Agricultural, manufacturing and the sectors considered as growth and employment stimulating, can now borrow long term as much as N10 billion at consolidated nine per cent interest rate under new guidelines issued by the Central Bank of Nigeria.
The new credit policy called Guidelines for Accessing Real Sector Support Facility (RSSF) through CRR and Corporate Bonds was released by the CBN today.
And it marks a big departure from the excruciating interest rate regime of 25-30 per cent that has been blamed for stifling enterprises in the country.
The CBN acting Director, Corporate Communications in a statement on Thursday in Abuja said the new directive aimed to increase the flow of credit to the real sector; agriculture and manufacturing.
He said that Deposit Money Banks (DMBs) would henceforth be incentivised to direct affordable, long-term bank credit to the manufacturing, agriculture, as well as other sectors considered by the Bank as employment and growth stimulating.
He said also that Corporate, Triple-A rated companies would be encouraged to issue long-term Corporate Bonds (CBs).
He said that a CBs Funding Programme had already been put in place to enable the CBN and the general public invest in the CBs.
Furthermore, Okorafor said the Bank had put in place another programme under the Differentiated Cash Reserves Requirement (DCRR) Regime.
He said under the programme, banks interested in providing Credit Financing to new and expansion projects in the real sector could request for the release of funds from their Cash Reserve Ratio (CRR) to finance the projects.
Making further clarifications, Okorafor said that the tenor for the Differentiated CRR would be a minimum of seven years with a two-year moratorium.
For the Corporate Bonds programme, he said the tenor and the moratorium would be specified in the prospectus by the issuing corporate.
He said also that the maximum facility would be N10 billion per project and facilities were to be administered at an Interest rate of 9 per cent per annum.
Okorafor therefore advocated for a total compliance with the guidelines by stakeholders.
He also reiterated CBN’s determination towards the encouragement of projects that would further enhance Nigeria’s import substitution strategies.
The guidelines followed the recommendation of the CBN Monetary Policy Committee (MPC). At its 119th meeting held between 23 and 24 July, the MPC emphasised the need to increase the flow of credit to the real sector of the economy, to consolidate economic recovery.
Source: NAN
The dollar dipped Tuesday in Asia after Donald Trump hit out at the Federal Reserve’s interest rate rises and accused it of not backing his economic plan, while most equity markets edged up ahead of highly anticipated China-US trade talks.
The greenback has been on the ascent in recent months as US borrowing costs have gone up and the economy improves, but it stumbled after Trump’s latest criticism of the central bank.
In an interview with Reuters, the president said he was “not thrilled” with the rate rises under new Fed boss Jerome Powell, repeating comments made last month about the bank’s tightening measures.
When asked if he believed in the Fed’s independence, he refused to say yes, telling the reporter: “I believe in the Fed doing what’s good for the country.”
Trump also accused the European Union and China of manipulating their currencies, adding that Beijing was weakening the yuan to offset the effects of US tariffs.
While analysts said it was unlikely Trump’s remarks would make much difference to the Fed’s decision-making — Powell has said in the past “we don’t take political considerations into account” — the greenback was weaker against most other currencies.
The Fed is expected to raise rates twice more this year.
The pound and euro enjoyed some much-needed buying, while the yen was also up.
Higher-yielding and emerging market currencies — from South Korea’s won and the Indonesian rupiah to the Australian dollar and Mexican peso — were also higher, having come under pressure last week from the Turkey financial crisis.
Stocks rally
After the previous day’s broad gains, equity markets fluctuated as traders turn their attention to the China-US talks, which are due Wednesday and Thursday.
By the close Tokyo was up 0.1 percent, Hong Kong added 0.6 percent and Shanghai rallied 1.3 percent.
Seoul jumped one percent and Singapore and Wellington each gained 0.1 percent, while Taipei and Jakarta also rose.
Sydney shed one percent.
In early European trade London and Paris each dipped 0.2 percent, while Frankfurt shed 0.1 percent.
The trade meeting will be the first since the world’s top two economies started imposing tit-for-tat tariffs on billions of dollars’ worth of goods, with the Wall Street Journal saying they are aimed at smoothing the way ahead of a November summit.
They also come despite Washington continuing to push through fresh measures slated for Thursday.
However, JP Morgan Asset Management global market strategist Tai Hui said: “Given the little progress made on the US-China negotiations in the past six months, investors’ expectations are still low.
“Ongoing negotiation is good news, and that’s what the market is riding on at this stage, but a sustainable agreement to end this tension still seems unlikely at this point.”
He added: “If China’s earlier offer to buy US products and open up its market did not convince the US to de-escalate, it would take more creativity from Beijing to reach a compromise.”
– Key figures around 0810 GMT –
Tokyo – Nikkei 225: UP 0.1 percent at 22,219.73 (close)
Hong Kong – Hang Seng: UP 0.6 percent at 27,752.79 (close)
Shanghai – Composite: UP 1.3 percent at 2,733.83 (close)
London – FTSE 100: DOWN 0.2 percent at 7,580.80
Euro/dollar: UP at $1.1535 from $1.1479 at 2030 GMT
Pound/dollar: UP at $1.2836 from $1.2791
Dollar/yen: DOWN at 110.01 yen from 110.11 yen
Oil – West Texas Intermediate: UP 30 cents at $66.73 per barrel
Oil – Brent Crude: UP five cents at $72.26 per barrel
New York – Dow Jones: UP 0.4 percent at 25,758.69 (close)
The Guardian

