Economy
Inflationary Pressures Hamper Business Operations as PMI Remains Under 50 Points
By Aduragbemi Omiyale
The Stanbic IBTC Purchasing Managers’ Index (PMI) has shown that the manufacturing sector in Nigeria has remained depressed below the 50-point mark for November 2024, though there is an improvement.
In its latest reading, it was disclosed that it was at 49.6 points compared with 46.9 points in October 2024, attributing this to inflationary pressures.
Business Post reports that readings above 50.0 signal an improvement in business conditions in the previous month, while readings below 50.0 show deterioration.
It was revealed that business operations in the Nigerian private sector have been hampered as employment was down and companies continued to lower their purchasing amid steep price pressures.
The firm stated that the less pronounced deterioration in business conditions in part reflected a renewed expansion in new orders, which rose slightly following a solid fall in October.
Although there were some tentative signs of demand improving, companies reported that customers were often deterred by high prices. The inflationary environment and muted demand conditions meant that business activity continued to fall, the fifth month running in which that has been the case.
The Head of Equity Research West Africa at Stanbic IBTC Bank, Mr Muyiwa Oni, said, “The Nigerian private sector activities deteriorated further in November, albeit at a less pronounced rate relative to October.
“This less pronounced deterioration was primarily due to the return to growth of new orders in November, after having decreased solidly in October. Notably, new orders have now risen in three of the past four months, although the latest expansion was only modest.
“Some panellists saw signs of demand picking up, but others reported that high costs again acted to deter customers. Elsewhere, higher energy prices, increases in the cost of raw materials, and lingering currency weakness continue to lead to intensification of price pressures in November.
“Thus, input prices increased at a substantial rate again during November, with the pace of inflation only slightly lower than that seen in October and remaining one of the sharpest on record. In Q3:24, the Nigerian economy grew by 3.46% y/y relative to 3.19% y/y growth in Q2:24. Notably, the non-oil sector grew by 3.37% y/y in Q3:24 from 2.80% y/y in Q2:24, albeit with uneven performance across the sub-sectors that make up the non-oil sector. ICT, finance & insurance, trade, road transport, and agriculture were the key growth drivers of the non-oil sector in the review period.
“Nonetheless, there appears to be a disconnect between the composite PMI and non-oil GDP growth in recent quarters, with this disconnect more pronounced in Q3:24 when the PMI for the quarter weakened to 49.6 points – a sign of deterioration in business conditions – while non-oil GDP growth was strong in the review period.
“Historically, the non-oil GDP growth is mildly negative whenever the composite PMI is below the 50-point no-change mark. We expect the economy to maintain the Q3:24 growth momentum in Q4:24, supported by a festive-induced increase in economic activity and sustained improvement in crude oil production.
“Indeed, based on the November PMI survey results, companies reported some tentative signs of demand improving although some customers were deterred by high prices. On balance, we estimate the economy to grow by 3.24% y/y in real terms in Q4:24 and adjust our 2024 growth estimate upward to 3.2% (previously: 3.1%).
“The latest reduction was only marginal, however. Sector data pointed to increases in output in agriculture and manufacturing but decreases in wholesale & retail and services. Purchase costs rose rapidly again in November amid currency weakness and higher prices for fuel and raw materials. Although slowing slightly for the second month running, the pace of inflation remained elevated. Staff costs were also up as companies helped their workers with higher living and transportation costs,” he said.
By Adedapo Adesanya
The Naira appreciated on the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by 1.8 per cent or N29.54 on Tuesday, December 3.
At the official market yesterday, the exchange rate stood at N1,643.15/$1, in contrast to Monday’s closing price of N1,672.69/$1, according to data obtained by Business Post from the Central Bank of Nigeria (CBN).
Also, the Nigerian currency traded flat against the greenback during the session at N1,730/$1.
This development followed the launch of the apex bank-backed Electronic Foreign Exchange Matching System (EFEMS), which began operations this week.
The implementation of the forex system comes with diverse implications for all segments of the financial markets that deal with FX, including an expected rebound in the value of the Naira across markets.
The system is expected to instantly reflect data on all FX transactions conducted in the interbank market and approved by the CBN.
The central bank also said it would publish real-time prices and buy-sell orders data from this system.
Meanwhile, Nigeria has successfully raised $2.2 billion in Eurobonds maturing in 2031 and 2034 in the international capital markets to finance deficits from the 2024 budget.
