Akeem ReachnaijaMarch 19, 2019


An ambitious plan, which is expected to lift Nigeria to the world’s third largest palm oil producer, was announced yesterday by the Central Bank of Nigeria (CBN).

The plan is to overtake Thailand and Columbia as major palm oil producers.

Addressing stakeholders in the palm oil industry in Abuja yesterday, CBN Governor Godwin Emefiele stated: “Our ultimate vision is to overtake Thailand and Columbia to become the 3rd largest producer over the next few years.”

The CBN boss noted: “If we had kept pace with our peers in supporting improved cultivation of palm oil, at the current global market price of $600 per tonne, and an assumed production level of 16m tonnes, Nigeria could have generated close to $10bn worth of foreign exchange for the country.

“This analysis does not take into consideration the amount of jobs that could have been created in our rural communities from large scale small holder developments.”

To achieve this, the CBN governor is advocating for improved financing.

He said: “With regards to improving access to finance for small holder farmers focused on cultivation of palm oil, the Bankers Committee has established a special sub-committee to make recommendations on sustainable financing models for oil palm and four other critical agricultural commodities that include cocoa, sesame seed, shea-butter, animal husbandry and cashew.

“As part of the Anchor Borrowers Programme (ABP) and our Commercial Agriculture Credit Scheme (CACS), the CBN will work with large corporate stakeholders and small holder farmers to ensure availability of quality seeds for this years planting season and agro-chemicals in order to enable improved cultivation of palm oil.

“We will also work to encourage viable off taker agreements between farmers and large-scale palm producing companies.

“Loans will be granted through our ABP and CACS programs at no more than nine per cent p.a to identified core borrowers.

“With an estimated three million hectares of land under cultivation, abundance of suitable arable land, we need the cooperation of our state Governments in the oil palm producing zones to make land available to investors with proven financial and technical capabilities, who will be able to support developments of large scale palm oil plantations in the country.”

Akeem ReachnaijaMarch 19, 2019


The internally generated revenue (IGR) of Lagos state rose by approximately N33 billion from 2015 to 2016, beating 33 states put together.

According to a report by the Nigeria Extractive Industries Transparency Initiative (NEITI), the state recorded an IGR of N301.19 billion, a rise of N32.99 billion in one year.

The total IGR from 33 states of the federation, excluding Delta, Ogun and Rivers states, stood at N299 billion — over a billion less than Lagos IGR.

Delta, Ogun and Rivers raked in N44.89 billion, N56.30 billion and N82.10 billion respectively.

Like his predecessors, Bola Tinubu and Babatunde Fashola, Akinwunmi Ambode, governor of Lagos state, has at various times committed himself to the generation of IGR in the state.

The NEITI report, which reviewed disbursements from the Federation Account Allocation Committee (FAAC) for the fourth quarter of 2016, also showed that Lagos received N109 billion in 2016.

The agency lamented low revenue generation across 34 states, citing Lagos and Ogun as the only states generating more than what they get from the central.

“IGR is very low in most states and it is only in two states – Lagos and Ogun – that IGR is higher than FAAC allocations. The figure shows that total revenue by itself cannot fund states budgets,” it said.

NEITI said the three tiers of government shared N5.121 trillion through 2016 — a decline from 2015 figures.

“Total disbursements fell by 14.8% from N6.011 trillion for the year 2015 to N5.121 trillion for the 2016. In Q1 2016, total disbursements were N1.132 trillion as against N1.648 trillion in Q1 2015, a decline of 31.2% in Q1 2016,” NEITI said.

“Total disbursements fell by 26.9% from N1.241 trillion in Q2 2015 to N906 billion in Q2 2016. There was a further decline in Q3 when total disbursements dropped by 7.8% from N1.887 trillion in 2015 to N1.738 trillion 2016.

“However, total disbursements increased in Q4 by 8.8% from N1.233 trillion in 2015 to N1.343 trillion in 2016.”

The report revealed that “the federal government received a total of N2.08 trillion from the federation account in 2016, which represents a drop of 19.9% of the total N2.6 trillion received in 2015.”

