Banks, fuel supply crippled as Labour strike begins

14-day ultimatum didn’t get to me, says Labour minister
•Strike could trigger another recession, say experts, OPS
•React to CBN’s alarm on economy

Distribution of petroleum products, banking and other essential services were grounded today as workers in the petroleum, financial, maritime and other sectors of the economy began a nationwide strike as directed by organized labour.

This is even as stakeholders in the organized private sector are expressing worries over effects of the strike, saying it could send the economy back into recession.

The strike, according to labour, is essentiallyto compel the Federal Government to announce its figure and ensure completion of work on the new national minimum wage

This came as a last-minute effort by the Federal Government to prevent the strike failed yesterday.

Consequently, the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), including its Petroleum Tanker Drivers (PTD) branch, Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), National Union of Banks, Insurance and Financial Institutions Employees (NUBIFIE), Association of Banks, Insurance and Financial Institutions (ASSBIFI), National Union of Electricity Employees (NUEE), and Maritime Workers Union of Nigeria (MWUN), will from today withdraw their services nationwide.

Similarly, workers in the aviation, transportation (railway), construction, manufacturing, hospitals, schools, among others, are expected to also stay away from their duty posts.

In the same vein, public workers in government offices, ministries, departments, agencies, (MDAs) educational institutions, and others are expected to stay at home.

Labour calls out workers to strike

It will be recalled that the Nigeria Labour Congress, NLC, Trade Union Congress of Nigeria, TUC, and United Labour Congress of Nigeria, ULC, had on Tuesday directed all their affiliate unions and state councils nationwide to begin strike

President of ASSBIFI, Mrs Oyinkan Olasanoye, told journalists yesterday that as directed by TUC, their umbrella body, the association had informed their management that members would not report for today, as banks and other financial institutions would be shut.

She said: “We have sent letters to banks, insurance and other management in the financial sector that from tomorrow (today), our members will be joining the nationwide strike directed by organized labour.

“So, I can tell you that the sector will be shut from tomorrow (today). We have already directed our members to comply fully.”

Also, President of NUPENG, Prince Williams Akporeha, told Vanguard: “Our members nationwide will comply with the directive of ULC in particular, which is our umbrella body, as well as directive jointly issued by organized labour. So, there will be no loading and discharge of petroleum products during the duration of the strike.”

Meanwhile, leaders of organized labour yesterday directed workers to go ahead with the nationwide strike from today as scheduled after attempts by the Federal Government to persuade them not to go ahead with the strike yielded no positive results.

However, the Federal Government disclosed that the Minimum Wage Tripartite Committee would resume sitting next Thursday to continue the negotiation process.

Minister of Labour and Employment, Senator Chris Ngige, disclosed this to journalists after meeting behind closed doors with some members of the Tripartite Committee.

Vanguard gathered that the meeting was to persuade labour leaders to consider government’s position on the planned strike and also to update them on government’s decision.

He said: “One of the ways we are going to show it is by implementing the new national minimum wage and this we need to fix a base for the lowest paid worker in Nigeria.

“We are resuming next week, precisely on Thursday, October 4, and the meeting may spill over to October 5, as we normally use two days for the meeting. So, we are reconvening the meeting on October 4, and all the process have been put in place.”

We don’t need the strike — Ngige

He noted that the labour leaders havd been informed about it and were expected to communicate to their members, saying “we do not need to have any strike in the country.”

Ngige said further: “Part of our consultation means that the Economic Management Team which is managing the entire economy of the country would have something to work on.

“Already they are working on it and the National Salaries and Wages Commission and it is expected that before that meeting on October 4, they would have been through with the work. “So, everything is subject to negotiation, so on Thursday, October 4, we are going back to the negotiating table.”

Ngige claimed that the 14-day ultimatum issued to the Federal Government did not get to him, stressing that “we would have addressed it scientifically the way it should be done.”

He also said the Federal Government was optimistic that the committee would wrap up in October and that all other processes as they concerned the new national minimum wage for workers in the country would be completed.

Also speaking to journalists, President of NLC, Ayuba Wabba, said the outcome of the briefing by the minister would be communicated to their members.

He said: “As you are aware, there is a meeting where the Minister of Labour tried to address us because since the time we issued this notice, there was no consultation or meeting.

