By Dipo Olowookere
Leading pan African cement manufacturer, Dangote Cement, has maintained its strong hold in the Nigeria domestic cement market accounting for 65 percent of the Nigerian market volume, while other African plants’ volumes went up by 7.5 percent to 7.0 mta.
In the past months, Dangote Cement has expanded its operations across Africa with the coming on stream of the 1.5 mta integrated cement plant in Mfila, Republic of Congo even as an acting chief executive officer has been appointed for the company.
According to the unaudited results for the nine months ended September 30, 2017, the plant, which began operations last month, has almost doubled the size of the cement sector in the country. The Congo plant brings to 10 the number of Dangote Cement plants across Africa.
Analysis of the results indicated that the company recorded strong volumes in Senegal, Ethiopia and Cameroon.
In the nine months under review, the 1.5 mta clinker grinding facility in Douala, Cameroon sold approximately 938 kt of cement, indicating an increase of 16.4 percent on the 806 kt sold during the same period in 2016.
The company attributes the increase in sales to a number of factors ranging from strong brand recognition, increased point of sales branding, improvements in sales and marketing strategies to higher visibility through trade shows.
Dangote Cement Ethiopia increased sales by 16.8 percent to nearly 1.7 mta in the first nine months of 2017 representing capacity utilization of approximately 88 percent. The cement plant in Pout, Senegal sold 1.0 mta of cement in the period under review, up by 21.7 percent on the comparable period of 2016. This represents almost 89 percent capacity utilization at the factory.
Chief Executive Officer of Dangote Cement, Mr Onne van der Weijde, speaking on the results said, “Our Pan-African operations are performing strongly with excellent sales growth in Cameroon, Ethiopia and Senegal. We are consolidating our success across Africa and have just commissioned our 1.5Mta factory in Congo, the tenth country in which we have established operations.”
“In our key operations in Nigeria we have significantly improved our fuel mix and this has helped increase margins across the Group. It is especially good for Nigeria because most of the coal we are using is mined in our own country”.
The Board of the cement company also announced changes in the leadership of the company with Mr Onne Van der Weijde, stepping down as the company’s CEO at the end of 2017 having completed three years in this position, in order to return to his home country, The Netherlands. He will be appointed as a Non-Executive Director of Dangote Cement PLC, with effect from 1st January 2018.
The Board expressed appreciation to Mr Onne for his contribution during his period as CEO in the last three years, in which he managed an important growth phase in the company’s development.
Engr. Joseph Makoju, Honorary Adviser to the Chairman and former MD of WAPCO/Lafarge, will be acting MD/CEO of Dangote Cement Plc.
IMF Insists Nigeria Must Raise Taxes, Adopt Unified FX Regime for Macroeconomic Stability
By Dipo Olowookere
If Nigeria intends to achieve macroeconomic stability, it must take the bold step to put in place “decisive fiscal and monetary” policies, the International Monetary Fund (IMF) has declared.
These policies, according to the global lender, include increasing the tax rates, especially the value-added tax (VAT), from 7.5 per cent to double digits, adopting a single exchange rate regime, removing subsidies on petrol, and raising the benchmark interest rate to curb inflation, which is slightly above 21 per cent.
In a statement issued on Wednesday after the conclusion of its Executive Board’s consultation with Nigeria, the IMF said it was impressed with the growth recorded by the country’s economy after COVID-19 hit in 2020.
In the statement made available to Business Post, the IMF attributed this recovery to “favourable oil prices and buoyant consumption activities.”
“Nigeria’s economy has recouped the output losses sustained during the COVID-19 pandemic,” the organisation stated, praising the federal government for “containing and managing the COVID-19 infections.”
But it warned that “socio-economic conditions remain difficult” as a result of “higher domestic food prices, worsened the scarring effects of the pandemic, particularly on the most vulnerable—with Nigeria being among the countries with the lowest food security.”
“The near-term outlook faces downside risks, while there are upside risks in the medium term. Higher international food and fertilizer prices and continued widening of the parallel market premium could culminate in the de-anchoring of inflation expectations,” it said.
However, the IMF said if the country hopes to surmount these problems, the country must make “bold fiscal reforms to create needed policy space, [and] put public debt on sound footing” because high fuel subsidy costs have further widened “the general government fiscal deficit” in 2022.
The IMF “urged the authorities to deliver on their commitment to remove fuel subsidies by mid-2023 and increase well-targeted social spending.”
“Strengthening revenue mobilization, including through tax administration reforms, expanding the tax automation system and strengthening taxpayer segmentation, and improving tax compliance is also a priority.
“In the medium term, directors recommended modernizing customs administration, rationalizing tax incentives, and raising tax rates to the levels of the Economic Community of West African States (ECOWAS),” it also said after advising Nigeria last November to raise VAT to 15 per cent.
The body emphasised that the Central Bank of Nigeria (CBN) must further increase the policy rate if needed, and implement additional actions, including fully sterilizing central bank financing of fiscal deficits and phasing out credit intervention programs.
Last year, the bank raised the Monetary Policy Rate (MPR) by 5.00 per cent to 16.50 per cent in an attempt to bring down inflation, which moderated in December to 21.34 per cent. Last month, it further jerked the rate higher by 100 basis points.
US Markets May Give Back Ground In Early Trading
The major US markets are currently pointing to a lower open on Wednesday, with stocks likely to give back ground after moving notably higher in the previous session.
