attributed this oversight to their discontent over the ECOWAS ultimatum.

The leader of the junta said their doors are now open to explore diplomacy and peace in resolving the matter.

Poor Ghana: it made 1 Cedi = 1 USD in 2007 hoping that abracadabra magical algebra makes sense in global economics/currency (it was about 1 USD = 10,000 Cedi before the redenomination). But it is not just Ghana. Some Nigerian politicians promised to make 1 Naira = 1 USD. Thankfully, that hopeless policy was abandoned. Yes, since the Tang dynasty invented paper money in 7th century China, some countries have seen the value of money on the number printed on the paper. But the best among nations, think beyond that.

In June 2007, a redenomination of the cedi by the Bank of Ghana, led to the initiation of the new Ghana cedi. The value of the cedi relative to the dollar before the redenomination was in the range of ¢9,300 to ¢10,000. It became ¢0.93 – ¢1 to 1USD after the redenomination.

In the African Union, many have postulated that once Africa has one currency that all our problems will disappear. But look at the CFA Franc area and how it is being rattled. That is also a strong indication that currency union will not save Africa until we begin to win on innovation and productivity. You have no national positioning under a supranational central banking ordinance in a currency union within a heterogeneous market system. Indeed, if Africa goes ahead on a single currency and does nothing on economic output, welfare losses will be huge. 

I have made that point before the African Union Congress – and I remain hopeful that we do not adopt the EU/euro playbook without considering that the EU’s economy is very homogenous, and shocks are relatively more manageable.

Back to Ghana: 1USD = 11 Cedi today. Sure, that old magic achieved something, if not 1 USD  will be about 100,000 Cedi today. So, the magic saved people time from writing long digits. More so, it has reduced greenhouse emissions since cheque books, bank forms, etc may not need to be longer. How do you write $10,000,000 if 1 USD would have been 100,000 Cedi. On that, you commend the genius in Ghana.

People, Nigeria needs to have a national emergency on its currency. Do not tell me that it would stabilize without explaining how. Ghana promised the same… and that illusion continues to scale.

The strength of Nigerian Naira comes from warehouses and factories, and not from the Central Bank of Nigeria (CBN) headquarters. Those warehouses and factories include the old (the traditional firms like Innoson Motors, Dangote Cement) and the modern  ones (like Paystack, Tomato Jos). Until the CBN can use its monetary tools to elevate them, it cannot win the fight for Naira.

As this election season begins, if you want to strengthen the Naira, vote for visionaries who understand the multifaceted global economic system, with defined roles on where Nigeria can play.

Anyone who tells you that he will make N1 = $1, via fiat, is a liar by default; only the factories have the real powers to determine those. So, the question is really: who can help us create better factories, the old and the modern?

People, Naira needs help right now.

Roadmap to the future

I wrote a lead paper for the African Union Congress as a banker and banking/finance doctoral student, and I disputed many of the illusions on the required prior convergence of our currencies before we could intra-trade, agnostic of currencies. Years later, I dropped  this challenge: “build a truly pan-African digital remittance/transfer banking product which is agnostic of location or currency in Africa.”

 In other words, you do not need a single currency to achieve this since technology can hide all the “regulations” and still achieve the same outcome. As Mr. President noted, it is time. Even the US dollars will benefit from it because Africa will grow to buy more from it.

I wrote a lead paper for the African Union Congress as a banker and a banking/finance doctoral student, and I disputed many of the illusions on the required prior convergence of our currencies before we could intra-trade, agnostic of currencies. Years later, I dropped  this… pic.twitter.com/pO95HbxBhl

— Ndubuisi Ekekwe (@ndekekwe) August 13, 2023

(Update: on video is President of Kenya)

Comment on Feed

Comment 1: Yes, zeros were removed, but if you look at the PP of the Cedi over the period between 2007 and now compared to the Naira, you find that with or without removing even the zeros, the Naira was not and is still not anywhere near where what the Cedi could and can buy from a basket of composites.

The history of the performance of the Cedi and Naira is still there to compare. That’s the difference. It’s not just a simple matter of removing zeros to make the currency look okay.

The fundamentals of the economy at the time Ghana undertook that project, supported that action. And, it’s no gainsaying that Ghana’s economic footings have always been on the better side, no matter the bleaks.

So, let not Nigeria attempt what Ghana did and survived; its economy will crash, because the existing trajectory points to an entirely unique imbalances from many angles. The malaise in the structure of the Nigerian economy, as you know is great.

Inspite of the managers of Ghana’s economy doing a bad job now, you’d agree with me that it’s a wrong choice to cite to make a case for Nigeria wanting or not wanting to do same; mind you, the Cedi still has better buying power than Naira; ask why.

