Business

Senate summons CBN governor, SEC chief over ban on cryptocurrency trading

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The Senate on Thursday summoned the Governor of Central Bank of Nigeria, Godwin Emefiele, over the ban of cryptocurrency transactions in the country.

The upper legislative chamber also directed its Committees on Banking, Insurance and other Financial Institutions, ICT and Cybercrimes, and Capital Market to summon the Director-General of the Security and Exchange Commission (SEC), Lamido Yuguda, on the same matter.

The duo are expected to brief the parliament on “the opportunities and threats of the cryptocurrency on the nation’s economy and security.

The committee is expected to present its findings within two weeks.

The apex bank had last week directed Deposit Money Banks (DMBs) and other financial institutions to close accounts of persons using their systems for cryptocurrency trading.

A cryptocurrency is a virtual or digital currency that appreciates or depreciates on the influence of market forces.

The decision to summon the CBN and SEC chiefs was taken following the adoption of a motion titled: “CBN decision to stop financial institutions from transacting in cryptocurrencies and matters arising therefrom,” presented by Senators Istifanus Gyang and Tokunbo Abiru.

However, senators differed in their opinion on the matter during the plenary.

While Abiru, the Chairman of Senate Committee on Finance, Solomon Adeola and Biodun Olujimi spoke in support of cryptocurrency usage, Senator Sani Musa defended the CBN’s decision to ban cryptocurrency trading in Nigeria.

Abiru said: “The last five years, we have had people changing cryptocurrencies to over 500 million dollars. It is good to ban because of the challenges it has presented; in reality, banning it doesn’t take it away.

“Even our Security Exchange Commission (SEC) also recognized cryptocurrency as a financial asset they need to regulate. What we should do is to invite the major stakeholders to a public hearing.”

On his part, Adeola said: “I am strongly against the outright ban of this medium of exchange by the Central Bank of Nigeria (CBN). What the CBN should be telling Nigerians are the regulations put in place to regulate the activities of the operators.

All over the world, these cryptocurrencies are regulated. The operators of this so-called currency are everywhere. I would indulge this Senate to allow the regulators also to be invited so that they can also tell the committees their own position concerning the operation of cryptocurrency in Nigeria.”

Olujimi, who canvassed the continuous usage of cryptocurrency, added: “We didn’t create cryptocurrency and so we cannot kill it and cannot also refuse to ensure it works for us. These children are doing great business with it and they are getting result and Nigeria cannot immune itself from this sort of business.

What we can do is ensure bad people must not use it. This motion is most important to us. The time has come for us to harmonize all the issues concerning cryptocurrency.”

But Musa insisted that Bitcoin has made the Naira almost useless.

He added that the Nigerian economy was too weak for the usage of Bitcoin which “can’t be regulated.”

The senator said: “Cryptocurrency has become a worldwide transaction of which you cannot even identify who owns what. The technology is so strong that I don’t see the kind of regulation that we can do. Bitcoin has made our currency almost useless or valueless.

If we have an economy that is very weak and we cannot regulate cryptocurrency in Nigeria, then I don’t know how our economy would be in the next seven years.”

Business

FEC approves new debt management strategy

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DMO reveals approval of new debt management strategy 2020-2023 by FEC

The Federal Executive Council (FEC) at its meeting on Wednesday, February 10, approved a new Medium Term Debt Management Strategy (MTDS) for Nigeria, for the period 2020-2023.

This was contained on the official website of the Debt Management Office (DMO).

According to the DMO, the MTDS was a policy document that provided a guide to the borrowing activities of a government in the medium-term, which is usually four years.

It said: “it is recognised as one of the best practices in public debt management and is recommended by the World Bank and International Monetary Fund (IMF)

This is to ensure that public debt management is driven by a well-articulated strategy that is structured to meet a country’s broader macroeconomic and public debt management objectives.

“The MTDS, 2020-2023 has been prepared by the DMO, in collaboration with Federal Ministry of Finance, Budget and National Planning and the Central Bank of Nigeria (CBN).

“Other collaborating stakeholders are the Budget Office of the Federation, National Bureau of Statistics, and the Office of the Accountant-General of the Federation.”

The DMO revealed that Nigeria has had two previous MTDS (2012-2015 and 2016-2019), prior to the current Strategy, which was designed with a consideration of the impact of the COVID-19 pandemic.

“The new Strategy had to be re-worked to reflect the global and local economic impact of the COVID-19 pandemic and it incorporates data from the revised 2020 Appropriation Act and the Medium-Term Expenditure Framework 2021-2023.

“The new MTDS adequately reflects the current economic realities and the projected trends. The preparation of the MTDS usually involves the consideration of alternative funding strategies available to the government.

“It seeks to meet its financing needs, taking into consideration the cost of borrowing and the associated risks, while ensuring debt sustainability in the medium to long-term,” the DMO explained.