The Debt Management Office (DMO) said that the two Eurobonds, with 6.5 years and ten years tenors, have $700 million placed in the 2031 maturity, and $1.5 billion placed in the 2034 maturity.
It said that the notes were priced at a coupon and re-offer yield of 9.625 per cent and 10.375 per cent, respectively.
Meanwhile, the cryptocurrency market was majorly positive, with Binance Coin (BNB) growing by 18.1 per cent to an all-time high (ATH) price of $774.92 amid a mix of technical signs and bullish market sentiment.
Further, Solana (SOL) jumped by 4.2 per cent to trade at $236.64, Ethereum (ETH) gained 2.8 per cent to settle at $3,716.76, Litecoin (LTC) expanded by 2.5 per cent to finish at $132.16, Bitcoin (BTC) appreciated by 1.0 per cent to $96,567.61, Dogecoin (DOGE) increased by 0.9 per cent to $0.4208, and Ripple (XRP) rose by 0.2 per cent to $2.63.
However, Cardano (ADA) depreciated by 2.7 per cent to sell at $1.23, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
Economy
Zurich Resilience Solutions and GoImpact Capital Partners forge strategic alliance to bolster climate resilience across Asia Pacific
This collaboration integrates ZRS’ advanced physical climate risk analysis, proprietary climate and financial loss data, and specialized tools with GoImpact’s sustainability education expertise, delivering a comprehensive solution to help businesses identify, assess, and adapt to climate risks.
Enhancing climate resilience with ready-to-go solutions
The partnership offers a ready-to-go suite of solutions that address the urgent need for actionable climate adaptation strategies. Businesses can benefit from:
- Data-driven climate risk assessments: ZRS’ proprietary tools to evaluate exposures to physical climate risks like extreme weather and supply chain disruptions.
- Climate resilience guidance and training: Support for organisations to build resilience in their assets, operations, and people.
- ESG knowledge upskilling: GoImpact’s structured sustainability learning programmes to keep companies informed about market trends and regulatory requirements.
- Regulatory reporting support: Assistance in meeting disclosure and reporting requirements related to physical climate risks.
By combining ZRS’ technical expertise with GoImpact’s practical learning resources, the alliance delivers a robust toolkit for businesses to enhance resilience and seize opportunities in the sustainability landscape.
Driving climate resilience and sustainability in business
Initially targeting businesses in Hong Kong, Singapore, and Malaysia, the strategic alliance aims to address key climate risks such as extreme weather events, supply chain disruptions, and operational vulnerabilities. Leveraging ZRS’ deep knowledge in climate resilience and GoImpact’s strong regional presence in sustainability advocacy, the alliance is well-positioned to empower companies to implement effective climate adaptation solutions.
Commenting on the partnership, Dr Amar Rahman, Global Head Climate & Sustainability Solutions, Zurich Resilience Solutions said: “Zurich Resilience Solutions’ partnership with GoImpact highlights the critical role of education in fostering climate resilience. The appetite for implementing effective solutions hinges on understanding the challenges at hand and the potential impact of inaction on business operations.”
“Through this collaboration, we aim to elevate awareness and empower public and private sector entities to take meaningful steps toward sustainability, developing solutions that protect their operations and strengthen their resilience against climate change.”
With better knowledge of the latest ESG trends, organizations can be better positioned to take advantage of market conditions and build a sustainable future for themselves and increase the resilience of the communities in which they operate.
“We are excited about this timely partnership between Zurich Resilience Solutions and GoImpact. Our combined strengths are complementary and form a holistic toolkit of offering on risk assessment, learning and advocacy that bridges a significant market gap, for large corporations and small medium enterprises alike,” said Helene Li, CEO and Co-Founder of GoImpact.
Hashtag: #ZurichResilienceSolutions
The issuer is solely responsible for the content of this announcement.
Zurich Resilience Solutions
Zurich Resilience Solutions, the risk advisory business of Zurich Insurance Group, leverages 150 years of industry experience and 75 years of risk engineering expertise to address the risk management needs of both existing and new customers. The unit offers specialized insights, tools, and solutions to help businesses tackle traditional and evolving risks, such as climate change and cybersecurity.
As a global entity, Zurich Resilience Solutions has over 950 risk experts stationed in 40 countries, bringing local expertise and industry specializations to clients worldwide. Its capabilities and solutions are available to any organization seeking a proactive approach to risk management and long-term resilience.
GoImpact Capital Partners
Bridging the great divide between the talk and action, accelerating the Sustainable Development agenda from intention to implementation – GoImpact means impact made easy and actionable.
