Guys for your informations. See how our country is preforming.

Inside info.

Please bear with me (the tabs for the preformance indicators) 



Assets


• Africa's leading oil producer, Nigeria boasts 31% of the African oil resources. Nigeria is also endowed with the world's seventh largest gas  reserves and largely unexploited farm potential.
• With its hydrocarbon resources, Nigeria is one of the leading destinations for foreign direct investment flowing into Africa.
• The Nigerian banking system is one of the most developed on the continent and contributes to financing the economy.
• With half the population of West Africa, Nigeria plays a preponderant political role at both the regional and continental levels


Weakness
• Not only has the oil wealth fostered corruption but its insufficient redistribution has also stoked social, ethnic, and religious tensions.
• An economy largely dependent on oil revenues — which represent nearly 90°% of exports and about 25°% of GDP — has remained vulnerable to price and production shocks.
• Deficient transport and energy infrastructure — with only 40°% of Nigerians equipped with electricity — has limited the diversification of the productive fabric.
• With hydrocarbon sector producing only a limited bandwagon effect, poverty thus continues to afflict 70°% of the population


Rating  D
A high-risk political and economic situation and an often very difficult business environment can have a very significant impact on corporate payment behavior. Corporate default probability is very high.

MAJOR MACRO ECONOMIC INDICATORS

NIGERIA

(USD billions)                2004 2005        2006        2007       2008(e    2009(f)
Economic growth (%) 10.6 5.4 6.2 6.4 6.2 6.0
Inflation (%)                 15.0        17.8          8.3           5. 5          8.6           8.5
Public sector balance (%GDP) 6.3 8.1 7.7 0.9 4.4 4.2
Exports                               36.9          50.2         59.1         61.3        78.9           80.3
Imports                               19.4          25.6         31.1         38.8         44.3          49.9
Trade balance               17.5          24.6          28.0         22.5         34.6 30.4
Current a/c balance (%GDP) 4.9 7.1 9.4 1.8 6.4 1.2
Foreign debt (%GDP) 41.3 19.8 2.4 2.0 1.6 1.8
Debt service (%Exports) 6.2 8.2 17.3 1.9 0.7 0.6
Forex reserves (mths/imports) 5.8 8.3 10.1 11.2 14.1 16.6


MARKET SIZE

NIGERIA
Main Economic Indicators                    NIGERIA                       Regional                       average                  DC average
GNP per capita (PPP dollars)                                                                          1050                            2029                        5983
GNP per capita (USD)                                                                           640                             842                                 2313
Human development index                                                                         0,453              0,450                      0,672
Wealthiest 10% share of national income (%)                                            33                                   34                          31
Urban population percentage                                                                            48                                   37                          44
Percentage under 15 years old                                                            44                                   43                                   30
Number of computers per 1,000 inhabitants                                              7                                   18                          50


RISK ASSESSMENT

NIGERIA
Persistent tensions in the Niger delta in 2008 continued to affect oil production, reduced to two-thirds of its potential despite the start-up of operations of off-shore sites. Economic growth was nonetheless spurred by soaring oil prices and the dynamism of sectors outside hydrocarbons, particularly agriculture, construction, and telecommunications. Public sector investment in the farm sector and transport infrastructure in 2009, albeit less dynamic than the previous year, will continue to drive an economy undermined by the fall of world prices and a slowdown in foreign direct investment inflows associated with the international financial context. Inflation that exceeded 8% in 2008 as a result of soaring prices for foodstuffs (constituting 70°per°cent of the reference basket) is expected to continue as a result of the inadequate sterilisation of foreign exchange reserves.

Sustainability restored; abundant liquidity
The discharging of the debt owed to Paris and London Club creditors in 2006-07 greatly strengthened Nigeria's financial position. The latest IMF debt-sustainability analysis concluded in limited default risk in the medium-term. Outside hydrocarbons, however, the public sector and current account deficits have been disturbingly large, representing respectively a negative 45°% and negative 36°% of GDP reflecting an insufficiently diversified economic fabric. In this context, public sector debt will remain exposed to a loosening of fiscal discipline with foreign debt, now down to under 2% of GDP, remaining exposed to non-concessional borrowing sensitive to price downturns and production shocks. And, the regularity of additions to the oil stabilization fund (which totalled USD 23 billion in 2008), necessary to compensate for any prolonged downturn of prices, will bear watching. With Nigeria's foreign exchange reserves covering over a year of imports, near-term liquidity risk is insignificant.