The trade volume between the Association of Southeast Asian Nations (ASEAN) and Nigeria in 2017 stood at $7.7 billion, the Malaysia High Commissioner-designate to Nigeria, Gloria Tiwet, has said.

ASEAN comprises 10 countries, with only five represented in Nigeria. They are Malaysia, Indonesia, Philippines, Vietnam and Thailand.

Tiwet made this disclosure while leading Embassies’ Heads of Missions and ASEAN member-states’ High Commissioners on a visit to the Foreign Affairs Minister, Geoffrey Onyeama, on Thursday in Abuja.

She said the envoys were in the ministry to familiarise the minister on ASEAN Day and Film Festival scheduled to hold soon in Abuja, noting that the festival was aimed at strengthening relations between Nigeria and ASEAN, particularly in the area of culture.

“In 2017, the trade volume between ASEAN and Nigeria amounted to $7.7 billion. That is very promising and portrayed good relations between our countries and Nigeria.

“Trade is one area that we looked into to strengthen our bilateral relations, and respectively, we represent our countries here as ambassadors and high commissioners to strengthen our bilateral relations as much as we can,” she said.


Source: The Business Insider

Israel will stop using coal between 2025 and 2030, as a result the country will stop producing coal ash at its power stations, Israeli Ministry of Environmental Protection said.
The ministry succeeded to promote governmental decision to close four out of eight coal units for electricity generation at Israel’s power stations by the summer of 2022.
These four coal units at power stations, according to the ministry are responsible for one quarter of all air pollution in Israel.
The pollution ratio generated by coal is up to 1,000 times more than pollution from natural gas, Yuval Laster, Director of Policy and Strategy Division of the ministry said.
Laster said that all the remaining coal units would be closed by 2025-2030 mostly because of environmental reasons.
Laster said that the National Coal Ash Board (NCAB) would not exist anymore because its work to find alternative use to coal ash will not be necessary anymore.
Laster added that even today the cement and concrete industries demand much more coal ash than it produces, so the work of NCAB to find by force alternative uses to it is needless.
Coal ash is disposal remaining after the power station burns coal to produce electricity, in many countries, this is a compound used for various industrial purposes.
Israel has begun mass use of coal for generating electricity during the 1980s, when there were not environmental awareness among public, nor the government or the industry cared about the environment.
The director said that besides the massive air pollution created during the burning of the coal, its remains, the coal ash was thrown into the Mediterranean, and this polluting practice stopped just during the 1990s.
“Israel recognised that it was a violation of the Barcelona Convention for protection of the Mediterranean Sea against pollution.
“The primary solution has been found in the 1990s, and the coal ash has begun to be used as a compound in the concrete and cement from which the houses, apartments, and buildings were built.
“Basically, any use of coal ash was banned by the ministry due to pollution concerns.”
Sinaia Netanyahu, a former Chief Scientist of the ministry, said she forced the ministry to quit from NCAB.
Just last week the High Court of Israel reassured the ministry of environmental protection policy not to give import permission of coal ash, according to the verdict it is dangerous disposal and no economic reasons can justify its import.
“Another concern of these companies is Israel’s tendency to close its coal power stations and to transfer the electricity generation to natural gas power stations and renewable energies.
“This tendency of reducing coal until a complete stop is rushed in 2017 due to substantial natural gas funding under the Mediterranean waters which belongs to Israel,” the director said.

