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News Economy (66)

Indications have emerged that the nation may soon begin to earn less from crude oil as the monthly volume of Nigerian oil imports into the United States dropped to 2.89 million barrels in May, the lowest since February 2016.
 
Crude oil accounts for over 70 percent of the Nigeria’s revenue and more than 95 percent of its foreign exchange earnings, while the United States (U.S) was the country’s fourth largest export destination, according to a recent Foreign Trade Statistics by the National Bureau of Statistics (NBS).
 
The latest data obtained by our correspondent from the US Energy Information Administration (EIA) during the weekend showed that the United States reduced its importation of Nigerian crude oil by 62.65 percent from 7.75 million barrels recorded in April.
 
Nigeria may start earning less as U.S slashes oil importation by 62%
 
The depreciation in the demand of the commodity, which was the largest monthly decline in more than three years, was occasioned by the increase in the production of the U.S crude.
 
Read Also: Nigeria earns $26bn from oil in 7 months as oil prices rise
 
An analysis of the data from the statistical arm of the U.S Energy Department revealed that, the country imported 10.03 million barrels of Nigerian crude in January.
 
It, however, reduced the importation of the commodity for the first time this year from 10.34 million barrels in February to 3.92 barrels in March, indicating 62.08 percent drop. In April, 2018, the U.S bought 7.7 million barrels of the commodity.
 
Within the first five months of 2018, the total Nigerian crude imports by the U.S stood at 34.93 million barrels, this is over 20 percent drop from 43.83 million barrels imported in the corresponding period last year.
 
The U.S crude imports from Nigeria was on a steady decline since it peaked 368.42 million barrels in 2010, it fell to 21.46 million barrels in 2014 and 19.86 million barrels in 2015 following the drop in the prices of crude oil in the international market.
 
However, the oil imports rose to 75.81 million barrels in 2016 and further increased to 112.92 million barrels in 2017.
 
But since crude oil production in the U.S began to boom in recent months, reaching 10.9 million barrels per day (mbpd) in June and 11 mbpd two weeks ago from 2.33 mbpd in April, the country has continued reduce its crude importation.
 
The EIA had reported last week that the U.S net import of the commodity fell by 1.05 mbpd to an average of 6.36 mbpd, with 10.7 mbpd and 1.7 mbpd as projections for the country’s crude oil production for 2018 and 2019, respectively.
 
 
Ripples news.
 

President Muhammadu Buhari on Monday signed an Instrument of Accession to the International Cocoa Agreement (ICA), 2010.

The pact was the seventh ICA adopted at the United Nations Cocoa Conference in 2010 following the contribution of ICA, 1972, 1975, 1980, 1986, 1993 and ICA, 2001 to the development of the world cocoa economy.

The ICA, 2010 was administered by the International Cocoa Organization, which was established by the ICA, 1972 and functions through the International Cocoa Council, the highest authority of the organization.

A statement signed by the Senior Special Assistant on Media and Publicity to the President, Garba Shehu, said that decision followed the approval by the Federal Executive Council (FEC) for Nigeria to accede to the agreement.

Following the execution of the instrument of accession, Nigeria undertakes “faithfully to abide by all the stipulations therein contained” in the agreement, according to the statement.

“Among other benefits, the agreement is expected to strengthen cooperation between exporting and importing member countries; improve their cocoa economies through active and better focused project development and strategies for capacity-building,” the statement read.

It is also expected to build on the successes of the 2001 Agreement by “implementing measures leading to an increase in the income of cocoa farmers and by supporting cocoa producers in improving the functioning of their cocoa economies.”

The statement added that the 2010 agreement would also “deliver cocoa of better quality, take effective account of food-safety issues and help establish social, economic and environmental sustainability, so that farmers are rewarded for producing cocoa that meets ethical and environmental considerations.”

According to the United Nations Conference on Trade and Development, the ICA, 2010 was agreed with a view to strengthening the global cocoa sector, supporting its sustainable development and increasing the benefits to all stakeholders.

It highlighted eleven objectives as rationales for the pact, they comprise to; promote international cooperation in the world cocoa economy; provide an appropriate framework for discussion on all cocoa matters among governments, and with the private sector; contribute to the strengthening of the national cocoa economies of Member countries; obtain fair prices leading to equitable economic returns to both producers and consumers in the cocoa value chain.

