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  #19461 (permalink)  
Old 7th October 2016, 02:06 PM
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Default Re: Economicwatch

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Originally Posted by migiets View Post
No mind the guy. He thinks because people like me be Security Guard on minimum wage, i do not know what is what. I dey wait for am for mama Ejiro.
My own definition of extortion is when a Security Guard in Lagos is using his Lagos sense to bamboozle a naive local farmer cum hunter
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  #19462 (permalink)  
Old 7th October 2016, 02:24 PM
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Default Re: Economicwatch

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Originally Posted by migiets View Post
Is Erisco and Dangote now importing tomato paste and re-packaging?. I thought they were supposed to be converting the abundant raw tomato being wasted every year into tomato paste?. Does that require Forex?.
What is the biggie in tomato paste that we can not have me and you limited doing this?
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  #19463 (permalink)  
Old 7th October 2016, 02:31 PM
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Default Re: Economicwatch

Quote:
Originally Posted by NiGSoro View Post
What is the biggie in tomato paste that we can not have me and you limited doing this?
That is the big question. It seems people want to partake of the Forex subsidy by fire by force.

Iam surprised you have also not come out to ask the government for Forex to plant your palm trees. That is the in-thing now. Setup an import substitution venture that has about 90% local content and then ask the FG for Forex. Na wa for this Contraption.
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  #19464 (permalink)  
Old 7th October 2016, 02:46 PM
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Default Re: Economicwatch

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Originally Posted by wanaj0 View Post
If you need forex to meet local demands you will likely rank LOW in terms of priority because tomato paste is not a necessity! I would prefer people like this, brewery, flour mills to generate the forex that they will use for their operations. If there is no oil, will there be no forex???
This company is not up to a year old,it needs forex for importation of technology which Nigeria does not have,the cans for the tomato i do not know if it is manufactured in Nigeria,the equipment used at the factory is imported, some other additives am sure are imported,This company in my own opinion needs all the support it can get to survive because in the long run it will be for the benefit of Nigeria,


In Nigeria, we have 2 major Breweries that have been in existence for the past many years, yet they are groaning and complaining of non access to forex


So i wonder why they should rank low in terms of Forex allocation.
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  #19465 (permalink)  
Old 7th October 2016, 02:46 PM
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Default Re: Economicwatch

Quote:
Originally Posted by migiets View Post
That is the big question. It seems people want to partake of the Forex subsidy by fire by force.

Iam surprised you have also not come out to ask the government for Forex to plant your palm trees. That is the in-thing now. Setup an import substitution venture that has about 90% local content and then ask the FG for Forex. Na wa for this Contraption.
Just thinking aloud, for some Nigerians, who engage in legit businesses, this period may be the most success period of their lives.

My challenge to all of us is to start open discussions on how to benefit from the current economic climate. This may just be scenario building.
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  #19466 (permalink)  
Old 7th October 2016, 02:54 PM
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Default Re: Economicwatch

Quote:
Originally Posted by migiets View Post
That is the big question. It seems people want to partake of the Forex subsidy by fire by force.

Iam surprised you have also not come out to ask the government for Forex to plant your palm trees. That is the in-thing now. Setup an import substitution venture that has about 90% local content and then ask the FG for Forex. Na wa for this Contraption.
Not so fast bro, I will also need fx subsidy to setup my oil mill - i need to import machinery and additives to be able to produce palm oil
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  #19467 (permalink)  
Old 7th October 2016, 03:03 PM
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Default Re: Economicwatch

Quote:
Originally Posted by NiGSoro View Post
You are right, there are breeds that can be harvested from 3 years but the challenges are huge when you are not doing this as a full time venture. In my own case, I got my fingers burnt big time experimenting with cocoa farming before I had to move to the less risky and more rugged palm trees venture, albeit on a moderate scale. My cousin who is fully into cocoa farming is not complaining. For instance when it was NGN160/USD his croc was not smiling but now that it is about NGN450/USD, the guy is now a big boi in my town. It is now a sellers market and that is why you see that it is only the buyers that are complaining. Even about the price of garri

However, where I see government coming in is in the area of creating enabling environment for stuffs that can grow the economy. For example for willing entrepreneurs to setup chocolate factories rather than the current practice of exporting raw cocoa. This reminds me of the report about CIV exporting cocoa beans worth $2.5b while the company that bought those seeds to produce chocolate was doing an annual turnover of $10b!

As things stands today, one reality is that we can not feed ourselves and it is really a shame on everyone of us.

