The International Monetary Fund (IMF) has warned Nigeria and other emerging market countries taking loans from China to consider the terms of such facilities, especially their compliance with the Paris Club arrangements.
Speaking yesterday at the ongoing IMF/World Bank Spring Meetings in the United States, Director, IMF Monetary and Capital Markets Department, Tobias Andrian, said there was nothing bad in borrowing from China, except that the terms of such loans are always questionable.
He said: “Loans from China are good, but the countries should consider the terms of the loans. And we urge countries that when they borrow from abroad, that the terms are favourable for the borrower, and should be conforming to the Paris Club arrangements.”
Andrian, who spoke on the Global Financial Stability Report (GFSR), said: “Let me reiterate that in many frontier markets, we see that the share of debt that is not conforming to the Paris Club standards is on the rise. And that means that if there is any debt restructuring down the road one day, that can be very unfavourable to those countries. So, the borrowing terms, the covenants, are extremely important. And we do see a deterioration in that aspect.”
Data from the Debt Management Office (DMO) showed that Nigeria’s total public debt rose to N24.39 trillion or $79.44 billion as at December 31, 2018 representing a year-on-year growth of 12.25 per cent. The 2018 debt stock is higher than that of 2017 by N2.662 billion.
DMO said that as at June 2018, loans obtained by the Federal Government from China represented about 8.5 per cent of Nigeria’s external debt and that they were taken under concessionary terms. But Nigeria was last year seeking $6 billion from China to fund the construction of the Ibadan-Kano rail line project.
Andrian said Nigeria had been borrowing from international markets, which gives the IMF some worries. He, however, noted that such loans are good as they allow the country to invest more, but expressed concerns over rollover or repayment risks.
“At the moment, funding conditions in economies such as Nigeria and other Sub-Saharan African countries, are very favourable but that might change at some point. And there is risk of rollovers and whether the need for refinancing can be met in the future,” the IMF director said, advising that Nigeria should seek higher capital for its banks through recapitalisation and also tackle rising non-performing loans in the sector.
Adrian said that where there are financial stability concerns, authorities are expected to use prudential tools, such as higher capital in the banking system and more conservative underwriting standards to reduce financial stability risks.
He said: “We advise countries that where those downside risks are increasing, to take more steps to ensure that vulnerabilities are not rising too much. Addressing non-performing loans is a first order importance for financial stability. Many countries have tackled that by developing secondary market for non-performing loans. And by being aggressive in writing off non-performing loans and through provisioning and use of improved accounting standards through International Financial Reporting Standards 9 (IFRS 9)”.
According to Adrian, many countries do not have all the tools that are necessary to ensure that the system is financially stable, hence the financial stability concerns can feed into monetary policy decisions. He, therefore, urged monetary policy makers to also look at risks to financial stability both in the short term and in the medium term.
As a way out of the crisis, the IMF director advised policymakers to develop and deploy macro-prudential tools which can mitigate vulnerabilities and make the financial system more resilient.
“Emerging markets facing volatile capital flows should limit their reliance on short-term overseas debt and ensure they have adequate foreign currency reserves and bank buffers. Besides, monetary policy should be data dependent and well communicated,” he said.
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Israel’s First Lady, Rivlin is dead
Israel’s First Lady, Nechama Rivlin, 73, died on Tuesday morning after battling with a respiratory disease for years, the Presidential Residence announced.
She died at Beilinson Hospital in Petah Tikva, The Jerusalem Post reports.
Three months ago, Rivlin underwent a lung transplant.
Rivlin suffered from pulmonary fibrosis and required the constant use of a portable oxygen tank, which was attached to her even during official ceremonies she attended with her husband.
Prime Minister Benjamin Netanyahu said in a statement: “Together with all the citizens of Israel, my wife Sara and I express deep sorrow at the passing of the wife of the president, Nehama Rivlin.
“We all prayed for her healing during the recent period in which she fought bravely and with all her might for her life.
“We extend our heartfelt condolences to the president and to all his family. May her memory be a blessing,” he said.
Rivlin was born in Moshav Herut, an agricultural community in today’s central Israel.
Her parents, Drora and Mendi, emigrated from the Ukraine and were among the pioneer founders of the community.
In 1971, she married Reuven Rivlin and the couple lived in Jerusalem.
Rivlin had a BSc in Botany and Zoology. As the first lady, she focused her activities on the environment, nature and art, as well as children with special needs.