The 2016 budget was for N6.06 trillion, implying that at N2.08 trillion, total FAAC disbursements were only 34.3 percent of the budget.

“Thus, the federal government would have to resort to even higher debts to fund the budget. The implication of this is that debt service payments, which accounted for 24.3% of the 2016 budget, would increase.”



Akeem ReachnaijaMarch 15, 2019


Increases were recorded in all COICOP divisions that yielded the Headline index.

On a month-on-month basis, the Headline index increased by 0.73 percent in February 2019, this is 0.01 percent rate lower than the rate recorded in January 2019 (0.74) percent.

The percentage change in the average composite CPI for the twelve months period ending February 2019 over the average of the CPI for the previous twelve months period was 11.56 percent, showing 0.24 percent point from 11.80 percent recorded in January 2019.

The urban inflation rate increased by 11.59 percent (year-on-year) in February 2019 from 11.66 percent recorded in January 2019, while the rural inflation rate increased by 11.05 percent in February 2019 from 11.11 percent in January 2019.

On a month-on-month basis, the urban index rose by 0.76 percent in February 2019, down by 0.01 from 0.77 percent recorded in January 2019, while the rural index also rose by 0.71 percent in February 2019, same rate as was recorded in January 2019 (0.71) percent.

The corresponding twelve-month year-on-year average percentage change for the urban index is 11.95 percent in February 2019. This is less than 12.20 percent reported in January 2019, while the corresponding rural inflation rate in February 2019 is 11.23 percent compared to 11.46 percent recorded in January 2019.

Food Index

The composite food index rose by 13.47 percent in February 2019 compared to 13.51 percent in January 2019.

This rise in the food index was caused by increases in prices of Fish, Bread and cereals, Potatoes, yam and other tubers, Meat, Vegetables, Oils and fats and Fruits

On a month-on-month basis, the food sub-index increased by 0.82 percent in February 2019, down by 0.01 percent points from 0.83 percent recorded in January 2019.

The average annual rate of change of the Food sub-index for the twelve-month period ending February 2019 over the previous twelve-month average was 13.62 percent, 0.31 percent points from the average annual rate of change recorded in January 2019 (13.93) percent.

All Items Less Farm Produce

The ‘’All items less farm produce’’ or Core inflation, which excludes the prices of volatile agricultural produce stood at 9.8 percent in February 2019, down by 0.1 percent when compared with 9.9 percent recorded in January 2019.

On a month-on-month basis, the core sub-index increased by 0.65 percent in February 2019. This was down by 0.16 percent when compared with 0.81 percent recorded in January 2019.

The highest increases were recorded in prices of Tobacco, repair and hire of footwear, Major household appliances, Domestic services and household services, Dental services, Medical and hospital services, Cleaning, repair and hire of clothing.

The average 12-month annual rate of change of the index was 10.19 percent for the twelve-month period ending February 2019; this is 0.15 percent points lower than 10.34 percent recorded in January 2019.

State Profiles

In analysing price movements under this section, note that the CPI is weighted by consumption expenditure patterns which differ across states. Accordingly, the weight assigned to a particular food or non-food item may differ from state to state making interstate comparisons of consumption basket inadvisable and potentially misleading.

All Items Inflation

In February 2019, all items inflation on year on year basis was highest in Kebbi (13.78%),Taraba (13.57%) and Kaduna (13.54%), while Cross River (9.81%) Delta (9.60%) and Kwara (9.36%) recorded the slowest rise in headline Year on Year inflation.

On month on month basis however, February 2019 all items inflation was highest in Taraba (1.87%), Ogun (1.83%), and Imo (1.62%), while Jigawa recorded the slowest rise (0.13%), with Delta and Kogi recording negative inflation or price deflation (general decrease in the general price level of goods and services or a negative inflation rate) in February 2019.

Food Inflation

In February 2019, food inflation on a year on year basis was highest in Nasarawa (16.78%), Taraba (16.76%) and Abuja (16.29%), while Kogi (11.68%), Delta (11.51%) and Abia (10.81%) recorded the slowest rise in food inflation.