Sterling Bank Plc, recently declared as a Great Place To Work, has decalred work-free day for all its employees across the country.

The decision, according to the bank, was in line with its Active Citizens Programme (ACP) scheme, encouraging employees to use to register and collect their Permanent Voters’ Cards.

Beyond promoting voting rights, the bank’s ACP also motivates employees to be productive, responsible, caring and be contributing members of their respective communities in alignment with the lender’s purpose of enriching lives.   

The Chief Executive Officer of Sterling Bank, Abubakar Suleiman, noted that the institution is passionate about promoting active citizenship among employees as a business of wholly Nigerian origin, which makes it important to place national interests above individual preferences.

“We believe that when more citizens are active and perform their duties to the nation, the country becomes a better place for all.

“These duties include abiding by the law, tax remittance and more importantly participating in the electoral process to strengthen our democracy.”

Source: The Guardian

Shareholders of Cadbury Nigeria Plc on Friday approved N301.51 million as total dividend for the financial year ended Dec. 31, 2017.

The shareholders gave the approval at the company’s 53rd Annual General Meeting (AGM) in Lagos.

The News Agency of Nigeria (NAN) reports that the dividend, which will be paid on July 9, translated to 16k per share.

Speaking at the meeting, Mr Emmanuel Popoola , a shareholder, commended the company for the dividend declared and return to profitability in spite of the challenging operating environment. Popoola urged the company to work harder to ensure enhanced dividends in the years ahead.

Mr Taiwo Oderinde, another shareholder, urged the company introduce new products to increase its market share and bottom line.

Oderinde said the company should target products that would address the health issues in the country such as diabetes.

He also called on the company to look for cheaper means of financing its activities to reduce costs of operation.

Oderinde advised the company to work toward floating rights issue in the future to raise fresh capital instead of obtaining bank loans.

Responding, Mr Atedo Peterside, the company’s Chairman, said the company was working on some new products, which would be launched at the appropriate time.

Peterside said the company built its business on four key pillars, such as price competitiveness, aggressive route to market initiatives and sustained consumer-driven activations.

He said the company’s top priorities in the current year were to sustain focus on quality, drive improvements in productivity and reinforce operational efficiency to maximise its competitive advantage.

The chairman added that the company would drive growth ahead of competition to increase market share within its product categories.

The company, during the period under review, recorded a revenue of N33.08 billion compared with N29.98 billion in 2016.

It also benefited from cost savings initiatives, which saw selling and distribution costs as well as administrative costs decline by seven per cent and 23 per cent respectively.

Its profit before tax stood at N350.32 million from a loss before tax of N562. 87 million recorded in the previous year.

Profit for the year stood at N299. 99 million against a loss of N296. 40 million in 2016.

The company said revenue contribution for the 2017 financial year came from 55 per cent refreshment beverages which includes Bournvita and Cadbury 3-in-1 hot chocolate.

It stated that 31 per cent was from confectioneries such as Tom-Tom peppermint and its variants, while 14 per cent of the revenue came from Intermediate Cocoa products comprising cocoa powder, cocoa cake and cocoa butter.

