Economic and Business News
For the Week ending, Friday, 27th March, 2017
FG to disburse N500bn Paris Club refund this week
LThe disbursement of the N500bn London-Paris Club loan refund to states by the Federal Ministry of Finance is to commence next week, investigations have revealed
Top government officials confided in our correspondent that the Minister of Finance, Mrs. Kemi Adeosun and the Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele, would meet anytime soon over the modalities for the disbursement of the funds.
The official said, "We have received the President's directive which was issued last week and we have already started working on the release of the funds but of course you know there are processes to be followed which is what we are doing now
Punch . Monday, 20 March 2017
World Bank to invest $57bn in Nigeria, Sub-Saharan Africa
The World Bank Group President, Mr Jim Kim said the bank would be investing 57 billion dollars to accelerate growth and development In Sub-Saharan African countries over the next three years.
In a statement released to Nigerian journalist by the Senior Communications Officer, World Bank Nigeria, Mrs Olufunke Olufon, on Monday in Abuja, Kim said the money would be raised by three subsidiaries of the group.
According to Kim, the funding will run from July 1, 2017, to June 30, 2020. "The bulk of the financing, 45 billion dollars will come from the International Development Association (IDA), the World Bank Group's fund for the poorest countries.
The Guardian. Monday, 20 March 2017
EU, Oxfam distribute water pumps, fertilizers to farmers
As part of its Pro Resilience Action Project, an European Union support for food security and resilience in the northern part of the country, Oxfam Nigeria has commenced the distribution of water pumps and fertilizers to farmers in Adamawa State, with the state government's support.
Over 400 water pumps and 4,800 bags of fertilizer were distributed to dry season farmers in Fofure and Guyuk Local Governments of the state to ensure food security and fight hunger.
The state government, during the exercise, warned farmers not to sell the inputs provided by the government and development agents instead of using them on their farms.
Punch. Monday, 20 March 2017
NEPC, Japan partner on packaging Nigeria's agric produce for export.
The Nigerian Export Promotion Council (NEPC) says it has partnered Japan External Trade Organisation (JETRO) to improve the quality of packaging of Nigeria's agricultural produce for export.
Executive Director of NEPC, Mr. Segun Awolowo, announced this at a capacity building programme for stakeholders in the sector, on Monday, in Lagos.
The theme of the programme was: "Logistical Packaging Technology for Agricultural Products."
Daily Sun. Monday, 20 March 2017
Fiscal, monetary authorities move to bridge policy gap
Ahead of the decision of the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) on interest rate, fiscal and monetay policy authorities have moved to bridge gaps between them on monetary policy rate direction against the need to stimulate economnic growth and curtail inflation.
Financial Vanguard investigation over the weekend revealed that the CBN's MPC would stick its Monetary Policy Rate (MPR) contrary to the position of the Ministery of Finance.
Vanguard. Monday, 20 March 2017
2017 Budget suffers major setback
Abuja - Strong indications have emerged that the passage of the 2017 Appropriation Bill may suffer a major setback in the National Assembly as forty- four committees of the Senate are yet to defend their budget proposals before the Committee on Appropriations.
The committees that have not yet defended their 2017 budget before the Senator Danjuma Goje-led Committee on Appropriations are Airforce; Army; Anti-Corruption and Financial Crimes; Capital Markets; Communications; Co-operation and Integration in Africa and NEPAD; Culture and Tourism; Defence; Downstream Petroleum sector and Ecology as well as Climate Change..
Vanguard. Monday, 20 March 2017
CBN's intervention forces BDCs to sell N415/$1
The naira will trade at N415 to a dollar as the series of intervention by the Central Bank of Nigeria (CBN) are sustained, Alhaji Aminu Gwadabe has said.
Gwadabe, President, Association of Bureau De Change Operators of Nigeria (ABCON), told the News Agency of Nigeria (NAN) on Tuesday in Lagos that the new Forex policy had eliminated frivolous demand for dollar. According to him, frivolous demand for dollar has been responsible for the weakness of the naira.
The ABCON chief said that CBN's continued intervention at the Forex market would soon spell doom for speculators and currency hoarders.
The Guardian. Tuesday, 21 March 2017
CBN says banks becoming less resilient, retains key rates.
The Monetary Policy Committee of the Central Bank of Nigeria on Tuesday said that the adverse macroeconomic environment, which had led to massive job losses and declining profitability, was making the banking sector less resilient.