On month on month basis however, February 2019 food inflation was highest in Taraba (2.95%), Ogun (2.73%) and Nasarawa (2.42%), while Benue, Delta, Kogi and Ondo all recorded food price deflation or negative inflation (general decrease in the general price level of goods and services or a negative inflation rate) in February 2019.

Akeem ReachnaijaMarch 10, 2019


Heavy rains and uncertainties in Nigeria’s political landscape in 2018 were not enough threats to improved profitability for Dangote Cement, a leading cement manufacturing group in Africa, as consumption in the country boosted its revenue to about N901billion. The sterling performance ostensibly accounted for 0.5 per cent of Nigeria’s GDP in the review year. Bamidele Famoofo reports

Manufacturing Sector

The manufacturing sector of the economy was one out of four major sectors in the non-oil sector that helped Nigeria’s Gross Domestic Product (GDP) grow by 2.38 percent in real terms (year-on-year) in the fourth quarter of 2018, according to figures from the Nigeria Bureau of Statistics (NBS).

The statistics bureau noted that nominal GDP growth for the manufacturing sector was recorded at 33.57 per cent, which is 24.37 percentage points higher than the rate recorded in the corresponding period of 2017 (9.20 per cent), but only 0.84 percentage points higher than the preceding quarter’s (32.73 per cent). Quarter on quarter, growth of the sector stood at 6.62per cent, while annual growth was 24 per cent in 2018. The contribution of manufacturing to nominal GDP in Q4 2018 was 10.11per cent, which is higher than its contribution in the corresponding period of 2017 (8.53 per cent) and Q3 2018 (10.01 per cent). For 2018, the sector contributed 9.75 per cent to total nominal GDP, higher than its contribution, of 8.83 percent in 2017.

The growth represents an increase of 0.27per cent points when compared to the fourth quarter of 2017, which recorded a growth rate of 2.11 percent. It also indicates a rise of 0.55 percentage points when compared with the growth rate recorded in third quarter 2018. On a quarter-on-quarter basis, real GDP growth was 5.31percent.

The fourth quarter growth performance implies that real GDP grew at an annual growth rate of 1.93per cent in 2018, compared to 0.82 per cent recorded in 2017, an increase of 1.09percentage points.

During the quarter, aggregate nominal GDP stood at N35.230 trillion, which is higher than N31.275 trillion recorded in Q4 2017, a nominal growth rate of 12.65 per cent. For 2018, nominal GDP was therefore recorded at N127.762 trillion representing a nominal growth rate of 12.36percent when compared to N113.711trillion recorded in 2017.

The manufacturing sector comprises of 13 activities: Oil Refining; Cement; Food, Beverages and Tobacco; Textile, Apparel, and Footwear; Wood and Wood products; Pulp Paper and Paper products; Chemical and Pharmaceutical products; Non-metallic Products, Plastic and Rubber products; Electrical and Electronic, Basic Metal and Iron and Steel; Motor Vehicles and Assembly; and Other Manufacturing.

Dangote Cement

While the improved contribution of non-oil sector and by extension the manufacturing subsector to GDP growth have been applauded by economic pundits, the impact of Dangote Cement in the revival of the near comatose manufacturing space in Nigeria cannot be ignored.

Ostensibly, Dangote Cement, largest capitalised company on the Nigerian Stock Exchange with a market capitalisation of about N3.4trillion was a major contributor to growth in GDP in 2018 with record revenue of N901billion in its financial year ended December 31, 2018.

The ever expanding Dangote Cement Group with established manufacturing plants across major countries in Africa grew total revenue by 11.9 percent from N805.58billion in December 31, 2017 to N901billion in 2018.

Going by the details in the group’s audited financial records for 2018, revenue was largely driven by the Nigerian market where revenue grew by 11.9 percent from N552.36billion in 2017 to N618.30billion. The implication is that consumption of cement in Nigeria in the review year increased by 11.9 percent or about N66billion.

Dangote Cement accounted for 0.5 percent of nominal GDP in 2018 considering the N618.30billion total revenue generated from the local market in comparison to an aggregate nominal GDP of N127.76trillion recorded by Africa’s largest economy in 2018.


Dangote Cement Plc, Africa’s largest cement producer, announces a group’s revenue of N901.2billion as at December 31, 2018, which represents an increase of 11.9 percent compared to N805.52billion in the corresponding period of 2017.