Debt incurred by the Federal Government

As of Q4 2020, the total public debt (External and Domestic) incurred by Nigeria stood at N32.22 trillion ($84.57 billion).

This represents an additional N6.01 trillion when compared to N26.21 trillion recorded as of the corresponding period of 2019.

This is according to the Nigerian Domestic and Foreign Debt report, released by the National Bureau of Statistics (NBS).

A cursory look at the breakdown of the domestic debts shows that 73.53% (N11.65 trillion) were in form of Federal Government bonds, 17.17% (N2.72 trillion) in Treasury bills, followed by Promissory Notes accounting for 6.13% (N971.9 billion) of the total federal government domestic debts.

Others include; FGN Sukuk (N362.6 billion), Treasury Bonds (N100.9 billion), Green bond (N25.7 billion), and Savings bond (N12.6 billion).

On the 31st of December 2020, President Buhari signed the 2021 appropriation bill of N13.59 trillion into law, which 25.7% higher than the revised 2020 budget of N10.8 trillion.

However, the budget comes with a deficit of N5.6 trillion, which is expected to be financed mainly through borrowings both externally and domestically.

According to the minister of Finance, Budget, and National Planning, Dr. Zainab Ahmed, during a budget presentation, N2.34 trillion will be sourced each from domestic and foreign sources respectively, N709.69 billion from Multilateral/bilateral loan drawdowns, and N205.15 billion from privatisation proceeds.

Business

United Nigeria Airlines begins operation

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United Nigeria Airlines will conduct its inaugural flight on Friday, February 12, 2021.

The inaugural flight will take off from the domestic wing of Murtala Mohammed International Airport (MM2) in Ikeja, Lagos state and terminate at the Akanu Ibiam International Airport Enugu, the operational base of United Nigeria.

The flight will also visit Abuja from Enugu and finally return to Lagos.

Head, Corporate Communications, Achilleus-Chud Uchegbu said the inaugural flight will be conducted with an EMB145 aircraft.

Daily Trust reports that the commencement of operation followed the issuance of an Air Operators Certificate (AOC) to United Nigeria by the Nigerian Civil Aviation Authority (NCAA), having fulfilled all mandatory regulatory requirements.

The airline said regular daily flight operations to Lagos, Abuja, Asaba, Enugu airports would commence immediately while Owerri and Port Harcourt will follow shortly.

Business, Politics

Reasons NIN is so important in Nigeria

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The Minister of Communications and Digital Economy, Dr Isa Ali Ibrahim Pantami, recently disclosed that the federal government has begun the process of replacing the Bank Verification Number (BVN) and other national database systems with the National Identity Number (NIN).

Aside from BVN, there are other key data systems in Nigeria.

Some of these are the Drivers Licence, issued by the Federal Road Safety Corps (FRSC), the Tax Identification Number (TIN) and the International Passport Number.

Others include professional licences like medical practice licence, pharmacology, nursing licence, teachers’ registration licence and engineering licence, among others.

According to the minister, his office was leading the initiative.

And the key reason for the migration of all databases to NIN is the fact that NIN is backed by law.

He said there is the need to replace BVN with NIN because the BVN is a bank policy but NIN is a law.

Because it has been established by law, the strength of the law everywhere is higher than a policy made by an institution.

The BVN was a policy directive by the Central Bank of Nigeria (CBN) that all customers of commercial banks must be identified through a verifiable number system.

Just like BVN and other data systems, there are limitations: you must be eligible to be captured in one or all these databases, but the NIN is not so, as long as you are a Nigerian or living in Nigeria.

For instance, BVN is only for those with active bank accounts, International Passport is often done by people who may have the need or opportunity to travel abroad, drivers licence works for those who have attained the 18-year for driving and are duly certified and fit for driving, while TIN is for those who are in the working-age and eligible to pay tax – Pay As You Earn (PAYE).

Countries in Asia, Europe and even the United States practice a central national identity system that tracks residents in a country.

The NIMC’s database is the primary one in the country that every institution should make reference to.

Another reason for prioritising NIMC is due to the insecurity issues in Nigeria.

Pantami said, with NIMC’s database, the level of security is 99.9 percent which is further guaranteed by the Nigeria Data Protection Regulation to guarantee safety of all data collected in the country.

Currently, NIN has been harmonised with the BVN of customers by most of the banks, the process is still on to integrate SIM cards with NIN by the telecommunication companies.

The NIN has been integrated as a central identity number in new international passports.

In December, FRSC rolled out its enforcement of NIN first before drivers licence, meaning you cannot get a new licence and renew one if you have no NIN.

Business

NNPC records N13.43bn trading surplus

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The Nigerian National Petroleum Corporation (NNPC) recorded a trading surplus of N13.43billion in November last year.

The figure was a 54 percent increase from N8.71billion surplus recorded in October.

The Group General Manager, Group Public Affairs Division of NNPC, Dr. Kennie Obateru, who disclosed this in the corporation’s Monthly Financial and Operations Reports for November 2020, added that NNPC generated $108.84 million from the export of crude oil and gas during the period.

