Economy
LCCI Tasks FG to Adopt Prudent Fiscal Measures, Pro-Investment Tax Policy
By Adedapo Adesanya
The Lagos Chamber of Commerce and Industry (LCCI) has urged the Nigerian government to adopt prudent fiscal policy measures and investment-friendly tax policies that work in tandem with the efforts of the Central Bank of Nigeria (CBN) to tame inflation.
The President of LCCI, Mr Gabriel Idahosa, said this at the Chamber’s first quarter of 2024 news conference on Thursday in Lagos, as he warned that as headline inflation continued its upward trend, it was telling on the ability of businesses to operate in the country.
He said in the last quarter of 2023, inflation notched higher to 28.92 per cent in December 2023, compared to 26.72 per cent recorded in September 2023,
Mr Idahosa also made a case for the government to strengthen its support to critical sectors like agriculture, road infrastructure, power, energy, and other key sectors because increasing the monetary policy rate has proven to be insufficient in taming inflation.
Last year, the CBN increased interest rates by more than 700 basis points to 18.75 per cent.
Citing the report from the National Bureau of Statistics (NBS), he noted that the inflationary pressures were primarily attributed to food and non-alcoholic beverages; housing, water, electricity, gas, and other fuel; clothing and footwear; transport, furnishing, household equipment, and maintenance.
He, however, projected that should the government be able to address the main drivers of inflation including food and transportation in 2024, projecting that the transportation component of inflation was likely to come down.
“This is because we can see the efforts being made to put buses on the road that are more gas or electric. For instance, Borno now has a large fleet of these vehicles and some companies in Nigeria are embracing producing gas-powered buses.
“Should this trend from now month by month continue, there would be a decrease in the cost of public transportation.
“Given the fact that Dangote has started refining fuel, we do not expect to see a dramatic reduction in the price of oil but we expect some reduction as we won’t spend dollars taking crude out or bringing it back.
“What that means is that sometime in the year, you won’t see a further dramatic rise in inflation,” he said.
Mr Idahosa said that the global economy in 2023 proved more resilient than expected in the face of significant monetary tightening, continuing policy uncertainties, multiple shocks from conflicts, and climate change.
He, however, noted that domestically, Gross Domestic Product (GDP) reports in 2023 showed quarterly growth that indicated a weak and fragile economy.
The LCCI president projected that in emerging markets and developing economies, growth was projected to remain steady at about 3.9 per cent in 2024.
He, however, stated that growth was expected to remain divergent in the region due to an array of global and domestic currents.
Mr Idahosa recommended that the federal government urgently address the structure of the power sector particularly, with a focus on the transmission segment.
This, he said, was needed to attract private sector investment into electricity transmission to bring in relevant financial, technical, and management capacity.
“The Federal Government needs to step up efforts to address the security challenges that have negatively affected investment inflows and improve the security measures adopted in tackling the menace of oil theft and vandalism.
“On agriculture sector growth, we urge the federal government to improve security and intensify the implementation of the national agricultural extension policy with a focus on improved and relevant agricultural technologies.
“The cost of logistics has gone up due to the poor state of our roads and the inadequate connectivity amongst farms, factories, and markets.
“The LCCI commends the Federal Government for the recent effort to attract private investment into the infrastructure sector. We also expect improved implementation of the capital funding allocated to infrastructures in the 2024 budget.
“While the CBN embarks on monetary tightening to tame inflation, it should ensure that targeted concessionary credit to the private sector is sustained for Micro, Small and Medium Enterprises (MSME),” he said.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its stay in the south territory with a decline of 0.56 per cent on Wednesday, April 2.
This brought down the market capitalisation by N13 billion to N2.417 trillion from N2.430 trillion, and downed the NASD Unlisted Security Index (NSI) by 22.57 points to 4,062.87 points from the previous session’s 4,062.87 points.
It was observed that the NASD exchange ended with three price gainers and three price losers during the trading day.
MRS Oil Plc depreciated by N19.00 to close at N171.00 per unit compared with the previous price of N190.00 per unit, NASD Plc lost N4.14 to trade at N37.36 per share compared with Wednesday’s N41.50 per share, and Central Securities Clearing System (CSCS) Plc gave up N2.00 to sell at N78.00 per unit versus N80.00 per unit.
On the flip side, FrieslandCampina Wamco Nigeria Plc appreciated by 19 Kobo to N93.00 per share from N92.81 per share, Food Concepts Plc expanded by 15 Kobo to N2.87 per unit from N2.72 per unit, and Great Nigeria Insurance (GNI) Plc improved by 2 Kobo to 52 Kobo per share from 50 Kobo per share.
Yesterday, the volume of securities dipped by 91.8 per cent to 260.2 million units from 3.2 billion units, the value of securities went down by 98.1 per cent to N154.2 million from N8.3 billion, while the number of deals soared by 53.3 per cent to 46 deals from 30 deals.