Group’s earnings before Interest, taxes, depreciation, and amortisation (EBITDA), (used as an indicator of the overall profitability of a business), moved up 12.1 per cent to N435.3billion from N388.15billion in the preceding financial year.

Details of the report indicated that Nigeria EBITDA increased by 10.2 percent from N360.76billion in 2017 to N397.40billion in 2018, while margin also increased by 64.3 percent. Pan-Africa EBITDA surged by 28.2 percent from N38.28billion in 2017 to N49.1billion while margin growth was put at 17.3 percent in 2018.

Dangote Cement explained that the increase in EBITDA was helped by the more favourable fuel mix at Obajana and Ibese, both of which were able to use coal from mines operated by its parent, Dangote Industries Limited.

“The use of expensive LPFO has been eliminated and our reliance on imported coal has ended at Obajana and Ibese, where we are using own-mined and third-party Nigerian coal, with obvious benefits to both margins and foreign currency demands. All of our eight kilns at Obajana and Ibese are now capable running on coal, gas or LPFO, or a mixture of the three. Our two lines at Gboko run on coal or LPFO or a mixture of the two”, the leading cement company in Africa revealed.

Further breakdown of the audited 2018 financial figures showed that earnings per share (EPS) of the cement group went up by 95.9 per cent to N22.83. To reward its shareholders across board, Dangote Cement has proposed a dividend of N16.00 per share which represents a growth of 52.4per cent compared to the dividend paid in 2017.

Speaking on the performance, Group Chief Executive Officer, Joseph Makoju, said: “This is a record financial performance by Dangote Cement, driven by a strong increase in our home market, Nigeria, despite heavy rains and uncertainties about the election. Although Pan-African volumes were unchanged in 2018, I am confident that we will see an increase in 2019, driven by higher volumes in Tanzania, Ethiopia, Congo and Sierra Leone. Now that we have gas turbines operating in Tanzania we will also see increased profitability in the Pan-Africa region and this will help to improve overall Group margins.”

Operating Highlights

Dangote Group revenue was driven by sales volumes which went up by 7.4 per cent to 23.5 metric tonnes (Mt) in 2018 driven largely by the Nigerian operations, which increased volumes by 11.4 percent to 14.2Mt in 2018, including export sales of 0.7Mt. Domestic sales in Nigeria were 13.4Mt, compared to 12.0Mt in 2017, because of higher building activity as the economy recovered from recession.

“In Nigeria, our 13.3Mta Obajana plant sold 6.7Mt of cement in 2017, with the 12.0Mta Ibese plant also selling nearly 6.7Mt. Our 4.0Mta plant at Gboko, in Benue State, was mothballed for most of the year but sold more than 0.8Mt,” the group remarked.

Meanwhile, group manufacturing costs increased by 9.1percent, mostly as a result of increased volumes in Nigeria. Manufacturing costs in Nigeria increased by 7.4per cent from N158.6billion to N170.3billion, on the back of the 11.4 per cent increase in sales volume for 2018.

Although Pan-African volumes remained constant, manufacturing costs increased by 10.6 per cent from N192.7billion to N213.0billion, mainly due to exchange rate impacts as well as input price adjustments.

The naira traded at N359/$1 at the end of 2018 compared to N331/$1 at the end of 2017, a decline in value of 7.8percent. The depreciation also contributed to the overall increase in Pan-African operating costs when these were converted to naira. The average exchange rate and year-end exchange rate for the main currencies applied are as shown in the notes to the financial statements.

Besides, total administration and selling costs rose by 22.0 per cent to N189.4billion, mostly as a result of higher sales and associated distribution costs in Nigeria, which also include increased export sales from the country whose delivery costs are higher. Haulage expenses in Nigeria increased by N10.2billion to N56.7billion from N46.5billion. Haulage costs in Pan-Africa increased by N3.2billion, representing 11.3per cent increase.


Mr. Olusegun Olusanya resigned from the board after being with Dangote Cement for about 15 years. Another major change on the board in the financial year ended December 31, 2018 was the resignation of the Group Chief Financial Officer and Board member, Brian Egan. The Irish finally quit the organisation on February 28, 2019 after five years with Dangote Cement.

