Monday, March 1African Business News
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Tag: forex

‘Infrastructure, forex undermining real sector interventions’

‘Infrastructure, forex undermining real sector interventions’

Business
Improvement in local manufacturers’ confidence in the economy as well as sectoral recovery, remains challenged by parlous state of infrastructure and poor implementation of policies, especially those related to the palliative given to the manufacturing sector in the form of reduced interest rate, operators have said. With the manufacturing sector’s contributions to the latest Gross Domestic Product (GDP) remaining very low, despite acclaimed interventions from the Central Bank of Nigeria (CBN), local producers noted that the inability to control input costs and poor infrastructure affect productive output as well as confidence in the economy. The Director-General of the Manufacturers Association of Nigeria (MAN), Segun Ajayi-Kadir, noted that while manufacturers are optimistic t...
Preserving forex reserves, raising local capacity through import substitution

Preserving forex reserves, raising local capacity through import substitution

Finance
For decades, successive governments in Nigerian resorted to protective measures, including import restrictions and exchange rate control, to manage its foreign exchange (forex) market, and deal with the problems of import and oil dependency. This import substitution policy is usually heralded by an economic crisis, often triggered by the collapse of the oil market, and a significant drop in Nigeria’s oil revenues, which account for 70% of the country’s total revenues. Expectedly, the Central Bank of Nigeria (CBN), followed this well-trodden path in efforts to ensure that Nigeria embraces import substitution and reduces the demand pressure on foreign exchange by importers, and ultimately conserves the nation’s hard-earned reserves. For instance, in June 2015, it ban...
Rising COVID-19 cases, unfavourable policies drag NSE’s index by 1.99%

Rising COVID-19 cases, unfavourable policies drag NSE’s index by 1.99%

Business
The Nigerian Stock Exchange (NSE) suffered another week of losses, amid rising COVID-19 cases, and the persisting foreign exchange (forex) illiquidity in the market. Consequently, the NSE All-Share index (ASI), and market capitalisation depreciated by 1.99% to close the week at 24,336.12 and N12.695 trillion, respectively. All other indices also finished lower. But analysts linked the persistent selloff to lack of coordination in policy articulation, formulation and direction. Specifically, the Chief Research Officer, Investdata Consulting Limited, Ambrose Omordion, said the proposed hike in electricity tariff and recent increase in the pump price of premium motor spirit (petrol) to N143.80 per litre, are clear indications that monetary and fiscal authorities are still not comple...