He said NNPC surplus was bolstered by additional engineering services rendered by the Nigerian Engineering and Technical Company (NETCO) and increased revenue from import activities posted by Duke Oil Incorporated.

Obateru said: “These healthy performances dominated the positions of all other NNPC subsidiaries to record the Group surplus.

“Operating revenue decreased slightly by 0.02 percent or N0.09billion to stand at N423.08 billion while expenditure for the month also decreased by 1.16 percent or N4.81billion to stand at N409.65billion. This led to the N13.43billion trading surplus.”

The NNPC spokesman added that crude oil export contributed $73.09 million (67.15 percent) of the dollar transactions for November compared with $12.38 million contributions recorded in the previous month.

Gas export sales amounted to $35.75 million in the month.

The total crude oil and gas export for November 2019 to November 2020 stood at $2.89billion.

The spokesman added: “In the Gas Sector, a total of 222.34 Billion Cubic Feet (BCF) of natural gas was produced in the month under review, translating to an average daily production of 7,411.52 Million Standard Cubic Feet per Day (mmscfd).

“Furthermore, for the period November 2019 to November 2020, a total of 3,004.06BCF of gas was produced, representing an average daily production of 7,642.69mmscfd during the period.

Out of this volume, production from Joint Ventures (JVs) accounted for 67.29 percent, Production Sharing Contracts (PSCs) accounted for 19.97 percent, while the Nigerian Petroleum Development Company (NPDC) contributed 12.74 percent.

“Breakdown showed that a total of 137.41 BCF of gas was commercialized. This consists of 39.99BCF and 97.42BCF for the domestic and export market respectively. This translates to a total supply of 1,332.82 mmscfd of gas to the domestic market and 3,247.44 mmscfd of gas supplied to the export market for the month.”

Business

SERAP wants World Bank to publish records on electricity projects funded with $500m loan

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Socio-Economic Rights and Accountability Project (SERAP) has urged the World Bank President Mr David Malpass “to exercise the Bank’s prerogative to release archival records and documents relating to spending on all approved funds to improve access to electricity in Nigeria between 1999 and 2020, the Bank’s role in the implementation of any funded electricity projects, and to identify and name any executed projects, and Nigerian officials, ministries, departments and agencies involved in the execution of such projects.”

The World Bank Board of Directors had last week approved $500m “to help boost access to electricity in Nigeria and improve the performance of the electricity distribution companies in the country.”

But in the application dated 6 February 2021, and signed by SERAP deputy director Kolawole Oluwadare, the organization urged the Bank to “explain the rationale for the approval of $500m to implement electricity projects in the country, despite reports of widespread and systemic corruption in the sector, and the failure of the authorities to enforce a court judgment ordering the release of details of payments to allegedly corrupt electricity contractors who failed to execute any projects.”

SERAP said: “This application is brought pursuant to the World Bank’s Access to Information Policy, which aims to maximize access to information and promote the public good. There is public interest in Nigerians knowing about the Bank’s supervisory role and specifically its involvement in the implementation of electricity projects, which it has so far funded.”

According to SERAP, “The $500m is part of the over one billion dollars available to Nigeria under the project titled: Nigeria Distribution Sector Recovery Program. We would be grateful for details of any transparency and accountability mechanisms under the agreement for the release of funds, including whether there is any provision that would allow Nigerians and civil society to monitor the spending of the money by the government, its agencies, and electricity distribution companies.”

SERAP also said: “Should the Bank fail and/or refuse to release the information and documents as requested, SERAP would file an appeal to the Secretariat of the Bank’s Access to Information Committee to challenge any such decision, and if it becomes necessary, to the Access to Information Appeals Board. SERAP may also consider other legal options outside the Bank’s Access to Information framework.”

The letter copied to Shubham Chaudhuri, World Bank Country Director for Nigeria, read in part: “SERAP believes that releasing the information and documents would enable Nigerians and civil society to meaningfully engage in the implementation of electricity projects funded by the Bank, contribute to the greater public good, and enhance the Bank’s oft-stated commitment to transparency and accountability.

The World Bank has been and continues to be involved in overseeing the transfer, disbursement, spending of funds on electricity projects in Nigeria. The Bank also reportedly approved a $750 million loan for Nigeria’s electricity sector in June 2020 to cut tariff shortfalls, protect the poor from price adjustments, and increase power supply to the grid. As such, the World Bank is not a neutral party in this matter.

“SERAP is seriously concerned that the funds approved by the Bank are vulnerable to corruption and mismanagement. The World Bank has a responsibility to ensure that the Nigerian authorities and their agencies are transparent and accountable to Nigerians in how they spend the approved funds for electricity projects in the country, and to reduce vulnerability to corruption and mismanagement.

SERAP also believes that the release of the requested information and documents is of paramount important to the public interest in preserving the legitimacy, credibility and relevance of the Bank as a leading international development institution. The Bank ought to lead by example in issues such as transparency and public disclosure raised in this request.

