Economy
FG Negotiating Free Trade Agreements
By Modupe Gbadeyanka
The Federal Government has noted that it was in the process of negotiating 21st century Nigerian free trade agreements with the goal of expanding market opportunities for Nigerian companies as well as looking into the ECOWAS Common External Tariff that has been quite controversial.
This disclosure was made by Minister of Industry, Trade & Investment, Dr Okechukwu Enelamah, during a press conference in Abuja on Thursday.
Dr Enelamah noted that that the Export Expansion Grant (EEG), which was suspended in 2014 following allegations of widespread abuse and the accumulation of significant liability on the Negotiable Duty Credit Certificate (NDCCs), is also expected to resume in 2017.
In addition, he said the minister is currently running a feasibility study for the development of six Special Economic Zones (SEZ’s) and securing funding in the Nigerian budget for the first development phase to be launched in 2017.
According to him, the Ministry is updating Nigeria’s trade policy priorities by working to correct imbalances in the country’s trade relationships and reversing negotiating failures. One of those items it is examining at the moment is the Economic Community of West Africa States (ECOWAS) CET.
The CET is a regional tariff structure for West Africa on the basis of which products are imported within the region.
It came into effect in 2015 with a transitional period of implementation to 2020. The challenge for the Nigerian economy is that manufacturers and industrialists have taken a strong position that the negotiation that resulted in the CET did not take into account the sensitive of the Nigerian industrial and manufacturing sector.
The pre-existing sensitivities have now been compounded with the onset of the recession and other vulnerabilities. Stakeholders have taken the position that the Nigerian economy would be damaged if the CET is implemented in 2020 and that the situation would be compounded if Nigeria signs the Economic Partnership Agreement (EPA) with the European Union.
He said as a consequence therefore, producers, manufacturers, industrialists and others have requested for the postponement and negotiation of the CET and for the EPA not to be signed. The government is thus, seriously working on these concerns.
On the EEG, the Minister said government intends to resume the scheme in 2017 because of its determination to expand the volume and value of Nigeria’s exports, diversifying export products and improving global competiveness of Nigerian exporters. The scheme will be included in the budget in order to manage the impact on government revenue and promote transparency.
On Industry, he said the aim is to broaden the scope and accelerate the growth of the Nigerian manufacturing & industrial businesses
The Minister said that approved liability on the Scheme for unused certificates which are either in the custody of exporters or awaiting issuance in the Federal Ministry of Finance, will be settled after the conduct of an audit to verify the actual amount due.
Following EEG suspension, Dr Enelamah had set up an Inter-Ministerial Committee to access the scheme holistically and make recommendations on its continued operation or otherwise and the framework for its continued operation.
The committee came up with far reaching recommendations and also made a presentation at the Economic Management Team (EMT) meeting of October 17, 2016, presided over by His Excellency, the Vice President of the Federal Republic of Nigeria, Prof. Yemi Osinbanjo, in which its recommendations were approved.
The Ministry had a meeting a couple of weeks ago with exporters and other stakeholders to discuss and exchange ideas once again on the matter.
On the SEZs, the Minister explained that his ministry was facilitating the setup of special economic zones throughout Nigeria. Specific goals include to help overcome the infrastructure disadvantages faced by local manufacturers, and promote the cluster effects gained by locating similar manufacturing businesses together.
Apart from the funding secured in the Budget for SEZs, other financial partners such as Afreximbank and EXIM bank of China have committed $1bn to the project.
On the investment front, he said the ministry is working with the Nigerian Investment Promotion Commission (NIPC) to enhance investments and reverse the overall decline of FDI inflows.
Key achievements include important Investment Promotion and Protection agreements signed with Singapore and UAE and Investment road shows undertaken in China, Germany, Singapore, Turkey, UAE, UK, and US.
Also investors such as GE, Nissan, Coca-Cola among others, have continued to express interest to expand investment in Nigeria.
