Economy
AfDB Forecasts 4.1% GDP Growth for Nigeria, Others in 2023
By Adedapo Adesanya
The African Development Bank (AfDB) says Nigeria and other economies of Africa are projected to grow by 4.1 per cent in 2023 and 4.3 per cent in 2024.
This was announced by the President of the regional lender, Mr Akinwumi Adesina, while inaugurating the African Economic Outlook (AEO) 2023 at the ongoing 2023 AfDB Annual Meetings in Sharm El Sheikh, Egypt.
According to him, the economies on the continent have shown remarkable resilience in spite of the multiple and dynamic shocks it faces.
“These multiple and dynamic shocks have weighed on Africa’s growth momentum, with growth in real Gross Domestic Product (GDP) estimated at 3.8 per cent in 2022.
“This is down from 4.8 per cent in 2021. The GDP growth in 2022 is above the global average of 3.4 per cent.
“Africa has also shown remarkable resilience, evident in the projected consolidation of economic growth in the medium term.
“The outlook remains positive and stable, with a projected rebound to four per cent in 2023 and further consolidation to 4.3 per cent in 2024,” he said.
The AfDB boss attributed the slowed growth on the continent to the tightening global financial conditions and supply chain disruptions exacerbated by Russia’s invasion of Ukraine, which subdued global growth.
He said growth was also impaired by the residual effects of the COVID-19 pandemic and the growing impact of climate change and extreme weather events.
Mr Adesina said Africa had a great potential to pursue green growth and climate objectives to accelerate economic growth, given its enormous advantages.
He said the continent had some of the world’s fastest-growing economies, and its real GDP growth was projected to surpass the global average from 2023 to 2024, even as headwinds persist.
He further said the continent also had an important human capital base, with its population projected to increase to 2.4 billion by 2050.
“As most of the current population is young, compared with other regions’ ageing populations, Africa is the current and future frontier market in green growth opportunities. Africa hosts 25 per cent of the world’s natural biodiversity and 30 per cent of the world’s mineral resources, most of which will be essential for a green transition.
“Africa has a large “renewable energy potential, including wind, solar, hydropower, and geothermal and the world’s highest solar energy potential. Countries in the continent also have the greatest potential for investments in green infrastructure and technology,” he noted.
The AfDB president also said this was due to their low levels of development, low legacy high-emissions infrastructure, and low frequency of infrastructure and project finance default rates, estimated at 5.5 per cent.
On his part, the AfDB Vice President for Economic Governance and Knowledge, Mr Kelvin Urama, said currency stability remained an issue noting that countries with appreciating currencies include Angola (27.1 per cent), Seychelles (15.6 per cent), and Zambia (15.3 per cent).
Mr Urama said depreciation rates could ease in 2023 and 2024, but continued strengthening of the U.S. dollar would keep African currencies under pressure.
He said currency weaknesses in some of Africa’s more globally integrated economies (Kenya, Nigeria, and South Africa) are expected to persist in 2023.
“This is largely due to potential capital outflows as investors search for safe assets in advanced economies.’’
“Public debt is projected to remain high, with lingering vulnerabilities. However, the median public debt in Africa is estimated to have declined to 65 per cent of GDP in 2022 from 68 per cent in 2021.
“Thanks to debt relief initiatives in some countries, it will remain above the pre-pandemic level of 61 per cent of GDP.
The economist said this debt-GDP ratio was expected to increase to 66 per cent in 2023 and then stabilise at around 65 per cent in 2024.
He said this was due to growing financing needs associated with rising food and energy import bills, high debt service costs due to interest rate hikes, exchange rate depreciations, and rollover risks.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its stay in the south territory with a decline of 0.56 per cent on Wednesday, April 2.
This brought down the market capitalisation by N13 billion to N2.417 trillion from N2.430 trillion, and downed the NASD Unlisted Security Index (NSI) by 22.57 points to 4,062.87 points from the previous session’s 4,062.87 points.
It was observed that the NASD exchange ended with three price gainers and three price losers during the trading day.
MRS Oil Plc depreciated by N19.00 to close at N171.00 per unit compared with the previous price of N190.00 per unit, NASD Plc lost N4.14 to trade at N37.36 per share compared with Wednesday’s N41.50 per share, and Central Securities Clearing System (CSCS) Plc gave up N2.00 to sell at N78.00 per unit versus N80.00 per unit.
On the flip side, FrieslandCampina Wamco Nigeria Plc appreciated by 19 Kobo to N93.00 per share from N92.81 per share, Food Concepts Plc expanded by 15 Kobo to N2.87 per unit from N2.72 per unit, and Great Nigeria Insurance (GNI) Plc improved by 2 Kobo to 52 Kobo per share from 50 Kobo per share.
Yesterday, the volume of securities dipped by 91.8 per cent to 260.2 million units from 3.2 billion units, the value of securities went down by 98.1 per cent to N154.2 million from N8.3 billion, while the number of deals soared by 53.3 per cent to 46 deals from 30 deals.