“It would also demonstrate that the Bank is willing to put people first in the implementation of its development and governance policies and mandates, as well as remove any suspicion of the Bank’s complicity in the alleged mismanagement of electricity projects-related funds.

The information is also being sought to improve the ongoing fight against corruption in the country and the provision of regular and uninterrupted electricity supply to Nigerians as a fundamental human right.

“The information requested is not affected by the “deliberative” “corporate administrative matters” or “security and safety” exceptions under the Policy. The information requested is crucially required for Nigerians to know how the funds released to the authorities to improve electricity supply in the country have been spent, and monitor how the funds are being used.

SERAP’s report, titled: From darkness to darkness: How Nigerians are paying the price for corruption in the electricity sector documents widespread and systemic corruption in the electricity sector, and reveals how about N11 trillion electricity fund was squandered by successive administrations in Nigeria since the return of democracy in 1999.

“This report raises specific questions of public interest, and the World Bank ought to be concerned about how Nigerian authorities are addressing reports of widespread and systemic corruption in the electricity sector, and to seek some answers from the authorities on the problems.

However, as the report shows, the Bank’s funding of the electricity sector has not resulted in corresponding access of Nigerians to regular and uninterrupted electricity supply. Successive governments have failed to provide access to regular and reliable electricity supply to millions of the citizens despite budgeting trillions of naira for the power sector.

“Millions of Nigerians still lack access to free pre-paid meters. Authorities continue to use patently illegal and inordinate estimated billing across the country, increasing consumer costs, and marginalizing Nigerians living in extreme poverty, disproportionately affecting women, children and the elderly.”

SERAP therefore urged Mr Malpass to:

  1. Disclose and release information and documents relating to spending of funds approved and released to Nigeria between 1999 and 2020 to improve access to regular and uninterrupted electricity supply, including copies of supervision reports, periodic reviews and other appropriate reports on the Bank’s role in the spending and disbursement of the funds, as well as specific projects on which the funds have been spent.
  2. Disclose implementation status and results and completion reports on the electricity projects that the Bank has so far funded in Nigeria.
  3. Disclose information on the of level of involvement of World Bank in the implementation of electricity projects between 1999 and 2020.
  4. Disclose information on agreements and the mechanisms the Bank is putting in place to ensure transparency and accountability in the spending of all funds on electricity projects in Nigeria.
  5. Disclose the terms and conditions of all electricity projects related funds that have been approved for Nigeria between 1999 and 2020

Business

Ecobank seeks foreign investors amid falling revenue

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Ecobank is planning to raise funds from foreign investors amid declining interest in its shares in Nigeria and falling revenue.

The company wants to use the international debt capital market to raise $300 million.

In a statement to investors, which was obtained from the Nigerian Stock Exchange (NSE), Ecobank identified the London Stock Exchange (LSE) as the market where foreign investors will be issued senior notes in exchange for the capital.

Senior notes is also known as senior debt, and it comes with lower interest rates compared to other bonds due to its low risk. Companies that offer senior notes are obligated to repay their creditors in the wake of any financial troubles experienced by the issuer – this means debt tied to senior notes are paid before other debts.

Ecobank said the Central Bank of Nigeria (CBN) has approved its senior notes issue on the LSE, hence, the decision of the lender to inform the investing public in Nigeria of its intention to raise funds.

Ripples Nigeria confirmed from the NSE document that the capital raised from the senior notes will be infused into Ecobank’s operation in Africa, where it will financially support international trade.

Ecobank said its issuance of $300 million senior notes is in line with “the United States Securities and Exchange Commission Rule 144A and Regulation S (the “Transaction”).” Adding that, “The proceeds of the Eurobond will provide medium term funding and help to enhance the capacity of the Bank to support international trade and service in Africa.

“Further, the Notes, which will be issued through a Dutch special purposes funding vehicle, will be listed on the London Stock Exchange. In view of the foregoing, ETI is pleased to notify the Nigerian Stock Exchange and the investing public of the proposed launch of the Notes by the Bank.

“The Bank intends to list the Notes on the London Stock Exchange, with the expectation that the Notes will be traded on its regulated market. The Central Bank of Nigeria has confirmed that it has no objection to the Transaction. It should be noted that the Transaction is subject to prevailing market conditions and the conclusion of the necessary Transaction documentation.”

The decision to raise capital on the LSE comes at a period the company’s share price is declining as investors dump Ecobank shares in the Nigerian bourse to protect their investment following report by the company that its revenue dipped by 2% to N829 billion at 2020 Full Year (FY), failing to surpass the N842.49 billion of 2019 FY.

Business

MTN loses 3m subscribers in 6 months, as Airtel, Glo consolidate

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The last six months of 2020 was a bad period for MTN Nigeria, as the company’s telephone subscribers dumped its Y’ellow network within three months.