My Response: Please I hope this piece is not creating tension. There was no intention to make people feel bad. But yet, if I have to take you up, your data is not factual. In 2007, US$1 = N130. At that time, $1 = 10,000 Cedi which was forced to 1 Cedi. Today, $1 = 11Cedi which is  a factor of 11. For what you said to be true, Nigeria has to be 130*11 = 1430. The Naira is about there but not yet there since it is about N930/$ today. So, your argument that Cedi could buy more is not supported by data.

Comment 1R: Ndubuisi Ekekwe, not at all, Prof. No tension created and no pun intended, too??. But, for the learning, I sought to point out some facts premised solely on PP of the two currencies underpined by the two countries’ economic dynamics over the period.

And, this was in response to some commentators who had taken your piece on its surface to propose a flawed position not backed by any fact.

Nigeria’s top imports

I think Nigeria needs to find a solution to the level of misinformation we have online these days. I have been inundated with many questions on if the Central Bank of Nigeria (CBN) is bankrupt or going bankrupt. Please there is nothing like that; your Nigerian treasury bills, bonds, etc are safe, at least from the angle of the CBN.

The Total Assets of CBN (Group) stands at ~N57.99 trillion while Total Liabilities are ~N56.34 trillion, giving a decent Equity of ~N1.604 trillion, as at Dec 31 2022. By accounting standard (at least to Intermediate Level of ICAN), this is not a state of bankruptcy. That said, the rate of growth in the Liabilities was not prudent, and Nigeria has to cut that down.

Instead of bankruptcy, the bank actually recorded a profit of N65.63 billion in 2022; in 2021, it was N31.04 billion. Relatively, that is nothing, but that is not a sign towards bankruptcy.

Understand that most people are very unhappy, including myself, not because of any sign of bankruptcy, the issue was borrowing $$billions from US banks, and securing/collateralizing the loans with the national foreign reserves or other asset classes, without informing the Nigerian people and the National Assembly.

That non-disclosure blew many models wide, since the funds you think are there have already been spent, via backdoor. I wrote that I was disappointed that Buhari allowed such to happen under his watch. But that observation was not on the financial position of the bank, rather, the lack of transparency in its management. CBN did what if any Nigerian bank had done and “covered it”, that bank would be in trouble with the apex bank.

Conclusion: The apex bank is “strong” but ought to be stronger.

They were fishermen doing their jobs. They were men of waters, earning their incomes, diligently, on the waters of Galilee. On this day, a Mentor was looking for mentees, for a grand mission, He was pursuing. Centuries earlier, something similar happened at a smaller scale: a young man was in the field, tending his oxen, when a mentor called him.

In both cases, the men had qualified themselves before they were discovered, right on their jobs.  Yes, the best time to audition for a job is when there is no job. For the disciples and Elisha,  we could learn lessons on mentoring, coaching and discipleship. The disciples left and followed Christ on a Call to Mission, paying severe personal prices, but with unparalleled ecumenical ecclesiastical blessing. For Elisha, he closed his farming business, left his personal ambitions, and followed Elijah.

And as the training began, Elisha was never far from Elijah, working diligently, and became qualified for a double portion of anointing: ‘Elijah said to Elisha, “Tell me, what can I do for you before I am taken from you?” “Let me inherit a double portion of your spirit,” Elisha replied.’ Elisha had impressed with dedication, excellence and results – and his boss knew he was ready for a double promotion. Centuries later, the disciples qualified by their commitment and grace, received on the day of Pentecost an unbounded promotion, with the Holy Spirit.

Good People, in politics, in business, and indeed everything, the system rewards those who commit absolutely to major calls, when they’re recruited, without looking back. Politicians elevate trusted aides who can wait hours at midnight as their bosses plot political next moves, CEOs handpick trusted subordinates, and Managing Partners send consultants with the mindset of whatever-it-takes to get the job done to major clients.

Check Obama, and those he brought to White House; some had worked with him for years. Check that new bank CEO, those he recruited; most have worked with him for years. Check that new president, the same people. You call it recycling. Yes, but that is the system: the mentors do not pursue the aides and proteges, the latter duo relentlessly push, and most times, they get double portions, if they excel based on the standards the bosses have set. Indeed, for that double promotion in our careers, we must deliver results, during the mentoring and preparation phase. 

Build a reputation of excellence before your supervisors, and be rewarded with a “double promotion”. Happy Sunday.