Source: NAN

Temile Development Company Limited, an indigenous shipping company operating in the Nigerian oil and gas industry, has signed a ship building contract with South Korean shipbuilder, Hyundai Heavy Industries (HHI) Limited. Under the terms, Hyundai will build one firm and one optional Liquefied Petroleum Gas (LPG) carriers. Both vessels are valued at over $120million with the first carrier expected to be delivered by the first quarter of 2020.
The contract, which was signed in London recently between Temile and HHI officials was witnessed by the CEO, Nigeria LNG Limited (NLNG), Tony Attah; Executive Secretary Nigerian Content Development and Monitoring Board (NCDMB), Simbi Wabot; and Deputy Managing Director, Fidelity Bank, Mohammed Balarabe.
Fidelity Bank is the main banker to Temile Development Company.Temile Devt. is a 100 percent wholly-owned Nigerian company, which began its marine and offshore operations five years ago, with a vision to revolutionise the shipping business in Nigeria. The company’s fleet comprises of 16 offshore vessels, acquired within the last five years. The new carriers would be the first of their kind in the West African oil and gas market, and would enable the company service an on-going time charter LPG contract with NLNG.
“We have extensive experience in various sectors of the oil and gas industry in Nigeria, with particular interest in the offshore shipping and logistics. Our entrance into LPG market is exciting and we are in very safe hands to have ordered a LPG carrier from Hyundai Mipo Dockyard. This will no doubt increase the participation of Nigerian investors in the LPG space,” said the Chief Executive Officer, Alfred Temile.
Also speaking at the ceremony, Attah said the transaction was indeed ground breaking, explaining that it supports the quest to develop the domestic LPG market and aid the growth of indigenous companies in the process. “NLNG’s domestic LPG intervention scheme aligns with our business focus of bringing energy to the world and helping to build a better Nigeria” Attah stated.
Whilst commending Temile Development Company for the trailblazing move, Balarabe emphasized the need to increase local participation of indigenous companies in the oil and gas industry and reiterated the bank’s support for indigenous players to grow capacity. “The attendant effect on job creation and economic development is huge and unimaginable if Nigerian companies can participate more in the entire oil and gas value chain” he said.
Source: The Guardian
Oil extended gains to near $75 a barrel after an industry report showed U.S. inventories shrunk as global output disruptions continued to stoke concerns over supply shortfalls.
Crude in New York increased as much as 1 percent as the premium on front-month futures surged even higher against later contracts. The American Petroleum Institute was said to report nationwide stockpiles dropped 4.51 million barrels last week. While the Saudi Cabinet affirmed the kingdom is ready to use its spare capacity as needed, the Middle Eastern nation also reiterated with Russia that OPEC’s agreement with allies is to boost output by 1 million barrels a day.
Oil is trading near the levels last seen in 2014 as a drop in global output due to disruptions from Libya to Canada and Venezuela were seen outweighing production gains by the Organization of the Petroleum Exporting Countries. Morgan Stanley increased its Brent crude forecast to $85 a barrel next year, while President Donald Trump continued to push OPEC’s biggest producer Saudi Arabia to pump more and reduce petroleum prices for consumers.
“Recent up moves have been surprising and the disruptions have caught a lot of traders by surprise,” Michael McCarthy, a chief market strategist at CMC Markets, said by phone from Sydney. “We’re likely to see further gains as the shift from a surplus to a deficit will come faster than expected. The supply side is constrained and markets are vulnerable to upside risks, and larger-than-anticipated draws in the U.S. are very supportive in the short term.”
Oil Prices:
West Texas Intermediate crude for August delivery traded at $74.59 a barrel on the New York Mercantile Exchange, up 45 cents at 11:28 a.m. in Singapore. Prices rose 20 cents to close at $74.14 on Tuesday, after breaching $75 for the first time since 2014. The premium for front-month futures widened to $2.64 a barrel against September delivery contracts. Total volume traded was about 35 percent below the 100-day average.
