economy Archives - Inside Business Africa

Jan182021 by Joshua OlotuNo Comments

Stagflation and how to tame Nigeria’s misery index

Economy

The headline inflation has grown consistently in the past 15 months to hit 15.75 per cent in December. The last time the index reached and exceeded its current figure was December 2018. Unmanageable inflation growth is a challenge but just one among the red data the economy is grappling with. Unemployment (plus underemployment) also reached an all-time high of above 55.7 per cent last year just as the weak naira is crushing the purchasing power of an average citizen daily. At the same time, production continues to face a cost efficiency challenge with the government’s ability to intervene being weakened by falling revenue. The country officially announced a recession last year when the gross domestic product (GDP) plunged over six per cent. These indicators point to one worrisome ...

Aug312020 by Joshua OlotuNo Comments

Reversing Nigeria’s current economic malaise

Economy

Nigeria is currently fighting on many fronts to keep the balance between a fall in oil prices and the global economic slowdown resulting from the COVID-19 pandemic. Unfortunately, many of the country’s major trade partners are also grappling with the negative effects of the pandemic, compounding the dilemma of Africa’s most populous country. The International Monetary Fund (IMF), had predicted that the Nigerian economy would recede by 5.4 per cent this year, its worst recession in three decades. The contraction comes amid a general slide in the global economy caused by the coronavirus pandemic. Hitherto, the nation’s economy had been wobbling with weak recovery from the 2014 oil price shock to the 2016 economic recession with Gross Domestic Product (GDP) growth tapering around ...

Jul152020 by Joshua OlotuNo Comments

‘Why investors must increase understanding of investment risks’

Capital Market

As the nation’s investment climate continues to pose a challenge to stakeholders, a new report on the Nigerian investment landscape says investors must increase their understanding of investment risks to enable them to enhance their returns. The report by Coronation Research titled, “Navigating the Capital Market: ‘the Investors Dilemma’,” argued that Nigerian investors are faced with difficult investment choices following the unprecedented crash in interest rates. According to the Head of Research at Coronation Asset Management, Guy Czartoryski, investors are left with the alternatives to either wait for rates to rise again in future, or accept more risk in order to increase returns. Czartoryski, while explaining the nitty-gritty of the report at a Webinar, Monday, said the repor...

Jun232020 by Joshua OlotuNo Comments

Local savings can help reflate Nigeria’s economy, stakeholders say

Economy

The Minister of Finance, Budget, and National Planning, Mrs Zainab Ahmed, has canvassed the need for the mobilization of local savings to help reflate Nigeria’s economy post-COVID-19.Ahmed, who spoke during the inauguration of the National Savings Strategy Working Group, in Abuja, weekend, urged members to develop easy instruments that are safe and capable of attracting ordinary Nigerians to key into the strategy. The terms of reference for the Group include; to study the National Savings Strategy Paper and advise the Federal Government on the feasibility of the proposals or with recommended changes. They are also to identify “ways and means of mobilizing and channelling corporate and individual savings to accelerate domestic capital formation in support of entrepreneurs and enterprise ...

Jun232020 by Joshua OlotuNo Comments

Stakeholders urged to explore COVID-19 opportunities, diversify economy

Business

Participants at the Africa Initiative for Governance (AIG) webinar, have underscored the need for the government to leverage opportunities presented by the COVID-19 pandemic and diversify the economy, and spend wisely. AIG, a not-for-profit founded to inspire the transformation of Africa’s public sector, in collaboration with the Blavatnik School of Government, University of Oxford, hosted a virtual discussion on COVID-19, themed: “COVID-19 and the Oil Price Crash: Nigeria’s Tough Choices.” The stakeholders argued that the time is ripe for the country to focus on encouraging growth in the informal sector to boost the economy. They pointed out that COVID-19 has brought about many changes to the fabric of every society, restricting business activities, and causing lo...