Thank you for stating the fact that the money is in the processing of the Raw materials, but not in the exporting

But i want to ask, the people that you want government to encourage to set up Chocolate factories, are they going to need Forex?

Like you said it will be better if willing entrepreneurs are are given a good environment to set up chocolate factories, the same applies to a willing entrepreneur that has already setup a tomato processing factory,government should give them all the support they need, because that is where the money and benefits lie.

It is the same way we have been exporting crude oil for a long time now and have not derived benefits of processing it locally
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  #19468 (permalink)  
Old 7th October 2016, 03:19 PM
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Default Re: Economicwatch

Quote:
Originally Posted by migiets View Post
How will the power sector privatization work well when they are hugely indebted to by the various governments parastatals and security outfits. Let government settles her debts to them and you will see them expand. I hope you know the borrowing cost of the banks. You have to borrow at a high rate and then operate in a fixed tariff structure. How does that work?.
A lot of those debts as I understand are Legacy debts and coming at a time when there is a slump in government earnings means that can has to be kicked down the road. The inability of the government to pay those debts is why the new MYTO was hurried (to pass some of the revenue gap to the public) and is still facing legal challenges. I think the current MYTO allows the DISCOs to disconnect those government offices if they are not paying their bills. I agree that I do not have all the facts to hand but if the government offices are not paying their bills, why haven't the DISCOs disconnected them and then negotiate deals with manufacturing concerns who will pay them instead to boost our economic output ?
Why haven't those DISCOs put out paid editorials in the papers and on their websites of which Government agencies exactly are owing, how much they are owing and for what periods ? Naming and Shaming still works even as shameless as the country seems to have become mind you (just see all those people like Amosu the past CAS who have returned money to EFCC already or are negotiating plea deals).

Another question people should be asking is why those debts came about in a time of Economic boom when the economy was awash with money, but if you ask this question, because of politics, you are instantly labelled as hating the past government, you can see the chicken and egg situation we find ourselves ?

Fashola talks a good game and has delivered comparatively well so far, at least the power sector hasn't collapsed and in fact attained peak generation figures within the year (although we have no data for comparison with earlier periods which is actually a major part of our corruption problem. When systems are opaque, nobody knows what is actually going on).
I can supply you some graphs that depict the power situation this year for example, I know the worst months and can tell you that things have significantly improved over the past 2 months for example and that is because that sector is now more transparent, nobody could do that in the past because it was a black box and you know how black boxes facilitate corruption.

I always say the best time to judge this government is during the next election, look at where we are now and where we are then. It is easier for me to do so personally because I know that what we are going through now was bound to happen because of our behaviour in the past. What we need to ask ourselves individually is what we are doing to ensure the mistakes of the past are not repeated. We have a country that is still worth saving and it is not about whether Buhari, APC or PDP wins or loses the next election or even who the next President of this country is, it is about saving the country.

Note: I wish Oga Netotse was contributing to this discussion due to his involvement in that sector.

Last edited by duduspace; 7th October 2016 at 03:35 PM.
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  #19469 (permalink)  
Old 7th October 2016, 03:35 PM
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Default Re: Economicwatch

Quote:
Originally Posted by Getthere View Post
Thank you for stating the fact that the money is in the processing of the Raw materials, but not in the exporting

But i want to ask, the people that you want government to encourage to set up Chocolate factories, are they going to need Forex?

Like you said it will be better if willing entrepreneurs are are given a good environment to set up chocolate factories, the same applies to a willing entrepreneur that has already setup a tomato processing factory,government should give them all the support they need, because that is where the money and benefits lie.

It is the same way we have been exporting crude oil for a long time now and have not derived benefits of processing it locally
We can both do an exercise to identify a broad list of what exactly government can offer:

1. Access to land and accelerated issuance of C of O;
2. Tax holiday;
3. Export incentives;
4. High tariff on imported (chocolate, tomato paste etc); etc

Please add to the list
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  #19470 (permalink)  
Old 7th October 2016, 04:57 PM
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Default Re: Economicwatch

Travelex sells dollar to travellers at N356 - Punch Newspapers

hopefully this should reduce some pressure in the parallel markets
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  #19471 (permalink)  
Old 7th October 2016, 06:01 PM
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Default Re: Economicwatch

Quote:
Originally Posted by migiets View Post
That is the big question. It seems people want to partake of the Forex subsidy by fire by force.

