₦airaland Forum

The Nigerian manufacturing sector expanded for the third consecutive month in June.

The Purchasing Managers’ Index (PMI) which measures the activities of the manufacturing sector increased to 52.9 in June, according to the Central Bank of Nigeria’s report. Up 0.3 points from 52.6 recorded in May. Readings above 50 indicate expansion and vice versa.

According to the report, 12 of the 16 subsectors recorded growth in June in the following order: Computer and electronic products; paper products; plastics and rubber products.

Others included primary metal, transportation equipment, petroleum and coal products, appliances & components, textile, apparel, leather and footwear, furniture and related products.

Also, electrical equipment, food, beverage and tobacco products and fabricated metal products made the list.

While the remaining four subsectors that declined were nonmetallic mineral products, cement, chemical and pharmaceutical products and printing and related support activities.

“The surge in economic activities in the manufacturing sector and improving consumer prices should boost consumer spending but the weak wage growth and high unemployment rate of 14.2 percent will continue to hurt progress,” said Samed Olukoya, a foreign exchange research analyst at Investors King Ltd.

http://investorsking.com/nigerias-factory-production-surges-in-june/

The cost of servicing debt will worsen Nigeria's financial position if not checked, especially with the drop in foreign reserves and low oil prices.

Global debt rose to a new all-time high of $217 trillion in the first quarter of 2017, according to the Institute of International Finance.

The institute said global borrowing hit 327 percent of the world’s gross domestic product (GDP) after data showed emerging market borrowing surged by $3 trillion to $56 trillion.

Making it 218 percent of emerging economies combined GDP and 5 percent higher than the first quarter of 2016.

China’s debt stood out of the entire emerging economies, rising by $2 trillion to $33 trillion. While the rest added $1 trillion.

Similarly, Nigeria’s external debt rose by $4.4 billion or 46 percent from $9.46 billion to $13.81 billion in 2107. While domestic debt climbed by N3.46tn or 40.71 percent to N11.97 trillion in 2017 from N8.51 trillion. Bringing the total debt to N19.2 trillion record high.

The report further revealed that while developed nations cut their total debt by over $2 trillion in the past year, emerging economies are adding more debts.

“Rising debt may create headwinds for long-term growth and eventually pose risks for financial stability,” the report stated.

“In some cases, this sharp debt build-up has already started to become a drag on sovereign credit profiles, including in countries such as China and Canada.”

Highlighting the danger of rising global debt, Samed Olukoya, a foreign exchange research analyst at Investors King Ltd said: “With rising interest rates in the U.S, and the European Central Bank announcing its readiness to unwind its quantitative easing program with possibility of a rate hike as early as the third quarter, global cost of borrowing would surge and stall new job creation and earnings if global debt is not checked.”

So far, the Federal Government has spent over N500bn (N474bn and $127.9m) to service both domestic and external debts in the first quarter of 2017.

http://investorsking.com/china-nigeria-others-push-global-debt-to-a-record-high-of-217-trillion/

In an effort to ensure a stable currency, the Central Bank of Nigeria (CBN) on Wednesday sold a total of $195 million to support the Naira.

The breakdown revealed authorised dealers in the wholesale segment received a total of $100 million offer from the bank.

While Small and Medium Enterprises (SMEs) and invisible segments were appropriated $50 million and $45 million respectively.

Mr Isaac Okorafor, the Central Bank’s Acting Director, Corporate Communications Department said the move was continued effort by the apex bank to ensure the stability of the currency.

The Central Bank of Nigeria remained upbeat that the Naira value would improve further in the months to come, especially with consumer prices now at a year low of 16.25 percent.

The foreign exchange market remained stable this week, with the Naira exchanging at an average rate of N363 to a US dollar.

http://investorsking.com/cbn-sells-another-195m-to-support-naira/

The Nigeria Customs Service generated a total sum of N239.4bn in the first three months of this year, figures obtained from the Federal Ministry of Finance have revealed.

The amount is contained in a document showing the activities of the ministry in the last two years, which was sighted by our correspondent in Abuja.

The NCS, according to the document, stated that its revenue performance for the first quarter of this year exceeded its target of N193.2bn by N46.2bn.

This, the service added, was achieved through a reform programmed aimed at restructuring it, re-orientating its officers, removing defects and adopting simplified procedures in its activities.

It stated, “The NCS collected N904.07bn in 2015 against a target of N944.4bn; the total collection in 2016 was N898.67bn against the target amount of N973.3bn.

“Between January and March 2017, the NCS was able to generate N239.4b, thereby exceeding the target of N193.22bn set for the period.”

The service also said it had complied with a presidential directive to deliver all seized perishable goods to the Internally Displaced Persons affected by the insurgency who are in Borno, Yobe, Adamawa and Edo camps.

It said the reforms embarked upon by the government had started yielding results as there was now strict compliance with rules governing the operations of the NCS, adding that a standard operational procedure had been developed to ensure transparency and accountability.

The NCS also said it had strengthened international engagements with the World Customs Organisation and the World Trade Organisation for trade facilitation and optimum revenue collection.

It added that a compliance team had been set up to ensure conformity with trade regulations, adding that this would help to block all illegal routes for smuggling.

The Minister of Budget and National Planning, Senator Udo Udoma, had last week said during the public presentation of the 2017 budget that although certain developments affected the realisation of projected government revenue last year, this administration was working hard to ensure increase in revenues to fund the budget.

“In terms of implementation of the budget, we are making strenuous efforts to find the resources required. We are challenging our revenue generating agencies, particularly the Federal Inland Revenue Service and the Customs to improve their efficiencies and broaden their reach so as to achieve the targets set for them in the 2017 budget,” Udoma had stated.

http://investorsking.com/customs-generated-n239-4bn-revenue-first-quarter-ministry/

The trade volume between Nigeria and Mexico has grown by 360 per cent from 166.5 million dollars in 2012 to 600 million dollars in 2016.

The Mexican Embassy, Deputy Head of Mission, Rodrigo Tenorio, made this known in an interview with the News Agency of Nigeria in Abuja on Monday (today).

