Economy
LCCI Demands Legal Framework for Subsidy Removal
By Adedapo Adesanya
The Lagos Chamber of Commerce and Industry (LCCI) has lauded the decision of the Nigeria National Petroleum Corporation (NNPC) to reform the downstream oil sector.
The LCCI said the move by the national oil company will have positive impacts on the Nigerian oil and gas sector and by extension, the economy.
In a statement signed by the Director General of the LCCI, Mr Muda Yusuf, the chamber said that the impact of the reform on the economy would be different now, considering the reality that the market is faced with.
“It is vital to ensure that this new policy direction will be entrenched so that there will be no contemplation of any form of reversal.
“We are aware that similar attempts to undertake this crucial reform in the past have not been successful.
“However, we are confident that in the current dispensation, this will not be the case,” he said.
The LCCI then asked for urgent steps to be taken to back up the reform process with legislative framework that would reconcile the initiative with some already existing laws.
The chamber recommended legislation such as those of the Petroleum Subsidy Fund (PSF), the Petroleum Product Pricing and Regulatory Agency (PPPRA) and the Petroleum Equalization Fund (PEF).
“It is imperative to ensure clarity on access to foreign exchange for petroleum marketers to import petroleum products. Operators (who are currently in a quandary on this matter) are eagerly awaiting guidelines from the central bank of Nigeria on this critical aspect of access to foreign exchange for the importation of petroleum products,” the chamber said.
It also commended the NNPC’s pronouncements on the future involvement of the private sector in the operation of the countries abandoned refineries, saying it was an initiative that would ensure that these national assets are put to use for the growth and development of our economy.
The chamber said the advantages the reform of the downstream oil and gas sector would create include the release of resources for investment in critical infrastructures such as power, roads, the rail systems, health sector, education sector and also the unlocking of the huge private sector investment potentials in the downstream oil sector especially in petroleum product refining.
“This will ultimately reduce importation of petroleum products and ease the pressure on the foreign exchange market as well as the burden on our foreign reserves.
“It will eliminate the patronage, rent seeking activities and corruption that currently characterise the downstream oil sector.
“It will create more jobs for the teeming youths of the country in the downstream oil sector as investment in the sector improves,” the chamber said.
The LCCI added that the investment opportunities in the country’s oil and gas sector were huge considering the country’s crude oil reserves and the even bigger prospects in respect of the country’s gas reserves.
By Dipo Olowookere
To minimise their risks, investors trimmed their exposure to Nigerian stocks by about 52.07 per cent last week, data from Customs Street has revealed.
At the Nigerian Exchange (NGX) Limited in the period under review, the market participants transacted 2.252 billion shares worth N58.831 billion in 63,657 deals compared with the 4.698 billion shares valued at N85.043 billion traded in 72,562 deals a week earlier.
Business Post reports that Universal Insurance, GTCO, and AIICO Insurance dominated the activity chart in the week with 468.315 million equities sold for N9.007 billion in 3,568 deals, contributing 20.79 per cent and 15.31 per cent to the total trading volume and value, respectively
At the close of business, the financial services sector recorded a turnover of 1.371 billion stocks worth N22.274 billion in 26,114 deals, contributing 60.86 per cent and 37.86 per cent to the total trading volume and value, respectively.
The consumer goods space transacted 253.536 million shares worth N15.244 billion in 8,869 deals, and the services industry exchanged 193.424 million equities valued at N931.795 million in 4,716 deals.
In the five-day trading week, the bourse posted 33 price gainers versus 51 in the previous week, 57 price losers versus 39 a week earlier, and 62 equities remained unchanged, in contrast to 62 recorded in the preceding week.
Neimeth was the biggest price advancer in the period under consideration with a 31.42 per cent appreciation to close at N3.43, SCOA Nigeria expanded by 20.39 per cent to N2.48, Northern Nigeria Flour Mills grew by 19.54 per cent to N54.45, Livestock Feeds soared by 17.62 per cent to N5.94, and Dangote Sugar surged by 16.67 per cent to N38.50.