On the Enabling Business Environment (EBE), he the stated that the Presidential Enabling Business Environment Council (PEBEC) has been created and monthly meetings have commenced to monitor results achieved.
On Industry, the aim is to broaden the scope and accelerate the growth of the Nigerian manufacturing & industrial businesses, with a special focus on agribusiness and agro allied industries. This includes for example auto assembly and component manufacturing, mining, sugar, food processing, textile and garments, palm oil, and leather.
He also said the ministry’s initiatives currently underway within the Nigerian Industrial Revolution Plan (NIRP) include: FG has approved the Nigerian Automotive Industry Development Plan (NAIDP). Secondly, a roadmap implementation has begun with sugar, tomato, textile and garments.
Also, he said in order to keep up with the rapidly transforming global economy, Nigeria’s digitalization has to be accelerated.
The ministry’s digitalization initiatives currently underway include: The establishment of the Smart Digital Nigeria Economy Project, as the baseline strategy for the digital-led growth of the Nigerian Economy.
Dr Enelamah said the ministry was working in partnership with the Bank of Industry (BoI) and other relevant government departments to support MSME’s through funding.
Specific MITI initiatives currently underway include: The GEM (Growth and Employment) initiative in collaboration with the World Bank. More specifically, The GEM initiative has identified 23 IDAs (Industrial Cluster Areas) to support MSME’s with capacity development and launch the ‘BIG platform’ funding initiative to provide funding and training for MSME’s.
Finally, giving an overview of the ministry’s vision, Dr Enelamah explained that there are three core pillars and five foundational enablers (necessary conditions to realise our plans) as follows:
3 Core Pillars:
– Implement the Nigerian Industrial Revolution Plan (NIRP)
– Support Micro, Small & Medium Enterprises (MSMEs)
– Support the Digitalization of the Nigerian economy
- 5 Foundational Enablers
– Establish an Enabling Business Environment (EBE)
– Develop Special Economic Zones (SEZ)
– Establish 21st Century trade/Free Trade agreements
– Attract domestic and foreign investments
– Institutionalize the Structural Reform Agenda (SRA)
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange rose by 2.30 per cent, spurring the NASD Security Index (NSI) to close higher by 96.61 points to 4,296.34 points from 4,199.73 points, and raising the market capitalisation by N57.99 billion to N2.578 trillion from N2.521 trillion.
The market was up yesterday despite a lower activity level, as the volume of securities traded slumped by 94.7 per cent to 1.3 million units from the previous 23.9 million units. The value of securities slipped by 57.2 per cent to N29.2 million from the preceding session’s N68.2 million, while the number of deals executed by market participants increased by 6.7 per cent to 32 deals from the 30 deals carried out on Thursday.
At the close of transactions, Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date basis, with a turnover of 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 in trades, and Central Securities Clearing System (CSCS) Plc with 70.8 million units traded for N4.9 billion.
GNI Plc was also 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 exchanged for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.
During the trading day, there were three price gainers and two price losers, led by Afriland Properties Plc, which shed N1.48 to sell at N15.17 per share compared with the previous session’s N16.65 per share, and Food Concepts Plc, which slid by 7 Kobo to close at N2.69 per unit versus N2.76 per unit.
Conversely, FrieslandCampina Wamco Nigeria Plc improved its value by N9.50 to trade at N150.00 per share compared with Thursday’s closing price of N140.50 per share, CSCS Plc went up by N7.95 to N89.65 per unit from N81.70 per unit, and 11 Plc soared by N6.94 to N206.95 per share from N200.01 per share.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited lost its footing by 0.07 per cent on Friday as a result of renewed profit-taking by investors.
The fall happened after Thomas Wyatt and Guinness Nigeria led other price losers group comprising 27 stocks at the market yesterday due to selling pressure.
Thomas Wyatt Nigeria shed 10.00 per cent to quote at N2.70, Guinness Nigeria drowned by 9.99 per cent to close at N329.00, Ikeja Hotel slipped by 9.96 per cent to N42.50, Zichis shed 9.94 per cent to trade at N26.37, and McNichols depreciated by 9.91 per cent to N5.00.