The CBN Governor, Mr. Godwin Emefiele, stated the position of the committee while addressing journalists shortly after the two-day MPC meeting held at the headquarters of the apex bank in Abuja.
The governor, who read the communique issued at the end of the meeting, said the committee specifically expressed concern about the rising non-performing loan portfolio and declining asset quality in the banking sector.
Punch. Wednesday, 22 March 2017
Stakeholders want FG to integrate SMEs into value-chain
Stakeholders have called on the present administration to prioritise developmental initiatives towards Micro Small and Medium Enterprise (MSME) development, by improving the ease of doing businesses and providing a separate tax regime for the SME sub sector in the country.
The stakeholders called for a tax regime that would support MSMEs, as well as an integration of the sector into the value-chain, while recommending that about 10 per cent of public procurement should be handled by such businesses to aid their growth.
Besides, the Bank of Industry (BoI) has restated its commitments to work on developing innovative products and services to support MSMEs' operations in the country, noting that promoting the growth of small businesses in the country is the fastest way to transform and achieve rapid industrial growth and development.
The Guardian. Wednesday 22 March 2017
Anambra surpasses local consumption with the entry of JOSAN Rice Farms and Mills.
AWKA- RICE production has received a further boost in Anambra State with the commissioning of JOSAN Integrated Rice Farms and Mills located at Enugwuabo, Ufuma in Orumba North local government area of the state. It is expected to add 90 metric tonnes of rice to the existing 250 metric tonnes currently being produced in the state.
Governor Willie Obiano, at the commissioning ceremony, boasted that agriculture, one of his administration's cardinal programmes, had made great impact within three years of his administration. He recalled that at the time he assumed office on March 17, 2014, Anambra was producing 80 metric tonnes of rice annually, but is producing 250 metric tonnes.
Vanguard. Wednesday, 22 March 2017
Nigeria introduces visa on arrival for foreign investors
The Nigeria Immigration Service (NIS) has announced the introduction of a liberalised online Visa on Arrival (VOA) facility to the public, especially foreign investors willing to invest in Nigeria. The Comptroller-General of the NIS, Mr Muhammad Babandede, made the announcement on Thursday in Abuja. Babandede said that the measure was part of the resolution of the Presidential Enabling Business Environment Council (PEBEC) aimed at attracting foreign investors to the country.
"As a critical member of the Presidential Enabling Business Environment Council (PEBEC), the NIS has automated its visa application and processing services at all entry points.
Vanguard. Thursday, 23 March 2017
External Reserves drop for first time since December
The nation's foreign exchange reserves, which had increased significantly in recent months to hit the $30bn mark, fell for the first time this year on Tuesday. Latest data from the Central Bank of Nigeria showed on Wednesday that the external reserves dropped to $30.349bn on Tuesday from $30.352bn on Monday.
The reserves, which rose 17.4 per cent from last year when they closed at $25.843bn, hit a low of $23.89bn on October 19, 2016. The foreign exchange reserves had on December 14 dropped to $25.041bn from $25.048bn the previous day but it increased to $25.043bn the next day.
Punch. Thursday, 23 March 2017
Recapitalisation spurs mergers, acquisitions in insurance sector
A fresh recapitalisation in the nation's insurance industry owing to its low capital base and penetration has spurred mergers and acquisitions to reposition the sector for a new era of efficient operations.
The move, according to stakeholders, is part of efforts by the National Insurance Commission (NAICOM) to make the sector once again attractive to Nigerians.
Following the apathy for the industry, mainly caused by acts of omission and commission manifest in the forms of non-payment of dues to policy holders and the shirking of other obligations over the years, the citizens now avoid insurance products. To reverse the trend, it has, therefore, become incumbent on the regulator to win back the confidence of Nigerians by strengthening the financial base of the sector. If the sector comes fully alive again on the basis of the new policy, the incidental benefits are many. Jobs will be created and the contracting national GDP may experience a breather and an opportunity to expand.
The Guardian. Thursday, 23 March 2017
China Exim Bank to bankroll $1.79bn Abuja light rail
The China Exim Bank will bankroll the $1.79 billion second phase of the Abuja Mass Transit Rail that will cover new areas in the capital city of Abuja.
The Abuja second phase mass transit rail is expected to pass through Area 10, Berger junction, Jabi Motor, Wuse Market, through to Life Camp to terminate at Gwagwa.