In the interim, Guillaume Moyen, who recently joined Dangote Cement as Group Chief Finance Officer (Operations) will be Acting Group Chief Financial Officer from March 1, 2019.


Dangote Cement believes the year 2019 has started well with sales volumes in Nigeria more than 10 per cent ahead of last year in ongoing first quarter. It is also hinging its hope on federal government’s commitment to a strong programme of infrastructure investment and incentivisation that will drive increased road building, including the construction of concrete roads for better performance in 2019.

Akeem ReachnaijaMarch 6, 2019


The World Bank has put the cost of water from alternative providers in Nigeria at $650 to 700 million a year—four times more than the combined revenue of all 35 state water agencies (SWAs).

According to the bank, should the trend continue within the next 10 years, less than a third of the municipal population will get water from SWAs at the cost of $1.5–2 billion a year for just basic water services.

Speaking to newsmen, yesterday in Abuja, United States Agency for International Development (USAID) consultant, Badamasi Abdulsalam, said that the lack of investment coupled with the lack of finances of most state water providers makes Nigeria’s water service unusually inadequate even when compared with much poorer African nations.

“Water consumption is adequate only in the North Central region, though it is close to the World Health Organisation (WHO) recommendation of 50 litres per capita per day (lpcd) in the North East region. In all other regions, consumption is significantly lower than recommended. Low consumption affects providers as well as users. Service below 50 lpcd does not correspond to the design standards for water supply systems—no utility can be sustainable and guarantee safe water when consumption is so low. There are, however, other elements of service that require swift attention and that need to be built into the assessment of investment needs. For instance, water services tend to be intermittent, with only Abuja (in the Federal Capital Territory) and Cross Rivers reporting 24/7 service” he said.

Abdulsalam also said that evolution of Nigeria’s water services has resulted in a situation in which each state has a unique institutional structure for service provision, tariffs and revenues, and principles of cost recovery and investment.

He observed that no water utility can borrow money or be made fully responsible for financial or investment support to water operations.

The reason, he explained, is that such operations are delegated to other state agencies either by State Water Boards (SWBs) or state water ministries.

“There is also no mechanism to transfer federal financial resources directly to SWAs. These limitations on SWA financial initiatives deter investment. The outcome is lack of incentives for water providers to attract new customers.

Akeem ReachnaijaMarch 5, 2019


The Nigerian equities market kick-started trading activities for the week, yesterday on a positive note, driven by the positive performance in 25 stocks across Banking, Consumer and Industrial sectors. As a result, the All – Share- Index (ASI) gained 302.70 absolute points, representing an increase of 0.95 per cent, to close at 32,129.94 points. Similarly, market capitalisation grew by N113 billion, to close at N11.982 trillion. The upturn was impacted by gains recorded in medium and large capitalised stocks, amongst which are; International Breweries, Guaranty Trust Bank, Zenith Bank, Dangote Flour Mills and Dangote Cement. Analysts at Afrinvest Limited believed that the positive performance recorded yesterday would persist into subsequent trading sessions as investors continue to take positions in fundamentally sound stocks. Market breadth was positive, recording 25 gainers against 10 losers. McNichols recorded the highest price gain of 9.80 per cent, to close at 56 kobo, per share. Cutix followed with a gain of 9.76 per cent to close at N2.25, while NPF Microfinance Bank rose by 9.72 per cent to close at N1.58, per share. Wema Bank appreciated by 9.09 per cent to close at 84 kobo, while Sovereign Trust Insurance up by 8.70 per cent to close at 25 kobo, per share. On the other hand, PZ Industries led the losers’ chart by 9.67 per cent, to close at N12.15, per share. Livestock Feeds followed with a decline of 8.96 per cent to close at 61 kobo, while Consolidated Hallmark Insurance lost 7.14 per cent to close at 26 kobo, per share. Law Union & Rock Insurance shed 5.45 per cent to close at 52 kobo, while United Capital depreciated by 2.99 per cent, to close at N3.25, per share. However, total volume of trades decreased by 33 per cent to 228.48 million units, valued at N2.61 billion and exchanged in 3,544 deals. Transactions in the shares of Diamond Bank topped the activity chart with 33.03 million shares valued at N82.11 million. United Bank for Africa (UBA) followed with 31.1 million shares worth N239.14 million, while Zenith Bank traded 28.87 million shares valued at N703.1 million. Access Bank traded 21.01 million shares valued at N124.2 million, while Transnational Corporation of Nigeria (Transcorp) transacted 16.98 million shares worth N37.56 million.

