Economy
Nigerian Economy is Truly Diversified—Ahmed
The federal government has expressed its commitment to continue to improve the diversification of the economy by steadily growing other sectors, particularly the commodities trading ecosystem.
The assurance was given by the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, during the presentation of a Gold coin to her by the Lagos Futures and Commodities Exchange in Abuja over the weekend.
Mrs Ahmed expressed her pleasure at the presentation as she stated that it is one of the results of the federal government’s commitment to continuing to improve efforts at diversifying the economy.
“This is really pleasing for me because we have been trying to improve the diversification of the Nigerian economy. People say we need to diversify the economy, but the Nigerian economy is truly diversified.
“Our GDP today has a 6.4 per cent contribution from the oil and gas sector, so 94.6% of the Nigerian economy is from other sectors. One of the sectors that we have been trying to activate its full potential is the mining sector.
“The mining sector today is still very small, but that is on the side of the government. But in the private sector, and now I am glad in the states, there are very active mining activities that are taking place.
“Unfortunately, until now, we have not been getting the full value of the mining activities. Mining activities have been largely artisanal; there are a lot of participants that take out our minerals without reporting it, without government or even the miners getting full value for it,” she said.
The Minister stated that in a bid to get the full value of mining activities in the country, the President approved and set up the Presidential Gold Mining Scheme with the Solid Minerals Development Agency leading.
“They had set up a pilot that started from Kebbi State where they supported the artisanal miners to be able to practise better mining practices and also to off-take the minerals that they mine, and do some first-level refining. Then the Central Bank offtakes this and sends it out of the country for proper mining.
“The essence for us is to begin to hold our reserves in minerals like gold so that our reserves are not all in US dollars. We know what happens to US dollars and what can happen to them. We are beginning to have our reserves in gold,” Mrs Ahmed stated.
She disclosed that the scheme, even though it was started by the federal government, has seen refineries beginning to actually work in Nigeria, adding that there is one in Ilesha, Segilola, which was the first refinery that was licensed in Nigeria.
According to Mrs Ahmed, “This gold is now being mined in Nigeria, refined in Nigeria up to the point of producing billions and then off taken by the CBN and other organisations like the LCFE. They are also coming forward to facilitate the trading of gold in the commodities exchange in Nigeria. That’s what we want; we wanted to be able to activate the full circle. What was missing was the off taking; now, the off-take is being addressed, and this will help to drive demand.
“Once there is demand in the market end, the producers will be encouraged to produce more, there will be more employment, and we will begin to see more banks supporting this mining sector. Before now, the banks were not too interested in supporting the mining sector because of the long gestation period. The investment is actually worthwhile, and we will encourage these businesses to grow and produce more. I want to congratulate the LFCE for being the first of its kind in Nigeria to achieve this”.
The Minister congratulated the SEC for pushing the milestone and expressed the hope that more commodities exchanges will come up as a result. She, therefore, charged the SEC to enable these companies to be able to operate because it is needed in the market to drive the kind of volumes that Nigeria hopes to get.
In his remarks, the Director-General of the Securities and Exchange Commission (SEC), Mr Lamido Yuguda, commended the Minister and the federal government on their determination to bequeath a vibrant commodities sector.
He stated that, “LCFE is into a number of commodities, and gold is just one of them. They have worked hard in this gold sector. This gold is 100% Nigerian gold, mined and refined in Nigeria, and I am happy that we have your support in this. Thank you very much for making this possible; we appreciate all the guidance and support you have provided so far”.
Also speaking, the Managing Director of LCFE, Mr Akin Akeredolu-Ale, expressed appreciation to the SEC for all the regulatory support the commission has provided in recent times.
Mr Akeredolu-Ale stated that Nigeria is a commodities country but has a large potential that is untapped so far and solicited the support of the National Assembly in passing the Investments and Securities Bill, which e said will bring about massive development in the sector.
“I thank the SEC for pushing the Investments and Securities Bill because that is the legal and regulatory framework that is supposed to support the capital market and, by default, the commodities trading ecosystem.
“We are hoping that the bill is approved so that we are able to have a hold on the commodities space and the revenues that are slipping out of Nigeria. We need that bill passed to be able to function more effectively,” he added.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited depreciated further by 0.44 per cent on Wednesday as selling pressure continued as investors monitor happenings in Rivers State, where pipeline explosion and political crisis triggered a state of emergency by President Bola Tinubu.
Investor sentiment was weak at midweek as Customs Street ended with 37 price losers and 13 price gainers, representing a negative market breadth index.
Livestock Feeds lost 10.00 per cent to trade at N8.46, eTranzact declined by 9.40 per cent to N5.30, Coronation Insurance slumped by 9.27 per cent to N2.35, MRS Oil shed 8.99 per cent to settle at N162.00, and May and Baker crashed by 8.05 per cent to N8.00.
On the flip side, Julius Berger appreciated by 8.47 per cent to N137.00, Omatek gained 6.15 per cent to close at 69 Kobo, UPDC rose by 2.69 per cent to N3.05, Wema Bank expanded by 2.43 per cent to N10.55, and Unilever Nigeria improved by 2.12 per cent to N38.50.
Business Post reports that all the key sectors witnessed profit-taking except the industrial goods space, which closed flat.
