Letting adverts that discriminate against tenants on housing benefit could be banned

Ministers in England are set to meet representatives of landlord associations, tenant groups, property websites and mortgage providers in a bid to clamp down on discrimination against people on housing benefit in the private rented sector.

Housing Minister Heather Wheeler said that adverts which specify that a home will not be rented to people on housing benefit could be banned and she called on landlords and letting agents to stop saying No to DSS claimants.

 

She pointed out that out of 4.5 million households living in private rental accommodation, 889,000 receive housing benefit to help pay their rent. Yet the latest figures show around half of landlords said they would not be willing to let to tenants on Housing Benefit.

‘I will be meeting key stakeholders to tackle the practice of No DSS, to underline the need for immediate change,’ Wheeler confirmed.

Justin Tomlinson, Minister for Family Support, Housing and Child Maintenance, said that everyone should have the same opportunity when looking for a home, regardless of whether they are in receipt of benefits.

‘With Universal Credit, payments can be paid directly to the landlord, and we continue to listen to feedback and work with landlords to improve the system.

Landlords can already receive rent from tenants on Housing Benefit and Universal Credit, meaning payments can be paid directly into their accounts,’ he pointed out.

Wheeler also announced that some £19.5 million is to be provided to local authorities in England to provide homes for people at risk of losing their or who are already homeless, it has been announced

Wheeler said that it will help people to get into the rented sector and the funding will go to 54 projects around the country.

Councils will use the funding boost to help vulnerable people secure their own tenancy through support such as, paying deposits or putting down the first months’ rent and Wheeler said that th

African cities become the new home to over 40,000 people every day, many of whom find themselves without a roof over their heads. With that in mind, IFC has committed to do more to develop the property sector, both to provide new and affordable housing and to encourage an industry that requires significant building materials and has the potential to be a major employer. In May, IFC and Chinese multinational construction and engineering company, CITIC Construction launched a $300 million investment platform, CITICC (Africa) Holding Limited, to develop affordable housing in multiple African countries. The platform will partner with local housing developers and provide long-term capital to develop 30,000 homes over next five years. IFC estimates that each housing unit will create five full-time jobs – resulting in nearly 150,000 new jobs on the continent. Kenya and Nigeria are high on the priority list for the new effort. Kenya’s housing shortage is estimated at 2 million units, while Nigeria is in want of 17 million units. The soaring demand is being met by scant new supply. Africa’s housing market has few local developers with the technical and financial strength to construct large-scale projects. The IFC-CITIC Construction platform will work with local housing companies to develop affordable housing projects across Sub-Saharan Africa, each ranging in size from 2,000 to 8,000 units. CITIC Construction has a proven track record in constructing and delivering large scale housing projects. The platform will start by developing homes in Kenya, Rwanda and Nigeria, expanding to other countries as operations ramp up. “In Angola, through planning, financing, construction and post-construction operation, CITIC Construction has successfully completed the 200,000 units housing program, new city of Kilamba Kiaxi, with relative infrastructure and utilities in four years. CITIC Construction has also founded the CITIC BN Vocational School in Angola which helps youth acquire the skills they need to become professionals”, said Hong Bo, Assistant President of CITIC Group and Chairwoman of CITIC Construction, “CITIC Construction will take advantage of our engineering experience and delivery capability to develop more affordable houses for Africa through the platform with IFC.” “As Sub-Saharan Africa become more urbanized, the private sector can help governments meet the critical need for housing”, said Oumar Seydi, IFC Director for Eastern and Southern Africa. “The platform will help transform Africa’s housing markets by providing high quality, affordable homes, creating jobs, and demonstrating the viability of the sector to local developers. IFC will work with financial institutions to support mortgages and housing finance that will allow people to purchase the units.” The new housing units will be constructed in accordance to IFC’s green building standards, delivering homes that are environmentally friendly and sustainable. The World Bank Group estimates that by 2030, three billion people, or 40 percent of the world’s population will need new housing units. To date, IFC has invested more than $3 billion in housing finance in over 46 countries world-wide. IFC focuses on regions where large portions of the population live in sub-standard housing and have limited access to credit to build, expand, or renovate their homes.is should give them an opportunity to make a home in a property they may otherwise not have been able to access.