The business environment: a critical risk factor
Nigeria's political and institutional shortcomings constitute, however, a critical risk factor. Coming into power in February 2007 via disputed elections, Umar Yar'Adua has not succeeded in imposing his authority, particularly in managing the Niger delta crisis. The intervention of federal armed forces in the delta in autumn 2008 sealed the failure of the negotiation process and prompted various rebel forces to form an alliance. At a more general level, the weakening of federal power and a president in poor health augurs a bogging down of the security situation. The priority given by the government to combating corruption has thus far not had any perceptible positive impact on the business environment with Nigeria remaining at the low end of governance rankings.

@ www.trading-safely.com

R u an accountant, economists, or both?

Credit Management

so how is this your Credit management going to help out guys here?

The current banking crisis in Nigeria could have been avoided if there was an effective credit management system and procedures in place.

Crucial to the country's financial system.

@vezycash - just a add on to your query.

explain more about credit management please. I just had that Nigeria was supposed to be one of the first countries in the world to have broadband internet connection -ITT and Obasanjo stole that right from us. Imagine where you would be now if,

This is my first post and just wanted to say hello to everyone. If you are looking for a nice technology blog visit http://infodirector.net

http://www.coface.com/CofacePortal/COM_en_EN/pages/home/risks_home/country_risks/country_file//Nigeria?nodeUid=572183

RISK ASSESSMENT

Demand for oil spurs the economy.

The economy rebounded in 2010, growing 5.5% thanks to the upturn of barrel prices with $79.30 expected for the full year compared to $63.30 in 2009. And the truce concluded with the insurgents in the Niger delta paved the way for an increase in oil production (which still reached just 2.05 million bpd).
In 2011, growth is expected to slacken somewhat as the world economy slows down. Oil prices will likely stagnate and thus guarantee relatively stable growth, against the background of a partial easing of tension in the Niger delta region. Agriculture is expected to continue to drive the economy, underpinned by investment in commercial operations. Excluding oil, 8% growth is expected. However, the country continues to largely under-exploit its potential for oil and gas production, and shortcomings in energy infrastructure (recurrent energy shortages) and transport infrastructure have undermined overall economic potential.

A sustainable level of debt but highly volatile foreign exchange reserves

The discharging of the debt to the Paris Club and London Club creditors in 2006-7 strengthened Nigeria's financial position significantly. Nigeria's debt remains sustainable in the medium term.

However, the crisis has highlighted the extreme volatility in the level of foreign exchange reserves, which would not suffice to overcome a permanent shock to growth, especially one resulting from a long-term drop in oil production. In addition, money is siphoned off from the Nigerian oil fund, as political tensions ebb and flow, by the local governors who believe it unlawful for the federal government to retain the funds. The fund has melted away from $20 billion in 2007 to under $500 million in August 2010. It is thus expected to be virtually exhausted by 2011.

A banking sector in the process of reconsolidation

Recapitalization of the banking sector by the CBN has prevented a systemic crisis. The establishment of a defeasance structure at the end of 2010 will likely speed up the consolidation of banks' balance sheets, in particular by bolstering the confidence of potential foreign investors. However, increased concentration in the sector is likely, as is the expansion of those banks spared by the crisis. These two trends are expected to result in deterioration in the quality of the banks' portfolios.

The business environment remains shaky, but some progress has been made in the political arena

Nigeria's political and institutional shortcomings constitute a critical risk factor. Governance deficiencies were the root cause of the banking crisis and have deterred investment, particularly in oil. The death of President Umaru Yar'Adua in May 2010 brought Vice-President Goodluck Jonathan to power temporarily. He has initiated a series of reforms, which, if successful, could eliminate the bottlenecks restricting growth in the country. The interim President also seems committed to developing and pacifying the Niger delta region, which is where he was born. These prospects will only pan out if, as appears likely, he is elected in April 2011.

Questions regarding the relationship between the oil price shock and macroeconomic volatility are fundamental empirical issues in macroeconomics. The maintenance of price stability is one of the macroeconomic challenges facing the Nigerian government in our economic history. This elusive factor is known and referred to as inflation in our economic history and this is defined by economists as a continuous rise in prices. By definition,


http://www.scharticles.com/oil-prices-shock-macroeconomic-volatility/