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Op-Ed

How foreign Aid fuels African Media’s payola problem

To build strong communities, Africans need news they can trust. To deliver it, journalists need to come by their funding honestly.

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At a recent press conference a small group of Liberian journalists made a courageous admission: they confessed they were all “on the take.” To supplement salaries as low as $40 a month, the journalists said they often rely on payments from the very people they write about.

The revelation confirmed a dirty secret of African journalism: reporters earn most of their income from payments by their sources. And the dirtiest secret of all is that the international aid community is among the most prolific payers.

Development agencies fork out vast sums to sway African journalists. While outright bribery is rare, insidious payment is rampant. Many schemes – from “transport” refunds that far exceed reporters’ travel costs to exorbitant per diems – come with a tacit understanding that coverage will be positive.

Aid groups insist that payments are not inducements in reality, poorly remunerated journalists cannot easily tell the difference. For media bosses, bribery rationalises costs: as long as they publish, sources will foot the bill.

Although it is difficult to know for certain what percentage of media budgets derive from unethical payments, in Liberia, where I do most of my work, anecdotal evidence suggests it is a majority of reporters’ pay. For example, two leading media companies told me that they have not paid their staff for at least a year, yet they continue to publish with no noticeable change in output.

The implications of this journalistic business model are profound. For starters, stories are typically poorly written, based on a single source, and inspired by a press conference or press release, rather than a thorough and objective assessment of issues affecting readers. Journalism as a career is also debased, and most top university graduates avoid the profession entirely. Ironically, aid agencies’ efforts to improve African media have only exacerbated the problem. That’s because today, a typical journalist in Africa is a professional workshop attendee.

NGOs from every sector “train” journalists in their subject matter, often with content conceived in Western capitals by people with no experience in journalism or in the target countries. Journalists go from workshop to workshop, turning up long enough to collect their per diems and write a puff piece.

This approach is as costly as it is regrettable. In one African country, a media-development organization with which I have worked spent more than $1 million of taxpayer money to produce a one-hour program on governance, which was then aired on community radio, its content so sanitized to appease local officials that few people tuned in. But even more problematic was the distortion to the domestic media market. To produce the program, the NGO recruited ten top journalists from established outlets and paid them as much as ten times their normal salary. Once the project was over, most of the journalists quit their old jobs in search of better pay in the aid and government sectors.

From my experience, most African journalists know how to report a well-sourced story. What they lack are the resources to put this knowledge to use. The deficiencies of African media are best addressed as a business challenge, not a training problem. Some media organizations already recognize this. In Ghana, Joy FM owner Kwasi Twum told me that he pays his staff “enough for a car and a mortgage,” and the station has been widely credited with helping lift the standard of journalism in the country.

In the past, Nigerian journalist Dele Olojede lured top graduates in business, medicine, and law to the profession with higher wages and an inspiring mission. In 2011, journalists whom he mentored founded Premium Times which has earned a reputation as an impartial political watchdog. Liberia’s Front Page Africa has played a similar role, as has the Daily maverick in South Africa.

To make further progress, African news outlets should emulate their counterparts in advanced economies by developing sustainable revenue streams though e-commerce, subscriptions, sponsored content, supplements, and multimedia. This is where donors can be helpful: rather than host useless trainings, they should enable innovation by pairing African media outlets with experts in business, technology, and advertising.

In particular, tech companies should help media organizations take advantage of platform innovations and find opportunities to monetize diaspora audiences. Donors have already shown that they can pursue development priorities while also making smart investments in media. The Bill & Melinda Gates Foundation, for example, funds health-related reporting at South Africa’s Mail and Guardian and at Premium Times. Aid has also been key to sustaining the organization I lead, News Narratives which uses funding from governments and foundations to support independent local media. Reporting we supported helped bring about a ban on female genital mutilation and uncovered numerous cases of corruption and mismanagement.

As these and other efforts demonstrate, supporting independent media is among the most important investments donors can make in Africa’s future. But support should never come with strings attached. To build strong communities, Africans need news they can trust. To deliver it, journalists need to come by their funding honestly.