‘I want everyone to have the security, dignity and opportunities they need to build a better life and at the heart of which is ensuring everyone can find a safe and secure home to call their own,’ said Wheeler.

‘This funding will make a huge difference in opening up the private rented sector to people who need it and give them the chance to rebuild their lives.

This helps strengthen the choices and opportunities available for those on benefits to secure the homes they and their families need,’ she added.

In a third move, local authorities can now also bid for a share of up to £26 million of Rapid Rehousing Pathway funding for 2019 to 2020.

This extra investment can be used to fund innovative local schemes which help those sleeping rough and struggling with mental health problems or substance misuse issues.

The Private Rented Sector Access Fund will also support minimum tenancies or existing tenancies for a period of 12 months.

Source: Propertywire

weah_in_studio

Liberia President Launches Low Income Housing in Rural Areas

Liberia President, has launched a housing program for rural dwellers known as the Sasstown development project targeted toward a better living environment.

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The former World best footballer took to his official social media page to make the announcement on Sunday, March 3.

President Weah revealed he was excited with the project expected to improve living condition of Liberians, who will be encouraged to go into agriculture after the residential buildings are ready.

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“I’m excited to announce that my vision to transform the standard of living of our rural dwellers, precisely by upgrading their homes from mud brick homes to concrete homes; has started with the Sasstown development project,” President Weah’s statement read in part.

A further breakdown of the Sasstown development project revealed that existing residential cities will be converted to agricultural zones once the new buildings are completed.

In an effort to avoid demolition of their existing homes; which will prevent them from being homeless during the construction period.

“We have devised a strategy wherein we will build the new homes at a different location; and once the construction is done, they can then move into the newly constructed homes while we demolish the old ones and encourage them to do agriculture at the site of their old homes,” he said.

The President assured Liberians that his government would use every available cent on developing the country..

Source: Legit.ng

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Foreign Trade volume hits N32.26Trn in 2018

The National Bureau of Statistics, NBS, said Nigeria recorded a total trade value of N32.26 trillion year-on-year in 2018, representing 39.3 per cent increase over the corresponding period in 2017.

The trade value for 2017 stood at N23.16 trillion.

The NBS said this in Foreign Trade in Goods Statistics for Fourth Quarter of 2018 posted on its website.

The bureau said the volume of total merchandise trade in 2018 was the highest recorded since 2014, nearly double pre-recession levels.

The Bureau said during the fourth quarter of 2018, total merchandise trade stood at N8.60 trillion compared to its value of N9.06 trillion recorded in third quarter of the year.

It said the total export component of the trade recorded at N5.02 trillion, represented an increase of 3.5 per cent over third quarter 2018 and 28.5 percent over fourth quarter 2017.