On the flip side, Universal Insurance slumped by 1923 per cent to 63 Kobo, Royal Exchange declined by 18.35 per cent to 89 Kobo, Regency Assurance shrank by 17.78 per cent to 74 Kobo, Sovereign Trust Insurance lost 16.67 per cent to close at N1.10, and Dangote Cement crumbled by 16.46 per cent to N400.00.
The market came under selling pressure in the week, resulting in the All-Share Index (ASI) and the market capitalisation tumbling by 2.94 per cent and 2.26 per cent each to 102,353.68 points and N62.851 trillion, respectively.
In the same vein, all other indices finished lower except the MERI Value, consumer goods, growth and sovereign bond indices, which appreciated by 0.70 per cent, 1.33 per cent, 0.15 per cent, and 0.04 per cent, respectively while the ASeM index closed flat.
By Dipo Olowookere
The three major partners of the Dangote Refinery in the Lekki area of Lagos, MRS Oil Nigeria, Heyden and Ardova Plc, will retail premium motor spirit (PMS), otherwise known as petrol, at its stations across the country at N970 per litre.
This information was revealed by Dangote Refinery, owned by one of Africa’s richest businessmen, Mr Aliko Dangote.
The three independent oil marketers entered into a bulk-purchasing agreement with the oil facility, which has the capacity to refinery about 650,000 barrels of crude oil per day.
The deal, first sealed by MRS Oil, ensured that it retailed fuel at its petrol stations at N935 per cent litre.
However, last week, Dangote Refinery increased its ex-depot price from N899.50 per litre to N950 per litre due to a rise in the price of crude oil to $80 per litre in the global market from about $72 per barrel.
In a statement on Sunday made available to Business Post, Dangote Refinery said, “All our partners, including Ardova, Heyden, and MRS Holdings, will offer petrol to Nigerians at a retail price of N970 per litre nationwide.
“We have absorbed the increased logistics costs to guarantee uniform pricing across the 36 states of the federation and the Federal Capital Territory (FCT).”
By Dipo Olowookere
A 0.17 per cent growth was recorded by the Nigerian Exchange (NGX) Limited on Friday, extending the stay of the local bourse in the positive territory.
This uptrend was maintained despite profit-taking in the banking sector, which left its index down by 0.23 per cent at the close of trading activities.
Business Post reports that the insurance industry expanded by 4.04 per cent during the session, the energy counter improved by 1.05 per cent, and the consumer goods space gained 0.58 per cent, while the industrial goods sector closed flat.
Consequently, the All-Share Index (ASI) went up by 170.62 points to 102,353.68 points from 102,183.06 points and the market capitalisation grew by N541 billion to N62.851 trillion from N62.310 trillion.
There were 34 price gainers and 22 price losers yesterday, indicating a positive market breadth index and strong investor sentiment.
The trio of Caverton, Livestock Feeds and Sovereign Trust Insurance appreciated by 10.00 per cent each during the session to quote at N2.20, N5.94, and N1.10, respectively, as Neimeth jumped by 994 per cent to N3.43, and Royal Exchange increased by 9.88 per cent to 89 Kobo.
On its part, Academy Press lost 9.74 per cent to close at N3.15, PZ Cussons declined by 9.09 per cent to N25.00, DAAR Communications weakened by 8.64 per cent to 74 Kobo, Transcorp Power shed 5.91 per cent to settle at N46.95, and Dangote Sugar fell by 4.94 per cent to N38.50.
A total of 327.8 million shares valued at N11.8 billion were traded in 11,905 deals on Friday versus the 472.2 million shares worth N16.7 billion transacted in 12,336 deals on Thursday, representing a decline in the trading volume, value, and number of deals by 30.58 per cent, 29.34 per cent and 3.49 per cent apiece.
Access Holdings recorded the highest sales with 49.1 million stocks sold for N1.2 billion, Fidelity Bank exchanged 20.4 million shares valued at N359.0 million, UBA traded 20.1 million equities worth N681.0 million, Oando transacted 14.8 million shares for N998.1 million, and Universal Insurance traded 13.8 million stocks worth N8.7 million.
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