Economy
World Bank Forecasts 1.8% GDP Growth for Nigeria in 2021
By Dipo Olowookere
The World Bank has said Nigeria, which prides itself as the largest economy in Africa, should record an economic expansion of 1.8 per cent in 2021.
In its latest report titled June 2021 Global Economic Prospects, the global lending organisation said the gross domestic product (GDP) growth projected for the country would be achieved only if prices of crude oil remain high at the international market.
It further said if this happens and the country carries out structural oil sector reforms, coupled with a market-based flexible exchange rate management, the economy should grow in 2022 by 2.1 per cent.
Business Post reports that in 2020, as a result of the COVID-19 pandemic, output in Sub-Saharan Africa shrank an estimated 2.4 per cent, but this year, the region has witnessed a resumption of activities, which the World Bank said reflects positive spillovers from strengthening global economic activity, including higher oil and metal prices, and some progress in containing COVID-19, especially in Western and Central Africa.
The bank said in Nigeria, South Africa and Angola, which are the three largest economies in the region, there have been recoveries and the growth forecast is put at 2.8 per cent this year and 3.3 per cent next year on the back of “stronger external demand, mainly from China and the United States, higher commodity prices, and containment of COVID-19.”
But the World Bank warned that, “Conditions in the region’s fragile and conflict-affected countries are expected to be particularly challenging; their average output level in 2022 is forecast to be 5.3 per cent below its size in 2019.”
On the global scene, the lender economy is expected to expand by 5.6 per cent in 2021, the fastest post-recession pace in 80 years, largely on strong rebounds from a few major economies.
It said growth in the United States is projected to reach 6.8 per cent this year, reflecting large-scale fiscal support and the easing of pandemic restrictions.
Also, growth in other advanced economies is also firming, but to a lesser extent and among emerging markets and developing economies, China is anticipated to rebound to 8.5 per cent this year, reflecting the release of pent-up demand.
In addition, emerging market and developing economies as a group are forecast to expand 6 per cent this year, supported by higher demand and elevated commodity prices.
“While there are welcome signs of global recovery, the pandemic continues to inflict poverty and inequality on people in developing countries around the world,” the World Bank Group President, Mr David Malpass, stated.
He said further that, “Globally coordinated efforts are essential to accelerate vaccine distribution and debt relief, particularly for low-income countries.
“As the health crisis eases, policymakers will need to address the pandemic’s lasting effects and take steps to spur green, resilient, and inclusive growth while safeguarding macroeconomic stability.”
On his part, the World Bank Group Vice President for Equitable Growth and Financial Institutions, Mr Indermit Gill, submitted that, “Linkages through trade and global value chains have been a vital engine of economic advancement for developing economies and lifted many people out of poverty. However, at current trends, global trade growth is set to slow down over the next decade.”
“As developing economies recover from the COVID-19 pandemic, cutting trade costs can create an environment conducive to re-engaging in global supply chains and reigniting trade growth,” he added.
As for the World Bank Prospects Group Director, Mr Ayhan Kose, “Higher global inflation may complicate the policy choices of emerging market and developing economies in coming months as some of these economies still rely on expansionary support measures to ensure a durable recovery.”
He noted that, “Unless risks from record-high debt are addressed, these economies remain vulnerable to financial market stress should investor risk sentiment deteriorate as a result of inflation pressures in advanced economies.”
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange was depleted by 0.86 per cent on Friday, November 14, after the price of six securities on the platform closed lower.
This reduced the NASD Unlisted Security Index (NSI) by 31.38 points to 3,613.23 points from the 3,644.61 points recorded a day earlier, as the market capitalisation lost N18.77 billion to end the week at N2.161 trillion compared with the N2.180 trillion it finished a day earlier.
During the session, NASD Plc fell by N4.00 to close at N55.00 per share compared with the preceding session’s N59.00 per share, FrieslandCampina Wamco Plc crashed by N3.00 to end at N51.00 per unit versus the previous day’s N54.00 per unit, Central Securities Clearing System (CSCS) Plc depreciated by N1.60 to close at N40.40 per share versus N42.00 per share, Lagos Building Investment Company (LBIC) Plc went down by 35 Kobo to settle at N3.13 per unit compared with the N3.48 per unit it ended on Thursday, UBN Property Plc decreased by 26 Kobo to quote at N2.33 per share versus the preceding day’s N2.59 per share and Industrial and General Insurance (IGI) Plc crumbled by 1 Kobo to close at 41 Kobo per unit versus 42 Kobo per unit.
Yesterday, the volume of securities traded by market participants increased by 99.5 per cent to 2.2 million units from the previous day’s 119,329 units, the value of securities ballooned by 4,185.1 per cent to N82.9 million from N1.9 million, and the number of deals expanded by 50 per cent to 21 deals, from 14 deals.
When the market ended for the session, Infrastructure Credit Guarantee Company (InfraCredit) Plc remained the most traded stock by value with a year-to-date sale of 5.8 billion units valued at N16.4 billion, trailed by Okitipupa Plc with 170.3 million units traded for N8.0 billion, and Air Liquide Plc with 507.4 million units sold for N4.2 billion.
InfraCredit Plc also ended as the most traded stock by volume on a year-to-date basis with 5.8 billion units worth N16.4 billion, followed by IGI Plc with 1.2 billion units transacted for N419.7 million, and Impresit Bakolori Plc with 536.9 million units valued at N524.9 million.