African cities become the new home to over 40,000 people every day, many of whom find themselves without a roof over their heads. With that in mind, IFC has committed to do more to develop the property sector, both to provide new and affordable housing and to encourage an industry that requires significant building materials and has the potential to be a major employer. In May, IFC and Chinese multinational construction and engineering company, CITIC Construction launched a $300 million investment platform, CITICC (Africa) Holding Limited, to develop affordable housing in multiple African countries. The platform will partner with local housing developers and provide long-term capital to develop 30,000 homes over next five years. IFC estimates that each housing unit will create five full-time jobs – resulting in nearly 150,000 new jobs on the continent. Kenya and Nigeria are high on the priority list for the new effort. Kenya’s housing shortage is estimated at 2 million units, while Nigeria is in want of 17 million units. The soaring demand is being met by scant new supply. Africa’s housing market has few local developers with the technical and financial strength to construct large-scale projects. The IFC-CITIC Construction platform will work with local housing companies to develop affordable housing projects across Sub-Saharan Africa, each ranging in size from 2,000 to 8,000 units. CITIC Construction has a proven track record in constructing and delivering large scale housing projects. The platform will start by developing homes in Kenya, Rwanda and Nigeria, expanding to other countries as operations ramp up. “In Angola, through planning, financing, construction and post-construction operation, CITIC Construction has successfully completed the 200,000 units housing program, new city of Kilamba Kiaxi, with relative infrastructure and utilities in four years. CITIC Construction has also founded the CITIC BN Vocational School in Angola which helps youth acquire the skills they need to become professionals”, said Hong Bo, Assistant President of CITIC Group and Chairwoman of CITIC Construction, “CITIC Construction will take advantage of our engineering experience and delivery capability to develop more affordable houses for Africa through the platform with IFC.” “As Sub-Saharan Africa become more urbanized, the private sector can help governments meet the critical need for housing”, said Oumar Seydi, IFC Director for Eastern and Southern Africa. “The platform will help transform Africa’s housing markets by providing high quality, affordable homes, creating jobs, and demonstrating the viability of the sector to local developers. IFC will work with financial institutions to support mortgages and housing finance that will allow people to purchase the units.” The new housing units will be constructed in accordance to IFC’s green building standards, delivering homes that are environmentally friendly and sustainable. The World Bank Group estimates that by 2030, three billion people, or 40 percent of the world’s population will need new housing units. To date, IFC has invested more than $3 billion in housing finance in over 46 countries world-wide. IFC focuses on regions where large portions of the population live in sub-standard housing and have limited access to credit to build, expand, or renovate their homes.

Meanwhile, the bureau said the import component stood at N3.58 trillion in fourth quarters 2018.

The figure showed a drop of N631.6 billion or 15.0 per cent compared to third quarter, 2018 but an increase of 69.6 percent when compared with the corresponding quarter in 2017.

However, it said the increase in export value and decrease in import value (relative to third quarter 2018) resulted in a favourable trade balance of N1441 billion, or 125.5 per cent over the preceding quarter.

According to the report, crude oil export has been the main stay of the economy, accounting for the largest share of total exports (84.2 per cent) in the fourth quarter of 2018 at N4.228 billion.

Non-oil products accounted for 4.6 per cent of total exports while other oil products accounted for 11.2 per cent of total exports in the quarter under review.

 

Source: DailyTrust

home

Affordable Housing in Africa

Rapid urbanization is pushing up demand for housing in Sub-Saharan Africa.

African cities become the new home to over 40,000 people every day, many of whom find themselves without a roof over their heads.

With that in mind, IFC has committed to do more to develop the property sector, both to provide new and affordable housing and to encourage an industry that requires significant building materials and has the potential to be a major employer.

In May, IFC and Chinese multinational construction and engineering company, CITIC Construction launched a $300 million investment platform, CITICC (Africa) Holding Limited, to develop affordable housing in multiple African countries.

African cities become the new home to over 40,000 people every day, many of whom find themselves without a roof over their heads. With that in mind, IFC has committed to do more to develop the property sector, both to provide new and affordable housing and to encourage an industry that requires significant building materials and has the potential to be a major employer. In May, IFC and Chinese multinational construction and engineering company, CITIC Construction launched a $300 million investment platform, CITICC (Africa) Holding Limited, to develop affordable housing in multiple African countries. The platform will partner with local housing developers and provide long-term capital to develop 30,000 homes over next five years. IFC estimates that each housing unit will create five full-time jobs – resulting in nearly 150,000 new jobs on the continent. Kenya and Nigeria are high on the priority list for the new effort. Kenya’s housing shortage is estimated at 2 million units, while Nigeria is in want of 17 million units. The soaring demand is being met by scant new supply. Africa’s housing market has few local developers with the technical and financial strength to construct large-scale projects. The IFC-CITIC Construction platform will work with local housing companies to develop affordable housing projects across Sub-Saharan Africa, each ranging in size from 2,000 to 8,000 units. CITIC Construction has a proven track record in constructing and delivering large scale housing projects. The platform will start by developing homes in Kenya, Rwanda and Nigeria, expanding to other countries as operations ramp up. “In Angola, through planning, financing, construction and post-construction operation, CITIC Construction has successfully completed the 200,000 units housing program, new city of Kilamba Kiaxi, with relative infrastructure and utilities in four years. CITIC Construction has also founded the CITIC BN Vocational School in Angola which helps youth acquire the skills they need to become professionals”, said Hong Bo, Assistant President of CITIC Group and Chairwoman of CITIC Construction, “CITIC Construction will take advantage of our engineering experience and delivery capability to develop more affordable houses for Africa through the platform with IFC.” “As Sub-Saharan Africa become more urbanized, the private sector can help governments meet the critical need for housing”, said Oumar Seydi, IFC Director for Eastern and Southern Africa. “The platform will help transform Africa’s housing markets by providing high quality, affordable homes, creating jobs, and demonstrating the viability of the sector to local developers. IFC will work with financial institutions to support mortgages and housing finance that will allow people to purchase the units.” The new housing units will be constructed in accordance to IFC’s green building standards, delivering homes that are environmentally friendly and sustainable. The World Bank Group estimates that by 2030, three billion people, or 40 percent of the world’s population will need new housing units. To date, IFC has invested more than $3 billion in housing finance in over 46 countries world-wide. IFC focuses on regions where large portions of the population live in sub-standard housing and have limited access to credit to build, expand, or renovate their homes.

