SEC Moves to Ensure Nigerian Agricultural Produce Meets Specifications for Export
By Aduragbemi Omiyale
The Securities and Exchange Commission (SEC) is taking steps to ensure that Nigerian agricultural produce meets specifications for exports, the Director-General of the agency, Mr Lamido Yuguda, has informed the management of the Nigerian Agricultural Insurance Corporation (NAIC).
Mr Yuguda said the reason behind this is to deepen the commodities trading ecosystem further and make it a potent way forward in Nigeria’s quest for sustainable foreign exchange (FX) earnings and economic development.
At a meeting with NAIC over the weekend in Abuja, the SEC chief said Nigerian has earned low forex “in the past few months [due to] low oil production and oil theft,” which has often resulted in FX “shortages and balance-of-payment problems.”
The SEC DG said there are markets that need these commodities that are produced in Nigeria but lamented that the only impediment at the moment is a lack of standards which he stated is the reason why some of the commodities are not being accepted in the international market for now, noting that his organisation was willing to work with NAIC in a bid to be able to mitigate various risks in the ecosystem when they happen.
He said the commission, as part of its implementation of the 10-year Capital Market Master Plan, constituted a Technical Committee on the commodities trading ecosystem whose mandate was to identify challenges of the existing framework and develop a roadmap for a vibrant ecosystem.
“A committee comprising various stakeholders, including the SON (Standards Organisation of Nigeria), was set up to drive the implementation of the report.
“One of the recommendations in the report identified the development of a grading and standardisation system in line with international best practices. We are therefore willing to also work with NAIC to grow the commodities sector,” he stated.
Mr Yuguda stated that the SEC and NAIC have a lot of things in common as both organisations are government agencies working towards the growth of the commodities sector of the economy.
“The SEC has been doing a lot of things in the commodities sector, and the role of NAIC in this sector cannot be overemphasised and based on that, we would like to explore areas of collaboration to see how far we can help grow that sector together,” he said.
“This sector is key to our country’s future. If we can harness it, it will greatly improve the economy of this country,” the DG disclosed.
Also speaking, Executive Commissioner Operations of the SEC, Mr Dayo Obisan, said enormous opportunities abound in the entire agricultural value chain that, if well harnessed, would lead to the further development of the nation’s economy.
“There has been a couple of developments in the commodities side; the entire value chain is quite large. The farmers want someone to take up the crops, even local companies in Nigeria can do that. They need quality seeds as well as the funds to buy them. If the sector is not de-risked, it will be difficult to attract investors.
“There are a lot of things we can do together, and we are looking forward to this partnership with you,” he added.
In her remarks, the Managing Director of NAIC, Mrs Folashade Joseph, stated that her organisation was willing and available to push forward any initiative that will add value to the population and the nation’s economy.
“It is a privilege to do this, as things begin to evolve, we try to push forward what will add value to the population. Our focus is on commodities. There are various evolving issues during the course of our business as insurers because we manage across the value chain,” she said.
The NAIC MD added that in areas of storage and insurance issues, the collaboration would be of great benefit to all parties involved and assured that NAIC is ready to provide their expertise in anything that will add value to the commodities ecosystem.
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Brent Soars on Iraq Supply Concerns, Ease in Banking Crisis
By Adedapo Adesanya
The price of Brent crude futures rose by 1.3 per cent or 99 cents to $79.27 per barrel on Thursday as banking crisis fears further eased and no resolution in sight yet for the cut-off of the flow of Iraqi Kurdistan oil to Turkey.
Also, the US West Texas Intermediate crude rose by 1.9 per cent or $1.40 to $74.37 per barrel as producers shut in or reduced output at several oilfields in the semi-autonomous Kurdistan region of northern Iraq following a halt to the northern export pipeline.
About 400,000 barrels per day have been cut off with the pipeline shutdown over an international arbitration ruling in favour of Iraq against Turkey, and this continues to put upward pressure on oil prices.
Likewise, fears that may linger about the potential broader economic impact in the aftermath of the failure of Silicon Valley Bank (SVB) and Signature Bank, as well as the share crash and rescue bid for giant Credit Suisse, and pressure on other regional banks in the US appear to be easing.
Also supporting prices was a Wednesday report from the US Energy Information Administration (EIA) that crude oil stockpiles in the world’s largest producer fell unexpectedly in the week of March 24 to a two-year low.
Crude inventories dropped by 7.5 million barrels, compared with expectations for a rise of 100,000 barrels.