By Adedapo Adesanya
The Naira weakened against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Friday, November 14 on fresh forex demand pressure associated with this period.
During the session, the domestic currency depreciated against the greenback by 99 Kobo or 0.07 per cent to trade at N1,442.43/$1, in contrast to the N1,441.44/$1 it traded on Thursday.
In the same official market window, the local currency closed flat against the Pound Sterling at N1,898.96/£1, but further declined against the Euro by N3.60 to close at N1,678.56/€1 versus the previous day’s N1,674.96/€1.
However, at the GTBank FX counter, the Naira appreciated against the Dollar yesterday by N2 to settle at N1,448/$1 versus the preceding session’s rate of N1,448/$1, and in the parallel market, it maintained stability at N1,455/$1.
Increased demand for Dollars above the supply level has impacted price swing, but in the last two sessions, the pressure have been minimal.
In recent weeks, the apex bank FX injection has been minimal and erratic due to increasing FX inflows from foreign portfolio investors and exporters. FX inflow into currency market has fallen from peaked of $1.37 billion to $899 million.
While the Naira came under renewed strain, Nigeria’s foreign reserves continued their upward trajectory, climbing to $43.5 billion, up from $43.32 billion the week before.
This steady improvement in external reserves may be attributed to stronger crude oil receipts, improved non-oil inflows, and tightened FX management policies by the Central Bank of Nigeria (CBN).
As for the cryptocurrency market, investors tried to claw back some gains after many liquidated positions in the recent sessions largely driven by a lack of clarity on key US economic conditions and subsequent monetary policy direction.
That data blackout was due to the longest US government shutdown that lasted from October 1 until Thursday, that suspended government inflation and jobs data releases, with Litecoin (LTC) growing by 8.5 per cent to $104.14.
Further, Binance Coin (BNB) rose by 2.3 per cent to sell for $932.27, Solana (SOL) went up by 0.9 per cent to $142.71, Ethereum (ETH) jumped by 0.3 per cent to $3,175.02, and Dogecoin (DOGE) also appreciated by 0.3 per cent to $0.1633.
But Cardano (ADA) depreciated by 0.8 per cent to $0.5130, Ripple (XRP) fell by 0.3 per cent to $2.28, and Bitcoin (BTC) dropped 0.2 per cent to finish at $96,193.83, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
By Adedapo Adesanya
The oil market was up by more than 2 per cent on Friday as a key Russian port suspended oil exports after Ukraine attacked the facility, raising concerns about supply.
Brent crude futures increased by $1.38 or 2.19 per cent to trade at $64.39 a barrel and the US West Texas Intermediate (WTI) crude futures grew by $1.40 or 2.39 per cent to close at $60.09 a barrel. Brent rose 1.2 per cent on the week, and WTI posted a weekly gain of 0.6 per cent.
Russia’s port of Novorossiisk halted oil exports following a Ukrainian drone attack that hit an oil depot in the Russian energy hub, stoking supply concerns.
The port, a key export outlet of crude from Russia and Kazakhstan, and a major wheat export hub, paused oil exports, equivalent to 2.2 million barrels per day, or 2 per cent of global supply.
According to reports, the attacks damaged a ship, nearby apartment buildings, and an oil depot, injuring three crew members aboard the vessel. This comes as Ukrainian forces have increasingly targeted Russian oil-refining, storage, and export infrastructure using drones and missiles.
In addition, Russia’s pipeline company Transneft suspended crude oil supply to the facilities at the port.
Ukraine on Friday said it separately struck an oil refinery in Russia’s Saratov region and a fuel storage facility in nearby Engels overnight.
Market analysts noted that in recent month, Ukraine has made a shift in strategy from smaller-scale strikes on storage tanks to targeting hard-to-replace refinery equipment, like cracking units, much of it western-made and subject to sanctions.
Britain on Friday issued a special licence allowing businesses to continue working with two Bulgarian subsidiaries of sanctioned Russian oil firm Lukoil, as the Bulgarian government seized control of the assets.
The US imposed sanctions banning deals with Russian oil companies Lukoil and Rosneft after November 21 as part of efforts to stop the war which commenced with Russia attacking Ukraine in February 2022.
While geopolitical tensions and the end of the US government shutdown offered fleeting support this week, the market remained focused on rising global inventories, shifting supply-demand expectations from the Organisation of the Petroleum Exporting Countries (OPEC) and the International Energy Agency (IEA) and a broader sense that supply continues to outpace demand.
-
Feature/OPED6 years agoDavos was Different this year
-
Travel/Tourism9 years ago
Lagos Seals Western Lodge Hotel In Ikorodu
-
Showbiz3 years agoEstranged Lover Releases Videos of Empress Njamah Bathing
-
Banking7 years agoSort Codes of GTBank Branches in Nigeria
-
Economy2 years agoSubsidy Removal: CNG at N130 Per Litre Cheaper Than Petrol—IPMAN
-
Banking3 years agoFirst Bank Announces Planned Downtime
-
Sports3 years agoHighest Paid Nigerian Footballer – How Much Do Nigerian Footballers Earn
-
Banking3 years agoSort Codes of UBA Branches in Nigeria