The platform will partner with local housing developers and provide long-term capital to develop 30,000 homes over next five years. IFC estimates that each housing unit will create five full-time jobs – resulting in nearly 150,000 new jobs on the continent.

Kenya and Nigeria are high on the priority list for the new effort. Kenya’s housing shortage is estimated at 2 million units, while Nigeria is in want of 17 million units. The soaring demand is being met by scant new supply. Africa’s housing market has few local developers with the technical and financial strength to construct large-scale projects.

The IFC-CITIC Construction platform will work with local housing companies to develop affordable housing projects across Sub-Saharan Africa, each ranging in size from 2,000 to 8,000 units.

CITIC Construction has a proven track record in constructing and delivering large scale housing projects. The platform will start by developing homes in Kenya, Rwanda and Nigeria, expanding to other countries as operations ramp up.

“In Angola, through planning, financing, construction and post-construction operation, CITIC Construction has successfully completed the 200,000 units housing program, new city of Kilamba Kiaxi, with relative infrastructure and utilities in four years.

CITIC Construction has also founded the CITIC BN Vocational School in Angola which helps youth acquire the skills they need to become professionals”, said Hong Bo, Assistant President of CITIC Group and Chairwoman of CITIC Construction, “CITIC Construction will take advantage of our engineering experience and delivery capability to develop more affordable houses for Africa through the platform with IFC.”

“As Sub-Saharan Africa become more urbanized, the private sector can help governments meet the critical need for housing”, said Oumar Seydi, IFC Director for Eastern and Southern Africa.

“The platform will help transform Africa’s housing markets by providing high quality, affordable homes, creating jobs, and demonstrating the viability of the sector to local developers.

IFC will work with financial institutions to support mortgages and housing finance that will allow people to purchase the units.”

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The new housing units will be constructed in accordance to IFC’s green building standards, delivering homes that are environmentally friendly and sustainable.

The World Bank Group estimates that by 2030, three billion people, or 40 percent of the world’s population will need new housing units.

To date, IFC has invested more than $3 billion in housing finance in over 46 countries world-wide.

IFC focuses on regions where large portions of the population live in sub-standard housing and have limited access to credit to build, expand, or renovate their homes.

 

Source: ifc.org

mike-pompeo

U.S. congratulates Buhari, Nigeria

The U. S. has congratulated Nigeria on its successful presidential election and President Muhammadu Buhari on his re-election.

U.S. Secretary of State Michael Pompeo, in a statement, noted the assessments of international and domestic observer missions affirming the overall credibility of the election.

Pompeo said the United States’ assessment was  “in spite of localized violence and irregularities”.

He called on all Nigerians to ensure successful Gubernatorial and House of Assembly elections on March 9.

Pompeo said: “The United States congratulates the people of Nigeria on a successful presidential election and President Muhammadu Buhari on his re-election.
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“We commend all those Nigerians who participated peacefully in the election and condemn those whose acts of violence harmed Nigerians and the electoral process.

