Economy
IMF Charges Nigeria, Others to Deepen Fiscal Buffers Amid Headwinds
By Adedapo Adesanya
The International Monetary Fund (IMF) has called on Nigeria and other African countries to deepen fiscal buffers, adopt context-specific monetary policies, and advance regional economic cooperation in order to cushion the effect of global headwinds and unlock long-term inclusive growth.
The Managing Director of the Bretton Wood institution, Ms Kristalina Georgieva, said this during the launch of IMF’s latest Global Policy Agenda Report titled Anchoring Stability and Promoting Balanced Growth at the ongoing World Bank/IMF Spring Meetings in Washington.
She highlighted the continent’s mixed growth outlook and called for a renewed commitment to structural reforms.
Speaking further on fiscal reforms, she said, “Don’t hide behind excuses, and say we can’t go for more tax because, you can. There is a lot that can be done to broaden the tax base, and a lot that can be done to reduce tax evasion and tax avoidance, using technology, as some countries are doing, to chase the tax dollars, when there is the foundation for that, is a very good thing to do.”
Ms Georgieva pointed out that while Africa remained home to some of the world’s fastest-growing economies, a significant number of low-income and fragile states were increasingly falling behind, especially in the wake of slowing global growth and rising geopolitical risks.
“We have seen over the last years, the African continent having some of the fastest growing economies, but we also have seen low-income countries primarily and among the fragile conflict-affected countries falling further behind, and now this, this is a shock for the continent,” she added.
The IMF chief stated that while the direct effect of trade tariffs on most African countries was minimal, the indirect consequences, particularly, from a slowdown in global growth posed more serious challenges, especially for oil-exporting countries, like Nigeria.
“The direct impact of tariffs on most of Africa, not on all of Africa, but on most of Africa, is relatively small, but the indirect impact is quite significant.
“Slowing global growth means that, all other things being equal, they would see a downgrade. And actually, we have downgraded the growth prospects for the continent, for the oil producers, like Nigeria, falling oil prices create additional pressure on their budgets. On the other hand, for the oil importers, this is a breath of fresh air.
“In other words, different countries face different challenges. If I were to come up with some basic recommendations that apply to Africa, I would say they apply to Nigeria, Egypt, Ghana, and they apply to Cote d’Ivoire.
“First, continue on the path of strengthening your buffer levels. There is still a lot that can be done on the fiscal side, to have strength and to have the buffers for a moment of shock, and don’t use any excuses around,” Ms Georgieva noted.
The IMF managing director urged Nigeria and other governments in Africa to do more to expand their tax base and tackle leakages through digital tools. She warned against copycat monetary policies, urging central banks to respond based on country-specific inflation pressures rather than mimic regional peers.
“On the monetary policy side, we are no more in a place where you can look at the book of the central bank governor of the neighbouring country and say, ‘Oh, they’re doing this, let’s try out the same,’ because you have to really assess domestically, what your inflationary pressures are and do the right thing for your country,” she said.
Ms Georgieva also made a passionate call for Africa to rebrand its global image, stating that corruption and conflict in one country cast a long shadow over the entire region.
“But above all, make it so that the image of the whole continent changes, because now everybody suffers from wrongdoing, from corruption or conflict in one country, it throws a shadow on the rest of the continent. And finally, like Asia, there is a need to deepen inter-regional trade and cooperation, remove the obstacles.”
She also underscored the importance of boosting intra-African trade, comparing the continent’s potential to that of Asia and welcomed World Bank efforts to ease infrastructure barriers to trade.
She added: “Sometimes they are infrastructure obstacles. The World Bank is working on reducing the infrastructure obstacles to broaden trade. Africa has so much to offer the world. They have the minerals, better resources, and a young population. I think that a more unified, more collaborative continent can go a long, long way to be an economic powerhouse.”
By Adedapo Adesanya
Food Concepts Plc neutralized the gains recorded by three securities, returning the NASD Over-the-Counter (OTC) Securities Exchange into the negative territory with a 0.27 per cent loss on Thursday, December 4.
Yesterday, the share price of the parent company of Chicken Republic and PieXpress declined by 34 Kobo to sell at N3.15 per unit compared with the previous day’s N3.49 per unit.
This shrank the market capitalisation of the OTC bourse by N5.72 billion to N2.136 billion from N2.142 trillion and weakened the NASD Unlisted Security Index (NSI) by 9.57 points to 3,571.53 points from 3,581.10 points.
Business Post reports that Central Securities Clearing System (CSCS) Plc went down by 50 Kobo to N38.50 per share from N38.00 per share, FrieslandCampina Wamco Nigeria Plc gained 29 Kobo to sell at N55.79 per unit versus N55.50 per unit, and Geo-Fluids Plc added 5 Kobo to close at N4.60 per share compared with Wednesday’s closing price of N4.55 per share.
Trading data indicated that the volume of securities recorded at the session surged by 6,885.3 per cent to 4.3 million units from the 61,570 units posted a day earlier, the value of securities increased by 10,301.7 per cent to N947.2 million from N3.3 million, and the number of deals went up by 146.7 per cent to 37 deals from the 15 deals achieved in the previous trading session.