He told State House correspondents after the meeting that the rail project has been awarded to China Civil Engineering and Construction Company, (CCECC) at the cost of $1.79 billion. This is outside $1.5 billion (about N450 billion) counterpart funding secured from China earlier in the year by the Federal Government for the Lagos-Ibadan rail project set to commence in March.
The Sun. Thursday, 23 March 2017
Financing agriculture and non-oil exports
The Bankers Committee's decision that all deposit money banks (DMBs) in the country should, every year, set aside and pool together five (5%) per cent of their Profit After Tax (PAT) for financing agriculture and non-oil exports is a very commendable one. The plan is to support agricultural and import substitution policies of the government as well as the drive towards diversification of the economy.
According to reports, the banks would use the pooled funds to be kept in the Central Bank, controlled and administered by the Bankers Committee, to make equity investments and not loans in companies that operate in the agricultural and non-oil export sectors. Banks would, therefore, not charge the companies interest but would be rewarded by sharing out of the dividends declared by the companies.
A maximum period of 10 years was agreed for banks to exit from companies they financed. The Bankers Committee would set up a Project Review Committee that would, among other things, assess applications from companies desiring to benefit from the scheme, make recommendations to a Board of Trustees of the Bankers Committee. The scheme would commence in 2017 using funds, estimated at N25 billion, from banks' 2016 financial statements.
The Guardian. Thursday, 23 March 2017
BoI, operators seek separate tax regime for SMEs
Operators in the Micro, Small and Medium Enterprise sector of the Nigerian economy have called on the present administration to prioritise initiatives aimed at the MSME development and provide a separate tax regime for the sub sector of the Nigerian economy.
The operators also recommended that about 10 per cent of public procurement should be handled by small businesses to aid their growth. Along with the operators, Nigeria's development finance institution, the Bank of Industry, indicated its readiness to work on developing innovative products and services to support the MSME operations in the country.
Punch. Friday, 24 March 2017
MAN faults CBN, seeks interest rate reduction
The Manufacturers Association of Nigeria on Wednesday faulted the decision of the Monetary Policy Committee of the Central Bank of Nigeria to retain the Monetary Policy Rate at 14 per cent.
The President, MAN, Mr. Frank Jacobs, said in a telephone interview with our correspondent that such a high interest rate was killing the manufacturing sector. He said with the plan of the government to stimulate the economy and reposition the country on the path of growth, having an interest rate as high as 14 per cent was not favourable to the real sector.
Jacobs stated, "The CBN has been doing the same thing and we have been complaining. Fourteen per cent is obviously not favourable to the manufacturing sector or the real sector of the economy, considering that the interest rate we pay on facilities will be over 20 per cent and no country that really wants to develop industrially will encourage that level of interest rate.
Punch. Friday, 24th March 2017.
Naira may gain further, hits 385/dollar
The Naira is likely to strengthen further on the black market as the Central Bank of Nigeria steps its interventions in the foreign exchange market.
The naira strengthened to 385 to the dollar on the black market on Thursday, from 395 on Wednesday, and from 457 last Thursday.
Punch. Friday, 24th March 2017.
Other Economic and Business Indicators
|Monetary Policy Rate||14%
|Inter-Bank Call Rate||10.39%
|Prime Lending Rate||17.09%
|Maximum Lending Rate||28.55%
|External Reserve||USD 30,340,326,322
(24 March, 2017)
|Exchange Rate (CBN)
17 March 2017
|Exchange Rate (Parallel Market)
24 March 2017
|Treasury Bill Rate (91 Days)||13.55%
(22 March, 2017)
|Currency in Circulation (Million Naira)||2,179,174
|Banks Reserves(Million Naira)||3,318,344.71
|External Debt - FGN + States (USD million)||11,261.89
(as at June 30, 2016)
|Local Debt - FGN only (NGN million)||10,606,334.22
(as at June 30, 2016)
|Bank Credit to to Private Sector (NGN million)||22,374,718.08
|Demand Deposits at Banks (NGN million)||9,699,750.76
|Nigeria's Merchandise Trade||4,721.9 billion (Quarter 3, 2016)|
|Crude Oil||$48.25 (OPEC Daily Basket, March 27, 2017)|
Source: CBN, NBS and DMO
Compiled by: Research Department, NACCIMA
27 March, 2017