Markets Around Africa - Nigeria Tightens Exchange Control
Dr Soleye, who was giving details of this year's budget at a news conference, said that the percentage of net income allowed as home remittance to expatriates employed in both the public and private sectors of the economy had also been reduced from 50% to 25% of net income. He said that although the basic travel allowance (BTA) was still 100 naira per annum, the amount of naira which could be taken out of the country had been reduced from 50 to 20 naira.
The minister said that business travel allowances would remain suspended until the economic situation allowed a review, while the maximum amount allowed for freight of personal effects was now 2,000 naira per person.
On technical services and management fees, the Minister said that the existing rate of 2% of the net profit before tax would apply during this fiscal year. "Payment of technical service fees and management fees will not be allowed except in exceptionally deserving cases such as manufacturing companies where the transfer of high technology is involved", he said.
Dr Soleye said that the present 20% consultancy fee payable in foreign ex change would continue to apply, adding that consultancy fees in respect of pre-feasibility and feasibility studies would not be allowed since these could be done locally. He said that a royalty fee of 1% of sales value would continue to apply this year while agreements in respect of royalty fees would continue to be cleared with the Federal Minister of Industries and Commerce. According to him, existing measures in respect of repatriation of dividends, proceeds of sales of shares and director's fees will continue to apply during this fiscal year. Dr Soleye reaffirmed that remittances for undergraduates and pro- fessional courses for which facilities are locally available would not be allowed to new applicants. In the case of postgraduate courses, he said foreign exchange would be made avail- able provided such courses were not obtainable in Nigerian universities.
The exchange control measures also affected commissions to agents or con- firming houses serving as intermediar- ies between exporters and importers, which the Minister said had been re- duced from a maximum of 4% to 2% of the value of consignments. Dr Soleye also announced the abolition of the compulsory advance deposit on imports.
Trial for economic sabotage
The public tribunal has begun trying two men on charges of acting with intent to sabotage the country's economy. They are Samuel Amu Okai, a purchasing officer of the Produce Buying Company (PBC) of the Ghana Cocoa Board, and Kobina Odoom, an employee of New Line Publishing Agency.Samuel Okai is alleged to have divulged classified information on Ghana's cocoa purchases to Kobina Odoom who had in effect passed this on to sources in London. According to the prosecution, in February this year, there were reports that some officials of the PBC had leaked statistical figures on cocoa and coffee purchases in the country to a group of freelance journalists in the UK. Unauthorised release of such figures caused prices of cocoa to fall on the world market.
EEC aids for drought victim
The European Community has set aside 15,600,000 European currency units (ECU), to provide emergency aid for 13 African countries hit by drought. In addition 50,000 tons of cereals are to be provided to some of the countries under the Community's programme to combat hunger.The latest aid allocation announced by the European Commission in Brussels are: Zambia 500,000 ECU; Benin 500,000 ECU; Ethiopia 2,500,000 ECU; Ghana 2,000,000 ECU; Upper Volta 500,000 ECU; Mali 850,000 ECU; Mauritania 2,000,000 ECU; Niger 1,500,000 ECU; Senegal 2,000,000 ECU; Sudan 500,000 ECU Chad 2,000,000 ECU; Togo 500,000 ECU; and Jibuti 250,000 ECU.
The emergency food aid programme includes 15,000 tons of cereals for Mozambique, 15,000 tons for Zimbabwe, 8,000 tons for Ghana and 8,000 tons for Senegal.
The European Commission has also announced a grant of 350,000 ECU to Madagascar to help victims of the cyclone which recently devastated parts of that country.
Trade imbalance with USSR
Nigeria has called on the Soviet Union to rectify the trade imbalance between them. This was stated by the Chief of Staff, Supreme Headquarters, Brig. Tunde Idiagbon, while exchanging views with the Soviet Ambassador in Nigeria, Vladimir Snegyrev.Brig. Idiagbon expressed disappointment with the Soviet Union for buying less goods from Nigeria. He hoped that the trade imbalance between the two countries would change for the better. He remarked that the Federal Military Government would intensify efforts to complete the Ajaokuta steel complex project.
Mr Snegyrev had earlier told the Chief of Staff that the Soviet Union wished to assist Nigeria economically especially with the Ajaokuta steel project. The Ambassador said that his government would ensure that co-operation between the two countries grows stronger while the imbalance of trade would be rectified.