He spoke on the sideline of a round-table for working business discussion on trade mission to Mexico organised by the Nigerian-Mexican Chamber of Commerce and Industry and Mexican Embassy.

“Though the figure may be small but in reality it is a huge transaction that we have in the last 15 years, which was then 45 million dollars.

“What that means is that it has grown more than 500 times in 15 years and our aim and goal is to ensure it grows more.

“There are some similarity between Nigeria and Mexico, we are predominantly largest and young population and we can be referred to as the power house of our region just as Nigeria in Africa,” he said.

According to him, Mexico sees Nigeria as a natural spring board to stand for the entire Africa and main goal is to make sure that Nigeria is known as number one economy in Africa.

He said that the major challenge in the relationship between the two countries was that they did not know each other well.

“We do not know each other, Mexico is known for drugs while Nigeria is known for Boko Haram and other social vices.

“But there is much more than that, what is most important in building the relationship is to know each other better.

“Once we know that Mexico is more than drug cartel and baron, Nigeria is much more than a small group in the north causing trouble,” he said.

According to him, if we know ourselves better the business people could sit down and start discussing potential businesses for the future.

http://investorsking.com/nigeria-mexico-trade-volume-hits-600m/

Lagos, the capital of Lagos State, is the 13th most expensive city in the world, says Mercer, the world’s largest human resource consulting firm.

The consulting firm also said in its 23rd Cost of Living Survey that African, Asian, and European cities dominated the 2017 list of most expensive locations for working abroad.

According to the survey, Abuja, Nigeria’s federal capital, ranked 20th in 2016.

The capital city of Angola, Luanda, however, ranked first globally, moving up from second place and taking over from Hong Kong as the world’s most expensive city.

The survey attributed cost of goods and security as factors that determined the cost of living in Luanda.

Other African cities that ranked high reflected high living costs and prices of goods for expatriate employees.

They include Victoria, Seychelles in the 14th position, N’djamena, Chad in the 16th position and Kinshasa, Democratic Republic of Congo ranked 18th.

The least expensive African cities include Gaborone, Botswana in the 196th position; Cape Town, South Africa ranking 199th and Blantyre, Malawi ranking 205th.

Windhoek, Namibia ranked 206 while Tunis, Tunisia ranked 209 and was found to be the least expensive country globally.

In Europe, three cities remained in the top 10 list of most expensive cities for expatriates, which included Zurich, Geneva and Bern which ranked fourth, seventh and 10th respectively.

Moscow ranked 14th and London ranked 30th position and the German cities of Munich, Frankfurt and Berlin dropped significantly ranking 98, 117 and 120 respectively.

Also, five of the top 10 expensive cities in the ranking were in Asia; Hong Kong ranked second and was found to be the most expensive city in the region as a result of its currency pegged to the US dollar, which drove up the cost of accommodations locally.

Others are Tokyo, Singapore, Seoul and Shanghai which ranked third, fifth, sixth and eighth respectively.

Nathalie Constantin-Métral, Principal at Mercer who is responsible for compiling the survey ranking, explained that the majority of Chinese cities fell in the ranking due to the weakening of the Chinese yuan against the U.S. dollar.

In India, Mumbai ranked 57, moving up 25 places due to its rapid economic growth, inflation on the goods and services basket and a stable currency against the U.S. Dollar.

New Delhi and Chennai ranked 99 and 135 respectively.

In the Middle East, Tel Aviv ranked 17 and continues to be the most expensive city for expatriates followed by Dubai, Abu Dhabi and Riyadh ranking 20, 23 and 52 respectively.

Jeddah ranked 117, Muscat ranked 92 and Doha ranked 81 and are among the least expensive cities in the region.

The survey found that cities in the U.S. were the most expensive locations in the Americas.

New York City ranked ninth as the costliest city; San Francisco ranked 22nd and Los Angeles 24th.

Ms. Constantin-Métral said, “Overall, U.S. cities either remained stable in the ranking or have slightly increased due to the movement of the U.S. dollar against the majority of currencies worldwide.

The Canadian city of Vancouver ranked 107, overtaking Toronto which ranked 119, to become the most expensive Canadian city in the ranking. Ottawa was found to be the least expensive city in Canada ranking 152.

“The Canadian dollar has appreciated in value triggering the major jumps in this year’s ranking,” explained Constantin-Métral.

Mercer’s 23rd annual Cost of Living Survey finds that factors like instability of housing markets and inflation for goods and services contribute to the overall cost of doing business in today’s global environment.

The survey is designed to help multinational companies and governments determine compensation allowances for their expatriate employees.

http://investorsking.com/lagos-13th-most-expensive-city-to-live-in-the-world/

Prolonged conflicts and droughts have left an unprecedented 81 million people needing food aid in 2017, a specialist U.S.-based agency said on Wednesday, revising up its earlier estimates.

Furthermore, it said there is still a risk of famine looming over Somalia, Yemen, Nigeria, and South Sudan, despite the international community committing about $2.2 billion to address the various crises since January.

In Nigeria, some 1.5 million people are on the brink of starvation in the northeast regions, hit by an eight-year insurgency by Boko Haram Islamists.

People in 45 countries are unable to feed themselves, said the Famine Early Warning Systems Network (FEWS NET), which issues alarms about food shortages to the U.S. government.

Furthermore, it said there is still a risk of famine looming over Somalia, Yemen, Nigeria, and South Sudan, despite the international community committing about $2.2 billion to address the various crises since January.

“Additional contributions to emergency appeals, particularly in these four countries, are urgently needed to prevent large-scale loss of life,” Reuters quoted FEW to have said in a statement.

The United Nations said it has so far received only a quarter of the $23.5 billion needed for humanitarian assistance programmes worldwide this year.

“However, famine risk will not fully recede until substantive efforts are made to resolve ongoing conflict and improve access,” FEWS NET added.

The agency said it had increased the number of people it expects to need emergency food aid over the course of 2017.