The objectives also include to; promote a sustainable cocoa economy; encourage research and the implementation of its findings; promote transparency in the world cocoa economy, and in particular in the cocoa trade, as well as to promote the elimination of trade barriers; promote and to encourage; consumption of chocolate and cocoa-based products in order to increase demand for cocoa.

Others include to; encourage Members to promote cocoa quality and to develop appropriate food safety procedures in the cocoa sector; encourage Members to develop and implement strategies to enhance the capacity of local communities and small-scale farmers to benefit from cocoa production and thereby contribute to poverty alleviation; facilitate the availability of information on financial tools and services that can assist cocoa producers, including access to credit and approaches to managing risk.

Currently, Nigeria rely on crude oil as its major source of revenue, accounting for about 70 percent of its total revenue and over 90 percent for its export earnings. The nation’s economy recorded its worst decline since 1987 in 2016 on the back of drop in the prices of crude oil in the international market in 2014.

Nigeria recorded five consecutive negative Gross Domestic Product growth rates from -0.67 percent in Q1 2016 to -0.91 percent in Q1 2017. It officially emerged from recession in Q3 2017 after two consecutive positive GDP growth. A development which had prompted the Federal Government to devise other means to diversify the economy away from oil into solid minerals, agriculture, among others to forestall a recurrence of the 2016 economic distress.

With the latest agreement, Nigeria is now a cocoa exporting member of the International Cocoa Organization and the International Cocoa Council, implying cocoa could become another alternative source of revenue generation and foreign exchange earnings as global organizations renewed their efforts to develop the cocoa sector.

Nigeria’s revenue from oil export hit an estimated $26 billion between January and July this year as the price of global oil benchmark, Brent crude, rose to the highest level in two weeks on Wednesday.

According to the new OPEC Revenues Fact Sheet recently released by the Energy Information Administration (EIA), revenue from oil export rose by 30 percent to $34 billion in 2017 from $26 billion in 2016.

The oil price appreciation followed a sharp drop in the United States crude inventories and the country’s sanctions on Iran, the third-largest producer in the Organisation of the Petroleum Exporting Countries (OPEC), causing tighter supply of the commodity.

The price of Brent crude, against which Nigeria’s oil is priced, rose by $1.38 to $74.19 per barrel, the highest since August 8, while US West Texas Intermediate (WTI) gained $1.28 to $67.12 per barrel.

Nigerian economy was battered due to the fall in the prices of crude oil in the international market in 2014, at the end of 2017, a development which led the country into its worst economy crisis since 1987 in 2016.

However, the country officially emerged from recession in Q3 2017 after two consecutive positive GDP growth. The economy shock occasioned by the drop in crude price prompted the Federal Government to devise other means to diversify the economy away from oil into solid minerals, agriculture, among others to forestall a recurrence of the 2016 economic distress.

But while the Mining and Quarry sector of the economy grew by 14.85 percent (year-on-year) in Q1 2018, 30.25 percentage points and 4.14 percentage points higher than the same quarter of 2017 and Q4 2017, the agriculture sector grew by 3.00 percent (year-on-year) in real terms in the review quarter, a decrease by 0.38 percentage points from the corresponding period of 2017 also a decrease by 1.23 percentage points from the preceding quarter.

Currently, Nigeria still rely on crude oil as its major source of revenue, accounting for about 70 percent of its total revenue and over 90 percent for its export earnings.

The Brent crude price rose to $66.87 per barrel from around $53 per barrel at the beginning of the year.

In May 2018, Brent rose above $80 per barrel for the first time since November 2014 but dropped afterward amid rising US crude inventories.

 

Source: The Ripples

Booking a learners or drivers license test in South Africa has never been the easiest thing in the world. The new online system is sure to change things up.
 
While a strike at the office that makes the license cards had caused some worry in recent weeks, getting a slot for your learners or drivers license test is about to become a whole lot easier. The Road Traffic Management Corporation (RTMC) is finally looking to keep up with the digital times in 2018.
 
RTMC to offer new online drivers license test bookings
 
On Friday, the RTMC unveiled a plan that is sure to make millions of young South Africans lives a lot easier. Yes, from September, you will be able to begin to book your learners and drivers licenses online.
 
The new system will begin to be rolled out in Gauteng in September and will then move its way to other provinces after assessing how well the system worked and if there were any issues.
 