Iam surprised you have also not come out to ask the government for Forex to plant your palm trees. That is the in-thing now. Setup an import substitution venture that has about 90% local content and then ask the FG for Forex. Na wa for this Contraption.

You be proper waka-about wayo man
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  #19472 (permalink)  
Old 7th October 2016, 06:16 PM
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Default Re: Economicwatch

Quote:
Originally Posted by NiGSoro View Post
Not so fast bro, I will also need fx subsidy to setup my oil mill - i need to import machinery and additives to be able to produce palm oil

Yes of course, .....but not for eternity like most industries have been doing for several decades, siphoning forex out of the country in over-invoicing like those on minimum wage have been doing

Seriously now,....post start-up stuff like additives, testing/laboratory chemicals and spare parts can be taken care off from export earnings to be generated. A lot of the mechanical parts can be produced locally too using steel materials from Owode Onirin in Lagos. There are quite a handful of technicians who are very good at working on machining equipment and foundry.
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  #19473 (permalink)  
Old 7th October 2016, 06:23 PM
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Default Re: Economicwatch

Quote:
Originally Posted by NiGSoro View Post
Just thinking aloud, for some Nigerians, who engage in legit businesses, this period may be the most success period of their lives.

My challenge to all of us is to start open discussions on how to benefit from the current economic climate. This may just be scenario building.


Oga mi,....but some arm-chair analysts do not see opportunities and will keep waiting for govt economic plan. hiohiohiohiohiohio
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  #19474 (permalink)  
Old 7th October 2016, 06:31 PM
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Default Re: Economicwatch

Quote:
Originally Posted by NiGSoro View Post
We can both do an exercise to identify a broad list of what exactly government can offer:

1. Access to land and accelerated issuance of C of O;
2. Tax holiday;
3. Export incentives;
4. High tariff on imported (chocolate, tomato paste etc); etc

Please add to the list

Oga mi, ....nos 2-4 can be pursued with the govt after you have staked your money and commenced production. Entrepreneurship is not for the fearful and fain-hearted

I don"t think number 1 is a biggie at all,........because people still negotiate land deals without the govt involvement.
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  #19475 (permalink)  
Old 7th October 2016, 06:42 PM
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Default Re: Economicwatch

Quote:
Originally Posted by Getthere View Post
This company is not up to a year old,it needs forex for importation of technology which Nigeria does not have,the cans for the tomato i do not know if it is manufactured in Nigeria,the equipment used at the factory is imported, some other additives am sure are imported,This company in my own opinion needs all the support it can get to survive because in the long run it will be for the benefit of Nigeria,


In Nigeria, we have 2 major Breweries that have been in existence for the past many years, yet they are groaning and complaining of non access to forex


So i wonder why they should rank low in terms of Forex allocation.




This is because of the attractions it offers,......ask Pa Migiets. This would not have continued if the "backward integration" policy introduced back in the day had not been abandoned by successive govts that stupidly bought into IMF liberalisation nonsense......and regretably, we still have remnants of such school of thought still raring their heads with the insanity
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  #19476 (permalink)  
Old 7th October 2016, 08:07 PM
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Default Re: Economicwatch

Quote:
Originally Posted by Getthere View Post
This company is not up to a year old,it needs forex for importation of technology which Nigeria does not have,the cans for the tomato i do not know if it is manufactured in Nigeria,the equipment used at the factory is imported, some other additives am sure are imported,This company in my own opinion needs all the support it can get to survive because in the long run it will be for the benefit of Nigeria,


In Nigeria, we have 2 major Breweries that have been in existence for the past many years, yet they are groaning and complaining of non access to forex

So i wonder why they should rank low in terms of Forex allocation.
Let us not forget that some also collect FOREX and sell on the black market according to SLS. Not all those who make noise are genuine. This is not to say this particular company is lying, just that in a situation where scarcity exists, accusations like this are bound to come up. Hopefully, the convergence will start soon.
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  #19477 (permalink)  
Old 7th October 2016, 08:11 PM
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Default Re: Economicwatch

Thank God for BudgIT, nothing to illustrate a problem better than one of their Infographics. Since I've been shouting about the problem pipeline vandalization has been causing, I've not found anything to illustrate it well but now I have one courtesy of BudgIT.
If you have been scratching your head about the major reasons for the current suffering in the country, do not look beyond this graphic.
For me, this is the price of taking on people who wanted to be bigger than the Nation and its government.