Its estimate rose to 81 million from the 70 million it predicted in January, due to a series of factors, including below average rainfall in the Horn of Africa.

http://investorsking.com/study-famine-looms-in-nigeria-yemen-somalia/

jaytime:
Funny enough the whole economic problem of this country connects largely to this oil price movement

If the Brent crude oil does not call bottom at $45 per barrel, Nigeria's foreign reserve will be affected and so is forex intervention. I am more concern about the Investors and exporters' fx window that has helped restored market confidence in recent time.

Let hope the continuous fall of WTI oil will slow down shale producers and OPEC will do more to ease global supply without raising eye at oil increase in production level. mynd44

The President, Dangote Group, Aliko Dangote, has lauded the decision of the Federal Government to reconstruct the failed Apapa Wharf Road as its grim state serves as both an embarrassment to the country and a huge loss of close to N140bn on a weekly basis.

Dangote, who spoke to journalists on Tuesday, said, “The economy loses more than N20bn daily. It (bad state of the roads) affects businesses across the country. All our operations in the hinterland in Ilorin, in Kano are operating at 40 per cent maximum capacity.”

Lamenting the state of roads in the country, Dangote said, “Today, there is no linkage road going from the South-West to the North. You have to go all the way through Ajaokuta, Obajana, Lokoja and you have to go by that uncompleted road that Obasanjo started 13 years ago.

Commenting on his resolve to personally get involved in the Apapa Wharf Road reconstruction, he said, “Because it is very embarrassing! We can’t just sit and have a road like that, which it is the heart of trade in the country. More than 60 per cent of our country’s imports and exports come through the Apapa Port and we leave the road unattended to.

“That is why we started on our own. Flour Mills said they will join us, but now the government has changed the design because they want all the cables and pipes underground and to have a more robust solution.”

To help in bringing the cost down, he explained that he forced his company to execute the project at a zero profit.

“Both Dangote and Flour Mills are pumping in over N2.5bn for the two-kilometre double lane on each side, making a total of four kilometres,” Dangote explained, adding that the biggest job “is drainage because that is what is destroying the road. We will make sure this problem is sorted out once and for all.”

http://investorsking.com/nigeria-loses-n140bn-weekly-apapa-gridlock-dangote/

Global oil prices plunged to its lowest this year on Tuesday after data revealed the surge in global oil glut.

Brent crude fell 1.66 percent to $46.13 a barrel on Tuesday, down 16 percent from $54.93 per barrel recorded in May when OPEC and non-OPEC members agreed to extend production cuts. While West Texas Intermediate crude, WTI, dipped 0.83 percent to $43.68 per barrel on Tuesday, bringing its total decline to 18 percent from $52.22 a barrel recorded a month ago. The lowest since November 2016.

Experts have said the surge in productions in the US and among OPEC members, Nigeria and Libya, the two countries exempted from production cuts is disrupting oil outlook and market confidence.

Nigeria’s exports, Bonny Light crude oil, is expected to reach 1.64 million barrel per day in June, a 164,000 bpd increase from May.

“The increasing August export program in Nigeria and the jump in Libyan oil output should pressure oil prices further in the short term,” said Tamas Varga, a senior analyst at London brokerage PVM Oil Associates.

Also, Libya’s production climbed more than 50,000 bpd to 900,000 bpd after the state oil company and Germany’s Wintershall reached an agreement.

“Oil productions in Nigeria and Libya are still fairly low when compared to other OPEC members,” said Samed Olukoya, a foreign exchange research analyst at Investors King Ltd. “Libya’s production just reached 900,000 bpd, while Nigeria’s production is expected to reach about 1.65 mbpd – 1.700 mbpd, but when compared to Iraq, Saudi, Iran etc these two nations have done little to nothing to the global glut.”

“The main issue here is the persistent increase in the US production and rig counts,” He added.

http://investorsking.com/oil-prices-fall-to-7-month-low-as-supply-surges/ mynd44

The Central Bank of Nigeria, CBN, on Monday sold another $190 million to meet customers’ requests in various forex segments.

The apex bank which injected $831.5 million into the interbank forex market last week said it would soon introduce a new forex retail option.

Speaking on the disbursement, the acting Director, Corporate Communications, Mr Isaac Okorafor, said in a statement in Abuja that the apex bank sold $100 million to authorised forex dealers through the interbank market, while $50 million was offered to Small and Medium Enterprises window.

Accordingly, the invisibles segment was appropriated $45 million to meet demands for business/personal travel allowances, school tuition and medicals.

The CBN reaffirmed its commitment to the ongoing forex policy and insist on transparency to guarantee stability in the foreign exchange market.

Since the Investors and Exporters forex window was launched in April, the CBN has aided transactions by contributing 30 percent of the total forex volume traded on the window, boosting total volume of trade to $2.2 billion.

This has helped increase forex liquidity and subsequently improved consumer prices which measure inflation to 12 months low of 16.25 percent in May from 17.24 percent in April.

Also, in an effort to further reduce inflation rate, the CBN last week announced a plan to mop up N200.32 billion from the banking system through Open Market Operation.

However, the Statistician General of the Federation, Dr. Yemi Kale said the economy will be out of recession in 2018, provided oil prices do not collapse and Niger Delta remains stable.

While his projection is more conservative than other experts, the statistician said; “Inflationary slowdown does not mean prices are coming down. Inflation by definition is always a rise in price. All we are saying is that the increase is decelerating.”

“Before it rose by 100 percent, but this time it went up by 50 per cent. As such, having double-digit inflation figure is still a huge problem. The fact that it went down from over 18 per cent to 17 per cent and now to 16 per cent shows improvement. But I can tell you 16 percent is not good,” he said.

The Naira appreciated to N364 against the dollar from N370 it traded last week.

http://investorsking.com/cbn-injects-another-190m-into-forex-market/

The Nigerian National Petroleum Corporation on Sunday said it had successfully crashed the pump price of Automotive Gas Oil, also known as diesel, by about 42 per cent nationwide.

It described this as a huge reduction over the past six months, linking it to series of interventions by the national oil firm in the downstream oil sector.

