I must first begin by saying that I am in great support and believe in President Buhari’s led administration and know they are tirelessly working selflessly to restore Nigeria. I also believe that this restoration campaign is not only the president’s job alone but the work of all well meaning Nigerians. So I am compelled to use this medium to try and shed more light on “The China Deal” hopefully it might better inform our leaders, so as to represent we the citizens (youths) effectively.

FG should consider restraining itself from going further on the “China Deal”-economic agreement. I am no expert in this field but I am educated enough to understand, that some executive elements and component are unpatriotic and may not be advising the executive correctly; the “deal” is imbalanced in purpose, design and objectives. This deal in reality has no potential of jumpstarting our economies or will it add value to our Naira in the long run. Or result in the expectant economic CHANGE we hope for.

Economic growth means an increase in Real GDP. Economic growth means there is an increase in national output and national income. Economic growth is caused first and foremost by factors on the supply (output) part of the economy, everyone benefits as increased supply leads to lower prices (REDUCED INFLATION) and higher productivity-a company increasing productivity necessitates an investment in additional capital and the hiring of more workers, both of which stimulate economic growth. Other factors that stimulate growth are increases in both the QUANTITY and QUALITY of local productivity that leads to an increase in export.

Economic growth can be said to be caused by two main factors; increase in aggregate demand, we have “250 million of this “Demand” (in waiting), and an increase in aggregate Supply (productive capacity) - NIGERIA’S CRITICAL DEAL FOCUS. An economic boom is affiliated with a rapid rise in aggregate demand; the faster the rise in aggregate demand, the higher the short run rate of actual growth. We already have a potential aggregate boom all we need now is to focus all our energy and resources in meeting that demand with appropriate local quality Supply.

The “China Deal” favours our partners so much more for nothing and this action I fear may inevitably devalue our Naira less than its actual value. Presently, our national reserve has 20% of its currencies in Yuan - a currency innately devalued against the dollar. China can employ such economic policy and strategy because they have the economic maturity, market population, production; capability, capacity, competency, technology and socio –economic infrastructure and “unified” expansionary monetary policy. And however, the currency swap deal has not shown long term successes with countries that have adopted it like Argentina, Kazakhstan, were our Naira has more value against the dollar-purchasing power.

Nigeria has core economic issues that MUST be addressed holistically, strategically and dynamically, in other to actually jump start its economies in moving forward, which this deal does not adequately address. The remedial effort of the “Chine Deal” addresses the resultant symptoms of a bad economy and not the macroeconomic root cause-solution path. This deal does not;

1. Make Nigeria’s local exports cheaper and or ensure the increase in quantity of exports (FX) or increased consumer confidence on local products, which encourages spending (quality).

2. The technological improvement to improve the productivity of capital and labour is not captured in the deal’s framework e.g. software development, hardware manufacturing and the internet infrastructure have been known to both contribute to the increase of economic growth in other countries.
3. Address lower interest rates from our local commercial banks to encourage spending and investment.

4. The deal addresses unemployment issue, but what really impacts an economy for economic growth is an increase in salary/wages, to encourage consumer spending-giving our aggregate demand the sustainable capacity to purchase locally made goods.(Minimum wage or per capital income -critical aspect to Growth),

5. Does not include the provision for building low income housing across the nation, which creates a positive wealth effect and encourages homeowners to spend more among other positive impacts on our economy. (Capital expenditure dynamics).

6. Does not address the development of the capacity and capability of our economy to increase productivity in the short-term.

7. The resultant impact of the deal, will not devalue the dollar or will it revalue the Naira, certainly not! Yuan, by economic policy design is devalued against the dollar. Also, it’s a certainty that the China economic environment cannot be used as a dumping ground and from statistics 20% of the Nigerian jobs could go over to our Chinese partners in the next seven (7) years, mostly through outsourcing avenues.

8. Most of the remedial clauses of the “China Deal” are long term based plans and strategy. We need more short term remedial solutions; such as how we can get cheaper or subsidized needed manufacturing equipments, tools, knowledge expertise to manufacture these tools and equipments locally-to boost immediate local production. Long term positive impact includes building roads, railway, sea port, airlines–labour productivity (human development), discovery of raw materials (mining), its exploration and its exportation.

9. Does not address the underlining issue/factor of the aggressive cancer of INFLATION

After studying China a bit, understanding they constitute great visionaries who are very proud of their heritage. I studied their political structure (culture, religion and nature of economy), social- economic policies, IT innovations/advancement, the battle of West and East quest for economic supremacy and how it impacts their economy. From the aforementioned evidenced core issues the deal does not translate in the best favour of our dear country Nigeria. In looking for the lowest interest (1.5%) borrowing rate we also must be very critical of the offer presented. I am not so optimistic that a country who is chiefly responsible for our Nation’s 80% trade deficit and imbalance, will be so eager to strengthen our industrial capacity cooperation in the manufacture of cars, household appliances, construction materials, textiles, food processing, and others.

