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Items filtered by date: Wednesday, 20 June 2018
The United States’ Energy Information Administration (EIA) forecasts that Brent crude oil prices will average $71 per barrel in 2018 and $68 a barrel in 2019. Meanwhile, Nigeria’s Bonny Light crude oil has maintain an international price of $73.44 per barrel, higher than the Organisation of the Petroleum Exporting Countries (OPEC) basket price of $73.35 per barrel.
The price of Nigeria’s Bonny Light is higher than the Nigeria’s $51 per barrel benchmark for 2018 budget.EIA in its Monthly Oil Market report for May, expects oil prices to decline in the coming months because global oil inventories are expected to rise slightly during the second half of 2018 and in 2019.The updated 2019 forecast price is $2 a barrel is higher than in the May forecast, which sold for an average price of $77 a barrel, an increase of $5 per barrel from April and the highest monthly average price since November 2014.
 
Even though the 2019 oil price forecast is higher than it was in the May monthly report, EIA expects oil prices to decline in the coming months because global oil inventories are expected to rise slightly during the second half of 2018 and in 2019.According to EIA, expected inventory growth results from forecast oil supply growth outpacing forecast oil demand growth in 2019.
 
EIA currently forecasts global petroleum and other liquids inventories will increase by 210,000 barrels per day (b/d) next year, a factor that, all else being equal, typically puts downward pressure on oil prices.Most of the growth in global oil production in the coming months is expected to come from the United States.
 
EIA projects that U.S. crude oil production will average 10.8 million barrels per day for full-year 2018, up from 9.4 million barrels per day (bpd) in 2017, and will average 11.8 million bpd in 2019.
 
The agency noted that if the 2018 and 2019 forecast annual averages materialize, they would be the highest levels of production on record, surpassing the previous record set in 1970.EIA expects that OPEC crude oil production will average 32.0 million b/d in 2018, a decrease of about 0.4 million bpd from the 2017 level.
 
The Minister of State for Petroleum Resources, Dr Ibe Kachikwu, expressed optimism that the price of crude oil would rise to a level that is neither too high nor too low.The Minister said though crude oil appears to have fallen into bad times because of prevailing low price and the campaign against the use of fossil fuels for environmental reasons, the product would soon rise up to take its place as the prime global energy source.
 
Waxing poetic message on the current crude oil prices recently, Kachikwu stated: “My name is oil, those who are kind to me call me black gold. Those who hate me call me crude.“I worry for my future; everyone now talks down on me. Even farmers who trembled at the sight of my name are now strategizing against me.“And all my beneficiaries, me have they abandoned, all because producers have lost their tracks. But I will rise again, and when I do, I will take no prisoners.
 
“I will new technologies control; I will my supremacy confirm; I will my respect regain.“And my pricing, not too low, not too high; but I will not allow prices to humiliate me. All of you in OPEC, APPA, GCEF and all such bodies who have shown me no respect recently, soon, you’ll eat your words.”
 
Source: The Guardian
Published in News Economy
Lucky Amiwero, President of National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), and the Managing Director, Eyis Resources Limited
 
The Federal Government has been urged to immediately step up its reforms strategy on import and export processes to help reverse the current poor ranking by Trading Across Borders (TAB).
 
TAB, in its latest rankings, put Nigeria at 183rd position out of the 190 countries it rated on Ease of Doing Business (EODB).
 
In the ranking, Nigeria took the last position, while Mali, 85th position, was rated first among the 17 West African countries considered in the report.
 
President, National Council of Managing Directors of Customs Licensed Customs Agents (NCMDLCA), Lucky Amiwero, in a letter to the Presidency, dated June 10, 2018, said Nigeria’s poor ranking on ease of doing business has brought to the fore the need to urgently institute reforms to address the challenges on import, export and transit regulatory procedures.
 
Amiwero, who is also the Managing Director, Eyis Resources, said Nigeria’s import, export, regulatory and transit procedures are encumbered with lengthy, cumbersome procedures.
 
This, he said, is associated with unnecessary delays, high transaction cost and increase of cargo dwell time, which makes our port the most expensive in the globe based on verifiable information.
 
In the letter obtained by The Guardian, he said the reform should be targeted at implementing an integrated set policies and procedures that is globally accepted, which would ensure effective trade facilitation by the reduction of transaction cost, cargo dwell time and ensure safety and security of the processes.
 