Ripples Nigeria gathered that MTN was the highest loser in the telecoms subscriber base market in the last half year of 2020 compared to Airtel Nigeria, Globacom and 9mobile.

Data from the Nigeria Communications Commission (NCC) showed that Airtel Nigeria, Globacom and 9mobile were on a gaining streak of six months before they hit a roadblock in December. During the six months period, MTN lost about three million subscribers, more than the 2.03 million Airtel, Globacom and 9mobile lost in total.

It was discovered that, while Airtel, Globacom and 9mobile grew their subscriber base without a loss in third quarter (July-September) last year, 448,831 subscribers dumped MTN in September to end Q3 with 82.63 million.

During the same period, Airtel had gained (483,851) more subscribers than MTN lost, to rise to 54.25 million, while Globacom added 1.32 million subscribers to its base to improve its total number ro 54.25 million, and 9mobile gained 351,610 subscribers to increase its base to 12.72 million in Q3 last year.

Meanwhile, in fourth quarter 2020, MTN recorded loses in November and December. MTN’s subscriber base depleted at a high rate from 83.33 million subscribers in October to 82.02 million in November.

In December, MTN’s subscriber base further declined to 80.76 million. This put MTN’s subscriber loss at over 2.56 million between October to December.

During the same period, MTN’s rivals, Airtel, Globacom and 9mobile suffered loss once – in December. While the Y’ellow network’s subscriber base dropped between October and November, Airtel grew its base by 1.01 million subscribers to hit 57.23 million total subscriber base.

However, the number dwindled by 1.58 million in December, putting Airtel’s total subscriber base at 55.64 million. Following a gain of 10,024 subscribers in November, Globacom also suffered the same fate like other telcos, as it lost 249,194 subscribers in December, to close the year with 54.84 million subscriber base behind Airtel.

The constant decline in MTN subscriber base shows that the telco giant is losing its grip in the telecoms market, and informing its rivals that subscribers confidence in the MTN service is depreciating.

Exodus exit from MTN affected the firm’s gap above its market rivals, shrinking its market share to 39.55% in December, from 40.30% in September 2020. In August last year, MTN held a 40.90% market share.

Airtel currently accounts for 27.25% of the subscriber base market share, while Globacom holds 26.85% share and 9mobile takes up the 6.36% share of the market.

The reason for the exodus in MTN could be linked to the company’s high rate of data depletion and call rate. MTN charges a flate rate of 11.26kobo per second for calls, Airtel, Globacom and 9mobile charge 11kobo per second.

Business

EFCC obtains court order to arrest ExxonMobil MD, Richard Laing

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The anti-graft agency had sought the order following Laing’s refusal to honour its previous invitations.

A statement by the commission’s head, media and publicity, Wilson Uwijaren and made available to a ripples Nigeria said EFCC had sent three invitations to Laing for questioning over Mobil’s role in an alleged procurement fraud of over $213 million, which EFCC was investigating.

With the bench warrant, EFCC is authorised by law to effect Laing’s arrest.

According to Uwujaren, Justice Okon Abang issued the arrest order on Friday January 29, 2021, following its request.

He further explained that the invitation into Mobil’s activities borders on fraudulent creation of Change Orders worth over $213 million.

Mobil isn’t the only company on EFCC’s radar relating to the procurement fraud case. Other companies are Suffolk Petroleum Services Limited and Global Offshore Limited, as well as Mobile Producing Nigeria.

“The Commission is investigating alleged procurement fraud in the Major Integrity Pipelines Project involving Mobile Producing Nigeria as the contracting company, Suffolk Petroleum Services Limited as the main contractor, Saipem Contracting Nigeria, Global Offshore Limited and Van Ord as sub-contractor to SPSL.” Uwujaren disclosed in a statement to Ripples.

Business

Dangote fertilizer plant to take-off Q1 2021

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After failing to meet the December 2020 target, the Dangote Group has set the first quarter 2021 date for the take-off of its fertilizer plant.

The Urea fertilizer plant will now take-off between February and March this year.

The project, which is operated by Dangote Industries Limited, completed its test run in November last year.

The Head of Corporate Communications, Dangote Group, Anthony Chiejina, had said the COVID-19 pandemic forced the company to push the project take-off to December last year.

The project is expected to save Nigeria’s economy the $500 million spent annually on the importation of fertilizers.

Nigeria consumes 0.7 metric tonnes of Urea fertilizers per annum but Dangote’s fertilizer plant will produce three metric tonnes.

The excess will be exported to other African countries to generate at least $400 million for the nation’s economy.

The plant which is dubbed the largest Urea fertilizer plant in the world is located at the Lekki Free Zone (LFZ) in Lagos.

The project’s first phase cost Dangote $2.5 billion.

Business, World News

Jeff Bezos to step down as Amazon CEO

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The Amazon’s founder and chief executive, Jeff Bezos, said on Tuesday he would hand over the company’s reins in July.