Those looking to book their tests will be able to choose the date, time and place for their test. Want to book your test at a traffic department on the other side of the province, that is easily doable. Seriously, you won’t even be required to go in beforehand.
 
RTMC spokesperson Simon Zwane has been doing the media rounds explaining why the system was needed and what it does for people.
 
“I think this will be convenient for the members of the public because now you will be going to the centres to pay for your appointment and do the eye test and from there will be no interaction with officials and officials won’t have the opportunity to block bookings.”
 
Zwane explained that fraud and corruption have played a huge part in there being a need for an online method. In some cases, corrupt driving schools are even paying for certain slots to be booked with specific traffic officials.
 
“We have found that spaces are being blocked to enable people who are coming from the corrupt networks to be able to do tests on a particular date and a particular time. We want to deal with that so people have equal opportunity and the handling of officials,” Zwane says.
 
Let’s hope the system launch goes relatively smoothly.
 
Source:IreportSouthAfrica
South Africa’s Upper House of Parliament, the National Council of Provinces (NCP), on Tuesday approved the controversial National Minimum Wage (NMW) Bill which will be sent to President Cyril Ramaphosa for assent.
 
The Parliament said the NCP approved the bill without amendment.
 
The bill, which Minister of Labour Mildred Oliphant introduced in November 2017, aims to provide for a NMW and the establishment of a commission with clear functions and composition for implementation, Parliament spokesperson Moloto Mothapo said.
 
The National Assembly (Lower House of Parliament) had earlier approved the bill and referred it to the NCP. Once signed by Ramaphosa, the bill will become law.
 
The bill sets 3,500 rand (about 243 U.S. dollars) per month or 20 rand (about 1.4 dollars) per hour for over six million working people in the country.
 
Trade unions have lambasted the NMW as “slavery wage,” saying the working class cannot make both ends meet with the meagre NMW.
 
In May, massive protests against the bill took place across the country.
 
Trade unions have threatened to stage more protests if the NMW wage is not raised to a living wage.
 
The government says setting the NMW was informed by research and robust analysis of various scenarios and their possible ramifications, not by some idealistic desires.
 
All social partners have worked hard for nearly three years to reach agreement on the NMW to improve the conditions of millions of poor families, according to the government.
 
Ramaphosa has pledged to increase the NMW over time in a way that meaningfully reduces poverty and inequality.
 
Source: PMNEWSNIGERIA
Ethiopian Airlines says it has signed a shareholding agreement with Zambia’s main development agency to relaunch the southern African country’s flag carrier at an initial cost of $30 million.
 
A joint statement with Zambia’s state-owned Industrial Development Corporation (IDC) in Lusaka said that under the plan, Zambia Airways, being revived more than two decades after it was shut down, would operate 12 planes by 2028.
 
The Ethiopian state-owned carrier has outpaced regional competitors Kenya Airways and South African Airways to become Africa’s largest airline by revenue and profit, and has been buying shares in other African airlines to gain a competitive advantage over rivals such as those in the Gulf.
 
Ethiopian Airlines said it would own 45 per cent of the revamped Zambian airline, while Zambia would own 55 per cent.
 
“The initial investment as we start up the national carrier will be $30 million. Obviously, as we operate the airline, we will facilitate the financing necessary to support its growth,” it said.
 
Ethiopian Airlines had earlier said in January that it had signed an agreement with the Zambian government to relaunch Zambia Airways.
 
“Zambia Airways will launch local and regional routes this year, while intercontinental routes, including Europe, the Middle East and Asia, will be added in the near future,” the joint statement stated.
 
It would be recalled that the state-owned Zambia Airways went into liquidation in 1994, while the privately-owned Zambian Airways then emerged as the country’s main carrier with flights to other major hubs in southern Africa, but it suspended operations in 2009.
 
 
NAN
With the myriads of problems facing the nation’s stock market, stakeholders have expressed divergent views on the relevance of the routine ‘Bell Ringing’ exercise at the Nigerian Stock Exchange (NSE) and the impact on the market.
 
While some stakeholders believe that the ceremony has increased stock market visibility and attracted more stakeholders, others argued that the impact has not reflected on the market.
 
The Managing Director of High Cap Securities, David Imafidon, explained that the NSE uses the gong sounding ceremony to publicise itself and attract stakeholders to its platform.
 
According to him, efforts must be made not to trivialise the programme, considering the level of visibility and competitiveness the exercise has attracted to the exchange.
 