Akeem ReachnaijaMarch 3, 2019


Investors in the Nigerian equities market witnessed the largest single daily loss since the beginning of 2019 after Nigeria’s presidential election with All Share Index dipping by 1.63per cent on the last trading in the election month. However, the trend may be short-lived as the market recorded a gain on Friday, the first day of trading in March, reports Bamidele Famoofo

The four business days that followed the presidential elections in Nigeria won’t be forgotten in a jiffy by investors in the Nigerian equities market as a big drop recorded in market capitalisation and All Share Index also translated to a big loss for them.

Market capitalization dropped from about N12.194trillion on Monday, 25th February to about N11.829trillion on Thursday same week, representing N365billion loss in investors’ equities portfolio.

The NSE-All Share Index (ASI), which tracks performance of stocks listed on the platform of the Nigerian Stock Exchange (NSE) as a result of sell-offs by investors declined from 32,700.12 points to 31,721.76 points on the last trading day in the month of February.

A report from Cordros Capital Limited on how the market fared in the review period indicated that the drop in ASI on the last day in February was the largest single day decline recorded in the market so far in 2019 as it attributed the loss to sell-offs across bellwether stocks in the equities market.

“Against marked sell-offs across bellwether stocks, the Nigerian equities market closed the last session of the month on a negative note as the ASI dipped by 1.63% — largest single day decline since Jan 31, 2019 — to 31,718.70 points”, the report disclosed in part.

As a result of the performance in the last four days in February, Month-to-date returns moderated to 3.80 percent while Year-to-date stood at 0.92 percent, according to Cordros Capital.

It was a all round loss especially on Thursday, February 28, 2019 with Banking sector index closing negative to the tune of -4.56 percent, meaning that investors who hold bank shareslost about five percent of value of their stock in that sector for the day. Equally, investors in the Industrial Goods sector shed -2.18 percent of value on the same day. Others are Consumer Goods (-2.02%), Oil & Gas (-1.56%), and Insurance (-0.97%). Notable stocks include, GUARANTY (-6.85%), WAPCO (-0.39%), NB (-4.45%), OANDO (-9.92%), and AIICO (-5.19%), respectively.

Meanwhile, experts have assured investors in the market that the fundamentals for recovery remain strong medium to long term even while the market continues to digest election results.

“As the market continues to digest election results, we guide investors to trade cautiously in the short term. However, stable macroeconomic fundamentals and compelling valuations remain supportive of recovery in the mid-to-long term”, Cordros Capital said.

Meanwhile, the month of February could not be labeled a period of doom for investors as it ended on a positive note overall as ASI appreciated by 3.8 percent to close on Thursday at 31,721.76 points compared to 30,557.20 points which opened the second month of the year.

Also, compared with the performance in January when ASI closed on a declining note, investors amassed N434billion from trading as market capitalization moved up from N11.395 trillion in January to close at N11.829 trillion on February 28, 2019.

As earlier reported by THISDAY, the market had recorded a decline in January as general elections jitters kept most investors away from the market. However, investors increased their patronage in February as they anticipated the release of corporate results for the year ended December 2018. Also, some investors felt the political uncertainties were reducing. Hence, the market appreciated in the month of February.

Besides, the growth would have been higher but for the decline recorded in the last two days of the month after the results of the presidential election were announced and President Muhammadu Buhari declared the winner.

The NSE ASI had appreciated to a high of 32,700.12, while market capitalisation rose to N12.194 trillion on Monday. However, the NSE ASI closed the month at 31,721.76, while market capitalisation ended at N11.829 trillion.