However, in an email sent to staff, Bezos said he would transit into the role of executive chairman in the e-commerce giant.

A statement by Amazon said the Chief Executive of the company’s Cloud Computing Division, Andy Jassy, would be promoted to run the entire company.

Bezos said “As much as I still tap dance into the office, I’m excited about this transition.

“As executive chairman, I intend to focus my energies and attention on new products and early initiatives.”

Bezos has successfully transformed the company he founded as an online bookseller in 1996 into a $1.7 trillion behemoths with more than 1.2 million employees.

Business

Nigerian govt spent N123.45bn on refineries in 12 months –NNPC

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The Federal Government spent a whooping N123.45 billion on Turn Around Maintenance (TAM) on the country’s four refineries in 12 months.

The Nigerian National Petroleum Corporation (NNPC), which disclosed this in its Monthly Financial and Operations report obtained by Ripples Nigeria on Sunday, revealed that the TAM was carried out on the refineries between October 2019 and October 2020.

The refineries are the Warri Refining and Petrochemical Company (WRPC), Port Harcourt Refining Company (PHRC), and Kaduna Refining and Petrochemical Company (KRPC).

The refineries have a combined production capacity of 445,000 barrels per day (bpd).

The PHRC has a production capacity of 210,000 bpd, KRPC 10,000 bpd, and WRPC has 125,000 bpd.

The NNPC report showed that the WRPC, KRPC, and the PHRC recorded no operating surplus in October.

In the straight 13 months, KRPC recorded the biggest loss of N45.53 billion followed by PHRC with N40.87 billion while WRPC had N37.04 billion.

Business

GIGL launches new plan to help e-commerce merchants boost revenue

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As part of of its sustained innovation strides, Africa’s leading logistics company, GIGL, has launched a new service bouquet tagged Class Plan which e-commerce merchants, both local and international, can leverage to digitally scale their ventures, and, in turn, increase revenue.

“The cost effective delivery plan goes forward to double down on GIGL’s commitment to meet every business with logistics services that are smart, effective and completely flexible,” the company said in a statement as the business solution went live in the first half of January, 2021.

With local and global businesses seeking more cost effective solutions to their logistics challenges, especially those hinged on technology, the Class Plan looks to fill a void that guarantees tremendous returns in the value chain.

Headquartered in Lagos, GIGL has pioneered other last-mile solutions, and says its new business solution in the COVID-19 pandemic era offers subscribers a 15% discount on shipping charges as well as other business interventions.

Its January release said, “GIGL Class Plan which offers up 15% discount on shipping charges was created as the ecommerce merchant’s solution to these and other far-reaching issues.”

“The plan also offers free insurance cover on all shipments, priority shipping for merchants who subscribe to it, no charges on COD (Cash on Delivery), free bulk pick up for interstate deliveries, e-Commerce business growth kit, a dedicated account officer and media visibility for business growth,” the statement added.

The Class Plan may well be the solution value-oriented e-commerce players have long expected as subscribers get an edge over competitors, with huge discount promises.

GIGL makes further claim to simplifying the buying process and making it easier for the consumer to connect with the right seller and also says that its various business solutions have positioned it as the ultimate enabler of that process.

“A seamless logistics process is one of the major defining factors in ensuring a consistently valuable consumer journey the world over. But companies delivering seamless logistics processes are not easy to come by, especially in Africa and Nigeria,” GIGL said.

The company, therefore, urged e-commerce merchants to weigh in on their everyday challenges and insist on “a quality platform that synchronizes the logistics process and actually provides timely & efficient deliveries.”

Subscribers to the new business solution have been promised a monthly charge of ₦4,999, brand support through increased awareness arising from their affiliation to the GIG Logistics platform, as well as a growth kit to merchants which shall be equipped with detailed insights from experienced and skilled professionals in the industry.

Prospective merchants who seek to be among the early beneficiaries of the Class Plan can sign up either on the website or via the GIGGo App on a scheme which Africa’s leading logistics company says will “largely reduce the burden of cost arising from standard and incidental charges incurred by e-commerce merchants.”

Business

IMF downgrades forecast for Nigeria’s economic recovery in 2021

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The International Monetary Fund (IMF) has downgraded forecasts for Nigeria’s recovery in 2021 to 1.5 percent, 0.2 percent lower from its earlier projection of 1.7 percent made in October 2020.

IMF however retained its 2.5 projection growth for Nigeria in 2022.

The IMF made the new projection known in its World Economic Outlook (WEO).

The new report, titled ‘Policy Support and Vaccines Expected to Lift Activity,’ said even though the recent vaccine approvals have raised hopes of a turnaround in the pandemic later this year, renewed waves, and new variants of the virus pose concerns for the outlook.

For Africa, IMF, projected that in sub-Saharan Africa, growth will strengthen to 3.2 percent in 2021 and 3.9 percent in 2022.

“Amid exceptional uncertainty, the global economy is projected to grow 5.5 percent in 2021 and 4.2 percent in 2022,” it said.