Making our economy the hub for Yuan, clearing and transaction…wow? We have a free trade Zone in the works with China as our major partners and China economic dominance in Africa /Asia is growing? These developments presently do not in anyway affect the Naira value (purchasing power), economy or profiting us more than our partners. Our GDP growth projections are low and are presently at a deficit growth rate. I advice that this “China Deal” clause should be suspended for the time been until our own economy is matured enough (Expansion Cycle) i.e. should be at the Growth Cycle of Economic Boom threshold not Recession.

Conclusion
Economic growth is measured by how much Gross Domestic Product, or GDP, increases from one period to the next. GDP is the combined value of all goods and services produced within a country. This “deal” could have increased the SUPPLY potential with which our resources can be best used that serves the Nation. The “Nigerian Deal” as revised should chiefly focus on rapid transfer of Business/Manufacturing/Agricultural models and technology expertise,– production capacity (from the most needed essential consumer goods to the least needed essentials as indicated from our importation economic leakages data(Great initiative of the establishment of 50 Agricultural Demonstration Farms across the country). In competency- fertiliser local production, Agricultural product quality, storage, bettered organisation, etc should be our focus, Power- green energy (Solar Energy focus-manufacturing the Solar plates in Nigeria).

Nigeria’s economies cure approach should be that of Supply Economic Growth; an economy that has a large market (huge aggregate demand) needs to primary focus on local supply to meet aggregate demand as it meets the masses primary consumer needs. We need short remedial plans to address this.

Finally, the “deal” holistically or dynamically, does not address the internal and external growth aspects of the Nation’s economic growth. Will it give us the “big push”? I am not too optimistic…

I am no expert in this field

this part sha,

masterchi:
this part sha,

Guy, u wan take style steal my name ba?

Bugzynigeria007:

I must first begin by saying that I am in great support and believe in President Buhari’s led administration and know they are tirelessly working selflessly to restore Nigeria. I also believe that this restoration campaign is not only the president’s job alone but the work of all well meaning Nigerians. So I am compelled to use this medium to try and shed more light on “The China Deal” hopefully it might better inform our leaders, so as to represent we the citizens (youths) effectively.

FG should consider restraining itself from going further on the “China Deal”-economic agreement. I am no expert in this field but I am educated enough to understand, that some executive elements and component are unpatriotic and may not be advising the executive correctly; the “deal” is imbalanced in purpose, design and objectives. This deal in reality has no potential of jumpstarting our economies or will it add value to our Naira in the long run. Or result in the expectant economic CHANGE we hope for.

Economic growth means an increase in Real GDP. Economic growth means there is an increase in national output and national income. Economic growth is caused first and foremost by factors on the supply (output) part of the economy, everyone benefits as increased supply leads to lower prices (REDUCED INFLATION) and higher productivity-a company increasing productivity necessitates an investment in additional capital and the hiring of more workers, both of which stimulate economic growth. Other factors that stimulate growth are increases in both the QUANTITY and QUALITY of local productivity that leads to an increase in export.

Economic growth can be said to be caused by two main factors; increase in aggregate demand, we have “250 million of this “Demand” (in waiting), and an increase in aggregate Supply (productive capacity) - NIGERIA’S CRITICAL DEAL FOCUS. An economic boom is affiliated with a rapid rise in aggregate demand; the faster the rise in aggregate demand, the higher the short run rate of actual growth. We already have a potential aggregate boom all we need now is to focus all our energy and resources in meeting that demand with appropriate local quality Supply.

The “China Deal” favours our partners so much more for nothing and this action I fear may inevitably devalue our Naira less than its actual value. Presently, our national reserve has 20% of its currencies in Yuan - a currency innately devalued against the dollar. China can employ such economic policy and strategy because they have the economic maturity, market population, production; capability, capacity, competency, technology and socio –economic infrastructure and “unified” expansionary monetary policy. And however, the currency swap deal has not shown long term successes with countries that have adopted it like Argentina, Kazakhstan, were our Naira has more value against the dollar-purchasing power.

Nigeria has core economic issues that MUST be addressed holistically, strategically and dynamically, in other to actually jump start its economies in moving forward, which this deal does not adequately address. The remedial effort of the “Chine Deal” addresses the resultant symptoms of a bad economy and not the macroeconomic root cause-solution path. This deal does not;

1. Make Nigeria’s local exports cheaper and or ensure the increase in quantity of exports (FX) or increased consumer confidence on local products, which encourages spending (quality).

2. The technological improvement to improve the productivity of capital and labour is not captured in the deal’s framework e.g. software development, hardware manufacturing and the internet infrastructure have been known to both contribute to the increase of economic growth in other countries.
3. Address lower interest rates from our local commercial banks to encourage spending and investment.

4. The deal addresses unemployment issue, but what really impacts an economy for economic growth is an increase in salary/wages, to encourage consumer spending-giving our aggregate demand the sustainable capacity to purchase locally made goods.(Minimum wage or per capital income -critical aspect to Growth),

5. Does not include the provision for building low income housing across the nation, which creates a positive wealth effect and encourages homeowners to spend more among other positive impacts on our economy. (Capital expenditure dynamics).

6. Does not address the development of the capacity and capability of our economy to increase productivity in the short-term.