“This is the first meeting and he tried to update us on what they are trying to do. That briefing had to be communicated to our membership and clearly from where we are, you also know our demand.

“Our demand is that the Tripartite Negotiating Council should be called back to conclude its assignment. We are taking back the discussion we had with him, especially the update on what they are doing which before now, we are not aware because there was no consultation.”

Also speaking, the Deputy President of ULC, Igwe Achese, said the meeting with members of Tripartite Committee was an interactive one.

“I want to say that our demand stands until government complies,” he said.

In his earlier briefing before the meeting, Wabba said the strike would be total and comprehensive.

“In compliance with this mandate, all workers (in public) and private sectors at all levels across the country have been directed to comply.

“All public and private institutions, offices, banks, schools, public and private business premises, including filling station, are to remain shut till further noticed,” he said.

Desist from panic buying of fuel, says NNPC boss

Meanwhile, Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Dr. Maikanti Baru has appealed to motorists and other consumers of petroleum products across the country not to engage in panic buying of products over the Nigeria Labour Congress, NLC, planned industrial action.

In a statement in Abuja yesterday, Baru said the Federal Government was seriously engaging the NLC on the issues it raised.

Baru affirmed that the country has self-sufficiency of 37-day petroleum Premium Motor Spirit, PMS, otherwise known as petrol, assuring that all the NNPC depots across the country, including private ones engaged by the corporation on throughput basis, have abundance of petroleum products to meet the needs of Nigerians.

Baru said all its depot managers have been instructed to intensify products loading and other activities in their depots to avert any fallout of developments in respect of NLC’s proposed strike.

He further explained that the NNPC will continue to meet the products consumption needs of all Nigerians wherever they might be within the shores of the country.

It will be recalled that on Wednesday, September 12, leaders of Organised Labour in Nigeria handed down a 14 day ultimatum to the Federal Government to announce its figure and ensure the completion of work on the new national minimum wage or risk unprecedented industrial unrest in the country.

At a joint briefing in Lagos, leaders of Nigeria Labour Congress, NLC, Trade Union Congress of Nigeria, TUC, and United Labour Congress of ULC, had warned that at the expiration of the ultimatum, they could no longer guarantee industrial peace in the country.

They accused the federal government and the minister of labour and employment of frustrating and delaying the process of arriving at a new minimum wage expected by workers since 2015.

OPS: Recession possible, labour’s strike further threatens the economy

Against the backdrop of the warnings by the Central Bank of Nigeria, CBN, over threats of relapse into recession, economy analysts, financial sector operators and the Manufacturers Association of Nigeria, MAN, have given further details on the current travails of the economy.

Outgoing President of Manufacturers Association of Nigeria (MAN), Dr. Frank Jacobs, said, presently the economy is weak and can go back into recession, citing a threat to inflation from politics sector.

He stated: “Too much money is being thrown into the system because of the elections as politicians have been actively throwing in a lot of money on securing a seat in government. This will increase in liquidity and it will cause inflation. Inflation will definitely go up and it could affect the economy” he stated.

Decline in inflation rate is reducing

Reacting, Managing Director, Highcap Securities Limitded, Mr. David Adonri, agreed with the CBN’s position, saying that: “If you look at the macro-economic indicators, starting with inflation rate, you see that the rate of decline has reduced considerably. Two, the growth of the economy has practically diminished and the threat to inflation is very high because as we approach election, by historical antecedent, more money will be spent in the economy and so that will increase inflation rate.

“Secondly, we are actually in the period where harvest should bring down headline inflation rate, but, unfortunately, we have seen that headline inflation rate has increased. We are now moving to a period of the year where the farm output will reduce progressively. That will also constitute rise in inflation rate.

Also, as a result of political uncertainty, the country’s risk has increased and that has been demonstrated by lack of demand in the capital market ie, exit of investors from the capital market.

These are all indications of the threat that there is a risk to the country’s entering into another recession. So, the analysis all point in respect of the fact that the country is heading into recession if macro-economic policies are not realigned to ensure that the economy does go into recession.”

“From the monetary policy perspective, I think they have already exhausted all tools available to prevent the economy from reversing into what we experienced in recent times. The onus lies on the fiscal authorities to deploy fiscal measures and policies to to address the shortcoming of the economy. The political uncertainty can also be addressed by transparency in the drive towards the 2019 election.