Traders may look to cash in on some of yesterday’s gains, which came amid a positive reaction to comments by Federal Reserve Chair Jerome Powell.
Powell acknowledged recent indications of easing inflation but noted that the disinflationary process has a long way to go and cautioned further interest rate hikes could be needed.
Overall trading activity may be somewhat subdued, however, with a relatively light economic calendar keeping some traders on the sidelines.
Reports on initial jobless claims and consumer sentiment are likely to attract attention in the coming days, with the consumer sentiment report including readings on inflation expectations.
Despite staying weak until noon and suffering a setback after a subsequent recovery, U.S. stocks closed on a buoyant note on Tuesday thanks to strong buying at several counters.
The major averages all ended with impressive gains. The Dow ended higher by 265.67 points or 0.8 per cent at 34,156.69. The S&P 500 closed up 52.92 points or 1.3 per cent at 4,164.00, and the Nasdaq surged 226.34 points or 1.9 per cent to 12,113.79.
A positive reaction to Federal Reserve Chair Jerome Powell’s remarks at the Economic Club of Washington lifted the market.
In a Q&A session at the Economic Club of Washington, Powell told Carlyle Group co-founder David Rubenstein that he expects 2023 to be a year of “significant declines in inflation.”
Powell said inflation is beginning to ease, though he expects it to be a long process and cautioned that interest rates could rise more than markets expect if the economic data doesn’t cooperate.
“The disinflationary process, the process of getting inflation down, has begun, and it’s begun in the goods sector, which is about a quarter of our economy,” Powell said. “But it has a long way to go. These are the very early stages.”
Microsoft shares gained nearly 4 per cent. Boeing surged 3.8 per cent, and Chevron climbed 2.6 per cent.
Walt Disney, Merck, Travelers Companies, Apple, Intel, Salesforce.com, JP Morgan Chase, American Express, Goldman Sachs and Walgreens Boots Alliance also posted impressive gains.
Hertz climbed 7.5 per cent, and DuPont shares surged 7.8 per cent on stronger-than-expected results.
Verizon, Home Depot, P&G and Caterpillar ended weak. Chegg plunged more than 17 per cent after the company came out with disappointing guidance.
In economic news, data showed the US trade deficit widened to $67.4 billion in December 2022 from a downwardly revised $61.0 billion in November.
Naira Swap: Governors Saved Nigeria from Needless Political, Economic Chaos
By Modupe Gbadeyanka
The presidential candidate of the All Progressives Congress (APC) in the February 25, 2023, election, Mr Bola Tinubu, has praised Nigerian governors, especially those of Kaduna, Kogi, and Zamfara States, for standing by the people of Nigeria.
On Wednesday morning, the Supreme Court granted an interim injunction seeking to stop the federal government and the Central Bank of Nigeria (CBN) from banning the use of old N200, N500, and N1,000 notes as legal tender in the country from February 10.
In a statement issued by the Director of Media and Publicity of the APC Presidential Campaign Council, Mr Bayo Onanuga, the former Governor of Lagos State, noted that the policy has subjected the masses to pains.
He stated that the Governors intervened and saved Nigeria from needless political and economic chaos and miseries, which have clearly become the unintended consequences of the monetary policy of the apex bank.
However, Mr Tinubu called on the CBN to ensure the execution of the Supreme Court ruling by taking all necessary steps to ensure sufficient availability of old and new Naira notes to citizens and properly sensitise the public on the ruling and the consequent validity of old Naira.
“I want to salute the courage of our Governors and most especially the Progressives Governors in APC who acted to save our country from avoidable and dangerous political crises and social unrest which the Central Bank policy on new Naira notes has brought on our country.
“Our country was dangerously careering toward anarchy and political and economic shutdown. But with the Supreme Court interim ruling, our country has been pulled back from the precipice. We thank our Supreme Court Justices for ruling wisely on the side of the people who have been subjected to undue agony and pain since this policy was announced.
“The Federal Government and relevant stakeholders can now sit down and work out a better framework on how to proceed with the new policy without causing any social and economic disruption and inconvenience to our people. We have examples of other countries that have successfully and seamlessly changed their currencies to learn from.
“Those countries give a long time, at least 12 months, to effect the currency change. They do not engage in a CBN-like fire brigade approach.
“We have seen how a good policy can be poorly implemented to cause unintended problems for the people who should be the beneficiaries. While lessons have been learnt, we must now move on as a country and people with a Renewed Hope for a better tomorrow.
“The sole aim of my running to be the president of our country is to make life better and more abundant for our people, and this is an ideal to which I will remain eternally committed,” he said.
Latest News on Business Post
- The Best Tips For A Great Start To The Day February 8, 2023
- IMF Insists Nigeria Must Raise Taxes, Adopt Unified FX Regime for Macroeconomic Stability February 8, 2023
- US Markets May Give Back Ground In Early Trading February 8, 2023
- Joe Ajaero Replaces Ayuba Wabba as NLC President February 8, 2023
- Naira Swap: Governors Saved Nigeria from Needless Political, Economic Chaos February 8, 2023
- Nigeria Records Highest Crypto Ownership, Use in 2022 February 8, 2023
- Rite Foods Removes Over 100k Plastic Bottles From Lagos Shorelines February 8, 2023
- Ardova Plans Exit from Stock Exchange, as Ignite Wants Minority Investors Out February 8, 2023
- BREAKING: Supreme Court Stops Banning of Old Naira Notes February 8, 2023
- NASD OTC Exchange Records 0.81% Fall February 8, 2023