At the close of business, Infrastructure Credit Guarantee Company (InfraCredit) Plc was the most traded stock by value on a year-to-date basis with the sale of 5.8 billion units for N16.4 billion, trailed by Okitipupa Plc with 170.4 million units worth N8.0 billion, and Air Liquide Plc with 507.5 million units valued at N4.2 billion.
InfraCredit Plc also finished the session as the most traded stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.2 million, and Impresit Bakolori Plc with 536.9 million units traded for N524.9 million.
By Dipo Olowookere
The upward trend witnessed at the Nigerian Exchange (NGX) Limited in recent sessions continued on Thursday as it further improved by 0.10 per cent.
This was despite investor sentiment turning bearish after the local equity market ended with 23 price gainers and 28 price gainers, indicating a negative market breadth index.
UAC Nigeria gained 10.00 per cent to finish at N88.00, Morison Industries appreciated by 9.94 per cent to N3.54, Ecobank rose by 8.53 per cent to N36.90, and Coronation Insurance grew by 8.47 per cent to N2.56.
On the flip side, Ellah Lakes depreciated by 10.00 per cent to N13.14, Eunisell Nigeria also shed 10.00 per cent to finish at N72.90, Transcorp Hotels slipped by 9.95 per cent to N157.50, Omatek shrank by 9.23 per cent to N1.18, and Guinea Insurance dipped by 8.46 per cent to N1.19.
Yesterday, the All-Share Index (ASI) went up by 152.28 points to 145,476.15 points from 145,323.87 points and the market capitalisation chalked up N97 billion to finish at N92.726 trillion compared with the previous day’s N92.629 trillion.
Customs Street was bubbling with activities on Thursday, though the trading volume and value slightly went down, according to data.
A total of 1.9 billion stocks worth N19.2 billion exchanged hands in 23,369 deals during the session versus the N2.3 billion valued at N21.0 billion traded in 21,513 deals a day earlier.
This showed that the number of deals increased by 8.63 per cent, the volume of transactions depleted by 17.39 per cent, and the value of trades decreased by 8.57 per cent.
For another trading day, eTranzact led the activity chart with 1.6 billion units sold for N6.4 billion, Fidelity Bank traded 31.0 million units worth N589.3 million, GTCO exchanged 28.3 million units valued at N2.5 billion, Zenith Bank transacted 27.1 million units for N1.6 billion, and Ecobank traded 21.9 million units worth N744.3 million.
By Adedapo Adesanya
The Naira marginally depreciated against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday, December 4 amid renewed forex pressure associated with December.
At the official market yesterday, the Nigerian currency lost 0.01 per cent or 18 Kobo against the Dollar to close at N1,447.83/$1 compared with the previous day’s N1,447.65/$1.
It was not a different scenario with the local currency in the same market segment against the Pound Sterling as it further shed N15.43 to sell for N1,930.97/£1 versus Wednesday’s closing price of N1,925.08/£1 and declined against the Euro by 20 Kobo to finish at N1,688.74/€1 compared with the preceding session’s N1,688.54/€1.
Similarly, the Nigerian Naira lost N5 against the greenback in the black market to quote at N1,465/$1 compared with the previous day’s value of N1,460/$1 but closed flat against the Dollar at the GTBank FX counter at N1,453/$1.
Fluctuations in trading range is expected to continue during the festive season as traders expect the Nigerian currency to be stable, supported by intervention s by to the Central Bank of Nigeria (CBN)in the face of steady dollar demand.
Support is also expected in coming weeks as seasonal activities, particularly the stylised “Detty December” festivities, will see inflows that will give the Naira a boost after it depreciated mildly last month, according to a new report.
“As the festive Detty December season intensifies, inbound travel, tourism spending, and diaspora inflows are expected to provide moderate support for FX liquidity,” analysts at the research unit of FMDA said in its latest monthly report for November.
Traders cited by Reuters expect that the Naira will trade within a band of N1,443-N1,450 next week, buoyed by improved FX interventions by the apex bank.
Meanwhile, the crypto market was down as the US Federal Reserve’s preferred inflation gauge, core PCE, likely rose in September—moving in the wrong direction. However, volatility indices show no signs of major turbulence.
If the actual figure matches estimates, it would mark 55 straight months of inflation above the US central bank’s 2 per cent target. The sticky inflation would strengthen the hawkish policymakers, who are in favour of slower rate cuts.
Ripple (XRP) depreciated by 4.5 per cent to $2.08, Solana (SOL) went down by 3.8 per cent to $138.11, Litecoin (LTC) shrank by 3.1 per cent to $83.23, Dogecoin (DOGE) slid by 2.5 per cent to $0.1463, Cardano (ADA) declined by 2.1 per cent to $0.4368, Bitcoin (BTC) fell by 0.9 per cent to $91,975.45, Binance Coin (BNB) crumbled by 0.9 per cent to $899.41, and Ethereum (ETH) dropped by 0.7 per cent to $3,156.44, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 apiece.
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