Explaining how this was achieved, the Group General Manager, Public Affairs Division, NNPC, Mr. Ndu Ughamadu, stated that in the first quarter of this year, the retail price of AGO, which is one of the deregulated products, was N300 per litre in major demand centres across the country.

“Such unpleasant situation placed a huge burden on truck drivers, who need the product to remain in business; the nation’s manufacturing sector, which requires it to run its operations; and the masses, who need it for household power generation,” he said.

He, however, noted that following the various interventions by the oil firm for sustained improvement in the supply of diesel, the product’s retail price as of the end of May this year dropped to between N175 per litre and N200 per litre, a decrease of about 42 per cent, while the ex-depot price also dropped to between N135 per litre and N155 per litre.

http://investorsking.com/diesel-price-fallen-42-says-nnpc/

Nigerian migrant workers sent back home $18.956bn as remittances, a figure which indicated a 5.2 percent growth in nine years, a UN agency’s report showed on Wednesday.

According to the report, titled Sending Money Home: Contributing to the SDGs, One Family at a Time and published on Wednesday, global migrant workers sent back to their home countries $445bn in 2016, lifting millions out of poverty.

The United Nations International Fund for Agricultural Development said currently about 200 million migrants, by sending money home, have supported some 800 million family members globally.

Women now comprise about half of all remittance senders, and it is believed that this trend can help advance gender equality and women’s empowerment through financial independence and better employment opportunities.

The report, by the UN International Fund for Agricultural Development, said that remittance flows have grown over the last decade at an average rate of 4.2 percent annually, from $296bn in 2007 to $445bn in 2016.

The top 10 sending countries account for almost half of annual flows, led by the U.S., Saudi Arabia and Russia.

Up to 80 percent of remittances are received by 23 countries, led by China, India, the Philippines, Mexico and Pakistan.

As to the remittance transfer method, cash-to-cash remains the most common form, while mobile phone networks, internet-based tools and digital money in various forms present a potentially transformative force for sending and receiving money.

The report also pointed out that the most important objective going forward should be to leverage the potential development impact on the receiving side by providing remittance-receiving families better opportunities to use their money productively.

http://investorsking.com/dispora-nigerians-remit-18-97bn-in-2016-un-report/

The Central Bank of Nigeria on Thursday said its new currency window for investors had handled $2.2bn of trade in six weeks.

The CBN also said it accounted for almost 30 per cent of the $2.2bn transactions, adding that this was meant to keep the window operating.

The CBN had about six weeks ago created the Investors & Exporters FX Window to attract foreign investors and at same time maintain a strong currency to ward off inflation.

Analysts and experts have lauded the initiative as a right step in the right direction.

However, some experts including a former Governor of the CBN, Prof. Charles Soludo, said although the initiative among others taken by the regulator in recent times had moved the forex market forward by 10 steps, there was a need to take about 90 steps to get the economy to where it ought to be.

Commenting on volume of activities on the I&E FX window, the Acting Director, Corporate Communications, Mr. Isaac Okorafor, said the CBN would sustains its intervention to support the naira.

He said the central bank was comfortable with the external reserves level of $30.3bn. Analysts estimate the bank has spent more than $5bn defending the naira this year.

“Average trading on investors’ window is now $2.2bn in the first six weeks of its introduction with our participation restricted to less than 30 per cent,” Okorafor told Reuters.

“This showed the level of confidence in the system,” he added.

Before the investors’ window was introduced in April, the central bank was the main supplier of hard currency on the interbank forex market, after foreign investors fled naira assets in the wake of an oil price slump in 2014.

The regulator has allowed investors to trade the naira at rates set freely between buyers and sellers, hoping to increase the amount of dollars available in Nigeria – but effectively introducing yet another exchange rate to the five already in operation.

The CBN has an exchange rate for Muslim pilgrims going to Saudi Arabia, a retail rate set by licensed Bureau De Change operators, and a rate for foreign travel and school fees, in addition to the official and black market rates.

The stock market has reacted positively to the introduction of the investor window, rising 34 per cent in six weeks with volumes more than doubling.

The rally also partly follows MSCI’s recent move to boost Nigeria’s weighting on its frontier index, according to analysts.

“When we started intervening in the market, the question was sustainability but we will ensure the process is sustained,” Okorafor said in Lagos.

The central bank last year removed a temporary peg to float the naira, but to protect its precariously low foreign reserves it introduced the convoluted exchange rate system that sees different buyers paying various rates for dollars.

It has said the move is needed to eliminate frivolous demand for foreign currency.

The naira was quoted at 372.70 on the investors’ window on Thursday. It traded at 365 on the black market and was stuck at around 305.25 to the dollar on the official window.

“Today we are gradually achieving convergence between the investor window and invisible window (FX rate for retail users),” Okorafor said.

http://investorsking.com/transactions-on-fx-investor-window-hit-2-2bn-cbn/

The cost of goods and services in Nigeria improved to a year low in May, following the implementation of the new foreign exchange policy by the Central Bank of Nigeria (CBN) in April.

The figure released by the National Bureau of Statistics on Thursday showed the consumer prices which measures inflation rate declined from 17.24 percent (year-on-year) recorded in April to 16.25 percent in May. The lowest since June 2016.

While on a month basis, the headline index surged 1.9 percent in May, a 0.28 percent higher than the 1.60 percent recorded in April. Suggesting persistence price pressure despite the general decline in year-on-year inflation.

Also, the percentage change in the average composite consumer price index for the 12-month period through May 2017 was 17.63 percent, up from 17.59 percent recorded in April 2017.

"This is a welcome development, especially with the economy gradually recovering and the foreign exchange market improving," said Samed Olukoya, a foreign exchange research analyst at Investors King Ltd. "It will boost business confidence and economic activities going forward."

http://investorsking.com/nigerias-inflation-improves-to-12-month-low-in-may/ mynd44

The Apapa Area Command of the Nigeria Customs Service has disclosed that it recorded 39 per cent increase in revenue generation in the first five months of this year despite the economic challenges in the country.

