₦airaland Forum

*Says growth potential beset by worsening FX crisis, inflation, insecurity, others

*Forecasts naira to officially weaken to N1,171/$ by December

*Says manufacturing may be further constrained by FX shortages

James Emejo in Abuja

A new report has predicted an increase in Nigeria’s current account surplus to about 1.8 per cent of Gross Domestic Product (GDP) in 2024, compared to an estimated 1.0 per cent in 2023.

According to the African Markets Revealed (AMR) report for January 2024, which was published by Standard Bank, oil production is expected to grow sufficiently to supply the Dangote Refinery with feedstock as well as impel higher oil export volumes.

Essentially, a current account surplus means that a country has more exports and incoming payments than imports and outgoing payments to other countries. It is generally seen as a positive development because the current account surplus adds to a country’s reserves.

The report, however, highlighted downside risk to the prediction due to the continued oil price weakness following the slowing global growth.

It said, “We forecast downward pressure for goods importation from two fronts.
“Firstly, increased oil refining from the Dangote Refinery and Nigerian National Petroleum Company Limited (NNPCL) would likely lower demand for imported petroleum products.

“Secondly, non-petrochemical goods imports (71.2 per cent of the total import bill in Q2 2023) could be hindered by poor FX liquidity and naira weakness.”

The report pointed out that despite the country’s growth prospects for the year, downside risks, including the worsening FX liquidity challenges, high inflation, increased insecurity, and lower crude oil production might diminish expectations.

It stated that the Nigerian economy was forecast to grow by 3.4 per cent, year on year in real terms in 2024, relative to an estimated 2.6 per cent for the preceding year.

Standard Bank hinged its optimism on anticipation for the oil sector to deliver 11.8 per cent year-on-year growth in the review period, higher crude oil production, as well as the non-oil sector’s growth improving slightly to 2.9 per cent from a 2023 growth estimate of 2.8 per cent.

However, structural issues regarding liquidity and worsening insecurity stood in the way of actualising the country’s growth potential, the bank stated.

Standard Bank said crude oil production, including condensates, was expected to increase significantly to 1.59 million barrels per day (mbpd) in 2024, from an estimated 1.43 mbpd in 2023.

It said the anticipated increase might result from primarily the cumulative impact of the government’s ongoing anti-crude oil theft and vandalism efforts, coupled with new production streams.

The Standard Bank report also warned that the manufacturing sector might witness a continuation of headwinds, particularly FX volatility and liquidity challenges, elevated consumer price levels, and rising interest rates during the year.

However, it stated that the commencement of operations at the Dangote refinery should boost oil refining, a sub-sector within manufacturing.
The report predicted the refinery to make up one per cent of manufacturing gross value added, thereby driving growth in the sector to 2.4 per cent year on year in 2024, from an estimated 1.4 per cent in 2023.


It also forecasted the agricultural sector to grow faster in 2024.
It said, “We expect output to increase by 2.2 per cent year on year in real terms (2023: 1.0 per cent year on year), supported by low base effects from previous periods of lower-than-average productivity due to poor weather conditions in food-producing regions.”
In the medium-term outlook, the report predicted higher economic growth for the country, noting, however, that reforms remained a hurdle to achieving desired results.

On the FX outlook, the bank predicted that the naira would weaken to N1, 171 against the US dollar by December this year.
It said, “We see the USD/NGN pair at 1,171 by Dec 24 in the official market. The CBN is likely to keep gradually clearing its foreign currency obligations with funds from the FGN and NNPC capital raises, shifting FX liabilities away from the CBN, which would liberate FX reserves to support the market and foster investor confidence.

“Until confidence in CBN reserves returns to the market, we forecast only a gradual improvement in foreign private sector inflows.
“Under the new administration, the CBN has undertaken a series of FX reforms to rectify past policy errors. Key reforms include the elimination of multiple FX windows, the termination of the RT200 rebate and Naira4Dollar scheme, the removal of FX restrictions on 43 prohibited imported goods, and the ongoing clearance of outstanding FX obligations.”

It stated that FX reserves declined by 11.2 per cent or $4.17 billion to $32.91 billion in 2023, with inflows still limited amid outflows to finance external obligations.

Specifically, the report stated that while the federal government received $2.25 billion of the $3 billion loan from AFREXIM, “We doubt that it can securitise $7 billion dividend receipts from the Nigerian Liquefied Natural Gas company (NLNG) for the desired five-year period.