“The 2021 forecast is revised up 0.3 percentage point relative to the previous forecast, reflecting expectations of a vaccine-powered strengthening of activity later in the year and additional policy support in a few large economies.

“The projected growth recovery this year follows a severe the collapse in 2020 that has had acute adverse impacts on women, youth, the poor, the informally employed, and those who work in contact-intensive sectors. The global growth contraction for 2020 is estimated at -3.5 percent, 0.9 percentage point higher than projected in the previous forecast (reflecting stronger-than-expected momentum in the second half of 2020).”

The IMF noted that the strength of the recovery is projected to vary significantly across countries, depending on access to medical interventions, the effectiveness of policy support, exposure to cross-country spillovers, and structural characteristics entering the crisis.

Business

SON raids firm, outlets; sizes N55m ‘harmful’ detergents in Ogun

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Operatives of the Standards Organisation of Nigeria (SON), on Wednesday, stormed four retail outlets and Daraju Industries Limited, a company they said was violating the agency’s regulation on detergent production in Ota, Odo Ota Local Government Area of Ogun State.

The SON officials led by the state coordinator, Engr Jerome Otene Umoru, told newsmen at the end of the exercise, that the products valued at N55 million were evacuated and quarantined because they contained phosphate, which is harmful to humans and the environment.

The SON coordinator added that the organisation had carried out analysis on 36 detergent products nationwide, and 14 were discovered to contain phosphate, hence, the enforcement exercise.

He said, “In 2018, manufacturing companies were told to stop using phosphate in the production of detergents but some of them are still using it. It has a lot of effects on human beings and the environment.

“Because they are still using it, we have been told to come evacuate it and stop further production.

“The health implication is that it leads to skin irritation. If you continue to use it, it causes cancer of the skin. Another thing is that it has implications on the environment.”

Business

CBN holds monetary policy rate at 11.5%

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The Central Bank of Nigeria (CBN) on Tuesday kept its Monetary Policy Rate (MPR) unchanged at 11.5 percent after two days of its Monetary Policy Committee (MPC) meeting in Abuja.

This will not come as a surprise as analysts in the financial services sector had predicted the CBN will maintain the status quo following an uptick in inflation rate and weak growth.

Nigeria’s inflation rose to 15.75 percent in December from 14.89% percent in November 2020 according to data from the National Bureau of Statistics (NBS).

By unanimous decision, Members of the MPC of the CBN also retained the Cash Reserve Ratio (CRR) at 27.5 precent, Liquidity Ratio at 30 percent as well as the Assymetric Corridor around the MPR at +100/-700 basis points.

Business

Unilever extends losses for second-straight year in 2020

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Unilever Nigeria Plc, has reported a loss of N1.59 billion in 2020, 62.3 percent lower than the 2019 loss of N4.22 billion.

The last profit recorded in the company books was N10.6 billion in 2018. This is according to figures obtained from its unaudited account on the website of the Nigeria stock exchange.

The improved performance in 2020, as against 2019, was largely driven by a decline in borrowing, sales growth, and reduced cost of sales.

A breakdown of the figures show, the company aggressively reduced its borrowing by 72 percent to N223.2 million from N824.1 million in 2020.

Also, it grew its sales to N61.5 billion, up by 1.3 percent from N60.7 billion in 2019.

Cost of sales dropped 115 percent to N47.7 billion in 2020 compared to N3.5 billion in 2019.

During the lockdown, buying and selling activities were disrupted along the value chain as factories worked below capacity, while some stores or outlets were shut down.

Other reduction was a loss before tax which fell by 77.4 percent from to N1.956 billion.

The company recorded no finance cost as against the last three months of 2019 when it recorded a borrowing cost of N381 million.

However, earnings per share were 62.2 per cent lower at -N0.28 compared to the -N0.74 posted in the corresponding period of 2019.

Business

Nigeria attracted $2.6bn investment in 2020 – UN

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Nigeria was the top Foreign Direct Investment (FDI) destination in Sub-Saharan Africa for 2020 ahead of South Africa and Ethiopia, the United Nations Trade Association (UNTA) said on Monday.

In its World Investment Report for 2020, UNTA said Africa’s largest economy attracted $2.6 billion investment last year, a 21.21 percent decline from $3.3 billion recorded in 2019.

South Africa and Ethiopia received $2.5 billion each.

However, Egypt remained the top recipient of FDI in Africa with about $5.5 billion in 2020.

The report describes Nigeria as among the most promising poles of growth in Africa and attracts numerous investors in hydrocarbon, energy, building, and other sectors.

It said: “Poorly developed transport and energy infrastructure (lack of electricity), which result in high operating costs is one of the weak points for investment in Nigeria if this can be addressed, Nigeria has the potential of attracting more.”

The report added that investors in the country are from the United States China, the United Kingdom, the Netherlands, and France.