Also speaking, the Managing Director of High Cap Securities Limited, Mike Eze, who described the exercise as a routine, said: “Bell ringing in any stock exchange is the exclusive preserve of the President of the stock exchange.
 
The President, who is not on ground day to day, on his part, delegates this function to the Chief Executive Officer (CEO) of the exchange, who is on ground running the exchange day to day.
 
“The CEO in his wisdom, may decide to invite any reputable hand to assist him in bringing the market to a close. This is the interplay you see going on every day in the last eight years. It is just the process of opening and closing of a stock market.”
 
The Managing Director of Dependable Securities Limited, Chinenyem Anyanwu, said: “It has a way of impacting the market positively by making the stock Exchange and the capital market to always be in the news, sometimes occupying the front pages of the print media.
 
However, the President of Progressive Shareholders association of Nigeria, Boniface Okezie, explained that the exercise has not attracted the expected investments into the market.
 
According to him, it is expected that the ceremony would serve as a platform for listed firms to unfold their growth plans and present their scorecards to stockbrokers for share price appreciation.
 
He noted that in other exchanges across the world, due to the amount of coverage the opening and closing bells receive, many companies coordinate new product launch and other marketing-related events with the day their company representative rings the bell.
 
“The purpose of the exercise is to boost the market in terms of liquidity, volume of shares and attract new investments. Listed companies may also use the platform to inform stockbrokers on new products they are about to lunch or any other information that can boost their share price. But these are not happening.
 
“I have not seen the impact. They should look at how to improve on the exercise, so that it would be more impactful and add value to the market. Those undervalued stocks need to improve.
 
“We need the companies to come to the market and tell stockbrokers their growth plans so that it would lift their stock prices and in turn, grow the market.”
 
The Guardian 

Zimbabwe’s annual inflation rate rose 1.38 percent to 4.29 percent in July 2018, latest figures from the Zimbabwe National Statistics Agency (ZImStats) show.

This was a significant upturn from the June 2018 figure of 2.91 percent.

On a monthly basis, the inflation rose 1.03 percentage points to 0.98 percent.

“The month-on-month inflation rate in July 2018 was 0,98 percent gaining 1,03 percentage points on the June 2018 rate of -0,05 percent,” said ZimStats in its monthly update.

Some observers have attributed the quickening inflation to the continuance of the parallel currency market.

Although the Reserve Bank of Zimbabwe (RBZ) has maintained the US dollar-bond note official rate at 1:1, cash shortages have resulted in a thriving black market for physical currency, both bond notes and United States dollar notes.

It is largely expected that the high demand for US dollars by both companies and individuals continues to push up the exchange rate.

 

Source: Vanguard

Leading management consulting firm, Phillips Consulting Limited (PCL), has transformed the financial technology sector by introducing cutting-edge technology, Intellect Digital Core Banking Solution, to Nigeria.
 
Phillips Consulting collaborated with Intellect Design Arena Limited, a global leading company that offers services in Financial Technology for Banking, Insurance and other Financial Services. This collaborative banking solution will no doubt revolutionize the Nigerian banking industry.
 
Intellect Digital Core banking solution is a comprehensive, integrated, yet modular and agile business solution, addressing all core banking needs. It is designed to help banks accelerate their digital banking and channel transformation journey. Intellect Digital Core comes with a Digital 360 proposition with an inbuilt design for both Digital Outside and Digital Inside. Digital Outside ensures true Omni-channel and consistency of customer experience at all touch points while Digital Inside drives operational excellence. In addition, it provides all the building blocks of business functionality, enabling users to flexibly configure products and processes in order to adapt to a dynamic environment.
 
Through this partnership with Intellect Design Arena, Phillips Consulting builds local capacity by playing an integral role in the joint implementation and on-going support of Intellect Digital Core in Nigeria.
 
Speaking on the Core Banking Solution, the Managing Director of Phillips Consulting, Mr. Robert Taiwo, explained the benefits of Intellect Digital Core. “In banking, the digital discourse has shifted from ‘nice to have’, to critical business imperative. Market share will increasingly swing to those banks that can quickly and effectively respond to technology advancements. The ability to grapple with 4.0 technologies such as AI, Big Data, Robotics and Blockchain, will differentiate the leaders from followers. Superior interconnectivity and system integration will enhance customer-centricity and this by default will accelerate first mover advantage.” He added “But technology must not become the end in itself. “Me too” strategies will not be effective. CEOs must, therefore, drive business aligned digital strategies which speak directly to the operating models and value propositions of their respective organisations.”
 