The Area Comptroller of the command, Musa Jibrin, who stated this at a media briefing about the command’s activities in the first half of the year, disclosed that it generated a total of N136.3bn between January and May.

He said that the command was ready to facilitate export trade in line with the Federal Government’s effort at diversifying the economy through exportation of agricultural products.

According to him, the command has created a functional examination centre within the APM Terminal to serve as a coordinating centre for all stakeholders in cargo examination at the Apapa Port, in line with the government’s ease of doing business initiative.

“The command will continue to intensify efforts at blocking all revenue leakages in order to sustain and build on this result,” he explained.

According to Jibrin, the command’s enforcement unit carried out a total of 24 detentions, including containers of different items, adding that the arrests ranged from under invoicing, wrong classification, declaration, prohibition and under payments.

He said, “I wish to reiterate our resolve to do our best to maintain our lead in revenue generation irrespective of the prevailing harsh economic conditions. We are, however, committed to ensuring trade regulations and enforcement of government’s fiscal policies, while issues of national security also remain cardinal in our day-to-day operations.

“I assure all patriotic stakeholders of a more conducive business environment that will avail them the opportunity of experiencing a seamless clearance of their consignments and general improvement within the shortest possible time.”

http://investorsking.com/apapa-customs-command-records-39-increase-in-revenue/

The National Bureau of Statistics on Tuesday released the total revenue generated by the country through Value Added Tax with receipts from VAT dropping from N207.35bn in the fourth quarter of 2016 to N204.77bn in the first quarter of this year.

The NBS in the report stated that manufacturing sector generated the highest amount of VAT with N28.73bn, adding that this is followed by professional services and commercial trading with N20.82bn and N12.89bn respectively.

On the other hand, the report stated that mining sector recorded the least VAT collection of N35.07m.

It reads in part, “Sectoral distribution of VAT data for Q1 2017 reflected that the sum N204.77bn was generated as VAT in Q1 2017 as against N207.35bn generated in Q4 2016 and N186.43bn in Q1 2016 representing 1.25 per cent decrease quarter-on-quarter and 9.84 per cent increase year-on-year.”

The report stated that out of the total VAT generated in the first quarter of2017, N126.64bn was generated as Non-Import VAT locally while N31.72bn was generated as Non-Import VAT for foreign. The balance of N46.41bn, the report added was generated as NCS-Import VAT.

The Minister of Finance, Mrs Kemi Adeosun, had called for improvement in the rate of tax compliance as a means of shoring up non-oil revenue for economic development.

The minister stated that the low level of non-oil revenue in the country is unacceptably low, adding that there is need for concerted efforts to improve revenue generation.

She said, “Revenue mobilization is critical to the success of Nigeria’s economic reform agenda. We have an unacceptably low level of non-oil revenue, and much of that is driven by a failure to collect tax revenues.

“With a tax to GDP ratio of only six per cent, one of the lowest levels in the world, we have a lot of work to do if we are going to build a sustainable revenue base that will deliver inclusive growth.

“Our data gathering programme over the last year has now given us the tools we need to be more aggressive at pursuing tax avoiders, both domestically and abroad.

“We are going to focus on tax in 2017 through an asset an income declaration scheme to address our low tax revenue collection and ensure improved compliance, a broader tax base and more sustainable revenue. This is fundamental to delivering on our reform plans.”

http://investorsking.com/value-added-tax-revenue-falls-to-n204-7bn/

Following the fluctuations in forex and international crude oil prices, the ex-depot price of diesel has dropped by over 30 per cent between February and June 2017.

As a deregulated product, the price of diesel is controlled by the market forces of demand and supply, unlike petrol, which has a price cap.

The international market price of crude above $53 in February, the prices of refined products were also high as the ex-depot price of diesel was between N225 per litre and N235.

The situation, it was gathered, was worsened by the high exchange rate at the period, which also impacted on the landing cost of products.

For instance, during the first week of February, the depots in Lagos were selling diesel above N235 per litre, while the pump price at filling stations were as high as N260 – N280 per litre.

While some were selling at N231, N230, 235, 227, 225, and N226, others were selling above N235 at the depots.

However, at the beginning of June, the depots were selling between N152 and N154 per litre.

According to market survey, the marketers were selling diesel at N152, 153 and N154, while the pump price was below N200 per litre at the beginning of June.

The price of diesel dropped further at the weekend with depots in Lagos selling at N155, 149, 147, 145, 144, and 144.50.

A marketer, who spoke on the situation, said the development was cyclic as a result of changing prices at the international and forex fluctuations.

“The price of crude and exchange rate in February were on the high side and they impacted not only on the price of diesel but all other products. Nigerians did not feel the impact on petrol because of the price cap. With the drop in price of crude below $50 per barrel, the country is not seeing the benefits of liberalisation on diesel,” he said.

Chairman of the Major Oil Marketers Association of Nigeria (MOMAN), Mr. Akin Akinfemiwa had told downstream operators in Lagos recently that the country was reaping the benefits of diesel and called on the federal government to remove the cap on the price of petrol.

“Without that, we will not realise the potential of this $5 billion revenue in the sector,” Akinfemiwa said.

The Chairman of Depots and Petroleum Products Marketers Association (DAPPMA), Mr. Dapo Abiodun, had also made similar call, saying that it was not by choice that the marketers allowed NNPC to currently import 95 per cent of petrol.

Abiodun, who is also the Chief Executive Officer of Heyden Petroleum Limited, said in addition to paying the marketers’ outstanding $2 billion claims arising from the old subsidy regime, the permanent solution was to remove the cap on the pump price of petrol and fully liberalise the downstream sector.

http://investorsking.com/price-of-diesel-drops-by-over-30-in-four-months/

Global oil prices plunged for a third week as shale and OPEC production continued to surge amid global oil glut.

The West Texas Intermediate, WTI, declined to $45.84 a barrel, while Brent crude traded at $48.15 a barrel from $52 it traded last week.

On Tuesday, Shell Nigeria announced it has lifted exports restrictions on a key Nigeria crude oil pipeline. Boosting production by 250,000 barrels a day, according to loading report.