“FDI flows to Africa declined by 18 percent to an estimated $38 billion, from $46 billion in 2019. Greenfield project announcements, an indication of future FDI trends, fell 63 percent to $28 billion, from $77 billion in 2019. The pandemic’s negative impact on FDI was amplified by low prices of and low demand for commodities,” it added.

Business

Nigeria second most expensive country to rent an apartment in Africa —Survey

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Securing an apartment for rent in Nigeria is more expensive than any other country in Africa except for Seychelles, according to data by global data service provider Numbeo.

The ranking released over the weekend, surveyed 23 African countries and showed that renting an apartment in Nigeria is five percent more expensive than last year, increasing to 28.91 index points in 2021 from 23.59 index points in 2020.

Number rankings are based on the average price of rent with New York City in the United State of America acting as the “100” baseline on the scale.

Over the years, Nigerians especially those trying to settle in major cities, renting an apartment have formed the major core in the cost of living.

Another increase was also seen in the food index. Nigeria rose to 14th and 19th as the most expensive country in Africa to buy groceries and pay for a restaurant meal compared to the 11th position and 17th respectively in 2020.

Numbeo’s index also includes local purchasing power, which shows relative purchasing power in buying goods and services in a given country for the average net salary in that country.

Nigeria ranks second in Africa and fourth in the world, suggesting salaries of Nigerians buy less than in other countries.

Despite the increase in rent, food, and low purchasing power, Nigeria still ranks as 5th most affordable country in Africa and 125th globally.

The headline cost-of-living index includes the costs of consumer goods, including groceries, restaurants and transportation.

Global rank shows Nigeria dropped from 115th place in 2020 to 125th in 2021 in the Cost of Living Index only ahead of Tunisia, Algeria, Zambia and Libya.

Nigeria’s cost-of-living index for 2021 is 29.74 index point compared to 31.00 index point in 2020.

Business

BUSINESS ROUNDUP: Naira falls against dollar; CBN threatens defaulters of diaspora remittance regulations

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Hello, and welcome to Business Roundup this week. Here, we bring you highlights of events that happened during the week -from the capital market to the mainstream business activities, while not forgetting the tech/economy build up.

Here are the Headlines:

  • CBN threatens to shut accounts of diaspora remittance regulations defaulters
  • Nigeria’s active telephone subscribers hit 208m
  • Discos get N14.35bn loan from CBN for 263,860 Meters
  • Naira falls against dollars on Wednesday

Summary:

The Central Bank of Nigeria (CBN) threatened to shut the accounts of operators who continue to violate diaspora remittance regulations as well as withdraw their operating licences.

In a circular signed by the Director, Trade & Exchange Department of the CBN, Dr. O. S. Nnaji, on Friday, the apex bank said it would no longer tolerate the clear “contravention of its directive that all remittances be paid to beneficiaries in dollars.

The Nigerian Communications Commission (NCC) has confirmed that the number of active telephone subscribers has hit the 208 million mark across the country.

At a press briefing the Commission held in Abuja on Thursday to usher in the new Permanent Secretary of the Federal Ministry of Communications and Digital Economy, Festus Daudu, the NCC Executive Vice Chairman, Umar Danbatta said third generation (3G) and fourth generation (4G) base transceiver stations deployment in Nigeria had also increased from 30,000 to 53,460. 

The Federal Government said on Thursday it had approved and disbursed the sum of N14.35 billion to the Distribution Companies of Nigeria (DisCos) to procure at least 263,860 meters for electricity customers.

The disbursement was under the National Mass Metering Programme (NMMP), initiated by the federal government to put an end to estimated billing of electricity consumers by DisCos.

This was disclosed on Thursday, via the official twitter handle of the presidency @NGRPresident. 

Naira put up a poor performance against the dollar at the Investors and Exporters (I&E) window on Wednesday as trading closed at N394.17k per dollar.

This represents a 0.21 percent drop or 82 kobo loss when compared to the N393.35k per dollar that it exchanged for on Tuesday, according to data from FMDQ Securities Exchange Plc.

Although, at the black market, Naira remained steady in value to the dollars at N475/$ after two days trading. 

On NSE ROUNDUP: Stocks investors lose N81.59bn in one week

Stock investors in Nigeria lost about N81.59billion in the third trading week following increased activities of profit takers.

At the end of today’s trading, the market depreciated by -0.24% to close at 41,001.99 basis points as against -0.12% depreciation recorded previously.

The All Share Index dropped by -0.42% to close the week on the negative while the market capitalisation came down to N21.448trillion as against the week’s high N21.530 trillion. 

MEANWHILE, on the tech scene, latest development around Sim Shagaya’s edutech product, uLesson, led amongst stories for the week, especially as it concerns Nigerian tech ecosystem.

Nigerian auto-tech company Autochek joined the league of Nigerian startups with footprints in Ghana. Also during the week, we recorded the launch of a new product, Avocat, built, by Rimotli Technologies, to facilitate legal services online.

 

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