Nigeria is now at the risk of running out of cash in five months, according to a report by Premium Times: “Nigeria nears economic collapse; external reserves down to $15 billion contrary to CBN’s $36 billion claim”. It is not rocket science: if NNPC does not pay into the reserves, the numbers will not improve since we hardly make money from any other source. The biggest challenge is that many citizens still think that Nigeria has a positive financial positioning. 

May I tell ASUU and the striking university professors, the probability that the government will fund (fully) whatever you are asking for is close to zero. In short, as you strike, you are making it easier for your line items to be removed from some of the problems at hand.

The minister of labour, Chris Ngige, was blunt: ““I can tell you that Nigeria is broke. There is no money to fund capital projects next year. As you can see, the dollar that has been hovering around N500 and N600 is now above N700. The truth is that there is no money anywhere. The National Nigerian Petroleum Company Limited (NNPC) no longer remits money to FAAC. So, the situation calls for patriotism from all Nigerians. The lack of money to fund capital projects would have implications on capacity to create jobs. If jobs are not created, poverty will increase in the country.” With debt servicing absorbing the little revenue we generate in Nigeria, we have crises ahead.

(Of course, it is hard to believe the government when it still has enough funds to buy vehicles for politicians in the neighbouring Niger Republic.)

But get this from me: provided you plan to vote in 2023, there is HOPE. In FUTO, we skipped meals to balance our budgets as students. But one day,  we started working in the bank, and they paid tons of money – and that past immediately became a distant one. A new leader can fix Nigeria even though it may take a lot of work. #believe

As Nigeria prepares for general elections next year that promise to be one of the most keenly contested in its history, evidence is emerging that the economy faces a double whammy: an empty treasury and rapid decline.

Government officials and business leaders knowledgeable about the situation say there have been concerns in Abuja and Lagos after an elected official drew the attention of the Central Bank of Nigeria governor, Godwin Emefiele, to the fact that Nigeria’s external reserves amount to only $15 billion, well below the $36 billion balance on the gross external reserves claimed by the bank.

With the country spending N5.9 trillion on imports in the first quarter of the year, irrespective of the preferred exchange rate, reserves of $15 billion would barely cover four months of import.

Financial analysts claim this would not have mattered much but for recent difficulties in different sectors of the economy, especially the export constraints that have seen the nation’s petroleum monopoly unable to add to the reserves in the last six months.

The NNPC’s inability to remit oil sales receipts to the CBN, despite elevated crude oil prices, is seen as one reason why the naira has nose-dived recently in the parallel market.

Debt Servicing Gulped N310bn More Than Revenue Generated by Nigeria in First Four Months of 2022

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FrieslandCampina is a Dutch multinational dairy cooperative which is based in Amersfoort, Netherlands. Largely, it is “owned” by dairy farmers. What happens is this: you produce 2 trucks of milk, I produce 5, and another produces 8, etc. Because we are small in our capacities, no one pays attention. But if we all come together, we become BIG and can move global. Those farmers did just that and today, they have one of the largest companies in the world with annual revenue in excess of $11billion.

Can we run the same playbook in Aba? Use a brand name, and ask those small shoemakers to feed into the brand. As Naira continues to fade, many will buy “local”, and a business model that can feed that pipeline has a promise. I suggest a name – “Aba” or “Enyimba” leather products brand, to be owned and controlled by men and women in the leather industry, within a cooperative.

People, you can use aggregation to get scale and drive orchestration in markets. That name-brand provides one certainty: designer, we will buy whatever you produce provided it is within standards. Once that is there, those men and women will scale because the demand side has been fixed.

Comment on LinkedIn Post

Comment: This is old skool Ndubuisi Ekekwe… as I read the article, I thought, the old words worth is back, demanding big attention span from readers… until I looked at the date of the article and saw it was 2017 !

Well if an article 5 years old has been resurrected by this analyst with a penchant for business detail, it can mean only one thing… the content is just as valid today, and Aba has not changed.

Is that a good or a bad thing? It is bad because the artisans are not seeing just reward from their labour.

The problem however, that production is often by hand, or at least hand finished, and that imperfections exist, would be a selling point in other markets globally.

Top finds for numismatists and philatelists for instance are coins or postage stamps with minting or printing flaws. Where labour is at a premium, small imperfections can be seen as proof of handicraft rather than mass production. Indeed, specialist machine changes are now available to deliberately introduce small process flaws to give the hand made look.

It may not be that Aba has lost its way in being what Nigeria needs. It may be that Nigeria has failed to be what Aba needs.

No one is a prophet in their own land.

My Response: Aba is fading and that affected my village Ovim. Ovim train station was the largest train station in our area serving many communities. Typically, from Aba, every train is expected to stop at Umuahia, Uzuakoli and then Ovim, bypassing some small stations.

Ovim served Ohafia, Arochukwu, Ahaba, and many other communities. As that was happening, businessmen went and built houses around the station. But with the train station gone, everything has collapsed. The hub is gone and Ovim lost a strategic positioning which was used to supply garri to Enugu via rail!

Every kid rode a Raleigh bicycle which was used to move foodstuffs from Oriendu Market to the train station! It was great.

Fixing Aba Shoe And Leather Industry