Brent for September settlement was 0.5 percent higher at $78.16 a barrel on the London-based ICE Futures Europe exchange. The global benchmark traded at a $6.11 premium to WTI for the same month.
Yuan-denominated futures for September delivery slid 0.9 percent to 498.8 yuan a barrel on the Shanghai International Energy Exchange. The contract closed 0.4 percent higher on Tuesday, capping the longest run of daily gains since their debut in late March.
Supplies Shrink:
As well as declines in nationwide stockpiles, inventories in the key storage hub of Cushing, Oklahoma dropped by 2.6 million barrels, the API was said to report. If confirmed by U.S. government data Thursday, that would be the seventh consecutive decline. Nationwide stocks are forecast to have fallen by 5 million barrels, according to a Bloomberg survey.
Saudi Arabia said the country would “use its spare capacity when needed to deal with any future changes in oil supply and demand rates, in coordination with other producing countries,” according to a report in the Saudi Press Agency. Earlier, the kingdom and Russia’s energy ministers reiterated the agreement reached last month in Vienna, following President Trump’s tweet over the weekend that said he’d received assurances from the Middle Eastern nation that it could increase production by double that volume.
Source: Bloomberg News
Gulf Arab energy companies retreated from debt markets in the first half of 2018 after a banner year for borrowing as higher oil prices curbed financing needs for existing operations and new projects.
Oil and gas producers, pipeline operators and refiners in Kuwait, the United Arab Emirates, Saudi Arabia, Oman, Bahrain and Qatar borrowed $6 billion through loans and bonds in the first half of 2018, the slowest start in four years, according to data compiled by Bloomberg. By comparison, U.S. energy companies, driven by resurgent shale production, issued a record $74.3 billion in debt so far in 2018.
The diverging debt appetites between the six Arab exporters and U.S. suppliers shows that Gulf Cooperation Council, or GCC, producers are bringing in more cash to finance operations and expansion after crude prices rose 18 percent this year.
It also reflects how higher prices are spurring a debt-fueled surge in U.S. production, which is pumping a record 10.9 million barrels a day and has averaged 10.4 million barrels this year, according to Energy Information Administration data. GCC countries pump about 17 million barrels a day and their energy industries borrowed a record $28.7 billion in 2017, with $12.8 billion in the first half.
Oil and gas producers in the U.S. are far more dependent on debt than GCC exporters. Borrowings in the U.S. tend to rise with oil prices to finance drilling activity, while Gulf Arab producers seek debt when prices are low and companies have to send more cash to their government owners to help plug budget deficits.
GCC producers “raised what they wanted last year. This year oil prices are much stronger than anyone anticipated, and they don’t have the capital needs to go back to the market,” said Robin Mills, chief executive officer of consultant Qamar Energy in Dubai. “The U.S. seems convinced that the shale boom is more sustainable, and this is the rush that everyone goes for.”
Oil and gas producers in Saudi Arabia, Kuwait and the U.A.E. plan to spend more than $600 billion on energy projects over the next five to 10 years, officials from the countries have announced. Some of that will be financed by debt, especially for refineries and petrochemical plants, but borrowings will likely be subdued in 2018 because many of the projects won’t begin for a few years, Mills said.
The biggest borrowing in the GCC this year was a $3 billion loan to Abu Dhabi National Oil Co. U.A.E.-based oil field services providers Shelf Drilling Holdings Ltd. and Borr Drilling Ltd. took out a combined $1.25 billion, Saudi Aramco Total Refining & Petrochemical Co. issued a $150 million revolving credit line, and Kuwait Integrated Petroleum Industries Co. borrowed about $1.3 billion to finance the construction of its liquefied natural gas import terminal.
Source: Bloomberg News