GoImpact has established significant market footprint on its mission to drive the sustainability agenda forward, bridging the knowledge gap between talk and action. We offer the best ESG learning experience in the market, providing case-based, experiential learning courses which are crafted and delivered by a group of world-class experts in sustainable finance and ESG.
Through its partners network across Asia Pacific which includes regulators, financial institutions and large corporations, delivering online-to-offline initiatives, GoImpact connects stakeholders across sectors and provide learning and advocacy opportunities to drive real change by example for everyone who is keen to understand more about the full spectrum of Sustainability and Resilience agenda.
As part of its contribution to the Fifth Review Conference, Prince Foundation designed ARMAC’s exhibition booth, which was widely praised as the “best in show” by attending delegates. The campaign also resulted in a notable boost to ARMAC’s social media presence and increased engagement across its platforms.
The immersive display effectively conveyed ARMAC’s mission through visually striking elements, compelling storytelling, and innovative presentations of key initiatives, including the groundbreaking SAFE (Saving All From EO) chatbot.
Prince Foundation also worked closely with ARMAC leadership to craft strategic messaging that spotlighted the organization’s victim assistance programs, particularly the ASEAN Regional Victim Assistance Network (VAN), which provides comprehensive care for survivors of explosive ordnance and their families.
“Our role was to ensure ARMAC’s vital work received the attention it deserves,” said Gabriel Tan, Chief Communications Officer of Prince Holding Group and Head of Prince Foundation. “Through strategic communications and innovative exhibition design, we have helped amplify ARMAC’s message of hope and action to a global audience.”
Creating Impact Through Strategic Communications
The Foundation’s communications strategy highlighted ARMAC’s technological innovations, including the SAFE chatbot, an artificial intelligence-powered platform that delivers critical safety information to at-risk communities through accessible messaging systems.
“Prince Foundation’s strategic communications expertise has been instrumental in helping us convey the urgency and importance of our mission,” said Rothna Buth, Executive Director of ARMAC. “Their innovative approach to exhibition design and messaging strategy enabled us to effectively showcase our work, particularly in victim assistance and technological solutions, to a global audience.”
“By crafting compelling narratives around ARMAC’s initiatives, we’re fostering broader understanding and support for mine action efforts,” Tan added. “Our goal was to make complex technical information accessible and engaging for all attendees through our exhibition design and communications strategy.”
Comprehensive Communications Support
Prince Foundation’s contributions to ARMAC’s success at the summit included:
- Design and Execution: Development of ARMAC’s flagship exhibition booth, ensuring a captivating and interactive experience for delegates.
- Strategic Messaging: Creation of key communications materials that effectively conveyed ARMAC’s mission and initiatives.
- Multimedia Content: Production of dynamic content showcasing ARMAC’s programs, including the SAFE chatbot and the VAN network.
Through its partnership with ARMAC, Prince Foundation has played a key role in advancing mine action efforts by delivering effective communications support and promoting collaboration among key stakeholders. By amplifying ARMAC’s initiatives and raising awareness of critical programs, the Foundation is contributing to tangible progress toward the shared goal of a mine-free world. This collaboration reflects Prince Foundation’s ongoing commitment to building safer communities and driving meaningful change in Cambodia and across the ASEAN region.Hashtag: #PrinceFoundation #ARMAC #PrinceHoldingGroup
The issuer is solely responsible for the content of this announcement.
About Prince Foundation
Prince Foundation, founded in 2015, is one of Cambodia’s leading philanthropic foundations. A member of Prince Holding Group, which is one of the largest business groups in Cambodia, the Foundation aims to work with local communities to build thriving living and working environments that elevate people’s well-being and livelihoods, following the vision: “Together, Building a Better Future for Cambodia.”
Focusing on education and youth development, healthcare, and community engagement and sports, and healthcare initiatives, Prince Foundation works with partners to deliver sustainable programs that enhance opportunities for Cambodia’s youths, build resilience in communities, and contribute to sustainable infrastructure.
The Foundation’s flagship projects are the Chen Zhi Scholarship, offering full scholarships, stipends, internships, and work opportunities to 400 Cambodian university students over a period of seven years, and Prince Horology, where aspiring Cambodian watchmakers learn the art of Swiss-style watchmaking in a state-of-the-art facility. Prince Foundation has launched more than 250 philanthropic initiatives, benefiting over 1.3 million people, with donations exceeding US$16 million
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