Economy
FG Flings 41 Items Exempted From Forex Policy By CBN
By Dipo Olowookere
There are strong indications that the Federal Government may set aside the policy of the Central Bank of Nigeria (CBN) regarding the 41 items exempted from foreign exchange market in its newly released 2017 Fiscal Policy Roadmap.
The policy document prepared by the Minister of Finance, Mrs Kemi Adeosun, will, instead, come up with fiscal measures to reduce pressure in the parallel market.
According to the document, the FG “will replace administrative measures on list of 41-items with fiscal measures to reduce demand pressure in parallel market.”
Presenting the document at a programme held in Lagos, Mrs Adeosun said, “The Federal Government’s Fiscal Roadmap is addressing barriers to growth that will drive productivity, generate jobs and broaden wealth-creating opportunities to achieve inclusive growth.”
She stated that the President Muhammadu Buhari administration was determined to return Nigeria to a productive economy rather than one steeped in consumption. To do so, government would tackle the infrastructure deficit to unlock productivity, improve business competitiveness and create employment.
She further said that government would actively partner with the private sector to achieve this by use of a number of new funding platforms, including the Road Trust Fund, which would develop potentially tollable roads, and the Family Homes Fund, which is an ongoing PPP initiative for funding of affordable housing.
According to the minister, the tax provision that allows companies to receive tax relief for investment in roads on a collective basis would be reviewed.
She explained that the existing provision that enabled companies to claim relief for road projects had only been taken advantage of by two companies, Lafarge and Dangote Cement. This was because few companies were large enough to fund roads alone.
The revision would now allow collective tax relief, such that companies will be able to jointly fund roads, subject to approval by FIRS and the Ministry of Works, and share the tax credit. It added that the government would revitalise refineries and increase Diaspora remittances through participation in the buyer support scheme for the Family Homes Fund with a view to increasing the supply of US Dollars to the Nigerian market.
The Roadmap also provides for a fresh audit of the federal government debt profile after which it would introduce a promissory note program to finance verified liabilities and issue debt certificates to contractors of Ministries, Departments and Agencies (MDAs).
These, according to the document, would positively impact on the economy by improving government’s cash flow of businesses, improve banks’ Non-Performing Loans, (NPLs); free up banks’ balance sheet for lending to private sector; and improve business interaction. These liabilities were estimated to be N2.2 trillion and would be addressed with a 10 year Promissory Note Issuance programme in conjunction with the CBN.
“Some contractors had not been paid in the past 4 years and in some cases the banks they were owing refused them access to the funds released, causing delays,” she explained, adding that those receiving the Promissory Notes would be expected to provide a material discount to government. The issuance was a solution to a long term problem that was ‘a drag on economic activity’.
It would also mobilise private capital to complement government spending on infrastructure, through the Roads Trust Fund, Family Homes Fund, while extending infrastructure tax relief to a collective model to attract clusters of corporate entities and expand the provision of infrastructure, in other to drive growth of non-oil sector, especially and the economy in general. There would be incentives for exports which would include restructuring the Export Expansion Grant (EEG) to a tax credit system, as well as rationalised tariffs and waivers in key export sectors. These have been designed to drive import substitution. The document indicated that the federal government would encourage investment in specific sectors through fiscal incentives especially in food processing, mining and power, and would rationalise tariffs and waivers in such priority sectors. In order to expand fiscal space through revenue enhancement and cost consolidation, it would enhance the Customs Single Window (being implemented through a Private Public Partnership (PPP) scheme), introduce template for non-allowable expenses for government agencies, control overhead costs by the Efficiency Unit and implement a continuous risk based audit by the Presidential Initiative on Continuous Audit.
In order to improve fiscal discipline at Sub-National level, the federal government would, from next year, extend the Efficiency Unit to Sub-National level; fast track municipal bond issues to deepen the bond market, as well as conversion to International Public Sector Accounting Standards by all state governments. The government plans to pursue its anti-corruption crusade in the new year with greater vigour and accelerate recoveries process, introduce a whistle-blower scheme, centralised database on recovered assets, asset tracking and a professional management of recovered assets. It also plans to rebalance debt portfolio to extend maturity and optimise debt service cost through rebalancing public debt portfolio with increased external borrowing with a target of 60:40 ratio and extend maturity profile of public debt portfolio, while deploying long-term debt instruments and depending more on concessionary loans.
http://www.vanguardngr.com/2016/12/41-exempted-items-fg-dumps-cbns-forex-policy/
By Modupe Gbadeyanka
Stanbic IBTC Bank, a subsidiary of Stanbic IBTC Holdings Plc, has provided insights that empower businesses to navigate a complex economic landscape.
This was done at its annual Global Markets Economic Outlook forum themed Global Economic Trends and Nigeria’s Position, which was attended by key stakeholders, industry leaders, and clients.
The Executive Director for Corporate and Transaction Banking at Stanbic IBTC Bank, Mr Eric Fajemisin, said the forum reflects the bank’s continued commitment to keeping clients ahead of global shifts that have direct implications for their businesses.
“As global trade patterns continue to realign, it’s important that our clients understand not just what is happening, but what it means for their operations and growth strategies.
“This forum is part of our ongoing effort to translate global trends into actionable insights for businesses operating in Nigeria,” he said.