In 2017 56 UN peacekeepers were killed in malicious acts such as when they were deliberately attacked, the most fatalities of that kind since 1994. All but one of the fatalities resulted from operations that included “stabilization” in its name.

Four blue-helmeted UN peace operations have had “stabilization” included in their title. These include operations in Haiti, the Democratic Republic of the CongoMaliand the Central African Republic.

The UN has not defined stabilization in official documentation. As a result, the practice of stabilization by UN forces has developed organically in recent years. The Security Council has given increased attention to the concept with recent research showing the term is used more and more during open meetings. In 2001 stabilization was mentioned in 16% and by 2014 the use of the term had spiked to 44%.

Nevertheless, when mandating peace operations the Security Council has not given a consistent indication of what activities fall under stabilization. Likewise, UN personnel have differing understandings of what the term means.

The mandates of stabilization missions have one major similarity – they are routinely instructed to support efforts that extend state authority.

In the stabilization mission to the Democratic Republic of the Congo, for example, this is achieved through the use of a Force Intervention Brigade. The brigade operates in cooperation with Congolese forces and is mandated “to prevent the expansion of all armed groups, neutralise these groups, and to disarm them”. The brigade has used offensive rather than defensive force, which is not the norm in UN peace operations.

In the Central African Republic, the UN has taken a “proactive and robust posture” to help create conditions that will reduce the presence and threat of armed groups. For that purpose, the UN has operated alongside Central African forces on a number of occasions.

These two examples illustrate that stabilization missions are increasingly acting in concert with government forces, posing a potential problem on two fronts. First the UN risks alienating communities it is mandated to protect and, second, the increased intensity of violence against UN forces puts those troops at greater risk.

What does stabilization mean?

The UN appears to have adopted a combination of US and UK understandings in its approach to stabilization. The US sees stabilization as militarily defeating an insurgency to give the “legitimate authority” the monopoly on the use of force while supporting a locally owned transition.

The UK, however, sees stabilization as civilian led action undertaken with military support aimed at long-term recovery from conflict.

Both the UK and US are heavily involved with the mandating and planning of operations as part of the Security Council’s P3 (US, UK and France). The three are the so-called “penholders” on most resolutions relating to UN peace operations.

As a result, UN stabilization missions typically do two things. First, they displace and deter armed groups and, second, undertake peace building activities to entrench state authority and create state legitimacy in the power vacuum left behind. Depending on the situation, the displacement and deterrence of armed groups has been sought by using offensive force or by taking a robust defensive posture.

This approach can be seen in the UN stabilization mission in the Central African Republic. When the mission was deployed in 2014, the state had little authority beyond Bangui, the capital. From the outset UN forces understood robust force would be needed to support the state’s authority outside Bangui and to prevent armed groups from entering the capital.

Three examples bear this out. In February 2017, UN troops opened fire on 40 members of an armed group approaching the city of Bambari. An airstrike was used to show that the armed group had crossed a “red line” around the city that had been imposed to protect civilians. The UN mission also announced that a joint deployment was underway with Central African forces to establish state authority in Bambari.

In January 2018, the UN launched a joint military operation with government forces to deter armed groups from entering the town of Paoua. The most recent example was in April 2018 when UN forces undertook a “joint disarmament and arrest operation” alongside government forces. The targets were criminal groups that threatened civilians and obstructed state authority. The operation led to exchanges of fire and the death of a peacekeeper.

The Congolese, Malian and Central African missions have all operated during ongoing conflicts in contrast with traditional operations where there is peace to keep. These missions are also mandated to use varying degrees of proactive, robust force to prevent attacks on themselves and people they’re trying to protect. This invariably means extending a state’s authority.

Consequently, the lines are increasingly becoming blurred between using robust force for protective purposes and the use of offensive force to fight an enemy alongside the host state government.

A new precedent for UN peace operations?

It may be the case that the UN has now set a precedent of entering conflict zones ready to stand its ground and fend off armed groups rather than wait for peace to keep. But there are risks.

One is increased peacekeeper deaths where troops are increasingly targets of attack. The other is that support from UN member states may wane in the long term as the dangers associated with contributing troops multiply.

What is undoubtedly true is that stabilization efforts will have an effect on the civilian populations the UN is there to protect. The robust use of force by well equipped peacekeepers who can access the latest intelligence and logistical equipmentfrom Western contributing states could lead to the effective deterrence of armed groups and a better chance at a normal life for civilians.

But the importance of who the UN chooses to work with cannot be underestimated. Where the UN seeks stabilization in cooperation with the government it risks marginalising communities disillusioned with the current regime. The UN promotes local ownership in peace building, yet this may be prove more difficult to achieve where UN personnel are seen to be synonymous with state authorities that aren’t trusted by sections of the population.


Credit: The Conversation

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