Jun182020 by Joshua OlotuNo Comments

‘Balanced growth will expedite economic recovery, resilience’

Business

The outbreak of COVlD-19 has brought to fore the need to build a resilient economy that can withstand global shocks; hence, high time Nigeria adopted a Balanced Growth Model (BGM), to expedite economic recovery and resilience. BGM emphasizes the importance of simultaneously developing the oil sector value-chain (local oil refinery), and the non-oil sector (agricultural sector, manufacturing and education, among others), through strategic policies that focus on sustainable development, policy stability, economic stability and enhancing domestic purchasing power. PricewaterhouseCoopers Limited (PwC Nigeria) in its Economic Alert: Q1’20 GDP report, titled, “Broad-based shocks to global economy weigh on the country’s growth,” says BGM will not only expedite an economic recovery from the ...

Jun132020 by Joshua OlotuNo Comments

Hard, challenging recovery await air travel as airspace reopens

Aviation

Ahead of the air travel restart across the globe, the International Air Transport Association (IATA) has warned that a hard and challenging recovery await aviation across several levels. The body, which is the clearing house for over 280 global airlines, said without support from governments, the recovery might be harder. Already, IATA released its financial outlook for the global air transport industry showing that airlines are expected to lose $84.3 billion in 2020 for a net profit margin of -20.1 per cent. Revenues will fall by 50 per cent to $419 billion from $838 billion in 2019. In 2021, losses are expected to be cut to $15.8 billion as revenues rise to $598 billion. Airlines entered 2020 in relatively good financial shape. After a decade of profits, debt levels were relati...

Jun132020 by Joshua OlotuNo Comments

FG Extends Deadline for Marginal Oilfield Bids to June 21

Oil & Gas

The Department of Petroleum Resources (DPR) thursday extended by one week, the deadline to register to bid for Nigeria’s marginal oilfields, which will now close on June 21. The DPR launched the first marginal field award round in nearly 20 years on June 1. Applicants initially had until June 14 to register, but the timeline has been moved to June 21. The DPR, the nation’s petroleum regulator, did not give a reason for the extension, a report by Reuters said. The marginal oilfields comprise 57 fields located on land, swamp and shallow offshore terrains. Meanwhile, oil prices tumbled around seven per cent yesterday, fuelled by renewed concerns about demand destruction as new cases of coronavirus tick up globally, while the United States saw another large build in crude inventories. U...

Jun132020 by Joshua OlotuNo Comments

‘NPA to Save Nigeria Multi-million Dollars through Local Dry-docking’

Economy

The Managing Director of the Nigerian Ports Authority (NPA), Hadiza Bala-Usman, has said the agency has granted the necessary approval to ensure that vessel owners dry-dock their vessels in Nigeria to save the country multi-million dollars spent on ship repairs outside the country. Bala-Usman disclosed this while speaking during a webinar, titled: “COVID-19 and the Nigerian Maritime Sector: Lessons and Way Forward,” organised by maritime lawyer, Mike Igbokwe. According to her, “NPA has given a waiver for vessels that are meant for servicing and dry-docking and this has enabled vessel owners to competitively dry-dock in Nigeria. “This is important for us to build that sector and retain jobs in Nigeria. We have done our bit in promoting that sector and I call on the associations to brin...

May272020 by Joshua OlotuNo Comments

Experts urge FG to scale stimulus package for economic revamp

Economy

To mitigate the impact of COVID-19, financial experts have advised the Federal Government to go beyond the 3.83 per cent aggregate stimulus response for Nigeria economy. They urged authorities to increase support for the Small and Medium Enterprises (SMEs) that constitute over 70 per cent of the economy to keep them afloat. The experts made the call during a webinar, entitled: “CoVID-19: Strategies for mitigating economic crisis in Nigeria,” organised by the Institute of Chartered Accountants of Nigeria (ICAN), as one of its economic discourse series at the weekend. The virtual forum was attended by ICAN past presidents and members that included, Ismaila Zakari, Rasaq Jaiyeola, and Dame Onome Adewusi, as well as other professionals. The guest speaker, Dr Biodun...