Accordingly, the US crude oil production is expected for the first time in almost 50 years to reach 10 million barrels per day by March 2018, the US Energy Information Administration said on Thursday.

“Increased drilling activity in US tight oil basins, especially those located in Texas, is the main contributor to oil production growth, as the total number of active rigs drilling for oil in the United States has more than doubled over the past 12 months,” the EIA’s acting Administrator, Howard Gruenspecht, said in a statement.

Also, Libya has resumed production at the Sharara oil field, its largest oil field with 213,000 barrels a day capacity to boost its production. This according to experts would boost global supplies and further plunge oil prices if OPEC giants failed to cut equal production.

“The US oil rig count jumped to 741 rigs last week, suggesting continuous production and renewed confidence. Therefore, OPEC will need to do more henceforth,” said Samed Olukoya, a foreign exchange research analyst at Investors King Ltd.

OPEC newest member, Equatorial Guinea, called on other oil producers in the region to join OPEC to protect the value of their oil resources.

http://investorsking.com/global-oil-falls-for-third-week/

While I commend you for taking the time to put together this piece. I must say, there is a gross misconception of facts.

One, there is nothing wrong with the Nigerian youths, but the country Nigeria herself. A society is made up of diverse people, and that include the youths. The inability of the country to manage this diversity is its failure and not the fault of the victims of the failed system.

Also, don't forget the youths, Andela Group, brought Mark Zuckerberg, and last year alone the Nigerian youths raised $46.5 million from investors down from $49.4 million raised in 2015. This is how paga, payporte, hotel.ng, tolet.ng, etc were born. All these were achieved in an economy ranked as 169 worse countries to do business.

Two, the change started from Nigeria, you and others should know that Nigerian youths unseated incumbent president via ballot box for the first time. Nearly every youth turn to a political analyst, screaming and taking the fight from social media to tv studios to discuss their choices and concerns. Thereafter, Brexit happened, Nigeria led Ecowas unseated Jammeh in Gambia and ensure democratically elected president was sworn-in. Today we have Donald Trump that won against all odds and Emmanuel Macron in France.

Three, in Nigeria the primary is decided by the elites that emerged two candidates, one bad and the other worse. Leaving, the people including the youths to choose the bad. While in France, Emmanuel Macron became Minister of Economy and Finance at the age of 36 in 2014, that was after working as an Inspector of Finances in the French Ministry of Economy for two years. The system prepared and instilled in him conviction and vision necessary to break societal norms that led him to found his own party and led the same party to victory at a minimal cost raised via donations. The question is do we have such system?

Again, education is not the problem. In every society, there is educated, ill-educated and outright illiterates. But never has this incapacitated leadership or do you know how many extraordinary Nigerians we have home and abroad? With a good leader, we can restructure the system. The youth need a party they will represent them, a true populist party for the people is the ANSWER.

Despite the ongoing economic recession and rising unemployment rate in Nigeria, the labour productivity index showed labour activities surged to a new height in 2016.

The figure released by the National Bureau of Statistics revealed that the Labour Productivity Index climbed by 10.8 percent in 2016. Making it the highest since the first quarter of 2015.

While labour productivity in the fourth quarter rose to N783.51 from N713.77 recorded in the third quarter. The total number of hours worked increased by 0.48 percent between the third and final quarter of 2016, indicating that while output remains subdued, labour productivity surged due to the relative stable power supply during the period under review.

“While the overall level of productivity was high, there were several challenges that generally impacted on output and labour, and indirectly on labour productivity, keeping it below optimal levels. Some of these issues faced during the quarter were issues that spilled over from Q1 through Q2 and Q3 2016,” the NBS report stated.

“Investment in the economy was still relatively low; though some government investments were recorded during the quarter, the volume of private investment and foreign direct investments was still considerably low compared to previous years.

“Power was relatively stable during the quarter, which partly accounted for the increase in labour productivity, but was still lower than the required levels.”

The economy contracted by 0.5 percent in the first quarter of the year, while the consumer prices improved to 17.24 percent in April. The labour market slacked further to 14.2 percent unemployment rate in the final quarter of 2016 from the 13.9 percent recorded in the third quarter of 2016.

http://investorsking.com/nigerias-labour-productivity-surges-by-10-8-nbs/

The United States’ import of Nigeria’s crude oil rose to 25.97 million barrels in the first three months of this year from 18.62 million barrels in the same period of 2016.

The US Energy Information Administration revealed in its latest data that the country bought a record 10.24 million barrels from Nigeria in March, the highest monthly import since July 2013.

With global oil benchmark, Brent crude, averaging $50 per barrel in the first quarter of the year, the 25.97 million barrels imported by the US translate to an income of about $1.3bn for Nigeria.

The US almost tripled the volume of crude oil bought from Nigeria last year, with the biggest monthly import of 8.43 million barrels in July. It imported 76.9 million barrels of Nigeria’s oil in 2016, up from 19.9 million barrels in 2015.

Nigeria saw significant reduction in the US imports of its crude in recent years, starting from 2012, following the shale oil production boom.

The US import of Nigeria’s crude fell to 6.17 million in June 2013 from 10.115 million barrels in May and about 40 million barrels in March 2007.

In 2014, when global oil prices started to fall from a peak of $115 per barrel, Nigeria saw a further drop in the US imports of its crude from 87.4 million barrels in 2013 to a record low of 21.2 million barrels.

For the first time in decades, the US did not purchase any barrel of Nigeria’s crude in July and August 2014 and June 2015, according to the EIA data.

Meanwhile, Nigeria’s crude differentials remains under downward pressure as Forcados loading programme for June added to already ample supplies.

Reuters reported that the Forcados programme in June, scheduled at seven cargoes, was weighing on the market.

The nation’s oil production, which plummeted to near 30-year lows of around 1.2 million barrels per day in May 2016 amid militant attacks on oil facilities in the Niger Delta, still remains sharply below its capacity of 2.2 million bpd.