The views expressed in this piece are the author’s own and do not necessarily reflect News Central’s editorial stance.


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Op-Ed

Oil sensitivity set to intensify on conflicting themes

Oil markets are poised to remain highly sensitive and reactive to supply and demand side factors ahead of the OPEC meeting this month.

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Oil sensitivity set to intensify on conflicting themes | News Central TV

It has been a rollercoaster trading week for oil markets as investors tussled with conflicting fundamental themes pulling and tugging at the commodity.

Oil prices initially collapsed roughly 4 per cent mid-week thanks to an unexpected rise in U.S. crude stockpiles and a gloomy outlook for global oil demand. Bulls were later thrown a lifeline after geopolitical tensions in the Middle East rekindled concerns over potential supply shocks.

Oil markets are poised to remain highly sensitive and reactive to supply and demand side factors ahead of the OPEC meeting this month. With oil trading at depressed levels despite the recent rebound, OPEC+ may have no other choice but to extend supply cuts in an effort to prevent any further downside shocks.

Related: Nigeria foreign reserves rise in May; Gold Shines

For as long as Nigeria remains reliant on oil sales as a source of growth, the weakness in oil exposes the nation to significant downside risks. Should oil prices sink deeper into the abyss, Nigeria’s fragile recovery, exchange rate stability and improving sentiment will be under threat.

Looking at the technical picture, WTI Crude is trading marginally below $53.00 as of writing. Repeated weakness below this level is likely to encourage a decline towards $52.00 and $50.60.

Dollar steady ahead of retail sales 

dollar

The Dollar edged higher against a basket of major currencies today as trade tensions and global growth concerns supported the flight to safety.

While the Dollar is likely to remain supported by safe-haven flows amid persistent trade tensions, the question is for how long? With the Fed speculated to cut interest rates and recent economic data from the United States nothing to celebrate about, the Dollar is running on borrowed time.

Related: Nigeria’s week ahead: ECB meeting and Oil in focus

Much attention will be directed towards the latest U.S. retail sales figures on Friday which should offer insight into the health of the U.S. economy.

Should the report disappoint, the Dollar is likely to weaken as expectations mount over the Federal Reserve cutting interest rates this year.

Commodity spotlight – Gold 

Commodity spotlight – Gold

This has been a mixed trading week for Gold due to the growing sensitivity of global risk sentiment.

Related: Investors “Sell in May and Go Away” as risk aversion intensifies; Oil collapses

The precious metal has the potential to conclude the week on a positive note if the pending US retail sales report fails to hit market expectations. Looking at the technical picture, Gold is likely to test $1347 if $1324 proves to be a reliable support.

The views expressed in this piece are the author’s own and do not necessarily reflect News Central TV’s editorial stance.

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Op-Ed

Nigeria’s week ahead: ECB meeting and Oil in focus

The week kicks off with the US ISM Manufacturing PMI for May which is projected to hit 53.0

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Nigeria week ahead: ECB meeting and Oil in focus
(File photo)

It will be another busy week for financial markets as investors grapple with trade tensions, Brexit, depressed oil prices and concerns over slowing global growth.

The week kicks off with the US ISM Manufacturing PMI for May which is projected to hit 53.0. Appetite for the Dollar is likely to take another hit if the PMI figures fail to meet market expectations.

Investors will be paying very close attention to Fed Chair Powell’s speech on Tuesday for fresh insight into the Fed’s monetary policy path. Investors will be paying very close attention towards Powell’s tone, given how concerns are rising over trade tensions potentially impacting the US economy. 

The biggest event risks this week will be the European Central Bank meeting and US jobs report on Friday. The Dollar could end up depreciating further if the US jobs report disappoints and fuels speculation over the Fed cutting interest rates this year. Naturally, this will be good news for emerging market currencies with the Naira falling into the category.

The economic calendar for Nigeria will be relatively light this week with the Stanbic IBTC Bank PMI scheduled for release on Thursday. Although the economic docket is light, external factors in the form of trade tensions, the Dollar and most importantly oil prices will impact sentiment towards the nation.