GNI Plc was the most active stock by value on a year-to-date basis with 3.4 billion units worth N8.4 billion, followed by CSCS Plc with 56.9 million units valued at N3.9 billion, and Okitipupa Plc with 27.5 million units traded for N1.8 billion.
The most traded stock by volume on a year-to-date basis was also GNI Plc with 3.4 billion units sold for N8.2 billion, trailed by Resourcery Plc with 1.1 billion units exchanged for N415.7 million, and Infrastructure Guarantee Credit Plc with 400 million units transacted for N1.2 billion.
By Adedapo Adesanya
The Naira dropped N2.09 or 0.15 per cent against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Thursday, April 2, to trade at N1,380.79/$1 compared with Wednesday’s rate of N1,378.70/$1.
However, it appreciated against the Pound Sterling in the official market by N2.77 to quote at N1,824.86/£1 versus the N1,836.57/£1 it was traded at midweek, and improved its value against the Euro by N10.54 to N1,591.92/€1 from N1,602.46/€1.
Yesterday was the last trading session of the week for the local currency in the spot market, as the market will be closed on Friday and Monday for the Easter Holiday.
At the black market, the Nigerian Naira maintained stability against the greenback yesterday at N1,405/$1, but gained N8 at the GTBank FX counter to settle at N1,388/$1, in contrast to the previous session’s N1,396/$1.
Pressure eased on the domestic currency as strong policy indicators have helped calm the majority of worries within the financial systems. Particularly in the remittance segment, the apex bank has directed all International Money Transfer Operators (IMTOs) to route remittance transactions through designated Naira settlement accounts in banks, a move aimed at boosting transparency and channelling more foreign exchange into the formal market.
This helps take off pressure from the foreign reserves, which have fallen below the $50 billion mark as they are gradually decreasing rather than falling sharply.
Meanwhile, the cryptocurrency market was bullish on Thursday, as macro sentiment shifted against recent optimism after reports that Iran is drafting a protocol with Oman to manage traffic through the Strait of Hormuz, easing concerns about disruptions to a key global oil route.
The remarks came after U.S. President Trump on Wednesday night vowed to hit Iran “extremely hard” in the coming weeks and that the Strait of Hormuz would “open naturally” once the war ends.
Cardano (ADA) chalked up 1.9 per cent to trade at $0.2435, Dogecoin (DOGE) grew by 1.2 per cent to $0.0912, Ethereum (ETH) appreciated by 0.8 per cent to $2,066.37, Bitcoin (BTC) added 0.5 per cent to sell at $67,080.53, Solana (SOL) increased by 0.5 per cent to $79.91, and Ripple (XRP) jumped 0.2 per cent to $1.31.
Conversely, Binance Coin (BNB) dipped 0.7 per cent to $586.90, and TRON (TRX) depreciated by 0.3 per cent to $0.3147, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 each.
By Dipo Olowookere
The local stock market was relatively flat on Friday, as the bears and the bulls shared the spoils of war, though investor sentiment turned bullish compared with the preceding session’s bearish posture.
Data from the Nigerian Exchange (NGX) Limited showed that the All-Share Index (ASI) was marginally down by 4.66 points as it ended at 201,698.89 points versus Wednesday’s 201,703.55 points, and the market capitalisation slightly contracted by N3 billion to N129.806 trillion from N129.809 trillion.
Customs Street was shut on Friday because of the public holidays declared by the federal government today and next Monday.
Business Post reports that John Holt declined by 9.91 per cent to N15.45, Abbey Mortgage Bank shed 9.60 per cent to trade at N8.95, International Energy Insurance slipped by 6.48 per cent to N3.32, Chams shrank by 5.30 per cent to N3.75, and Tantalizers depreciated by 5.18 per cent to N4.03.
On the flip side, Unilever Nigeria improved by 10.00 per cent to N103.40, Fortis Global Insurance gained 9.82 per cent to trade at N1.23, Multiverse appreciated 9.81 per cent to N20.15, Legend Internet advanced by 9.38 per cent to N6.30, and Zichis grew by 9.02 per cent to N14.14.
The market breadth index was positive during the trading session, as there were 35 appreciating stocks and 24 depreciating stocks.
Yesterday, investors traded 560.0 million equities valued at N19.3 billion in 49,676 deals, in contrast to the 815.5 million equities worth N33.3 billion transacted in 52,641 deals in the preceding day, representing a drop in the trading volume, value, and number of deals by 31.33 per cent, 42.04 per cent, and 5.63 per cent, respectively.
Secure Electronic Technology dominated the activity log with 59.7 million shares valued at N61.1 million, Wema Bank exchanged 52.0 million equities worth N1.4 billion, VFD Group transacted 36.0 million stocks for N410.5 million, Access Holdings sold 35.3 million shares valued at N914.8 million, and Chams traded 31.0 million equities worth N115.0 million.
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