“The poor rating of Nigeria can be seen from the identified challenges associated with the Import-Export, regulatory and transit procedures that is encumbered with lengthy and cumbersome procedure, which resulted to our present ranking of 183 from 190 countries.
 
“There is the urgent need to constitute a committee of trade procedure Experts, reform specialist and professional, as Task force to address the challenges urgently,” he stated.
 
Amiwero further recommended that the Federal Government should look into the issues of collapsed scanners, re-evaluate them to know the update and update the scanners for easy cargo examination.
 
He harped on the strict implementation and enforcement of the executive order in the seaport as stipulated in the Port Related offences, (Amendment) Act 61 of 1999.
 
Meanwhile, the Managing Director, Nigerian Ports Authority (NPA) Hadiza Bala Usman had recently threatened to seek the intervention of the Vice President Prof. Yemi Osinbajo on the non-compliance by some government agencies to the presidential order on Ease of Doing Business at the nation’s seaports.
 
Usman’s reaction is coming in the wake of complaints by some stakeholders that the level of compliance to the presidential order by some government agencies, one year after the order was issued has left much to be desired.
 
She said the way some government agents float the order has limited its positive impact and the Federal Government.
 
While assuring that the Authority would continue to fulfil its own part of the order she lamented that the organisation has the limitation of compelling other agencies to do what they are supposed to do under the presidential directives.
 
Source: The Guardian
Published in Business
Inflation eased to 4.4% for May compared to 4.5% in April, despite the implementation of a VAT hike implemented in April.
 
This is according to Statistics South Africa (StatsSA), which on Wednesday released the consumer price index figures for May. The index increased 0.2% month-on-month.
 
The market consensus was for CPI to accelerate to 4.6%, and in a market update on Wednesday RMB economist Isaah Mhlanga had projected an increase to 4.8% having considered the VAT pass-through.
 
Mhlanga also expected the fuel price and weak rand to impact inflation. “The oil price and a weak rand have had a huge impact (on inflation), but the second-round effects will only be visible in the months to come and they are difficult to quantify and separate from the first-round effects,” said Mhlanga.
 
He expects the current account deficit data due on Thursday to be a “shock to the currency”, RMB projects it to be 5% of GDP.
 
By 10:23 the rand was trading 0.44% firmer from the previous close at R13.68/$. 
 
Contributors to May's inflation include food and non-alcoholic beverages which increased 3.4% year-on-year. Inflation for restaurants and hotels increased by 5% year-on-year.
 
Transport contributed to the month-on-month inflation, the index increased 1.2%.
 
In May the CPI for goods increased by 3.5% year-on-year, unchanged from April. The CPI for services increased by 5.3% year-on-year, also unchanged from April
 
South: Fin24
Published in News Economy

Rwanda’s economy expanded by 10.6% in the first quarter of 2018, where GDP at current market prices was estimated at Frw 1,985 billion, up from Frw 1,816 billion in the previous year.

Announcing the growth numbers for the first quarter of 2018, Yussuf Murangwa, the Director General of the National Institute of Statistics of Rwanda pointed out that Agriculture grew by 8%, industry by 7% while services registered 12% growth.

He noted that growth in agriculture sector was boosted by a good harvest of food crops in season A of 6%. Export crops grew by 46% mainly due to Tea and Coffee production.

On the industry sector, DG Murangwa attributed growth to an increase of 8% in construction which is recovering following very low growth in 2017. Food processing increased by 9% due to processing of cereals, tea and sugar.

Local made products such as textile, clothes & leather products increased by 24%. Chemicals, rubber & plastics grew by 8% boosted by the production of paints and soaps. However, beverages & tobacco decreased by 2%.

Overall activities in the service sector performed well with an increase of 12%. Within this sector, Wholesale and retail trade increased by 26% due to increase in tradable agricultural and manufactured products.

Transport activities increased by 28% boosted by air transport that increased by 32%. Information and Communication increased by 24%. Financial services increased by 12% while Public administration increased by 15% and Human health & social work activities increased by 7%.

The Minister of Finance and Economic Planning  said that government will continue to create a conducive environment that supports the economy to grow. He said, “This is a consecutive quarter our economy has registered double digit growth. Going forward we hope to keep the momentum”.

Rwanda’s economy registered 6.1% growth in 2017 buoyed by 10.5% growth in the fourth quarter. According to IMF and the Ministry of Finance and Economic Planning projections, the economy is expected to grow by 7.2% in 2018.