Economy growing slowly

Also reacting, , CEO, Emerging Africa Capital Group , Mrs. Toyin Sanni, said: “Our exit from recession has been a welcome development with the economy recording stable and consistent growth quarter on quarter on the back of FGN’s Economic Recovery Growth Plan, ERGP, and commitment to on-going reforms. However, growth rate is still quite slow compared to Nigeria’s recent economic history and its potential. The economy also remains significantly dependent on oil revenues meaning a significant drop in either price or production would indeed put our recovery under threat.”

In his comment on the economy being threatened as announced by the CBN, Managing Director, Solid Rock Securities & Investment Limited and Chairman, Association of Stockbrokers Association of Nigeria, ASHON, Mr. Patrick Ezeagu said: “We knew the reasons why we went into recession last year and it would appear that we are not sensitive enough to the lessons derivable from that avoidable mistake, consequently, if we don’t correct ourselves both leaders and the lead, we may end up cutting short our sigh of relief on climbing out of the hole of recession.”

Commenting as well, a Chartered Stockbroker/ Managing Director, Sofunix Investment and Communications, Mr. Sola Oni said: “The solution is to undertake a review of the impacts of the macroeconomic framework within the context of the current realities. The Central Bank of Nigeria must take a long term view of our Nigeria’s economic plan, upgrade railroads, and airport s fix drainage systems, address electricity challenges and a host of other infrastructural deficits. This will enhance interconnectivity among people and boost economic activities. Industrialization should be accorded priority if Nigeria intends to be among the leading economies like China and South Korea.

Nigeria should place premium on manpower development right from the youth by implementing Basic Education to the letters and investing in technical skills among others. We need this to grow our Gross Domestic Product (GDP) and per capital income.”

Economy has not recovered fully

Mr. Olumide Fatogun of Boof & Co. Insurance Brokers said: “The economy is just recovering slowly and has not fully recovered. For the economy not to fall back into recession, the federal government needs to commence implementation of the budget.

Nigeria operates a mono economy where everything comes from the federal government. Hence, implementation of the budget in full is very important.

The economy is dwindling because nothing is coming from the federal government that is why there is a lot of inactivity.

We all depend on the federal government for everything. It is only when the federal government spends that it will trickle down to the larger economy. Almost all the states go to Abuja for allocation. The public sector is holding things down and everything is done by government that is why the recession is still with us.

If the private sector were to be the mover of the economy, it would have recovered.”

In his own comment, the National President of the National Council of Managing Directors Licensed Customs Agents, NCMDLCA, Mr. Lucky Amiwero said that the rate at which government was borrowing monies was too high and cautioned on borrowing less.

He observed that most of the policies of government lacked focus saying that “economic policies without focus will amount to nothing”

He warned that if urgent steps were not taken to re-direct the economy, the country may rescind back into recession.

He said “We are borrowing much money and we also do not have focus on economic policies; they are scattered, they are not consummated economic policies.”

Strike’ll be costly

Reacting to the strike, Capt. Thomas Kerewerigha, said that “the strike will have a major effect on port operations becuase the MWUN is a strong member of the NLC and they control the dockworkers who are responsible for the cargo.

“There is no doubt that the MWUN would enforce the orders of the NLC but that does not mean that some civil servants would not come to work.”

Similarly, National Publicity Secretary of the Association of Nigeria Licensed Customs Agents, ANLCA, Joe Sanni, agreed with Kerewerigha. Sanni explained that the effect of the dockworkers cannot be over-emphasised and that like in the past, the MWUN will enforce compliance.

On what the industry stands to lose, he said while the entire lose of the industry is difficult to compute, the direct area of port operations can be easily estimated.

“On demmurage and storage charges, one can circulate that. Importers and their agents are made to pay N12,000 daily as demurrage and let us say about 200 containers leave a terminal; what you have is N12,000 multiplied by 200.

Then multiple that by the number of terminals in Tin can Island , Apapa, Kirikiri and others. This does not exclude the airport too. Finally you multiply that by the number of days the strike is expected to last.