But the output has recovered gradually this year as militant attacks have fallen substantially since early January after the government stepped up peace talks with leaders and youths in the Niger Delta to end militancy in the region.

http://investorsking.com/us-bought-1-3bn-crude-oil-from-nigeria-in-q1/ mynd44

Interbank forex rate to improve in days to come. This should get oil output to about 1.8 mbpd from current 1.5mbpd and boost external reserve to about $35 billion this year.

Royal Dutch Shell Plc lifted restrictions on exports of a key Nigerian crude oil, 472 days after imposing them following militant attacks. The extra flows alone amount to about 20 percent of the supply OPEC has pledged to cut from world markets.

Europe’s biggest oil company ended a force majeure of Forcados crude oil shipments at 4 p.m. on Tuesday, a spokesman said. The measure, which allows companies to miss contractual obligations, was imposed on Feb. 21 last year. Shipments this month will average about 250,000 barrels a day, according to a loading program obtained by Bloomberg.

Nigeria is adding barrels to the market just as other members of the Organization of Petroleum Exporting Countries are trying to remove them in a bid to bolster prices. The producer club said on May 25 that it will keep its collective output restricted by 1.2 million barrels a day until the end of the first quarter next year. As well as Nigeria, flows from Libya are also jumping. Both countries were exempted from the curbs because of domestic conflicts.

“The market is already drowning” in similar types of crude to the Forcados grade, said Ehsan Ul-Haq, an oil analyst at KBC Advanced Technologies. The return of the grade will only add to that, he said.

The return of Forcados will add more than 10 percent to the country’s output, lifting it toward the 2 million barrels a day mark. It also reinstates the crude as Nigeria’s second-largest export grade, after Exxon Mobil Corp.’s Qua Iboe.

Shell’s Nigerian unit declared the force majeure after the Niger Delta Avengers, a militant group, attacked the subsea export line. The NDA claimed another attack on the pipeline in June, and then again in early November, part of a spate of sabotage that pushed the country’s production to the lowest in almost three decades last year and cost it billions of dollars.

http://investorsking.com/nigerias-forcados-oil-comes-back-in-fresh-blow-to-opec-curbs/ mynd44

Nigeria’s total trade in the first quarter of 2017 stood at N5.30 trillion, the National Bureau of Statistics (NBS) has said.

The nation’s exports in the period under review stood at N3.01 trillion compared to imports of N2.29 trillion, with a trade balance of N719.38 billion.

The NBS stated that imports fell by 0.9 per cent, adding that the country recorded an increase of 6.5 per cent in external trade.

According to the NBS, the value of the total trade at the end of 2016 was N17. 35 billion, stressing that the figure was 6.5 per cent higher than the value recorded in 2015.

The report, however, stated that Nigeria’s external trade in the fourth quarter of 2016 was valued at N5.28 billion.

“The export component stood at N2.98 billion while the import component stood at N2.31 billion leading to a trade surplus of N671 billion.

“Trade by sector showed that crude oil exports had the largest share of the total trade, accounting for N2.43 billion or 45.9 per cent trade in fourth quarter.

“The second major contributor to total trade by sector was manufactured goods with N1.17 billion or 22.1 per cent of total trade,’’ it stated.

The report stated that manufactured goods were followed by the non-crude oil products, which was also a major contributor to total trade in the quarter under review.
“The non-crude oil products stood at N1.15 billion or 21.8 per cent while Agricultural goods accounted for N212.7 billion or 4 per cent.

“Raw material goods accounted for N309 billion or 5.9 per cent and Solid mineral goods stood at N13.1billion or 0.3 per cent of total trade in the quarter.’’

The report stated that Nigeria’s export intensity in the months of October, November and December 2016 was the highest for South Africa with export intensities of 8.9, 7.3 and 4.1, respectively.

Export intensity in the fourth quarter was also intense with India recording export intensities of 5.8, 5.8 and 1.7 for the last three months of 2016.

“ Spain and Netherlands also had high export intensities with export intensities of 4.8, 2.9 and 2.0 for Spain and 2.2, 1.5 and 2.2 for the Netherlands.

“Although United States was one of Nigeria’s major trading partners, its export intensity was low with 0.6, 0.6 and 0.2 for the last three months of 2016.’’

Meanwhile, the report stated that Nigeria imported mainly from China with total imports of N404.1billion or 17.5 per cent of total imports.

It stated that China was followed by Belgium with N356.46 billion or 15 per cent while import trade with Netherlands which was the third highest was valued at N230 billion or 10 per cent.

“ The remaining trading partners contributed relatively lower proportion of the total import trade.

“United States accounted for N205.6 billion or 8.9 per cent while India accounted for N113.9 billion or 4.9 per cent,’’ the report stated.

http://investorsking.com/nigeria-records-positive-trade-balance-exports-rise-to-n3-01tn-in-q1/

The number of unemployed people in Nigeria rose to more than 6 years high in the fourth quarter of 2016 following high inflation and foreign exchange rates that forced businesses to close down and plunge foreign direct investment.

The number of unemployed persons in the labour force during the Q4 2016 surged by 351,015 to 14.2 percent, from 13.9 percent recorded in Q3 and 10.4 percent more than the same quarter in 2015, the National Bureau of Statistics reported on Tuesday.

Accordingly, the economic active population increased in the Q4 2016 to 108.59 million from 108.03 million. But only 81.15 million people were willing and actively looking for a job, leaving 27.44 million people within the labour force that for whatever reason decided not to work.

Unemployment and underployment increase the most among persons aged between 15-34, while the unemployment rate among those between the ages of 15-24 rose to 25.2 percent. The highest in over 5 years.

“The data was before recent measures to ease business and increase forex accessibility were put in place, therefore, the labour market should start witnessing moderate improvement in new job creation by Q2 2017,” said Samed Olukoya, a foreign exchange research analyst at Investors King Ltd.

“Also, with the economy on recovery path and the new forex policy that has helped curtail consumer prices and aid economic activities, the labour market will adjust accordingly,” he added.

http://investorsking.com/nigerias-unemployment-rises-14-2-q4-2016/ mynd44

Nigeria’s debt continued to rise amid an economic downturn and unstable global oil market.