2 Kings 6:1-7 KJV

And the sons of the prophets said unto Elisha, Behold now, the place where we dwell with thee is too strait for us. Let us go, we pray thee, unto Jordan, and take thence every man a beam, and let us make us a place there, where we may dwell. And he answered, Go ye. And one said, Be content, I pray thee, and go with thy servants. And he answered, I will go. So he went with them. And when they came to Jordan, they cut down wood. But as one was felling a beam, the axe head fell into the water: and he cried, and said, Alas, master! for it was borrowed. And the man of God said, Where fell it? And he shewed him the place. And he cut down a stick, and cast it in thither; and the iron did swim. Therefore said he, Take it up to thee. And he put out his hand, and took it.

New Provisions of the Companies and Allied Matters Act 2020 on Foreign Companies 

Following from my last article on the subject matter of foreign companies, this article will be looking at the provisions of CAMA 2020 regarding the topics of :-

– Foreign company exemption in Nigeria

– Annual reports of foreign companies

– The legal status of foreign companies in Nigeria

– Sanctions applicable to foreign companies in Nigeria.

What does the act say regarding foreign companies intending to carry on business in Nigeria?

The act provides that:-

-Subject to relevant sections  of the act, every foreign company which before or after the commencement of this Act was incorporated outside Nigeria, and having the intention of carrying on business in Nigeria, shall take all steps necessary to obtain incorporation as a separate entity in Nigeria for that purpose, but until so incorporated, the foreign company shall not carry on business in Nigeria or exercise any of the powers of a registered company and shall not have a place of business or an address for service of documents or processes in Nigeria for any purpose other than the receipt of notices and other documents, as matters preliminary to incorporation under this Act.

– Any act of the company in contravention of subsection (1) is void.

-Nothing in this section affects the status of any foreign company-

(a) which before the commencement of this Act was granted exemption from compliance under the provisions of any preceding Companies Acts that had been applicable in Nigeria before the commencement of this Act ; and

(b) exempted under any treaty to which Nigeria is a party.

What are the provisions of the act regarding penalties on foreign companies under the act?

The act provides that:-

-If any foreign company fails to comply with the requirements of section 80 of this Act in so far as they may apply to the company, the company commits an offence and is, in addition to being liable to prosecution, also liable to such penalty as the Commission shall specify by regulation, and every officer or agent of the company who authorizes or permits the default or failure to comply is, whether or not the company is also convicted of any offence, liable on conviction to such penalty as the Commission shall specify by regulation, and where the offence is a continuing one, the company and every officer or agent of the company are liable to a further penalty as the Commission shall specify by regulation for every day during which the default continues.

What does the act say about the exemption of foreign companies under the act?

The act provides that :-

-A foreign company may apply to the Minister for exemption from the provisions of the relevant section of the Act if that foreign company belongs to one of the following categories, that is-

(a) foreign companies other than those specified in paragraph (d), invited to Nigeria by or with the approval of the Federal Government to execute any specified individual project ; 

(b) foreign companies which are in Nigeria for the execution of specific individual loan projects on behalf of a donor country or international organization ; 

(c) foreign government-owned companies engaged solely in export promotion activities ; and

(d) engineering consultants and technical experts engaged on any individual specialist project under contract with any of the governments in the Federation or any of their agencies or with any other body or person, where such a contract has been approved by the Federal Government.

What are the requirements of CAMA 2020 for foreign companies regarding annual reports?

The act provides:-

-Every exempted foreign company shall deliver to the Commission, in every calendar year, a report in the form prescribed by the Commission.

-An exempted foreign company that fails to comply with the provisions of the relevant sections of the act, is liable to such penalty as the Commission shall specify by regulation, for every year of default .

What is the legal status of a foreign company in Nigeria under the act?

Subject to the CAMA and save as may be stated in the instrument of exemption, a foreign company exempted pursuant to this Act shall have the status of an unregistered company and accordingly, the provisions of this Act applicable to an unregistered company shall apply in relation to such an exempted company as they apply in relation to an unregistered company under this Act.

What are the sanctions applicable to foreign companies? 

Except as provided under the relevant sections of this Act- 

(a) nothing shall be construed as authorizing the disregard by any exempted foreign company of any enactment or rule of law ; and 

(b) nothing in this Chapter shall be construed as affecting the rights or liability of a foreign company to sue or be sued in its name or in the name of its agent.

Minority Rights Protection , Major Asset Transactions, and Derivative Actions Under The Companies and Allied Matters Act (CAMA) 2020

This article will be focused on the protection of the rights of minority rights holders in companies under CAMA 2020, particularly on the topics of :-

– Who has the right to sue for a wrong or ratify irregular conduct

– The provisions of CAMA 2020 on the procedure for a major asset transaction

– The protection or minority rights, injunctions and declarations

– Personal and representative actions

– Members under CAMA 2020

Who under the act has the right to sue for a wrong or ratify irregular conduct?

Subject to the provisions of this Act, where an irregularity is made in the course of a company’s affairs or any wrong is done to the company, only the company can sue to remedy that wrong and only the company can ratify the irregular conduct.