A review of the performance of the equities market a week penultimate the elections showed that the NSE All-Share Index and market capitalisation depreciated by 0.61 percent to close the week at 32,515.52 and N12.126 trillion respectively.

Breakdown of performance in the week showed that a total turnover of 1.481 billion shares worth N17.647 billion in 20,449 deals were traded by investors on the floor of the Exchange in contrast to a total of 2.834 billion shares valued at N28.138 billion that exchanged hands last week in 28,739 deals.

But contrary to the results, the week after the elections when all sectors recorded losses especially on the last day of the month of February, the Financial Services Industry (measured by volume) led the activity chart with 1.038 billion shares valued at N10.170 billion traded in 12,232 deals; thus contributing 70.07 percent and 57.63percent to the total equity turnover volume and value respectively. The Conglomerates Industry followed with 193.204 million shares worth N306.521 million in 1,330 deals. The third place was Consumer Goods Industry with a turnover of 72.042 million shares worth N4.381 billion in 2,990 deals.

However, in line with the assurances from experts, the market on Friday, March 1, the first day of trading in March, launched a recovery bid as ASI appreciated by 0.34 percent. Index value moved up to 31,827.24 while market capitalisation increased to N11.868 trillion having gained N40billion in one day.

Akeem ReachnaijaFebruary 27, 2019


AS Nigeria’s stock market turn positive with significant capital gains ahead of official conclusion of the general elections, oil prices, yesterday shot up, apparently over uncertainty over the outcome of the election’s as well as the political tension in Venezuela. Also the pressure on oil price appears to be coming from a positive sentiment over United States–China talks.

International Brent crude oil futures were at $67.28 a barrel, up 16 cents, or 0.24 percent, from their last close, while U.S. West Texas Intermediate (WTI) crude futures were at $57.39 per barrel, up 13 cents, or 0.23 percent, from their last price.

“Risk appetite across global markets should improve as President Trump extends the deadline of trade talks with China,” Harry Tchilinguirian, global oil strategist at BNP Paribas in London, said.

“Supply risk is ever present with Venezuelan tensions brewing a notch higher, the National Oil Corporation in Libya refusing to start production at the El Sharara field,” he added, while also citing uncertainty over elections in top African oil exporter, Nigeria. U.S. sanctions on Iranian and Venezuelan crude plus involuntary curbs in Nigeria and Libya are lending support to efforts to balance the market and support prices, efforts led by member of the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers such as Russia. Further brightening the global economic picture, U.S. President Donald Trump on Sunday signalled a potentially bruising trade war with China could be averted.

Trump tweeted he would postpone a March 01, 2019 deadline for higher tariffs on Chinese goods and looked forward to a meeting with Chinese President Xi Jinping when a Sino-American deal was sealed.

Goldman Sachs analysts said that “the near-term outlook for oil is modestly bullish over the next two to three months”, but added that the outlook for later in 2019 was weaker due to a surge in U.S. exports and an “an increasingly uncertain economic, policy and geopolitical backdrop”.

Meanwhile, Trump resumed his attacks on the Organisation of Petroleum Exporting Countries, OPEC, saying the world is too fragile to handle a price hike and urging the cartel to “relax and take it easy.” Trump’s war of words with the OPEC punctuated big price swings in 2018, as he pressured the group to keep the taps open to help consumers. The president’s intervention follows a price rally of about 25 percent this year due to production cuts from OPEC and its allies, diminishing fears about the economic impact of the US-China trade war and Washington’s imposition of sanctions on Venezuelan oil shipments.

“We might see a less aggressive stance on supply cuts from the Saudis, this might stop them from cutting deeper,” said Giovanni Staunovo, an analyst at UBS Group AG in Zurich.

“But I still think Saudi Arabia has the incentive to see higher oil prices, and deliver the cuts agreed in December, when OPEC and its partners agreed to remove 1.2 million barrels a day’’, he added.

NOPEC risk

The risk to OPEC comes in the form of the so-called ‘No Oil Producing and Exporting Cartels Act’, or NOPEC, an act resurrected by US lawmakers that proposes making the organization subject to the Sherman antitrust law, used more than a century ago to break up the oil empire of John Rockefeller. Congressional support for the bill intensified last year as oil prices neared a four-year high, and Trump publicly blamed OPEC for high pump prices in the US In the past, the White House has opposed the NOPEC legislation – both George W Bush and Barack Obama threatened to use their veto.