GNI Plc was the most active stock by value on a year-to-date basis with 3.4 billion units worth N8.4 billion, followed by CSCS Plc with 56.9 million units valued at N3.9 billion, and Okitipupa Plc with 27.5 million units traded for N1.8 billion.
The most traded stock by volume on a year-to-date basis was also GNI Plc with 3.4 billion units sold for N8.2 billion, trailed by Resourcery Plc with 1.1 billion units exchanged for N415.7 million, and Infrastructure Guarantee Credit Plc with 400 million units transacted for N1.2 billion.
By Adedapo Adesanya
The Naira dropped N2.09 or 0.15 per cent against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Thursday, April 2, to trade at N1,380.79/$1 compared with Wednesday’s rate of N1,378.70/$1.
However, it appreciated against the Pound Sterling in the official market by N2.77 to quote at N1,824.86/£1 versus the N1,836.57/£1 it was traded at midweek, and improved its value against the Euro by N10.54 to N1,591.92/€1 from N1,602.46/€1.
Yesterday was the last trading session of the week for the local currency in the spot market, as the market will be closed on Friday and Monday for the Easter Holiday.
At the black market, the Nigerian Naira maintained stability against the greenback yesterday at N1,405/$1, but gained N8 at the GTBank FX counter to settle at N1,388/$1, in contrast to the previous session’s N1,396/$1.
Pressure eased on the domestic currency as strong policy indicators have helped calm the majority of worries within the financial systems. Particularly in the remittance segment, the apex bank has directed all International Money Transfer Operators (IMTOs) to route remittance transactions through designated Naira settlement accounts in banks, a move aimed at boosting transparency and channelling more foreign exchange into the formal market.
This helps take off pressure from the foreign reserves, which have fallen below the $50 billion mark as they are gradually decreasing rather than falling sharply.
Meanwhile, the cryptocurrency market was bullish on Thursday, as macro sentiment shifted against recent optimism after reports that Iran is drafting a protocol with Oman to manage traffic through the Strait of Hormuz, easing concerns about disruptions to a key global oil route.
The remarks came after U.S. President Trump on Wednesday night vowed to hit Iran “extremely hard” in the coming weeks and that the Strait of Hormuz would “open naturally” once the war ends.
Cardano (ADA) chalked up 1.9 per cent to trade at $0.2435, Dogecoin (DOGE) grew by 1.2 per cent to $0.0912, Ethereum (ETH) appreciated by 0.8 per cent to $2,066.37, Bitcoin (BTC) added 0.5 per cent to sell at $67,080.53, Solana (SOL) increased by 0.5 per cent to $79.91, and Ripple (XRP) jumped 0.2 per cent to $1.31.
Conversely, Binance Coin (BNB) dipped 0.7 per cent to $586.90, and TRON (TRX) depreciated by 0.3 per cent to $0.3147, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 each.
By Dipo Olowookere
The local stock market was relatively flat on Friday, as the bears and the bulls shared the spoils of war, though investor sentiment turned bullish compared with the preceding session’s bearish posture.
Data from the Nigerian Exchange (NGX) Limited showed that the All-Share Index (ASI) was marginally down by 4.66 points as it ended at 201,698.89 points versus Wednesday’s 201,703.55 points, and the market capitalisation slightly contracted by N3 billion to N129.806 trillion from N129.809 trillion.
Customs Street was shut on Friday because of the public holidays declared by the federal government today and next Monday.
Business Post reports that John Holt declined by 9.91 per cent to N15.45, Abbey Mortgage Bank shed 9.60 per cent to trade at N8.95, International Energy Insurance slipped by 6.48 per cent to N3.32, Chams shrank by 5.30 per cent to N3.75, and Tantalizers depreciated by 5.18 per cent to N4.03.
On the flip side, Unilever Nigeria improved by 10.00 per cent to N103.40, Fortis Global Insurance gained 9.82 per cent to trade at N1.23, Multiverse appreciated 9.81 per cent to N20.15, Legend Internet advanced by 9.38 per cent to N6.30, and Zichis grew by 9.02 per cent to N14.14.
The market breadth index was positive during the trading session, as there were 35 appreciating stocks and 24 depreciating stocks.
Yesterday, investors traded 560.0 million equities valued at N19.3 billion in 49,676 deals, in contrast to the 815.5 million equities worth N33.3 billion transacted in 52,641 deals in the preceding day, representing a drop in the trading volume, value, and number of deals by 31.33 per cent, 42.04 per cent, and 5.63 per cent, respectively.
Secure Electronic Technology dominated the activity log with 59.7 million shares valued at N61.1 million, Wema Bank exchanged 52.0 million equities worth N1.4 billion, VFD Group transacted 36.0 million stocks for N410.5 million, Access Holdings sold 35.3 million shares valued at N914.8 million, and Chams traded 31.0 million equities worth N115.0 million.
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