These factors offset bearish sentiment after a lower-than-expected cut to Russian crude oil production in the first three weeks of March, as numbers showed that there was a 300,000 barrels per day production decline compared with targeted cuts of 500,000 barrels per day, or about 5 per cent of Russian output.
Markets are now waiting for the US spending and inflation data due on Friday and the resulting impact on the value of the US Dollar, which impacts oil prices.
Also driving oil prices Thursday have been statements ahead of a planned meeting of the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) on Monday, where delegates have indicated that the 23-man cartel will likely stick to its current production cut plan.
Despite the low prices prompted in part by the banking crisis fears, analysts noted that OPEC+ would stay the course and not react by reducing output further.
Nigerian Exchange Witnesses N318.52bn Listings in Q1 2023
By Aduragbemi Omiyale
The Nigerian Exchange (NGX) Limited witnessed the listing of N318.52 billion worth of securities in the first quarter of 2023, data from the X-Compliance report of the bourse has revealed.
This cut across equities, fixed income, mutual funds and derivatives categories.
The X-Compliance report is a transparency initiative of NGX designed to maintain market integrity and protect investors by providing compliance-related information on all listed companies.
Through the report, NGX ensures that it provides timely information to investors to aid their capital allocation decisions and enable a properly functioning capital market.
According to the report, NGX saw N11.23 billion in Federal Government of Nigeria bond listings which constituted FGN Savings Bonds with maturities ranging between 2024 and 2026.
Lagos State Government issued the only bond by a sub-sovereign entity with its N137.33 billion series 1V, 10-year 13%, Fixed Rate Bonds due 2031 under its N500 billion debt issuance program.
The corporate bond segment recorded N112.42 billion senior unsecured bond listing from Dangote Industries Funding Plc and N31.36 billion in Sukuk Issuances from Taj Bank and Family Homes under their respective Sukuk Issuance programmes.
FTN Cocoa Processors Plc and Neimeth International Pharmaceuticals Plc both did supplementary listings of N850 million and N3.68 billion of shares, respectively.
Africa Plus Partners Nigeria Limited also listed its mutual fund, Africa Infra Plus 1, the first Carbon Plus naira-denominated fund to be listed on the Exchange, at a market value of N21.65 billion.
NGX also continued to drive participation in its derivatives market with the listing of the NGX Pension index Futures Contract and NGX30 Index Futures Contract.
Recall that the Chief Executive Officer of NGX, Mr Temi Popoola, had noted that the Exchange had a renewed focus on listings for the year 2023.
“We will be using listings as a vehicle for meeting strategic aspirations as the new dispensation comes in through increased advocacy and engagements,” he had said.
Nigeria’s Debt Profile Jumps 17% to N46.25trn in 2022
By Adedapo Adesanya
Nigeria’s total public debt stock increased by 17 per cent to N46.25 trillion or $103.11 billion as of December 2022 from N39.56 trillion or $95.77 billion in 2021.
This information was revealed by the Debt Management Office (DMO) on Thursday.
This means that the country’s debt profile precisely increased by 16.9 per cent or N6.69 trillion or $7.34 billion within one year, as the government borrow funds from various quarters for its budget deficits.
The agency said the new figures comprise the domestic and external total debt stocks of the federal government and the sub-national governments (36 state governments and the Federal Capital Territory).
The DMO statement partly read, “As of December 31, 2022, the total public debt stock was N46.25 trillion or $103.11 billion.
“In terms of composition, total domestic debt stock was N27.55 trillion ($61.42 billion) while total external debt stock was N18.70 trillion ($41.69 billion).
“Amongst the reasons for the increase in the total public debt stock were new borrowings by the FGN and sub-national governments, primarily to fund budget deficits and execute projects. The issuance of promissory notes by the FGN to settle some liabilities also contributed to the growth in the debt stock.
“On-going efforts by the government to increase revenues from oil and non-oil sources through initiatives such as the Finance Acts and the Strategic Revenue Mobilization initiative are expected to support debt sustainability.”
“The total public debt to gross domestic product (GDP) ratio for December 31, 2022, was 23.20 per cent and indicates a slight increase from the figure for December 31, 2022, at 22.47 per cent.
“The ratio of 23.20 per cent is within the 40 per cent limit self-imposed by Nigeria, the 55 per cent limit recommended by the World Bank/International Monetary Fund, and the 70 per cent limit recommended by the Economic Community of West African States,” the debt office said.
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