“We note the assessments of international and domestic observer missions affirming the overall credibility of the election, despite localised violence and irregularities.

“We also congratulate all the other candidates for their peaceful participation in the electoral process.

“We call on all Nigerians to ensure successful state elections next week.

“Going forward, the United States remains committed to working together with Nigeria to achieve greater peace and prosperity for both our nations”.

Exhibit

The presidential election, held on February 23 saw Buhari poll 15,191,847 votes and his closest challenger, People’s Democratic Party’s candidate and former Vice President Atiku Abubakar polled 11,255,978 votes to emerge a runner-up.

Buhari, who was declared re-elected by the Independent National Electoral Commission, also won in 19 states, to defeat other 72 candidates including Atiku, who won 17 states and the Federal Capital Territory, to occupy the second position. (NAN)

Source: Daily Trust

CBN

MFBs contemplate on the N10bn national licence ahead of CBN’s new capital requirement

Ahead of the full implementation of the new capital requirement for Microfinance Banks (MFBs) next year, the National Association of Microfinance Banks (NAMB) is planning to float a National MFB licence with N10 billion capital base.

The move is to absorb those MFBs who may not meet the new capital requirement announced by the Central Bank of Nigeria (CBN).

“As soon as we set up the National MFB, we will list it on the Nigerian Stock Exchange (NSE) before the end of the year,” Rogers Nwoke, president of NAMB, told BusinessDay exclusively.

Nwoke said his team was at the NSE last week for a closing bell ceremony where he discussed with the Exchange on how the members of NAMB could come to the market.

But the move by NAMB may also have been informed by the plan by the CBN and the Bankers Committee to establish a National MFB across the 774 local government areas of the country using Nigerian Postal Service (NIPOST) facilities.

According to the National MFB establishment plan by the CBN and the Bankers Committee, the two bodies will utilise the sum of N5 billion as equity from N60 billion Agri-Business Small and Medium Enterprises Investment Scheme (AGSMEIS) Fund, while NIPOST will contribute its offices across the country.

The CBN in October 2018 increased the minimum capital requirements for Unit microfinance banks from N20 million to N200 million, State MFBs from N100 million to N1 billion, and National MFBs from N2 billion to N5 billion.

The new minimum capital requirement was to take immediate effect for new applications while existing microfinance banks were required to fully comply with effect from April 1, 2020, according to CBN’s directive.

But MFB operators have been raising concern over the new capital requirement, saying it would be difficult if not impossible for many MFBs to meet.

Nwoke told BusinessDay that the existing 886 microfinance banks operating in the country have a capital base of N93 billion.

When contacted, Tokunbo Martins, director, Other Financial Institutions (OFIs) department, CBN, described the move by NAMB as “fantastic”.

Microfinance bank operators had protested the increase in their capital requirement and had written to the CBN for review of the new capital base and extension of deadline.

“We have taken all their requests on board and we are going to look at it,” Martins said.
The CBN had directed that to meet the new capital requirements, existing microfinance banks are expected to explore the possibility of mergers and acquisitions and/or direct injection of funds.

Also, the regulators said the Revised Regulatory and Supervisory Guidelines for Microfinance Banks, Code of Corporate Governance for Microfinance Banks and sector-specific Prudential Guidelines for Microfinance Banks would be issued in due course.

Institutions that meet the capital requirements as well as demonstrate the existence of strong corporate governance in their operations, the apex bank said, would be allowed to open account at the CBN office within their state of operation. Such institutions would also be channels for micro funding activities of the CBN and the Development Bank of Nigeria.

 

Source: Business Day

 

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Dangote Cement maintains market dominance, exports 0.8MT of cement

Africa’s largest cement producer, Dangote Cement, has maintained its dominance of the Nigerian market, accounting for 65 per cent of the total volume sold in the domestic cement sector in 2018.

The company also exported 800,000 metric tonnes (MT) of cement to West African countries in 2018, strengthening Nigeria’s position as a cement exporting country, creating jobs in the economy, and earning foreign exchange.

