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BRICS Development Bank to Rival IMF, the World Bank

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Geoffrey Wood, Professor of International Business said that the new BRICS Development Bank can rival the International Monetary Fund (IMF) and the World Bank if it can reconcile its competing agendas.

Leaders of the so-called BRICS nations – Brazil, Russia, India, China and South Africa – met in Durban to put together the new bank, which will initially focus on infrastructure and development projects.

The BRICS nations make up 40 per cent of the world’ s population and 17 per cent of world trade and though where it will be based and how much capital it will have is yet to be decided Professor Wood, of Warwick Business School, can see it becoming a big attraction for emerging markets.

“The track records of the IMF and World Bank austerity policies are very mixed, and there is little doubt that many nations would welcome an alternative to these bodies” said the Warwick Business School Professor.

“This is likely to make the BRICS development bank hugely influential if, indeed. But, in the short term, this is contingent on the extent to which it reconciles the competing agendas of the BRICS countries.

“Most people assume that the current economic crisis has led to a great strengthening of the power of the World Bank and the IMF, and that this power is largely uncontested. What is interesting however, are the limits of the power of these bodies. The aftermath of the Asian financial crisis saw a number of countries in Asia – and Russia as well – stockpiling foreign exchange reserves precisely so they did not have to make recourse to the IMF or World Bank again.

“The proposed BRICS development bank represents an important new development, that, potentially further circumscribes the influence of these bodies.

“The BRICS development bank will be extremely attractive to many developing countries who have had their fingers burned through engaging with the World Bank and the IMF”

In theory, the BRICS bank could erode the role and status of the IMF and the World Bank. However, the details of how the BRICS bank is governed and how it will operate remains unclear.

What is even unclear is the amount of initial capitalization; very different sums of money are being bandied about.

It will certainly be some years before the bank is operational, but in the long term it could have a significant impact.

“The bank would have access to a huge and growing market, though the power struggle between the nations involved could lead to difficulties” said Professor Wood.

“China holds vast foreign exchange reserves and is likely to be, in some manner or other, the dominant player in the BRICS bank” he added

As the weakest BRICS member, South Africa has perhaps most to gain from establishing the bank, although all may gain from the international clout the new body may confer.

“South Africa is the smallest BRICS member and has become increasingly reliant on minerals exports, which provide volatile revenue streams and, ultimately are a depleting resource.

South Africa could be faced by a balance of payments crisis in the future, and the BRICS bank could potentially be a lifeline for it”        


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FG Sacked IST Members over Fraud- Ahmed

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Mrs Zainab Ahmed, minister of Finance Budget and National Planning, has said the Federal Government sacked some past members of the Investments and Securities Tribunal (IST) as they indulged in corruption.

FG Sacked IST Members over Fraud- Ahmed

Inaugurating the new members, the minister charged the new members to eschew corruption and be forthright.

Bar. Azi Amos Isaac was appointed as Chairman for a five year term and Bar. Nosa Smart Osemwengie, was re-appointed as member for a second term of four years.

“The problem with the tribunal has been infighting amongst members, lack of industrial harmony and series of complaints bordering on maladministration.

“This has been the bane of the tribunal and a source of embarrassment not only for the Ministry of Finance but for the government in general,” Ahmed said.

The new chairman, Azi, assured the finance minister that, “the teething issue of restiveness has been addressed since he assumed duty,” adding that, “The place is calm and the staff have become very supportive.”

Azi said since 2003, the tribunal has “given judgment in the value of assets worth over N844 billion and that from 2017 to date, they have given decisions in monetary value totalling over N28bn.

“It has not failed in its adjudicatory responsibility.

“It has carried out its assignment with candour and integrity and intends to improve on what has been on ground.”

 


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CBN Bans Customer-to-Customer Forex Transfer

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Central Bank of Nigeria (CBN) has banned transfer of foreign exchange (forex) from one customer to another.

CBN Bans Customer-to-Customer Forex Transfer

According to the apex bank, forex cash lodgements into domiciliary accounts can only be done by the account owners henceforth.

An internal memo available in the media space explains that the new guidelines are necessary to review the utilisation of inflows into customers domiciliary accounts.

The circular states: “Forex inflows cannot be credited to customers until the legitimacy of funds is established.

“They can have unfettered access by telegraphic transfers up to a limit of $40,000 monthly for payment of medical bills, school fees, subscription to professional bodies subject to existing CBN guidelines.

“Transfers from one customer to another is prohibited. Transfer within related companies is allowed subject to a limit of $50,000 per month.”

It recommended that proceeds from non-oil exports should be sold to banks, used for repayment of dollar term loans, and self-utilisation for trade transactions for LC, bills and Form A.

Also oil export proceeds from E&P companies are to be used to pay contractors and service providers employed by the oil companies in addition to the recommended uses for non-oil FX proceeds.

Offshore forex inflows from other Nigerian banks and internal account to forex transfers sourced from offshore inflows are to be used for trade transactions subject to eligibility for E-Form M.

“Upon confirmation of the legitimacy of the inflows, customers can have unfettered access, subject to a maximum of $50,000,” the document read.

“Utilisation for trade transactions subject to processing of eligible trade transactions using E-Form M. Payment for services must be backed with demand note from offshore beneficiary and other regulatory documents.

“Related party transfers are allowed to the maximum of the inflow received. The transfer request should be backed by a signed instruction from the account holder.” Payment of government fees and levies are also allowed to the maritime, oil and gas, aviation. government parastatals and export processing zones.

 


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Stanbic IBTC, Standard Bank, Listed Among Top African Corporate Brands

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Stanbic IBTC Holdings PLC and its parent company, Standard Bank, have emerged amongst the top winners of the 2020 Tech Times’ Africa LinkedIn Corporate Brand Awards.

The Stanbic IBTC Group emerged the second position in the category, with total votes of 3,515, out of 24 firms nominated for the award. Standard Bank placed the fourth 2,494 votes.

Nominations for this award opened to the public on July 1, 2020 and closed on July 14.

Shortlisted nominees were announced on August 24 while voting commenced immediately and voting ended on September 8, 2020.

The Corporate Brand Awards was instituted by Tech Times’ Africa, an online platform for leading technology, innovation, and startup stories.

Expressing his delight on the awards, Dr Demola Sogunle, Chief Executive, Stanbic IBTC Holdings PLC, said that both Stanbic IBTC Holdings PLC and Standard Bank had been deliberate and consistent in making a remarkable impact in Africa’s financial sector.

“Our sincere appreciation goes to the organisers of the Africa Corporate Brands Awards and to every member of the public who voted. This is a reflection of the high level of trust and confidence that the public has reposed on us,” he added.

Dr Sogunle further said that Stanbic IBTC Holdings PLC would remain relentless in portraying the organisation as one of the most influential corporate brands in Africa.

He stated: “Stanbic IBTC Holdings PLC and Standard Bank have relentlessly contributed to driving the growth and development of the African financial ecosystem. These awards affirm our efforts, and we are encouraged to raise the bar continually.”

The Africa Corporate Brand Award is designed to identify and recognise outstanding companies. It also projects their achievements and impacts on African society and the world at large.


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