“We infer this from the decline in NLNG dividends to the NNPC in recent years, with averages falling from $1.7 billion during 2007- 2014, to $798.5 million during 2015-2022.”

To boost FX supply, the Tinubu administration announced plans for big-ticket capital raises, including a $1.50 billion World Bank budget support facility, a $3 billion loan from AFREXIM collateralised by future NNPC oil receipts, and a $7 billion securitisation of the Federal Government of Nigeria’s (FGN) dividend receipts from the NLNG.

The report, among other things, predicted the government’s current account surplus to reach 1.8 per cent of GDP in 2024, up from an estimated 1.0 per cent of GDP in 2023.

It stated that oil production should grow sufficiently to supply Dangote refinery with feedstock as well as impel higher oil export volumes.

Standard Bank said in the report, “However, a key downside risk here would be continued oil price weakness due to slowing global growth. We forecast downward pressure for goods importation from two fronts.

“Firstly, increased oil refining from the Dangote refinery and Nigerian National Petroleum Company Limited (NNPCL) would likely lower demand for imported petroleum products.

“Secondly, non-petrochemical goods imports (71.2 per cent of the total import bill in Q2 2023) could be hindered by poor FX liquidity and naira weakness. Services imports, accounting for 25 per cent of total imports, declined 14 per cent year on year in H1 2023. We foresee a further decline here, with higher traveling costs dampening demand due to persistent naira depreciation as well as longer, and, therefore, far more costly, travel routes caused by the conflicts in Sudan and Niger.”

https://www.thisdaylive.com/index.php/2024/01/26/standard-bank-report-predicts-increase-in-reserves-buoyed-by-domestic-oil-refinery-operation?amp=1

I took my time to read this article and sincerely there are certain cheering news and not too good news from the report
The cheering news is the rallying of the naira,I totally agree with this sense of thinking that the naira will start a strong rally this quarter,but for how long is something we need to really question
The second report amplifies what the former Deputy Governor of CBN,Mr Kingsley Moghalu recently advised,the urgent need to start diversifying our Economy
I sincerely believe that if this government is ready to sustain the rally of the naira,they need to quickly do the following:

1) Sell off at least Two Refineries
Reduce the wastage associated with those scrap metals
2) Give the states and local governments total control of Electricity generation and distribution
This model we are practicing is a total waste of government resources,allow individuals and willing states to generate electricity and distribute it at their a price that will be market competitive
3) Energise your Small and Medium Scale Businesses
This business that employ a minimum of two and maximum of 20,whose income is between 100,000 and 3 million should be given certain incentives to create more jobs and contribute to the growth of the Economy
4) Security
Allow the states and Local government to create structures that will secure their states.
What is happening in Abuja,Pleateau,Zamfara,Borno and states across the country with Banditry, Kidnapping and Armed Robbery can be fixed when states become more involved in securing their people
All crimes are local and it will take locals to help solve them

Still selling good properties at Ibeju Lekki Industrial Hub, kindly check my signature for more details

There's nothing new in jorgons written. It's just unnecessary capping with no evidence.


Naira don fall finish

Prediction

In summary... It's a terribly and perilously long walk to economic freedom for Nigeria.

Why am I seeing Standard Chartered logo when the report was issued by Standard Bank ?

Ok ooo

Thank you..

We hear you

Crude oil good but we need something else to be mainstay of Nigeria's economy.

When will all these wahala end in Nigeria

Odiegwu!! Dollar at all time high speaks volume.speculators already know that cbn gun powder is at the lowest, na mugus dey believe all these tales by the sun light because na blatant propaganda this govt carry come. I only convert to naira when i need to.

I wont comment until Peter Obi reacts to this great news.

Na una sabi

“Do not pray for an easy life.
Pray for the strength to endure a difficult one.” – Bruce Lee


“Blessed is the man who perseveres under trial because when he has stood the test, he will receive the crown of life that God has promised to those who love him.” – James 1:12

“Opportunity is missed by most people because it is dressed in overalls and looks like work.” — Thomas Edison

“The ability to sell yourself and your skills and expertise will empower you and build confidence, not only within yourself but within all aspects of your career in general.” – Jack Warren

From: BAMBOO ACADEMY


[img]https://www.hostpic.org/view.php?filename=2401260902480102.jpg [/img]

Wealth and development can never occur where there is no peace or security. So, the priority of the government should be permanent security of lives and property.