According to the details of Dangote Cement’s audited results for the year ended December, 31, 2018, it sold a total of 23.54 MT of cement across Africa indicating an increase of 7.4 per cent over 21.92 MT sold in 2017.

Nigerian operations accounted for 14.18 MT representing an increase of 11.4 per cent over the volume of 12.72 metric tonnes sold during the preceding year. The increase in the Nigerian volume is attributable to higher building activities as the economy recovered from recession.

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The sales volume in Nigeria is quite significant given the turbulent market situation as the election period approached and people usually hedged in the construction industry during such periods.

According to the Group Chief Executive Officer, Dangote Cement, Joe Makoju, financial performance by Dangote Cement was “driven by a strong increase in our home market, Nigeria, despite heavy rains and uncertainties about the election. Although Pan-African volumes were unchanged in 2018.

“I am confident that we will see an increase in 2019, driven by higher volumes in Tanzania, Ethiopia, Congo and Sierra Leone. Now that we have gas turbines operating in Tanzania, we will also see increased profitability in the Pan-Africa region and this will help to improve overall Group margins,” he said.Exhibit

 

Across Africa, the cement Group posted a combined revenue of N901.21 billion, with Nigerian operations doing N618.30 billion, representing an increase of 11.9 per cent over N552.36 billion in 2017. The Nigerian economy was earlier projected to have grown by 1.9 per cent in 2017, meaning that Dangote Cement outperformed the domestic economy.

Pan-African operations recorded revenues of N263.26 billion, an increase of 9.6 per cent over N258.44 billion posted in the corresponding period in 2017. Profit after tax stood at N390.32 billion in contrast to N204.25 billion while earnings per share rose from N11.65 to N22.83.

The company’s directors are proposing a dividend of N16 per share.

Implications of Buhari’s Victory on Nigeria’s Economy by Coronation Research

The announcement of the 2019 election results saw the All Progressives Congress (APC) of President Muhammadu Buhari retain the presidency, defeating the challenge from the Peoples Democratic Party (PDP) of Atiku Abubakar.

This implies a continuation of government based on firm regulation and security. However, while Buhari’s first term sailed into the oil price crash of 2015 and the recession of 2016, economic conditions are different – arguably better – now.The APC’s renewed majority in the Senate is significant. The Senate proved frustrating to Buhari’s agenda in his first term, 2015-19. Expect the budget to be passed quickly this year.

Click here to watch weekly episodes of Housing Development Programme on AIT

Foreign currency

Nigeria will almost certainly continue with a managed exchange rate. As we argue in Coronation Research: Year Ahead 2019, A Year of Two Halves, 15 January, the Naira is within 10% of its fair value, so fundamental pressure to revalue it is weak. FX reserves are US$42.4bn, which we calculate is compatible with Naira/US$ stability, at close to NGN363/US$1, for the rest of 2019.

Interest rates

The Central Bank of Nigeria (CBN) currently offers a risk-free-rate 587bps above inflation, which keeps foreign investors in Naira money markets. As we argued in January, if inflation trends down mid-year, there may be scope for rate cuts in Q4, or even Q3.

Equity market

There was a brief pre-election rally, which partly unwound last week. High economic growth rates were not a feature of the last APC administration. That said, the trend in non-oil GDP growth, evident in recent data, suggests that the economy is doing better than earlier thought. As we argued in January, we believe that under such conditions there is upside risk in bank stocks.

Political implications

The international context. Last Saturday’s elections proceeded, for the most part, without violence, and the Independent National Electoral Commission (INEC) went about its business in a businesslike way (albeit after a one-week delay). These facts are likely to be seen with relief by the international community.

Inevitably, there are allegations of irregularities. However, in the African context of a highly contentious electoral outcome in the Democratic Republic of Congo late last year, and hotly-contested elections in South Africa due later this year, Nigeria looks stable and orderly (though perhaps not quite as hopeful as Ethiopia after the election of a youthful and reforming Prime Minister last year).

At the same time, the political picture in Nigeria is not entirely settled. There are still governorship and state assembly elections to be held on 9 March, and in some of Nigeria’s 36 states we expect these to be hotly-contested.