OPEC’s concern now is that Trump may break with his predecessors, and angering him by not going “easy,” as he requested in his tweet, raises the stakes. Trump, before becoming president, didn’t just support the NOPEC bill, he was a cheerleader for it. “We can start by suing OPEC for violating antitrust laws,” he wrote in his 2011 book “Time to Get Tough: Making America #1 Again.”

Whether by coincidence or design, Trump’s latest tweet comes on the eve of International Petroleum Week, which opens in London on Tuesday. The annual event gathers the who’s who of the oil market and industry for several days of conferences, deal-making and cocktail parties.

Akeem ReachnaijaFebruary 20, 2019


The Central Bank of Nigeria (CBN) has injected 210 million dollars into the various segments of the market to sustain its intervention in the Inter-Bank Foreign Exchange Market.

The CBN Director, Corporate Communications, Mr Isaac Okorafor made this known in a statement on Tuesday in Abuja.

Mr Okorafor revealed that the apex bank offered 100 million dollars as wholesale interventions and allocated 55 million dollars to Small and Medium Enterprises (SMEs).

He further said that another 55 million dollars was allocated to customers requiring foreign exchange for business and personal travels, tuition or medical fees.

The director explained that the Tuesday’s interventions were in continuation of the bank’s resolve to sustain the high level of stability in the foreign exchange market.

According to him, it is also to continue to ease access to the currency by customers in different sectors.

Okorafor said the CBN was optimistic that the Naira would sustain its run against the dollar and other major currencies around the world, considering the level of transparency in the market.

Akeem ReachnaijaNovember 9, 2018


FSDH Merchant Bank Plc has predicted that about N2.82 trillion coming from matured government securities and Federal Account Allocation Committee (FAAC) are expected to hit the Nigerian money market this month.

The bank also projected a total outflow of approximately N1.03 trillion from various sources, including government securities and statutory withdrawals, leading to a net inflow of about N1.79trn.

The Head of Research and Strategy at FSDH Merchant Bank Limited, Mr. Ayodele Akinwunmi, while speaking on the firm’s latest monthly economic and financial market outlook report released recently.

The report was titled: “Local Competitiveness: A Prerequisite for Inclusive Growth.”

Presenting the highlight of the report, the Akinwunmi, reiterated the need for the diversification of the economy in order to drive inclusive growth and competitiveness.

According to him, the Nigerian economy has the potential to grow faster than the projection by the International Monetary Fund (IMF) and other organisation.

He added: “Even though FSDH is of the opinion that the Nigerian economy has the potential to grow faster that the projection of the IMF, this can only happen where we have coordinated set of policies that will unleash the economy: paying attention to power, paying attention to our infrastructure, involving the private sector, paying attention to our education system, paying attention to adoption of information and communication technology (ICT), to ensure that we are not lagging behind in the fourth industrial revolution which is digital revolution.

“We need to involve private sector operators in ensuring that we lay the foundation for a sustainable growth of the Nigerian economy and to diversify the revenue streams of the economy.”

According to him, “the more we create local competitiveness to make our local economy attractive, the better for us.

“And it comes in various ways: in terms of infrastructure, in education, right policies to develop the right education skills training to make people employable, right health facilities.”

Akinwunmi anticipated an uptick in inflation, to be, “driven by the escalation in price of food and account of the food shortage, the clash between herdsmen and farmers, the flooding issue that we had across the country. And maybe, if the minimum wage is approved for payment, it may likely have some little additional increase to it.”

He noted that if the ongoing agitation for an increase in minimum wage is approved and it leads to upsurge in liquidity in the system, the Monetary Policy Committee may intervene by adjusting the Cash Reserve Requirement (CRR) to soak the liquidity.

On capital flight, Aknwunmi said: “The capital flight will continue to increase because of the increase in rates in developed countries, which we call a saving haven. And it’s putting a lot of pressure on foreign exchange.”