The biggest problem is the fact is the worsening security situation in the country, ego wants to gamble!!

Kenochi:
1) Sell off at least Two Refineries
Reduce the wastage associated with those scrap metals
2) Give the states and local governments total control of Electricity generation and distribution
This model we are practicing is a total waste of government resources,allow individuals and willing states to generate electricity and distribute it at their a price that will be market competitive

I see your reasoning. I'll go farther on #1 ..... sell off all of the refineries. Neither the FG/State needs to be in the business of electricity generation or distribution. It should be run by the private sector but regulated by the FG/State. I do fully agree with your other points.... especially regarding encouraging small businesses. But proper infrastructure is the foundation of such a development .... what the FG should provide but not making it a priority

With the new day comes new strength and new thoughts.
- Eleanor Roosevelt

Believe in yourself! Have faith in your abilities! Without a humble but reasonable confidence in your own powers you cannot be successful or happy.
- Norman Vincent Peale

“The real man smiles in trouble, gathers strength from distress, and grows brave by reflection.” – Thomas Paine

From: BAMBOO ACADEMY
[img]https://www.hostpic.org/view.php?filename=2401260857560070.jpg [/img]

Slow and steady we will get to the nation of our dreams.

God bless all sane, honest and hardworking Nigerians 🙏.

To all enemies of our darling nation that wish her bad and pray for her downfall, nothing good will ever come your way in life.

God bless Nigeria 🇳🇬

Kenochi:
I took my time to read this article and sincerely there are certain cheering news and not too good news from the report
The cheering news is the rallying of the naira,I totally agree with this sense of thinking that the naira will start a strong rally this quarter,but for how long is something we need to really question
The second report amplifies what the former Deputy Governor of CBN,Mr Kingsley Moghalu recently advised,the urgent need to start diversifying our Economy
I sincerely believe that if this government is ready to sustain the rally of the naira,they need to quickly do the following:

1) Sell off at least Two Refineries
Reduce the wastage associated with those scrap metals
2) Give the states and local governments total control of Electricity generation and distribution
This model we are practicing is a total waste of government resources,allow individuals and willing states to generate electricity and distribute it at their a price that will be market competitive
3) Energise your Small and Medium Scale Businesses
This business that employ a minimum of two and maximum of 20,whose income is between 100,000 and 3 million should be given certain incentives to create more jobs and contribute to the growth of the Economy
4) Security
Allow the states and Local government to create structures that will secure their states.
What is happening in Abuja,Pleateau,Zamfara,Borno and states across the country with Banditry, Kidnapping and Armed Robbery can be fixed when states become more involved in securing their people
All crimes are local and it will take locals to help solve them

Still selling good properties at Ibeju Lekki Industrial Hub, kindly check my signature for more details

2 has been done
That number 4, I don't know what is delaying BAT from doing it!

They want to do concession of the Refinery ....good idea...get the Govt out of the business and regulate and collect taxes ..we can't afford NLC threatening the Govt when Labour Party loses.

Kenochi:
I took my time to read this article and sincerely there are certain cheering news and not too good news from the report
The cheering news is the rallying of the naira,I totally agree with this sense of thinking that the naira will start a strong rally this quarter,but for how long is something we need to really question
The second report amplifies what the former Deputy Governor of CBN,Mr Kingsley Moghalu recently advised,the urgent need to start diversifying our Economy
I sincerely believe that if this government is ready to sustain the rally of the naira,they need to quickly do the following:

1) Sell off at least Two Refineries
Reduce the wastage associated with those scrap metals
2) Give the states and local governments total control of Electricity generation and distribution
This model we are practicing is a total waste of government resources,allow individuals and willing states to generate electricity and distribute it at their a price that will be market competitive
3) Energise your Small and Medium Scale Businesses
This business that employ a minimum of two and maximum of 20,whose income is between 100,000 and 3 million should be given certain incentives to create more jobs and contribute to the growth of the Economy
4) Security
Allow the states and Local government to create structures that will secure their states.
What is happening in Abuja,Pleateau,Zamfara,Borno and states across the country with Banditry, Kidnapping and Armed Robbery can be fixed when states become more involved in securing their people
All crimes are local and it will take locals to help solve them

Still selling good properties at Ibeju Lekki Industrial Hub, kindly check my signature for more details