The total debt owes to both foreign and local creditors stood at N19.16tn, according to the Debt Management Office (DMO). This means the country has borrowed N1.8tn this year to take total debt from the N17.36tn recorded at the end of December 2016 to N19.16tn.

Therefore, the country’s total debt has risen by N7.1tn within two years of the current administration when compared with N12.06tn recorded on March 31, 2015.

Breaking down national debts, the Federal Government domestic debt climbed from N8.51tn in 2015 to N11.97tn in 2017. Bringing the total debt borrowed by the Federal Government from domestic creditors within two years to N3.46tn. A 40.71 percent increase.

Within the same period, the nation’s external debt rose from $9.46 billion to $13.81 billion. This is a 45.98 percent or $4.35 billion jumps in foreign debt.

The foreign debt component has been largely affected by the surge in the exchange rate as the last two years have witnessed variation in foreign exchange rates.

According to the DMO, the official government rate of N306.35 to a U.S. dollar was used in evaluating the country’s foreign debt for March 31, 2017, while the official rate of N197 was used in calculating the foreign debt for March 31, 2015.

The domestic debt component of the states stood at N2.96tn as of March 31, 2017, up from the figure of N1.69bn at the same time in 2015.

This means that within the period of two years, the local debt of the states rose by N1.27tn or 75.15 percent.

Therefore, while foreign loans are cheaper than local debts, the government has to depend on local creditors for borrowing as most foreign creditors place more stringent conditions before granting credit facilities to the government.

http://investorsking.com/nigerias-total-debt-rises-by-7-1tn-in-two-years/ mynd44

Basking in the euphoria of the near rate convergence achieved in the foreign exchange (forex) market, indications emerged yesterday that the Central Bank of Nigeria (CBN) would sustain its dollar injection in the market this week.

The sell side of the naira exchange rate against the dollar appreciated significantly by N12, to close at N363 to the dollar on the parallel market on Friday, as against the N375 to the dollar as was last Thursday.

Also, the buy rate of the greenback closed at N369 to the dollar on Friday, stronger than the N382 to the dollar it was the previous day.

To this end, a reliable source at the central bank revealed that the Bank was not resting on its oars and remained determined to ensure a convergence between the interbank and Bureau de Change (BDC) rates soon, hence the move to continue its intervention in the interbank market.

The CBN Acting Director, Corporate Communications, Isaac Okorafor, confirmed that there were indeed plans by the CBN to make necessary interventions in the forex market, in line with its earlier resolve to achieve forex rates convergence and liquidity in the market.

On how the bank hoped to sustain its interventions, Okorafor said the CBN has enough forex to meet the requirements of all customers, who had genuine need for the dollar.

He also expressed optimism that the current policy of the bank and the cooperation of all stakeholders would check the unwholesome activities of speculators.

CBN Governor, Mr. Godwin Emefiele, while commenting recently on how far the CBN would go in sustaining its market interventions, had said: “I have said it and I will repeat myself that the interventions will be more vigorous than before to underscore the fact that we are determined to ensure that the Nigerian economy recovers, by making sure that foreign exchange is being made available to operators of the economy to conduct their businesses.”

http://investorsking.com/cbn-pledges-to-sustain-dollar-injection-in-fx-market/

ehie:
Lies from the pit of APC, CBN is just countering the report tHat Nigeria has faced the worst recession in 25 years, Please fool the gullible, Osinbajo is just an Uncle Tom who stod by while christains were slaughterd.APC is unredeemable.NEXT!!!!!

What? CBN released the data yesterday. Here is a link to CBN report

https://www.cbn.gov.ng/Out/2017/SD/PMI_Report_May%202017.pdf

The ongoing economic recovery plan has started impacting the economy after data showed the manufacturing sector expanded for the second consecutive month in May.

According to the Purchasing Managers’ Index (PMI) report for May, the index stood at 52.6, indicating the manufacturing sector is sustaining April growth following the introduction of investors and exporters forex window. This is above the 50 level separating expansion from contraction.

The report released by the Central Bank of Nigeria, CBN, showed 10 of 16 the sub-sectors reported grew in May. While, the remaining 6 sub-sectors declined in this order: transportation equipment; nonmetallic mineral products; fabricated metal products; printing & related support activities; furniture & related products and computer & electronic products.

Also, the report showed that production index for manufacturing surged to 58.7 in May from 58.5 recorded in April. Making it the third consecutive month increase.

“The surge in the manufacturing activities further validated the ongoing business policy by the federal government to ease business and ensure manufacturers access forex at a market-determined rate,” said Samed Olukoya, a foreign exchange research analyst at Investors King Ltd.

“Gradually confidence is returning to the market as you can see from the surge in the index for new orders,” he added.

The new order index for May rose to 50.5, this is the second consecutive growth in new orders this year.

Naira gained against the greenback to trade at N374 a dollar.

http://investorsking.com/nigerias-manufacturing-sector-expands-may/ mynd44

The Lagos State Government says it is investing in Information and Communications Technology to push the state from the fifth largest to the third largest economy in Africa.

“We will need a new generation of technology literate graduates to drive that forward and ensure that Lagos State becomes the third largest economy at the turn of the next decade of this century,” the Special Adviser to the Governor on Education, Mr. Obafela Bank-Olemoh, said.

He stated this on Thursday at a quarterly forum organised by the Bridge International Academies. The forum was tagged, ‘Leapfrogging Social Impact through Technology’.

Bank-Olemoh added, “The appetite for investment in technology must continue to increase as this has become the most viable way to feed the growth of many social and economic indices.

“As we seek to educate our burgeoning population for the future, we are pleased to be partnering strategically with the Bridge to achieve our target.”

He had earlier called on other state governments to emulate Lagos, saying that their appetite for investment in technology must continue to increase, “as this has become the most viable platform to revving the growth of many social and economic indices.”

In calling for government at all levels to continue to invest in technology to drive national growth, he stated that Lagos State recently inaugurated her education-technology programme.

http://investorsking.com/lagos-plans-become-africas-third-largest-economy/