 As we look at some critical economic issues headlining today, joining me in this discuss is International Finance and Economic Analyst, Mokhtar Mohamed. Thanks for joining me, Mokhtar. Thank you, Justin, for having me. All right, let's start with the budget issue. Last week there was a conundrum about patent and several allegations and several people were talking about marginalization. Let's look critically at some parameters used in that same budget, specifically the forex rate which was spread that 800 naira, that they're about last year. We made the present reality of today. Now, Senate is looking ahead and running against supplementary budget like we always do have. But how significant or walkable is this 2024 budget in terms of the frontiers in what we have earmarked last year and what we are faced as of today? Well, Justin, sometimes the Senate seems to be saying the right thing, but hopefully they will be able to do the right thing, that's on the thing. Yes, but again, they are looking at that from one angle. The budget was stacked at 800 and today the exchange is about 1500. And so if you look there, you realize that the budget, the exchange has gone over by over 90 percent. Sure, that means the budget has to have significant income over 90 percent. I mean, what the amount was, 800,000 naira is about 1.5 million. So that seems to them that they have SS cash. That's what the Senate is saying that you don't have to come back to get the supplementary budget because by that you mean you have SS cash. But now the Senate is getting to say, okay, you're looking at it that way. The other way you have to look at it is that foreign debt payment was also stacked at that amount, which was 800 was $1,000, but today again, $1,000 is 1.5 million. So what do you think you gain in one hand? You lose also in the other hand. So there must be a balance. And again, if you talk about internally, okay, fine. But when you talk about externally, that means our standard debt has gone up again by over 90 percent. Exactly. I was going to say that. But the depreciation of the naira from about 800, 900 to the dollar to about over 1,500, that the Senate is saying that we should not increase our budget side. But it is talking already about some sort of savings, really. But do you think this move that's if we decide to go for supplementary budget that it might actually worsen the issue of inflation that we have right now? Yes, I think it depends. You are going for that based on the non-productive sector. Then you're worsening the inflationary pressure. But if you are going to do that with the productive sector, then you are also reducing the inflationary pressure. And like this is all the way I look at it. When you look at the budget and market at 800 naira, that was also not for the productive sector. It was for expenditure, especially recurrent expenditure, which has to do with debt payment and that and that. So if you look at it from that angle, then you have a lot of liquidity in the system. But you look at it if this was based on the capital expenditure, or if the rate at importation of goods that comes in were at 800, why a left currency was at 1,500? Then you see that the cost of food we go down, the cost of so many things imported we go down. We are not also we drive down inflation. So it depends. Is it reduction that we are seeing or heightening that we are seeing? Is it in the productive sector or is it in the sector that is not so much productive for the economy? Because what we've seen, like the CBN governor have said, the 10 trillion that was printed by the CBN, that the former administration of Godwin-Emefeli was used in not in the productive sector, was also used for consumption. So production, consumption and other things. So we need to look at if we are trying to deal with inflation, then we need to look at the economy critically and begin to look at the productive sector to 100%. Is it challenging? I want to get a bit of a clearer picture right now. Okay, the Senate says that we earn about 60% of our revenue in dollars. And as such, the fall of the Naira against the dollar has created some sort of huge savings. I'm just quoting them verbatim for the country. What is the true picture really bearing in mind that we're still servicing debt? And I'm thinking that since it's also denominated in dollars, we are actually paying more. And if there is any savings per se, what should we be handling? But I know you talked about that infrastructure and all of that, but what should we be doing with these so-called savings as it were? Well, Justin, I don't think how they will have savings. This is a government that is even struggling to meet up. It's budget deficit, a lot of promises that have made. It's a government that have not been able to even pay minimum, which there's not going into many agreements. Now what they are doing is payment of allowances. So I think, like you said it in your one hand, you think you are saving in the other hand, you are paying debt. So it's like a man that is saying I'm saving money and he's still indebted and the debt is going up and he's saying I'm saving. So by the time you knock up the debt to the savings, they don't have anything. So there's a common sense when it comes to personal finances. The first thing you tell you to do, you save and the second thing you do, you pay your debt. And after that, other money begin to go into other productive sector. So because when you are, that is both your asset and your liability. So you try to reduce your liability every time you end income. So in this case now, instead of any income to reduce our liability, our liability have increased and our income has calmed down. Because again, like they say 60% of what we earn comes from group. And as it stands today, we are not able to meet up, our look, our open quota. So we are not anymore and then we need to service the debt. So there must be a balance. So there must be a critical and looked at it and come up with a good understanding of what policy really you want to drive. Whether you are looking at savings. Now savings, ordinary should be good. And when you look at what is the benchmark that we're used to saving. Because most of our savings actually come from the oil benchmark. And that's why we have the sovereign wealth form. They want to manage some of these savings and put it into key capital infrastructure like what they did in the Second Niger and others. So those savings are not there yet. I don't think so because the government is still struggling to meet up with some liquid demand. But it's always good to have savings. Because it stands now. It's apparently very difficult to have the exchange rate. All right. Let's look at something equally as interesting that also is affecting every one of us, which is inflation. Inflation rose to about 31.7 percent in February. That's according to what the NBS released towards last week. Although some school of thought believes it's even higher than that. But my main concern is an analysis done by Narrow Metrics which says food inflation jumped to about 29.8 percent. What does this mean in clear terms and need this narrow depreciation that we have? What should be our concern right now, Mukhtar? Yeah, our concern is first of all to feed ourselves. Unfortunately, we are not doing that yet. And it's not that the farmer does not have the capability to feed us. But again, they have to deal with a lot of challenges. One most critical one they are dealing with, it has to do with the security challenges. And by the time they are finished with security, they are dealing with energy costs, high energy costs. And also, when