“Do not pray for an easy life.
Pray for the strength to endure a difficult one.” – Bruce Lee


“Blessed is the man who perseveres under trial because when he has stood the test, he will receive the crown of life that God has promised to those who love him.” – James 1:12

“Opportunity is missed by most people because it is dressed in overalls and looks like work.” — Thomas Edison

“The ability to sell yourself and your skills and expertise will empower you and build confidence, not only within yourself but within all aspects of your career in general.” – Jack Warren

From: BAMBOO ACADEMY


[img]https://www.hostpic.org/view.php?filename=2401260902480102.jpg [/img]

Bring back Okonjo Iweala

The haters of Nigeria don't like to read this kind of news they won't be able to wail

T

Kenochi:
I took
I sincerely believe that if this government is ready to sustain the rally of the naira,they need to quickly do the following:

1) Sell off at least Two Refineries
Reduce the wastage associated with those scrap metals
2) Give the states and local governments total control of Electricity generation and distribution
This model we are practicing is a total waste of government resources,allow individuals and willing states to generate electricity and distribute it at their a price that will be market competitive

The Government is already working on number 1

Number 2 has been done since last year. Even you sef can generate a certain amount of electricity. If you have the money, you can apply for a license.

Security should be one of the first priority right now

oluplus:
Why am I seeing Standard Chartered logo when the report was issued by Standard Bank ?

They own standard bank

Sufferhead Nigerians wey never chop this morning.
We dey Canada dey read about una love for suffering and support for govt.
Una Doh!!

Kenochi:
I took my time to read this article and sincerely there are certain cheering news and not too good news from the report
The cheering news is the rallying of the naira,I totally agree with this sense of thinking that the naira will start a strong rally this quarter,but for how long is something we need to really question
The second report amplifies what the former Deputy Governor of CBN,Mr Kingsley Moghalu recently advised,the urgent need to start diversifying our Economy
I sincerely believe that if this government is ready to sustain the rally of the naira,they need to quickly do the following:

1) Sell off at least Two Refineries
Reduce the wastage associated with those scrap metals
2) Give the states and local governments total control of Electricity generation and distribution
This model we are practicing is a total waste of government resources,allow individuals and willing states to generate electricity and distribute it at their a price that will be market competitive
3) Energise your Small and Medium Scale Businesses
This business that employ a minimum of two and maximum of 20,whose income is between 100,000 and 3 million should be given certain incentives to create more jobs and contribute to the growth of the Economy
4) Security
Allow the states and Local government to create structures that will secure their states.
What is happening in Abuja,Pleateau,Zamfara,Borno and states across the country with Banditry, Kidnapping and Armed Robbery can be fixed when states become more involved in securing their people
All crimes are local and it will take locals to help solve them

Still selling good properties at Ibeju Lekki Industrial Hub, kindly check my signature for more details

Don't forget add that the Federal Government should prioritize adequate funding and strengthening and implementation of the Nigerian National Quality Policy, including the National Quality Council and the National infrastructure

Kenochi:
I took my time to read this article and sincerely there are certain cheering news and not too good news from the report
The cheering news is the rallying of the naira,I totally agree with this sense of thinking that the naira will start a strong rally this quarter,but for how long is something we need to really question
The second report amplifies what the former Deputy Governor of CBN,Mr Kingsley Moghalu recently advised,the urgent need to start diversifying our Economy
I sincerely believe that if this government is ready to sustain the rally of the naira,they need to quickly do the following:

1) Sell off at least Two Refineries
Reduce the wastage associated with those scrap metals
2) Give the states and local governments total control of Electricity generation and distribution
This model we are practicing is a total waste of government resources,allow individuals and willing states to generate electricity and distribute it at their a price that will be market competitive
3) Energise your Small and Medium Scale Businesses
This business that employ a minimum of two and maximum of 20,whose income is between 100,000 and 3 million should be given certain incentives to create more jobs and contribute to the growth of the Economy
4) Security
Allow the states and Local government to create structures that will secure their states.
What is happening in Abuja,Pleateau,Zamfara,Borno and states across the country with Banditry, Kidnapping and Armed Robbery can be fixed when states become more involved in securing their people
All crimes are local and it will take locals to help solve them

Still selling good properties at Ibeju Lekki Industrial Hub, kindly check my signature for more details

by the time the naira goes at N1171 to a dollar in official market, blackie is N1500 or more.
That's not cheering.

We dey watch

Lol