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Thursday, 04 October 2018
The World Bank has lowered its growth forecast for Nigeria’s economy in 2018 to 1.9 percent as the growth continued to downsize in the oil and agriculture sector.
The latest estimate is 0.2 percent points lower than 2.1 percent growth the global financial body earlier projected for the nation’s economy in April.
The world bank said its decision to cut Nigeria’s 2018 growth estimate was occasioned by the reduction in the production volume of crude oil, the country’s main source of revenue, and contraction in the agricultural sector of the economy which was largely driven by the herder-farmer clashes.
“In Nigeria, declining oil production and contraction in the agriculture sector partially offset a rebound in the services sector and dampened non-oil growth, all of which affected economic recovery.
“Nigeria’s recovery faltered in the first half of the year. Oil production fell, partly due to pipeline closures.
“The agriculture sector contracted, as conflict over land between farmers and herders disrupted crop production, partially offsetting a rebound in the services sector and dampening non-oil growth,” the bank stated.
According to the National Bureau of Statistics (NBS), the oil sector of the economy contracted by -3.95 percent in the second quarter of 2018 from a year earlier, while the non-oil sector grew by 2.05 percent in real terms during the reference quarter.
The drop in the oil sector impeded growth in the Nigerian economy to 1.50 percent in the quarter down from 1.95 percent recorded in the preceding quarter.
Available statistics from NBS shows that the nation’s agricultural sector grew by 1.19 percent from a year earlier in real terms in the second quarter of 2018, representing a decrease by –1.82 percent points from the corresponding period in 2017.
The data further shows that Nigeria’s average daily oil production volume dropped in Q2 2018 to 1.84 million barrels per day after recording an average production volume of two (2) million barrels per day in the previous quarter.
The contraction in the Crude oil and Gas sectors was attributable to some production issues which, according to the Minister of Budget and National Planning, Sen. Udoma Udo Udoma, were being addressed by the Nigerian National Petroleum Corporation (NNPC).
But the Minister of State for Petroleum, Ibe Kachikwu, had last month noted that the decision to raise or cut production volume would be largely dependent on the prices of crude in the international market.
This indicates that there may soon be a rebound in the country’s crude oil production volume as the Brent crude, against which Nigeria’s oil is priced, hit its highest level of $84 per barrel since November 2014 last Monday.
The development was occasioned by supply concerns in the international market ahead of United States sanctions on Iran’s oil sector expected to take effect from next month.
Source: Business linking
Published in Business
The African continent is said to be losing over $80 billion to illicit financial flows every year, according to South Africa’s former President, Thabo Mbeki.
The loss represents an increase of about $30 billion in 2018 from $50 billion which the former South African leader had said the continent was losing in 2015.
Mbeki, who is the Chairman of African Union, made the disclosure while presenting a report of the union’s high-level panel on illicit financial flows during a two-day meeting in Abuja on Thursday.
The meeting which had in attendance leaders of African Union member countries was to review the progress made so far in the fight against the scourge.
He decried the growing level of illicit financial outflows from the continent, noting that the practice could impede Africa’s development.
Speaking at the event, Chairman of the Federal Inland Revenue Service (FIRS), Tunde Fowler, pointed out that 40 percent of the total illicit funds in the continent come from the oil & gas, multi-national corporations, and banking and financial services sector of the Nigerian economy.
Fowler explained that the funds also refer to taxes to the government defaulted by companies and individuals, and repatriated finances from one country into other Africa nations.
Also speaking, the Attorney General and Minister of Justice, Abubakar Malami, said Nigeria was deploying a number of strategies to address the ugly trend, stressing that government agencies like the Economic and Financial Crimes Commission (EFCC) and Independent Corrupt Practices and Other Related Offences Commission (ICPC) have been strengthened through the approach.
He also mentioned that the Federal Government’s strategies include the whistle-blowing policy, Bank Verification Number (BVN), and Integrated Personnel and Personal System (IPPS) which has helped by leveraging the use of technology to compute payment of salaries.
Source: The Ripples
Published in Bank & Finance

The Naira on Thursday appreciated marginally against the dollar at the Investors’ Window (I & E), exchanging at N363. 57, stronger than N363.94 posted on Wednesday.

The daily market turnover stood at 392.9 million dollars.

The Nigerian currency closed at N306.40 to the dollar at the official CBN window.

At the parallel market, the Naira closed at N359 to the dollar, while the Pound Sterling and the Euro closed at N478.30 and N420.

Trading at the Bureau De Change(BDC) segment saw the Naira close at N360 to the dollar, while the Pound Sterling and the Euro closed at N478.30 and N420.

Meanwhile, in spite of the continuous intervention by the Central Bank of Nigeria (CBN) at the foreign exchange market and the increase in the price of oil at the international market, the manufacturing sector witnessed slow growth in the month of September.