Outgoing President of Manufacturers Association of Nigeria (MAN), Dr. Frank Jacobs On the cost of impending NLC strike to the economy, Jacobs said it depends on the essence of the strike. “The strike is going to cost a lot to the economy, adding that the action is likely to crumble the economy.”

Reacting, the Managing Director, Solid Rock Securities & Investment Limited and Chairman, Association of Stockbrokers Association of Nigeria, ASHON, Mr. Patrick Ezeagu said: “On the likely cost of the intended strike by Labour, it will be unimaginable and may quicken our avoidable return to recession especially if prolonged. My take is that Labour and Govt should in the interest of the nation close rank and have a useful discussion to find a lasting solution to this prolonged negotiation on wage increase and other related issues.”

A Chartered Stockbroker/ Managing Director, Sofunix Investment and Communications, Mr. Sola Oni said: “The cost of labour unrest is better imagined than related on its negative impacts on productivity. Government and Labour leaders must come to terms with reality. Bit it is unfortunate that Nigerians do not earn living wage at this stage of our existence as a sovereign nation.”

Its impact will be high

Toyin Sanni, CEO, Emerging Africa capital Group, said: “A nationwide labour strike should be avoided at all cost as it will indeed be costly for the economy on many levels having both direct and consequential impact on productive activities and across all segments of the economy.”

Adding his voice, David Adonri, Managing Director/CEO, Highcap Securities, said: “The strike by any labour union carries huge cost. It will result in loss on man-hour and the cost could be very enormous depending on the severity of the strike because if the road transport union workers join in the strike and the tanker drivers participate, transpiration will triple. It will further increase the threat in the economy.

Mr. Olumide Fatogun of Boof & Co. Insurance Brokers said that the negative effect of a nationwide strike will be very pervasive on the economy.

He said, “When there is a nationwide strike, a lot of people will not go to work. A lot of organisations have already lined up something for the week but a strike will make the organisations not carry them out. There are some jobs that have to be completed within the week but will be suspended. Some people are on daily pay structure.

“Also, at the ports, a lot of vessels that are supposed to berth will no longer berth. If a vessel is supposed to berth tomorrow, it cannot berth, it will remain on the high sea because the dock workers will not discharge it. Those expecting their cargo will not receive it because cargoes will be affected.

The school system as well as hospitals will be affected. Some people will be in emergency and they will not attend to them, so it is a massive problem.”

The economy may not survive if the strike goes on

The National President of the National Council of Managing Directors Licensed Customs Agents, NCMDLCA, Mr. Lucky Amiwero in his reaction said:

“If at this stage of our national life allow the Nigerian Labour Congress go on strike, the economy may not survive it.

“It is better for both parties to go back to negotiating table and see reason.

“In as much as it is to have some increment in the salary of workers, there is a need for some sort of intervention.

“Any increment of salary will have a rippling effect on the economy.”

CBN warning shouldn’t be taken for granted

Some stakeholders in the maritime industry have stressed that the warning by the Governor of the Central Bank of Nigeria, should not be taken lightly following the recent development in the country.

National Publicity Secretary of the Association of Nigeria Licensed Customs Agents, ANLCA, Joe Sanni explained that Nigeria runs a micro economy and every where things are not going on fine. He said salaries are not being paid, market women are not selling because there is no money.

He further noted that the maritime industry is import dependent and that the level of export is very low. He explained that the fact that the Nigeria Customs Service, NCS is collecting huge revenue should not be mistaking to mean all is well in the sector.

He said some Customs officers have confirmed that they are only playing on the exchange rate, pointing out that the situation will not always remain that same.

In the same vein, Kerewerigha stressed that the situation is very bad and the warning of the CBN governor who is part of the economic team should not be taken for granted.

“It is clear, if not why is the federal government borrowing $500 million from China? There is increment in the prices of crude oil and nobody is talking about the where abouts of the excess fund.

“We have a mono-economy and we are not producing anything. The immediate past minister of finance had noted that the nation’s crude oil production was on the rise and the price of crude is increasing but the Nigerian National Petroleum Corporation, NNPC, was not remitting to the federation account.

We are currently borrowing more than we are earning which is a danger sign and if care is not taken; we will slide back into recession that is if we have got out of it in the first place.”

Courtesy: VANGUARD