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JUST IN!!! IT’S TIME FOR BIAFRA TO STAND AS A NATION – INDIA PRIME MINISTER
The Prime Minister of India, Narendra Damodardas Modi said, is not that Nigeria is too big to be one Nation, but because of Tribal and Religious problem.
The only way out is to allow Biafrans form their Biafra Republic and become a Christian Nation, Northerners are Free to go and become the Muslim Nation.
India is bigger than Nigeria, but we don’t have any Religious or Tribal problems, He commend IPOB for their resoluteness and steadfastness, , He made this known after watching IPOB members doing their Peaceful Rally/Protest with their flag in India. Those of you who thinks Biafra is joke, you’ll be surprised, just keep watching!
Theresa May resigns: British Prime Minister cry tears when she decide to step down on June 7
It’s been the honour of my life to serve the country I love’: Theresa May breaks down as she announces she will stand down on June 7 in emotional announcement and pleads for politicians to find Brexit compromise that eluded her
PM spent the night at home in Berkshire with her husband Philip before returning to Downing Street today
Theresa May announce plans to step aside as Tory leader on June 7 and leave No10 over the summer
Mrs May began the day with a meeting with the Tories’ backbench 1922 shop steward Sir Graham Brady
She then address the nation from Downing Street to explain why she has decided to leave ‘the job I love’
It will be recalled that her predecessor, David Cameron also resigned in what can be seen as an abrupt end to his six-year premiership, after the British public took the momentous decision to reject his entreaties and turn their back on the European Union.
There is serious problem facing great Britain
Pope Francis announces new rule for Catholics
Catholic Pontiff, Pope Francis, on Thursday, announced that henceforth, bishops would be accountable for sexual abuses or cover ups in their jurisdictions.
The pronouncement, which signalled a change in Catholic Church law, makes reporting of sexual cases obligatory for clerics and allows anyone to complain directly to the Vatican if necessary.
The papal decree, which covers abuse of children and adults, also obliges every Catholic diocese in the world to set up simple and accessible reporting systems and encourages local churches to involve lay experts in investigations.
The decree, whose preparation was reported first by Reuters in April, is the second of such papal provision since a summit on abuse by senior Church bishops at the Vatican in February.
It sets time limits for local investigations and the Vatican’s response to them and allows for retroactive reporting.
It also says bishops with conflicts of interest should recuse themselves from investigations and that they can also be held accountable for abuse of power in sexual relations with adults.
The 19-article decree called “Vos Estis Lux Mundi” (You Are the Light of the World), raises 16 to 18, the age of adulthood in cases of sexual abuse.
It also covers possession of child pornography.
The decree says local Church officials cannot order those, who report abuse to remain silent and that senior bishops should make provisions to prevent documents from being destroyed by subordinates if needed.
It directed that clerics should follow local law on whether they are obliged to report alleged sexual abuse to civil authorities.
Fire breaks out at Notre Dame Cathedral in Paris
A huge fire swept through the roof of the famed Notre-Dame Cathedral in central Paris on Monday evening, sending flames and huge clouds of grey smoke billowing into the sky.
The flames and smoke plumed from the spire and roof of the gothic cathedral, visited by millions of people a year.
A spokesman for the cathedral told AFP that the wooden structure supporting the roof was being gutted by the blaze.
The fire service said the blaze could be “potentially linked” to ongoing renovations.
President Emmanuel Macron cancelled a major televised policy speech he was due to give on Monday evening over the “terrible fire ravaging Notre-Dame.”
Paris mayor Anne Hidalgo in a tweet described it as a “terrible fire”.
“The Paris fire service is trying to control the flames,” she wrote on Twitter, asking residents to respect the security cordon thrown up around the site.
A spokesperson for the cathedral said the fire, which comes as French Catholics prepare to celebrate Easter, broke out at around 1650 GMT.
Fire trucks could be seen speeding through Paris towards the scene on the Ile de la Cite — an island in the Seine at the heart of Paris.
The Paris police department in a tweet called on residents to avoid the area and to “make way for rescue vehicles”.
US President Donald Trump in a tweet said: “So horrible to watch the massive fire at Notre Dame Cathedral in Paris. Perhaps flying water tankers could be used to put it out. Must act quickly!”
Hundreds of people gathered on the bridges of Paris downriver to witness the scene, some filming the images with their smartphones, an AFP reporter said.
A burning smell filled the air.
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