Although the Intellect Digital Core Banking Platform is new to Nigeria, a new age bank recently implemented it.
 
Further discussing the core banking solution, Senior Partner at Phillips Consulting, Mr. Seun Ngonnase explained, “In today’s world, banks require a single, seamlessly integrated global payments system for domestic and cross-border transactions. This system must eliminate manual tasks and enhance interoperability. Implementing Intellect’s Core Banking platform will save time and money for the bank while providing value-added services to their customers. The whole idea is based on the concept of Contextual Banking; customers should bank in the way they want to and how they want to.”
 
Intellect Design Arena – a global leader in Financial Technology for Banking, Insurance and other Financial Services. A uniquely focused Products business, Intellect addresses the needs of financial institutions in varying stages of technology adoption.
 
Intellect’s robust iDigital platform enables products across four distinct lines of businesses: Global Consumer Banking (iGCB), Risk, Treasury & Markets (iRTM), Global Transaction Banking (iGTB), Central Banking and Insurance (Intellect SEEC). Deep banking domain expertise coupled with investments of Rs 800 Crores over the last ten years in developing the world’s first full spectrum of banking products has made Intellect the company with the most advanced technologies for financial institutions with global businesses.
 
As leaders in strategy, execution and transformation are at the core of what Phillips Consulting does. The company’s digital and technology transformation practice supports clients in driving strategic business change across its operating model. Fundamentally reshaping the way products and services are delivered.
 
 
Source: NAN
An update received from the office of the Vice President of Nigeria on the state of foreign investment inflow into the economy has indicated that about $83.9 billion worth of investments were announced between January 2017 and the end of the first quarter of 2018, Q1’18. Osinbajo The report titled, “2018 Making Business Work”, evaluated government’s efforts in improving the business environment in Nigeria and was presented to the Vice President Yemi Osinbajo, by the Enabling Business Environment Secretariat in the Vice President’s office during the monthly meeting of the Presidential Enabling Business Environment Council (PEBEC). 
 
A breakdown of capital investments as contained in the report showed that in 2017, over $66 billion worth of investments were announced, comprising 112 projects across 27 states and the FCT Abuja, while an additional $17.9 billion worth of investments were announced in quarter 1 of 2018, as actual capital importation stood at $6.3 billion, representing over six times the value in the first quarter of 2017, Q1’17. 
 
The Senior Special Assistant to the President on Media & Publicity Office of the Vice President, Laolu Akande, who unfolded the report yesterday, stated that measurable progress has been recorded on multiple fronts as the economy responds to key government interventions particularly in the areas of economic growth, inflation, foreign exchange & external reserves, capital market, investment, infrastructure and social investment programmes. Looking at the journey so far, according to him, the report indicated that under economic growth, the rigorous implementation of the Economic Recovery and Growth Plan, ERGP, led the economy out of a recession in 2017; it grew to 0.83 percent, up from -1.58 percent recorded in 2016, on the back of improvements in agriculture, industry and trade. It further stated that the economy has registered four consecutive quarters of steady growth. 
 
In the first quarter of 2018, the economy grew 1.95 percent and is projected to grow by up to 3.0 percent over the year, driven by stronger oil prices, stable production, increased non-oil output and improved foreign exchange availability. The report also indicated that for the first time in Nigeria, under the competitiveness section of the ERGP, soft infrastructure is expressly recognized as a deliberate strategy to attain economic development through the facilitation of an enabling business environment for businesses to thrive. 
 
The report specifically recognized government’s efforts in improving the effectiveness of soft infrastructure such as the financial system; the education system; health care system; the system of government; law enforcement; and emergency service. According to the report, “Nigeria’s reforms have so far seen it successfully move 24 places up the World Bank Ease of Doing Business rankings. Overall, in the current reform cycle, the PEBEC focused on three pillars to accelerate and expand the impact of completed reforms. 
 
The focus will be on deepening existing reforms. Complete pending initiatives and ensure implementation of completed reforms launched in 2017, including communication and consequence management, as well as making the reforms sustainable.” On inflation, the report indicated that the pressure on prices is easing and inflation fell 16 consecutive months from 18.72 percent in January 2017 to 11.60 percent in May 2018.
 
 
 
Source: Vanguard

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