On the flip side, International Breweries gained 9.92 per cent to finish at N13.30, NEM Insurance appreciated by 9.61 per cent to N27.95, Jaiz Bank grew by 6.36 per cent to N9.20, UPDC expanded by 6.33 per cent to N4.20, and Livestock Feeds increased by 6.32 per cent to N9.25.
Business Post reports that investor sentiment remained bullish despite the loss recorded during the session, as there were 27 price decliners and 30 price advancers, representing a positive market breadth index.
Yesterday, market participants transacted 441.3 million equities for N19.4 billion in 44,938 deals compared with the 1.7 billion equities worth N112.0 billion traded in 44,780 deals a day earlier. This showed that the trading volume contracted by 74.04 per cent, the trading value declined by 82.68 per cent, and an uptick in the number of deals by 0.35 per cent.
Access Holdings led the activity chart on Friday after selling 40.2 million shares valued at N1.0 billion, Sterling Holdco traded 30.3 million stocks worth N228.8 million, Fidelity Bank sold 26.3 million equities for N505.6 million, Zenith Bank transacted 22.3 million shares valued at N2.5 billion, and First Holdco exchanged 19.0 million stocks worth N1.3 billion.
During the last trading session of the week, the consumer goods sector rose by 0.49 per cent, the insurance counter increased by 0.06 per cent, and the industrial goods index closed flat, while the banking and energy indices lost 0.78 per cent and 0.52 per cent, respectively.
As a result, the All-Share Index (ASI) shrank by 159.97 points to 243,798.76 points from 243,958.73 points, and the market capitalisation moderated by N103 billion to N156.445 trillion from N156.548 trillion.
By Adedapo Adesanya
The Naira performed poorly against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, July 10, losing N1.19 or 0.09 per cent to close at N1,379.62/$1, in contrast to Thursday’s exchange rate of N1,378.43/$1.
It also depreciated against the Pound Sterling in the official market during the trading session by N3.80 to trade at N1,850.62/£1 compared with the previous day’s N1,846.82/£1, but gained 43 Kobo on the Euro to sell at N1,575.66/€1 versus the preceding day’s N1,576.09/€1.
At the GTBank FX desk, the Naira weakened against the Dollar yesterday by N1 to quote at N1,386/$1 compared with the previous session’s N1,835/$1, and maintained stability in the black market at N1.400/$1.
Data showed that interbank FX turnover fell by about 10 per cent on Friday to $71.044 million from $78.708 million the previous day. Also, interbank forex market deals reduced to 87 from 106 trades executed at the window on Thursday.
The total forex inflows into the Nigerian foreign exchange market have been fluctuating, with about $1 billion in total inflows reported last week.
Total FX inflows settled at $0.99 billion last week, according to the research subsidiary of Coronation Merchant Bank, with Foreign Portfolio Investors (FPIs) accounting for the largest share at 35.81 per cent, or $0.35 billion.
Exporters accounted for 28.72 per cent or $0.28 billion, while the CBN contributed 11.15 per cent or $0.11 billion. Non-Bank Corporations also made up a notable 10.92 per cent of total inflows, reflecting continued support from both market-driven and official sources.
In the cryptocurrency market, Bitcoin rose above $64,100, retesting the price level that rejected it on Monday, with a clean break above, opening the path toward the June 15 high of $67,250. It gained 0.3 per cent to sell at $64,114.16.
Ethereum (ETH) appreciated by 1.6 per cent to $1,798.81, Dogecoin (DOGE) grew by 0.6 per cent to $0.0742, Binance Coin (BNB) added 0.6 per cent to sell for $576.47, Cardano (ADA) also grew by 0.6 per cent to $0.1674, and Ripple (XRP) jumped by 0.4 per cent to $1.10.
But Solana (SOL) lost 1.1 per cent to settle at $77.95, and TRON (TRX) declined by 0.2 per cent to $0.3296, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