The insurance counter went down by 1.62 per cent, the banking index lost 1.37 per cent, the energy space shed 1.32 per cent, the commodity sector tumbled by 0.45 per cent, and the consumer goods industry shrank by 0.09 per cent.
Consequently, the All-Share Index (ASI) contracted by 460.56 points to 104,915.13 points from 105,375.69 points and the market capitalisation dropped N288 billion to finish at N65.790 trillion compared with Tuesday’s value of N66.078 trillion.
The market recorded a turnover of 1.4 billion stocks worth N12.4 billion in 12,012 deals versus the 350.0 million stocks valued at N8.2 billion traded in 11,230 deals in the preceding session, indicating a surge in the trading volume, value and number of deals by 290.46 per cent, 51.22 per cent, and 6.96 per cent, respectively.
The busiest equity yesterday was Sovereign Trust Insurance with the sale of 1.0 billion units for N989.0 million, Fidelity Bank transacted 42.8 million units worth N723.2 million, Access Holdings exchanged 30.6 million units valued at N698.0 million, Jaiz Bank sold 24.0 million units worth N85.0 million, and Zenith Bank traded 21.6 million units valued at N1.0 billion.
By Dipo Olowookere
The president of Dangote Industries Limited, Mr Aliko Dangote, has disclosed that Nigeria was now self-sufficient in cement and fertilizer, with the surplus being exported to earn foreign exchange (FX), which the country desperately needs to boost the Naira and the economy.
He said the target of his company is to make the nation self-sufficient in whatever it consumes, noting that his Lagos-based refinery is currently meeting domestic demand for Premium Motor Spirit (PMS), otherwise known as petrol.
After a meeting with the governor of Ogun State, Mr Dapo Abiodun, the industrialist, said he would continue to invest in the country.
Mr Dangote was in Ogun State to finalise plans to build a multi-billion-dollar seaport and two new lines of cement plant with a capacity of 6.0 million metric tons per annum, (Mta) at Itori.
The richest man in Africa said he was attracted to Ogun State because of the investor-friendly climate in the state and the policies of Mr Abiodun.
He recounted how his predecessor, Mr Ibikunle Amosun, frustrated his efforts to invest in Ogun State, saying, “We had earlier abandoned our vision of investing in the Olokola Free Trade Zone (OKFTZ), but because of your policies and investor-friendly environment, I want to say we are back and will work with the state government to return to Olokola, and plans are underway to construct the largest port in the country.”
“Our factory at Itori was pulled down twice. When we started the second time, they not only demolished the factory but also the fence, so we left. But right now, because of His Excellency, our governor, Prince Dapo Abiodun, we are back. When you visit the factory, you will be surprised at what we have done,” he stated.
In his remarks, Mr Abiodun described the day the Dangote Refinery groundbreaking was performed in Lagos as “the day of heartbreak for the sons and daughters of Ogun State as they watched helplessly on television.”
But he thanked Mr Dangote for “coming back to Ogun State” to invest after his earlier bad experience, saying, “We welcome your return to the state” to complete the cement factor at Itori.
The Governor emphasized that with the establishment of the Itori cement plant, proposed to produce six million metric tons of cement per annum, and the existing Ibeshe plant, producing 12 million metric tons, cement production in the state would total 18 million metric tons per annum, making it the largest cement producer in Nigeria and sub-Saharan Africa.
He lauded the company for not shirking its Corporate Social Responsibilities (CSRs) to the host communities, just as it is currently constructing the Inter-change-Papalato-Ilaro road, assuring that his administration is ready to work with the conglomerate for the good of the state and the nation as a whole.
By Aduragbemi Omiyale
The $20 billion Dangote Petroleum Refinery in Lagos has announced the suspension of the sales of petroleum products in Naira.
This action came after the Nigerian National Petroleum Company (NNPC) Limited halted its Naira-for-crude oil agreement with the company and other local refiners.
Last month, the state-owned oil agency said it would stop selling crude oil to Dangote Refinery in Naira from the end of this month, claiming its deals was for six months, from October 2024 to March 2025.
This came after the private refinery triggered a price war with the NNPC, crashing the price of premium motor spirit (PMS) to N825 per litre from its depots.
The NNPC operates in the downstream sector of the petroleum industry but the Dangote Refinery only has partners like MRS Oil, Ardova Plc, and Heyden, which sell its products to customers at retail prices.
In a statement signed by its management of Wednesday, Dangote Refinery it temporarily halted the sale of petroleum products in Naira “to avoid a mismatch between our sales proceeds and our crude oil purchase obligations, which are currently denominated in U.S. dollars.”
“To date, our sales of petroleum products in Naira have exceeded the value of Naira-denominated crude we have received.
“As a result, we must temporarily adjust our sales currency to align with our crude procurement currency,” it stated.
“We remain committed to serving the Nigerian market efficiently and sustainably. As soon as we receive an allocation of Naira-denominated crude cargoes from NNPC, we will promptly resume petroleum product sales in Naira,” the statement emphasised.
The company also debunked reports that it stopped loading from its facility “due to an incident of ticketing fraud.”
Dangote Refinery described these reports as “malicious falsehood,” noting that its systems “are robust and we have had no fraud issues.”
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