The domestic context

A feature of President Buhari’s first term was conflict between the President and the Senate. Despite the APC having a majority in the Senate, it was a Senator with opposition sympathies (he later defected to the PDP) who held the Senate presidency.

Friction between the executive and legislative arms of government was a recurring theme during President Muhammadu Buhari’s first administration, 2015-19. The President depended, more than the previous administration, on executive orders where possible. The most serious example of his conflict with the legislature came with the six-month delay in the passage of the 2018 budget, which represented the longest ratification cycle for any full-year budget since 2000. The President presented the budget bill on 7 November 2017 and the act was not signed into law until 16 May 2018.

The Senate President, 2015-19, has now lost his Senate seat. The APC has a simple majority in the Senate which implies that it will be able to elect a Senate President. However, at this stage, with not all the Senate elections declared, it is unclear exactly how strong the APC position in the Senate, and the House of Representatives, will be. On balance, however, it looks as though the President may have an easier relationship with the legislature than during the period 2015-19.

Economy and unemployment

A feature of President Muhammadu Buhari’s first term as President was weak economic growth, 2015-18. GDP developed well below trend and fell into recession in 2016. One key cause was the oil price collapse in late 2014 and 2015 which put pressure on: government revenues; the Naira exchange rate; the trade account; and Nigeria’s ability to import critical industrial inputs.

Low growth has been associated with rising unemployment, which not only took off in 2015 and 2016, as the economy slowed and went into recession, but continued to rise during the weak recovery that followed.

The administration’s policy emphasis during this period was on: security; the fight against corruption; tax compliance; and tight regulation, which included exchange controls. Agriculture (25% of GDP) was supported with subsidized fertilizer and soft loans, and never went into recession; and an Economic Recovery and Growth Plan was enacted. One can argue that, after Naira devaluations in 2016 and 2017, the worst is behind us.

Economic growth – the green shoots

Although 2018 GDP growth, at 1.93% y/y, was slow, there are a number of positive items in the data. Non-oil growth is accelerating and reached 2.70% y/y in Q4 2018, compared with the overall growth rate of 2.38% y/y. Of the six largest sectors in the economy, Agriculture, Trade, Manufacturing and Telecoms have all recorded at least two consecutive quarters of growth.

External shocks characterised the years 2015-18: oil price shocks (2015), followed by a rise in US rates (2018). In forecasting US$58.00/bbl average oil prices for 2019 we demonstrate how the world has adjusted to new realities.

If external shocks in the coming period 2019-23 are not as great as those during 2015-19, then the nascent economic recovery might give this administration an opportunity to address pressing domestic issues. These include the insurgency in the North East, the herdsmen crisis in the Middle Belt, and disruption in the Niger Delta. Economic growth is a better platform for politics than recession.

Interest rates

Following the Naira/US dollar devaluations in 2016 and 2017, average annual domestic inflation increased from 9.00% y/y in 2015 to 16.55% at the end of 2017. The job of the Central Bank of Nigeria (CBN) was to both stabilize the currency – and the exchange rate has been broadly stable since August 2017 – and to bring down inflation. Early in 2018 the CBN began to win the battle against inflation and so it brought down the risk-free rate, which it sets with its open market operations (OMO).

Later in the year the Monetary Policy Committee (MPC) of the CBN began to express concern about the level of foreign investor participation in Nigeria’s fixed income markets and the danger posed to foreign exchange reserves if those investors left. Soon afterwards (in August) the CBN began to raise the risk-free rate so that foreign investors would continue to invest in OMO bills and T-bills. This policy has succeeded, in our view, in keeping foreign exchange reserves high (currently US$42.4bn) and the currency stable.

On the other hand, a risk-free rate 587bps above inflation might seem excessive in the context of domestic growth. And a slightly lower spread over inflation might be judged possible when it comes to attracting Foreign Portfolio Investment (FPI). Therefore, if inflation trends down towards 10% y/y towards the middle of this year (the CBN’s target range is 6% – 9%), then we may see interest rate cuts. These could appear in Q4 2019, less likely in Q3.