Published in Economy

The recent announcement of the Ethiopian government to sell share of the state monopoly Ethio Telecom includes liberalization of the sector, says Prime Minister of Ethiopia.

“We are not moving from government monopoly to private monopoly,” said Prime Minister Abiy Ahmed, who briefed the national parliament this afternoon. “…If Somalia with 12 million population has four telecom operators, Ethiopia with over a hundred million population has to also open its doors to multiple telecom operators,” he said.

Commenting about the implementation of the partial privatization of the state monopoly, the Premier Abiy stated that 30-40% of the share will be sold to one of the top ten telecom company in the world with excellent industry knowledge and track record.

The privatization process will be taken care of carefully and may take over a year, according to Prime Minister Abiy. He also mentioned privatization of mining companies and large coffee farms as bad examples which failed to benefit the mass ending up in the hands of the few.

He further stated that 5% of the total share of the Ethio Telecom will be sold to Ethiopian nationals both at home and abroad. But that 5% share will be owned by many people not by an individual who can afford to but that 5% share, according to the prime minister.

Speaking on the need for privatization of the big companies, he noted that the government of a developmental state is to serve as a bridge for the development of the private sector and capitalism.

Loan burden

“Our country has joined the highly indebted countries category,” Prime Minister Abiy said, commenting on the loan burden of the country, which has reached $24.7 billion, of which 43.9% is loan by state companies.

He noted that the current foreign currency crisis in Ethiopia is exacerbated because of the poor management and failures of the state companies, which were supposed to start exporting products and services such as, sugar factories, electric power.

In the coming two years Ethiopia is expected to payback $6 billion dollars and ongoing state projects need $7 billion, according to Yinager Dessie, an economist and ruling party member, who spoke to state broadcaster last night.

 
Published in Telecoms
President Donald Trump directed the US Trade Representative to prepare new tariffs on $200bn (R2.77tr) in Chinese imports Monday as the two nations moved closer to a potential trade war.
 
The tariffs, which Trump wants set at a 10% rate, would be the latest round of punitive measures in an escalating dispute over the large trade imbalance between the two countries. Trump recently ordered tariffs on $50bn (R692.77bn) in Chinese goods in retaliation for intellectual properly theft. The tariffs were quickly matched by China on US exports.
 
"China apparently has no intention of changing its unfair practices related to the acquisition of American intellectual property and technology," Trump said in a statement Monday announcing the new action. "Rather than altering those practices, it is now threatening United States companies, workers, and farmers who have done nothing wrong."
 
Trump added: "These tariffs will go into effect if China refuses to change its practices, and also if it insists on going forward with the new tariffs that it has recently announced."
 
Trump said that if China responds to this fresh round of tariffs, then he will move to counter "by pursuing additional tariffs on another $200bn (R2.77tr)of goods."
 
Trump's comments came hours after the top US diplomat accused China of engaging in "predatory economics 101" and an "unprecedented level of larceny" of intellectual property.
 
He said China's recent claims of "openness and globalisation" are "a joke." He added that China is a "predatory economic government" that is "long overdue in being tackled," matters that include IP theft and Chinese steel and aluminum flooding the US market.
 
"Everyone knows ... China is the main perpetrator," he said. "It's an unprecedented level of larceny."
 
"Just ask yourself: Would China have allowed America to do to it what China has done to America?" he said later. "This is predatory economics 101."
 
The Chinese Embassy in Washington did not immediately respond to a request for comment.
 
Pompeo raised the trade issue directly with China last week, when he met in Beijing with President Xi Jinping and others.
 
"I reminded him that's not fair competition," Pompeo said.
 
Wall Street has viewed the escalating trade tensions with wariness, fearful they could strangle the economic growth achieved during Trump's watch. Gary Cohn, Trump's former top economic adviser, said last week that a "tariff battle" could result in price inflation and consumer debt — "historic ingredients for an economic slowdown."
 
Pompeo on Monday described US actions as "economic diplomacy," which, when done right, strengthens national security and international alliances, he added.
 
"We use American power, economic might and influence as a tool of economic policy," he said. "We do our best to call out unfair economic behaviors as well."
 
In a statement, Trump says he has an "excellent relationship" with Xi, "but the United States will no longer be taken advantage of on trade by China and other countries in the world."
 
Source: Fin24
Published in Business

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