Also, the Head of Global Markets, Nigeria at Stanbic IBTC Bank, Mr Dare Otitoju, highlighted Nigeria’s growing relevance in global trade conversations, noting the country’s potential to strengthen its position as a trade and investment hub on the continent.
“Nigerians should look forward to a transition from stabilisation to selective growth. Global higher-for-longer rates indicate that capital will reward countries with policy consistency, which Nigeria is building post-reforms. Key areas to watch include infrastructure funding, gas and manufacturing, and capital market opportunities as FX becomes more predictable.
“The Outlook message was clear: while 2026 may not be a boom year, prepared individuals and businesses will find real opportunities. That’s the plan we want Nigerians to leave with,” he stated
On his part, the Resident Representative for Nigeria at the International Monetary Fund (IMF), Mr Christian Ebeke, in a keynote address, shed light on Nigeria’s optimistic outlook.
He highlighted several factors, including rising hydrocarbon prices, decreasing global financing costs, and tax reforms that took effect in January 2026, all of which could help the country surpass its revenue targets. He also pointed out the advantages associated with enhanced state policing.
Mr Ebeke stated in his presentation that Nigeria should capitalise on immediate opportunities. This includes securing oil pipelines, improving electricity infrastructure, and shifting investment from government securities to the private sector.
Also, the Special Adviser on Financial Markets and Economic Policy to the Governor of the Central Bank of Nigeria (CBN), Mr Mayokun Ajibade, emphasised the necessity of addressing excessive liquidity in the banking system as a sustainable means of combating inflation.
He expressed the importance of a balanced approach, advocating for a focus on lowering inflation before pursuing interest rate reductions; noting that the Nigerian banking system has too much liquidity, therefore a decline in interest rates should not be expected without first addressing inflation.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange depreciated by 1.63 per cent on Monday, July 6, after the share price of Central Securities Clearing System (CSCS) Plc depleted by N9.04 to N81.70 per unit from last Friday’s N90.74 per unit.
This shrank the NASD Security Index (NSI) during the session by 70.29 points to 4,236.97 points from 4,307.26 points, and contracted the market capitalisation by N42.19 billion to N2.543 trillion from N2.585 trillion.
The unlisted securities exchange lost yesterday despite having more price gainers than losers. Afriland Properties Plc gained N1.48 to end at N16.65 per share versus the previous N15.17 per share, Industrial General Insurance (IGI) Plc appreciated by 5 Kobo to close at 55 Kobo per unit compared with the preceding session’s 50 Kobo per unit, and Food Concepts Plc improved by 1 Kobo to trade at N2.51 per share, in contrast to last Friday’s N2.50 per share.
During the session, the value of trades by investors fell by 98.3 per cent to N2.8 million from N160.1 million, the volume of transactions dipped by 93.6 per cent to 114,175 units from 1.8 million units, and the number of deals decreased by 14.3 per cent to 18 deals from 21 deals.
Great Nigeria Insurance (GNI) Plc ended the day as the most traded stock by value on a year-to-date basis, with 3.4 billion units worth N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units valued at N6.5 billion, and CSCS Plc with 70.7 million units exchanged for N4.9 billion.
GNI Plc also closed the session as the most traded stock by volume on a year-to-date basis, with 3.4 billion units sold for N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.
By Adedapo Adesanya
The Naira further appreciated against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Monday, July 6, by N1.92 or 0.14 per cent to end at N1,368.27/$1, in contrast to the previous exchange rate of N1,370.19/$1.
The domestic currency also improved its value against the Pound Sterling in the official forex market during the session by N2.98 to trade at N1,826.91/£1 versus last Friday’s value of N1,829.89/£1, and against the Euro, it gained N5.63 to quote at N1,562.69/€1 compared with the preceding session’s N1,568.32/€1.
In the same vein, the Nigerian Naira gained N1 against the US Dollar at the GTBank FX counter during the session to close at N1,831/$1 compared with last Friday’s quoted price of N1,832/$1, and at the parallel market, it remained unchanged at N1,390/$1.
Monday’s appreciation reinforced the local currency’s relative stability witnessed in recent months under ongoing monetary and foreign exchange reforms by the Central Bank of Nigeria (CBN).
Market analysts linked the sustained improvement to stronger foreign-exchange liquidity in the official market, also citing improved investor confidence, which has supported demand and supply conditions in the FX market.
According to analysts, sustained policy measures introduced by the apex bank have continued to strengthen market transparency and price discovery.
Updated data showed the country’s gross external reserves ended the week at $51.46 billion following successive FX inflows from across multiple sources.
In the cryptocurrency market, Bitcoin (BTC) held in the low $63,000s, despite Strategy’s disclosure this week that it sold 3,588 bitcoin for about $216 million, its largest sale since abandoning its never-sell stance, which the market largely absorbed without breaking the recovery. It appreciated by 0.2 per cent to $63,069.84, while Solana (SOL) improved by 0.8 per cent to $80.94, and TRON (TRX) expanded by 0.2 per cent to $0.3295.
On the flip side, Cardano (ADA) fell by 2.5 per cent to $0.1793, Dogecoin (DOGE) slumped by 2.2 per cent to $0.0749, Ripple (XRP) depreciated by 1.1 per cent to $1.12, Binance Coin (BNB) slid by 0.5 per cent to $578.79, and Ethereum (ETH) slipped by 0.2 per cent to $1,767.90, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) sold flat at $1.00 each.
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