Source: Fakoyejo Olalekan/Nairametircs

NBS: Nigerian economy attract $43bn investments in four years

Between January 2015 and December 2018, the Nigerian economy attracted a total investment of $43.81bn, investigations have revealed

Based on the official N305 to a dollar exchange rate of the Central Bank of Nigeria, the $43.81bn translates into about N13.36tn

Documents of the country’s investment inflows obtained from the National Bureau of Statistics revealed that the investment came from three main sources.

They were Foreign Direct Investments made up of equity and other capital; Portfolio investment which comprised equity, bond and money market instruments; and other investments which were made up of trade credits, loans, currency deposit and other claims.

Further analysis of the report showed that Nigeria’s foreign exchange policy, the Economic Recovery and Growth Plan and the economic recession witnessed in 2016 largely shaped capital importation over the period.

For instance, investigations showed that prior to the economic recession of 2015, the level of investment inflows was at an upward trajectory.

However, at the onset of the economic crisis few months after the inauguration of President Muhammadu Buhari, findings showed that investment inflow recorded a sharp decline to almost half of the 2014 value of $20.76bn dropping to $9.65bn in 2015.

Further analysis of the report revealed that in 2016, the value of investment inflow remained depressed, decreasing by $4.55bn from $9.65bn in 2015 to $5.1bn.

It, however, noted that a recovery began in 2017, as investors raised their stake by $7.1bn to $12.2bn.

In the 2018 fiscal period, the country attracted about $16.81bn investment, the NBS data showed.

In 2018, the largest amount of investment inflow by type was received through portfolio investment, which accounted for $11.8bn or 70.20 per cent.

This was followed by other investment, which accounted for $3.81bn or 22.69 per cent of total capital, while Foreign Direct Investment had $1.19bn or 7.11 per cent of total capital imported in 2018.

In terms of destination, the report stated that the United Kingdom emerged as the top source of capital investment in Nigeria in 2018 with $6bn. This, it noted, accounted for 35.74 per cent of the total capital inflow in 2018.

This was followed by the United States with $3.57bn;  South Africa, $1.15bn; the United Arab Emirates, $937.19m;  Belgium, $886.08m; and Singapore, $780.87m.

Others were Ghana, $626.44m; Mauritius, $560.87m; The Netherlands, $373.08m; and Switzerland, $355.98m.

The Executive Secretary, Nigeria Investment Promotion Commission, Yewande Sadiku,  had said that the government was committed to attracting fresh investments in key sectors of the economy.

Sadiku said the commission now had a seamless collaboration with the states to enable it to monitor closely investments inflow into the country, as a one-stop centre.

She said the commission was working with key stakeholders to see more Nigerians invest in the country, adding that the current efforts of the NIPC in working more closely with the states was to increase the level of investment inflow into the country and to ensure seamless collaboration and proper tracking.

She said, “We are interested in seeing more Nigerians invest in the country, and we have a Domestic Direct Investment model now in the commission and we are working with the National Bureau of Statistics to track investments inflow into the country.”

“The current efforts of the NIPC in working more closely with the states is to increase the level of investment inflow into the country, and to ensure seamless collaboration and proper tracking.”

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Nigeria losses about $1.5billion on election postponement

Lagos Chamber of Commerce and Industry (LCCI) has stated that the postponement of the Presidential election by INEC cost the nation no less than $1.2billion loss owing to the disruption of activities across the states.
Independent National Electoral Commission (INEC) postponed the general elections a few hours to the commencement.The elections scheduled to commence Saturday, February 16 with the presidential and National Assembly elections, will be held February 23. Governorship and state houses of assembly elections will take place on March 9.

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The Director General of the Chamber, Muda Yusuf in a chat with The Guardian noted that several activities were disrupted as a result of the postponement adding that a slowdown should be expected in the days ahead till the elections are conducted.

Yusuf stated that many SMEs’ activities were affected; the airports and seaports were shut down while many people have had to move from one location to another.

He noted that the impact of the loss will be felt across the sectors of the economy, especially for activities scheduled for February 23rd, the new date for the elections.

Source: TheGuardian
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