What are the provisions of CAMA on the procedure for a major asset transaction?

The act provides that :-

-For the purposes of this section, “major asset transaction” means a transaction or related series of transactions which includes the-

(a) purchase or other acquisition outside the usual course of the company’s business ; and

(b) sale or other transfer outside the usual course of the company’s business, of the company’s property or other rights the value of which, on the date of the company’s decision to complete the transaction, is 50% or more of the book value of the company’s assets based on the company’s most recently compiled balance sheet.

-In undertaking a major asset transaction-

(a) the board of directors of the company shall recommend the transaction and direct that it be submitted for approval to an annual or extraordinary general meeting of members ;

(b) notice of the transaction, stating that a purpose of the meeting is to consider the transaction and including a summary of the transaction and of the recommendation of the board of directors on the transaction, shall be given to all members entitled to notice of or to attend the meeting or to vote n the transaction ; and

(c) at the meeting the members shall approve the transaction by a special resolution, unless the company’s memorandum of association provides for its approval by an ordinary resolution, in which case it is approved by an ordinary resolution.

What are the provisions of the act on the protection of minority, injunctions and declarations in certain cases?

The act provides that without prejudice to the rights of members under sections 346-351 and sections 353-355 of this Act or any other provisions of this Act, the Court, on the application of any member, may by injunction or declaration restrain the company or its officers from-

(a) entering into any transaction which is illegal or ultra vires ;

(b) purporting to do by ordinary resolution any act which by its articles or this Act required to be done by special resolution ; 

(c) any act or omission affecting the applicant’s individual rights as a member ;

(d) committing fraud on either the company or the minority shareholders where the directors fail to take appropriate action to redress the wrong done ;

(e) where a company meeting cannot be called in time to be of practical use in redressing a wrong done to the company or to minority shareholders ; 

(f ) where the directors are likely to derive a profit or benefit, or have profited or benefited from their negligence or from their breach of duty ; and

(g) any other act or omission, where the interest of justice so demands.

What are the provisions of the act regarding personal and representative actions?

-Under the act, where a member institutes a personal action to enforce a  right due to him personally, or a representative action on behalf of himself and other affected members to enforce any right due to them, he or they are subject to the act, entitled to-

(a) damages for any loss incurred on account of the breach of that right ; or

(b) declaration or injunction to restrain the company or the directors from doing a particular act.

-Where, in proceedings brought under this section, the Court finds the directors or any of them liable for any wrongdoing, the erring director is personally liable in damages to the aggrieved member.

-Where any member institutes an action under this section, the Court may award costs to him personally whether or not his action succeeds. 

– In any proceeding by a member under section 343 of this Act, the Court may, if it deems fit, order that the member shall give security for costs.

What is the definition of a member under the act ?

A company “member” as defined under the act includes-

(a) the personal representative of a deceased member ; and 

(b) any person to whom shares have been transferred or transmitted by operation of law.

What is the procedure for the commencement of derivative actions?

-Under the act, an applicant may apply to the Court for leave to bring an action in the name or on behalf of a company or a company’s subsidiary, or to intervene in an action to which the company or the company’s subsidiary is a party, for the purpose of prosecuting, defending or discontinuing the action on behalf of the company or the company’s subsidiary.

-No action may be brought and no intervention may be made under the act, unless the court is satisfied that-

(a) a cause of action has arisen from an actual or proposed act or omission involving negligence, default, breach of duty or trust by a director or a former director of the company ;

(b) the applicant has given reasonable notice to the directors of the company of his intention to apply to the Court under the act;

(c) the directors of the company do not bring, diligently prosecute, defend or discontinue the action ;

(d) the notice contains a factual basis for the claim and the actual or potential damage caused to the company.

(e) the applicant is acting in good faith ; and (f ) it appears to be in the best interest of the company that the action be brought, prosecuted, defended or discontinued.

-An action under this act may be against the director or any other person (or both).

-In any action referred to in this regard, the plaintiff shall have the right to obtain any relevant documents from the defendant and the witnesses at trial, and may in pursuance of that right request categories of documents from such person without identifying specific documents.

What does the act say regarding powers of the court to make orders in derivative actions?

The act provides that :-

-In connection with an action brought or intervened under section 346 of this Act, the Court may, at any time, make any such order or orders as it deems fit.

– The court may make an order- 

(a) authorising the applicant or any other person to control the conduct of the action ;

(b) giving directions for the conduct of the action ;

(c) directing that any amount adjudged payable by a defendant in the action is paid, in whole or in part, directly to former and present security holders of the company instead of to the company ; and

(d) requiring the company to pay reasonable legal fees incurred by the applicant in connection with the proceedings.