it's provided because you now move also to the transportation sector, high costs of transporting of their goods. There are choices that imply increase their costs of production. So definitely what should we be doing now? I think government should be thinking of how they can intervene. Because they've tried to say they have intervened, they will release meals, they will release meals, they will release all of these things into the economy, into the house to reduce food costs. But they've not done it because they've not really come out to take care of the strategy. And you need to look at Lagos, what Lagos is doing. And there is a market every Sunday, they release those markets that people can go and buy goods at an affordable price. So they also should begin to think of how they can support the farmers also to so that they can bring down the cost of production. Then when the cost of production comes down, the cost of those goods will come down. Because what you think, someone will say you don't buy food in dollars, but again look at the rising cost of energy and this people have to buy diesel to power their generators or to power their plant. So most of these diesel, the cost has gone up. So they have to transfer it there. And this is due to the exchange rate volatility. So I think what the government should do is to see how they can intervene, especially in the operational network of these farmers where they can bring down the cost of production, in turn by doing that, they also have brought down the cost of some of these diesel services. All right, still talking about what government should be doing. The CBN is set to hold its second MPC meeting for the year next week, where the committee will be deliberating a hold or a high stance following the 400 basis point increase in the previous one. What are your thoughts really with this MPC meetings and all that is going on with the monetary policy committee in Nigeria? Well, they do have the highest rate hike for a very long time. I mean, the highest may be 15 years. So I don't expect them to do anything less than just maintain it. They have seen how that rate can help improve the economy going forward. You're not supposed to see an economic impact of a great hike that it did last one. And then it will also be suicidal for it to continue to hit this hike. Like I always say, the development committee are different from us. They are different from us because what they do, they have the data, they have the variable to look at the situation. Example is that the British and Britain and United States started, even some Europeans in France, they started hiking almost at the same time with us to control inflation, to control destruction in terms of full supply because of the Russian-Ukraine crisis. But today, their rate has come down, but our own is going up. So that shows that there is something missing. And that missing lead is what the CBN should be looking at and beginning to address. And they know the missing lead has to do with FX volatility. So on the MPC admiring, they should be reviewing how more they've been able to achieve in terms of bringing rates down. FX volatility, and seeing how that will impact on footbridge. And again, footbridge. Again, the executives will have to partner with the CBN. And that's why when, at the beginning of the semester, we're excited to have a special advisor on monetary policy that is in the presidency. So we expect that to be given the president advice on how to make sure that we begin to tackle this inflation and they tackle it as a team to bring it down. All right. Finally, let's talk about our long-term phones. That's on pension phones and all of that. According to PENCOM, that's the pension commission, the net asset value of pension phones in U.S. dollar terms declined by $18.9 billion from $33.3 billion as of January last year to about 14.4 as of January this year, that's year and year. But what are the effects of all of this? Should we be worried? Because I'm thinking that I am saving money for my pension. I'm putting my own money. All of the money I've been putting over the years because of my depreciation, it might not really be worth anything when I really want to use the money. I don't know. You're laughing at me, Mukta. But that's the reality. That's how I see it. You have to put up money for your pension there. You need to do that. It's legal. What I may advise people is you have the government pension phone. You should also have your own personal pension phone for what you can access at any given time. Now, when you look at that report, again, they are looking at January and also it's not depends on the type of investment they are investing. If you looked at the report before, they mean over 200 and something percent. And when you look at that report, by and by the exchange rate, you realize that the exchange rate has moved up almost like about 100 percent. And so they have made more money when you convert what they've made and what the exchange rate in terms of value. That means they also made up to 80 something to 90 percent, which is good in any given economy. If you make that, you are a fantastic fund manager. Okay. Now, when you look at inflationary pressure, you've also been able to give a return of almost 39 percent and inflation is the 31 percent. Then so the problem we have is that sometimes we tend to look at the Nigerian fallage of this and this dollar, but we're forgotten that we are thinking about an ingrown economy. In other words, I don't doubt what they're saying again. It also depends on the sector that the pension phone and Mr. Tosa and employing this money. Because if they are putting this money in the equity market, then definitely they have been making so much on returns because that means that they should have been making up over a hundred and something percent. So it's all about the strategy. They remember the pension funds. I mean, so we're not just put in the phone in one place, the one to diversify their reach so that we don't have people like you are saying at the point, you will not be able to assess your pension. But if you look at it, it's not that it's not going, but in dollar term, it's not seems not to be going. But in Naira 10, it's doing very, very well. And in the overall picture of the Naira 10, it's also doing very well. So Justin, that is why you should still look at it critically and make sure that your organization continues to do its contribution for you as an individual. Try to set up a personal pension form for yourself because for your organization, what the pension fund and Mr. Tosa will give to you might not be enough to carry out your goal and your vision at the time that you are leaving that organization or you are planning to retire. So it's always good to have those two in place. And that's why I think with that again, you know your risk level, then you'll be able to invest in previous platform compared to the pension fund and Mr. Tosa that would need to be conservative in their returns so that it don't wipe off a lot of people's savings and life savings and investments. Thank you so much, Jim Mukta for that time free advisory. I don't know if you'll be floating your own PFA soon so I can actually just invest that in your own business. Thank you so much for all the useful insight and you appreciate it. Back later, Justin. Thank you for having me. All right. That's the size of the show. My guest Mukta Mohamed is an International Finance and Economic Analyst and we have been looking at various issues and plagues in the economy. Over time again, same time, my name is Justin Akadounye. Many thanks for being there.