7. The resultant impact of the deal, will not devalue the dollar or will it revalue the Naira, certainly not! Yuan, by economic policy design is devalued against the dollar. Also, it’s a certainty that the China economic environment cannot be used as a dumping ground and from statistics 20% of the Nigerian jobs could go over to our Chinese partners in the next seven (7) years, mostly through outsourcing avenues.

8. Most of the remedial clauses of the “China Deal” are long term based plans and strategy. We need more short term remedial solutions; such as how we can get cheaper or subsidized needed manufacturing equipments, tools, knowledge expertise to manufacture these tools and equipments locally-to boost immediate local production. Long term positive impact includes building roads, railway, sea port, airlines–labour productivity (human development), discovery of raw materials (mining), its exploration and its exportation.

9. Does not address the underlining issue/factor of the aggressive cancer of INFLATION

After studying China a bit, understanding they constitute great visionaries who are very proud of their heritage. I studied their political structure (culture, religion and nature of economy), social- economic policies, IT innovations/advancement, the battle of West and East quest for economic supremacy and how it impacts their economy. From the aforementioned evidenced core issues the deal does not translate in the best favour of our dear country Nigeria. In looking for the lowest interest (1.5%) borrowing rate we also must be very critical of the offer presented. I am not so optimistic that a country who is chiefly responsible for our Nation’s 80% trade deficit and imbalance, will be so eager to strengthen our industrial capacity cooperation in the manufacture of cars, household appliances, construction materials, textiles, food processing, and others.

Making our economy the hub for Yuan, clearing and transaction…wow? We have a free trade Zone in the works with China as our major partners and China economic dominance in Africa /Asia is growing? These developments presently do not in anyway affect the Naira value (purchasing power), economy or profiting us more than our partners. Our GDP growth projections are low and are presently at a deficit growth rate. I advice that this “China Deal” clause should be suspended for the time been until our own economy is matured enough (Expansion Cycle) i.e. should be at the Growth Cycle of Economic Boom threshold not Recession.

Conclusion
Economic growth is measured by how much Gross Domestic Product, or GDP, increases from one period to the next. GDP is the combined value of all goods and services produced within a country. This “deal” could have increased the SUPPLY potential with which our resources can be best used that serves the Nation. The “Nigerian Deal” as revised should chiefly focus on rapid transfer of Business/Manufacturing/Agricultural models and technology expertise,– production capacity (from the most needed essential consumer goods to the least needed essentials as indicated from our importation economic leakages data(Great initiative of the establishment of 50 Agricultural Demonstration Farms across the country). In competency- fertiliser local production, Agricultural product quality, storage, bettered organisation, etc should be our focus, Power- green energy (Solar Energy focus-manufacturing the Solar plates in Nigeria).

Nigeria’s economies cure approach should be that of Supply Economic Growth; an economy that has a large market (huge aggregate demand) needs to primary focus on local supply to meet aggregate demand as it meets the masses primary consumer needs. We need short remedial plans to address this.

Finally, the “deal” holistically or dynamically, does not address the internal and external growth aspects of the Nation’s economic growth. Will it give us the “big push”? I am not too optimistic…

Thank you for this nice writeup.
I have said it before, if the deal is just giving us this loan, perform the necessary constructions and train Nigerians on technological innovations and our indigenous factories secure machineries from them, that's okay but if they plan on coming to open factories themselves to run as Chinese factories, then we are in serious trouble.

First, the government out of sympathy for the loan we receive from them and who knows the agreements made will grant them favorable duties and taxes which will reduce their operating cost at the expense of the growing indigenous factories.

Secondly, their population will increase here working in their factories that is suppose to be occupied by Nigerian youths: so the supposed job creation will be shared by Nigerians and the Chinese.

Thirdly, our own companies gradually losing it in their own country cause the chinese know how to get cheap Labour from their people coupled with their near zero tax payment and duties.

Fourthly, the number of kidnapping and missing persons will increase as these people are capable of using human flesh as meat in their restaurant which will be cheaper for them than securing a cow or goat. There was a case in Douala, Cameroon where a refrigerator in a restaurant was stocked with dead babies which were used as meat in cooking.

The coming of the Chinese in Cameroon has made about 70% of their youths travelling overseas for greener pastures as there are no jobs for them in their country anymore.


There are endless ways this new marriage is going to be a loss for us Nigerians IF my assertion of it is correct.

What we need is train more Nigerians as experts and encourage the rich guys to invest more into local manufacturing even if it means giving them free tax for two years and not foreigners to establish these for us.

The CBN has bank details for majority of rich Nigerians. I suggest they invite them including those in diaspora and have a chat with them even if it means begging them to invest in specific areas of manufacturing and tell them the level of help they will get from the government as low taxes and import duties so they can actually stabilize.

There are so many ways I can think of to put Nigeria on its feet and even revive the naira but I wonder how the experts up there are doing something different that will not work.

Just seems to me as if the CBN governor and those involved don't want to implement policies that will favour Nigerians cause I don't think it's a case of being clueless. I think it's a case of sabotage


If this deal is what i think it is then Nigerian youths should start saving to relocate out of this country.

mastercee:

Guy, u wan take style steal my name ba?

guy relax oh.