Note: This is only for Forcados which is I think the 2nd largest export stream. For about 2 months, we had the 4 largest export streams down so you can do your own extrapolations.
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File Type: jpg Oil-production.jpg (113.0 KB, 0 views)

Last edited by duduspace; 7th October 2016 at 08:20 PM.
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  #19478 (permalink)  
Old 7th October 2016, 09:28 PM
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Default Re: Economicwatch

Quote:
Originally Posted by Waves View Post
Quote:
Originally Posted by horlads View Post
That is one side of the picture. Let me explain

They also need to tell us those who brought in Forex so we can do a net off. FPIs would come through banks and exit through them, along with their interests earned. It will be unbalanced to look at the picture at exit without looking at the corresponding side at entry.

On a side note, all the talk about FPI and FDI will not solve our problems in the long term. Those categories of investment will take out more FX than they brought in. FPIs in the short to medium term (when they buy bonds and treasury bills) and FDIs in the medium term to long term. For instance, MTN has also taken out more $$ in profits than they brought initially.

I'll rather call for investments (local or foreign) that can boost and balance our export basket...
Oga Waves and Horlads, abeg let me drag both of you back to this discussion, particularly to the bolded by Oga Horlads. I have now found the Inflow portion of the FOREX for the period (2011 to 2015) and I'm attaching both to this post.
I'm focusing on the income portion as recommended by Oga Horlads and although it is a highly summarized data, I can't help thinking to myself, that this FPI thing is not really of a long term benefit to the country (at least in the way its worked out in the period under review).

If you take note of the Inflow portion, FPI + FDI + Financial Services = 44 + 31 + .3 = $75.3b (approx).
Now the Outflow portion gives a figure of $78.3 for Financial Services (and I think it is safe to assume that all the investment classes are encapsulated in that figure).

Now taking the position that FDI stays for longer periods and Financial services is minimal, it stands to reason that a lot of the outflow is for FPI.

Now I will make a massive assumption that FDI has a gestation period of 5 to 10 years and pick a midpoint of 7.5 years (rounded to 7 for ease), i.e lets assume 1/7th of the FDI sum is repatriated (approx $5b), now lets even 'generously' triple that amount (making allowance for profits, previous FDI still repatriating money and other sundry outflow) = $15b, (subtracted from the outflow of $78.3 = $63b) this gives FPI roughly a profit of $20b for investing $44b (close to 50% profit margin for investments less than 1 year gestation).

Considering that a lot of our inflow from oil was $394b in that same period, how useful really was that $44b of FPI to command such a premium ? I think as well that a lot of this money is probably also repatriation of the proceeds of corruption away from the country but no matter how you look at it, there is a lot of money that left this country which probably shouldn't have.

I look forward to hearing from both of you on this.

NOTE: I know I made many assumptions that might not be remotely realistic and will be glad for you to point them out, I also found it funny when I realized that Diaspora remmitances was even more than double the much vaunted FPI (considering Diaspora remittances stay for much longer in the country).
Attached Images
File Type: jpg FOREX inflow.jpg (662.5 KB, 0 views)
File Type: jpg FOREX outflow.jpg (928.1 KB, 0 views)

Last edited by duduspace; 7th October 2016 at 09:38 PM.
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  #19479 (permalink)  
Old 8th October 2016, 07:02 AM
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Default Re: Economicwatch

Quote:
Originally Posted by NiGSoro View Post
We can both do an exercise to identify a broad list of what exactly government can offer:

1. Access to land and accelerated issuance of C of O;
2. Tax holiday;
3. Export incentives;
4. High tariff on imported (chocolate, tomato paste etc); etc

Please add to the list
Erisco in question has
1. access to land already, factory is already setup,
2.i do not know if he is asking for tax holiday
3.I do not know if export incentives is a priority for him, he has not even met up to 5% of local demand
4.


He is only asking for dollars to do his business ,he was not asking for subsidized dollar, he said he applied for dollars, up to 2 months he is yet to get from his bankers
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Old 8th October 2016, 10:48 AM
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Default Re: Economicwatch

Quote:
Originally Posted by migiets View Post
That is the big question. It seems people want to partake of the Forex subsidy by fire by force.

Iam surprised you have also not come out to ask the government for Forex to plant your palm trees. That is the in-thing now. Setup an import substitution venture that has about 90% local content and then ask the FG for Forex. Na wa for this Contraption.
The funny thing is these are the people that called for devaluation so that import will be expensive so they can produce the goods to compete with imports...

This forex issue, I think Individuals should be block from having dorm account.. yet to see any sense in it..
and I think we need big international banks with deposit and retail banking in US and UK...
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