Falling oil prices are set to place the Nigerian economy in a difficult position. It is widely known that Nigeria relies heavily on crude oil exports which account for over 90% of exports earnings and over 70% of government revenues.

A sharp decline in oil prices could threaten Nigeria’s economic recovery while disrupting exchange rate stability. The potential decline in foreign exchange reserves from lower oil is likely to weaken the Naira, consequently translating to rising inflationary pressures. Consumers and businesses will feel the pain as inflationary pressures mount, while the drop in foreign reserves may complicate the Central Bank of Nigeria’s efforts to defend the Naira.

For Nigeria to insulate itself against such external risks, there needs to be a greater push on diversifying away from oil reliance to other sustainable sources of economic growth with Agriculture being one of several solutions. Elsewhere, Gold is glittering as geopolitical risk factors and concerns over slowing global growth accelerate the flight to safety.

This precious metal has turned bullish on the daily timeframe as is positioned to push higher should $1,300 prove to be reliable support. A vulnerable Dollar should inject bulls with enough inspiration to push Gold towards $1,324 in the short to medium term.

The views expressed in this piece are the author’s own and do not necessarily reflect News Central TV’s editorial stance.

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Op-Ed

Nigeria foreign reserves rise in May; Gold Shines

Rising foreign reserves should provide the extra ammunition needed for the Central Bank of Nigeria (CBN) to defend the Naira

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Nigeria foreign reserves rise in May; Gold Shines

The Naira is set to witness further stability against the Dollar after Nigeria’s foreign exchange reserves increased by $295.12m to $45.087bn in May.

Rising foreign reserves should provide the extra ammunition needed for the Central Bank of Nigeria (CBN) to defend the Naira against a tornado of domestic and external headwinds. Nevertheless, the nation still remains exposed to oil price volatility. It is widely known that Nigeria relies heavily on crude exports which account for over 90% of exports earnings and over 70% of government revenues. The fact that oil prices are sinking towards $55 today may lead to a fall in reserves in the coming months which has the potential to impact exchange rate stability, inflation, and economic growth.

Dollar blinks and loses hold on throne 

Dollar bulls were nowhere to be found today despite risk aversion accelerating the flight to safety. Market fears over Trump’s trade disputes with Mexico and China negatively impacting the US economy are weighing on the US Dollar.  While the Greenback still remains a prime destination of safety in times of uncertainty, the question is for how long? When keeping in mind how the Fed funds futures are currently pointing to a near 70% chance of a rate cut by September, the Dollar’s upside may be limited. In regards to the technical picture, the Dollar Index has the potential to sink back towards 97.50 if a weekly close below 98.00 is achieved.

Commodity spotlight – Gold 

Gold is extended gains on Friday amid news of unexpected tariffs on Mexican goods, while ongoing US-China trade tensions continued to support safe-haven demand. 

A depreciating Dollar is supporting the upside with prices trading marginally below $1300 as of writing. Market expectations over the Fed cutting interest rates in 2019 coupled with concerns over slowing global growth are likely to ensure Gold remains buoyed moving forward. Technical traders will continue to closely observe how Gold behaves below the $1300. A solid breakout above this point should signal a move higher towards $1324.

Oil set to register first monthly loss of 2019 

Oil is on track to register its first monthly loss of 2019 with WTI Crude sinking towards $55 thanks to Trump’s newly announced tariffs on Mexico and concerns over rising US gasoline stockpiles.

It is becoming increasingly clear that oil markets remain highly reactive to news around supply and demand factors. Such market dynamics will frame the upcoming OPEC meeting in June as a pivotal event that will shape Oil’s outlook for the rest of the year. Even if OPEC+ decide to extend their supply cuts into the second half of the year, this may be overshadowed by concerns over US-China trade tensions impacting the demand for oil as global grows.

The views expressed in this piece are the author’s own and do not necessarily reflect News Central’s editorial stance.

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