The manufacturing sector continued to expand in September, though at a slower pace, the latest CBN Manufacturing Purchasing Managers’ Index (PMI) report, shows.

It showed that the September Manufacturing PMI eased to 56.2 from 57.1 in August, indicating expansion in the manufacturing sector for the 18th consecutive month.

The report noted that “a composite PMI above 50 points indicates that the manufacturing/non-manufacturing economy is generally expanding, 50 points indicates no change and below 50 points indicates that it is generally contracting.”



Published in News Economy

Twitter has launched a new setting for South Africa which will enable people using Twitter for iOS and Android to save data while they browse.

Jesar Shah, Product Manager, Twitter said: “With data saver, images will load in a smaller size, allowing them to load more quickly and autoplay videos are disabled. This enables you to consume less data and have more control over your data usage. You can turn data saver mode on or off in data usage settings on iOS and Android. The feature is also currently available on Twitter Lite.”

Shah explained that people will still be able to access high quality images with the setting turned on: “If people want to see images in higher quality with data saver on, they simply tap the more icon and select ‘Load High Quality.’”

Published in Telecoms

Sluggish expansion in Nigeria, Angola and South Africa – Africa’s three largest economies – is expected to dampen the growth prospects for Sub-Saharan Africa to 2.7 percent in 2018, according to the World Bank which has also warned of increasing public debt in the region.

The World Bank says it now expects Sub-Saharan Africa economies to grow by 2.7 percent in 2018, lower than the 3.1 percent it had projected for the subregion earlier in April.

The World Bank notes that Sub-Saharan African economies are still recovering from the s2015-2916 slowdown, but growth is still slower than expected.

“The slower pace of the recovery in Sub-Saharan Africa (0.4 percentage points lower than the April forecast) is explained by the sluggish expansion in the region’s three largest economies, Nigeria, Angola, and South Africa,” the World Bank said in the Africa Pulse published on Wednesday ahead of the Annual meetings of the International Monetary Fund (IMF) and World Bank scheduled to begin in Bali, Indonesia on Monday, October 8.

The estimated 2.7 percent average growth rate in the region is however, a slight increase from 2.3 percent recorded in 2017.

“The region’s economic recovery is in progress but at a slower pace than expected,” said Albert Zeufack, World Bank Chief Economist for Africa.

“To accelerate and sustain an inclusive growth momentum, policy makers must continue to focus on investments that foster human capital, reduce resource misallocation and boost productivity. Policymakers in the region must equip themselves to manage new risks arising from changes in the composition of capital flows and debt.”

According to the World Bank, Slow growth is partially a reflection of a less favorable external environment for the region.

Global trade and industrial activity lost momentum, as metals and agricultural prices fell due to concerns about trade tariffs and weakening demand prospects. While oil prices are likely to be on an upward trend into 2019, metals prices may remain subdued amid muted demand, particularly in China.

Also, Financial market pressures have intensified in some emerging markets and concern about their dollar-denominated debt has risen amid a stronger US dollar.

Besides, Lower oil production in Angola and Nigeria offset higher oil prices, and in South Africa, weak household consumption growth was compounded by a contraction in agriculture. Growth in the region – excluding Angola, Nigeria and South Africa – was steady.

The Bank further notes that Several oil exporters in Central Africa were helped by higher oil prices and an increase in oil production.

Economic activity remained solid in the fast-growing non-resource-rich countries, such as Côte d’Ivoire, Kenya, and Rwanda, supported by agricultural production and services on the production side, and household consumption and public investment on the demand side.

“Public debt remained high and continues to rise in some countries,” the World Bank further notes – amid heightened concerns that about 40 percent of low income countries in Sub-Saharan Africa region are already in debt distress or in high risk of debt crisis.

The IMF for instance worried that for low income countries, including Nigeria, governments have embarked on excessive borrowing to fund development, especially as incomes dwindled for commodity prices- and is now strongly advising on an aggressive tax mobilisation.

“Vulnerability to weaker currencies and rising interest rates associated with the changing composition of debt may put the region’s public debt sustainability further at risk,” the World Bank says in the latest report.

Other domestic risks include fiscal slippage, conflicts, and weather shocks. Consequently, policies and reforms are needed that can strengthen resilience to risks and raise medium-term potential growth.

This issue of Africa’s Pulse highlights sub-Saharan Africa’s lower labor productivity and potentials for improvement

“Reforms should include policies which encourage investments in non-resource sectors, generate jobs and improve the efficiency of firms and workers,” said Cesar Calderon, Lead Economist and Lead author of the report.


- Businessday

Published in Economy
  1. Opinions and Analysis


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