NAIJAFEED: Economy

Showing posts with label Economy. Show all posts

Tuesday, April 23, 2024

Video - Tade unions in Nigeria want 500 U.S. dollar-per-month minimum wage for workers

Union leaders say the adjustment is necessary to help workers cope with the rising cost of living in the country.

Nigeria seeking up to $2.25 bln in World Bank loans

Nigeria is seeking up to $2.25 billion in World Bank loans and expects the bank's board to approve the request in June, the government said in a statement following the IMF/World Bank spring meetings in Washington, D.C.

Nigeria also aims to issue diaspora bonds later this year to attract much-need foreign exchange into the country, Finance Minister Wale Edun said in the statement.

The World Bank loans would comprise $1.5 billion in development policy financing and $750 million in programme-for-results financing, the statement said, adding the bank would meet in June to consider final approval of the package.

The World Bank did not immediately comment on the statement.

Nigeria, typically Africa's largest oil exporter, has faced a shortage of foreign exchange that pushed its naira currency to record lows versus the U.S. dollar this year, though it has since rebounded.

President Bola Tinubu also inherited an economy saddled with record debt, high unemployment and large central bank financing, though Edun, in an interview with Reuters last week, said the government had halved federal borrowing from the central bank.

By Maxwell Akalaare Adombila, Reuters

Thursday, April 18, 2024

Heineken Shuts Down Two Plants in Nigeria

Beer-manufacturer Nigerian Breweries will shut down two of its nine manufacturing plants in Nigeria due to the harsh economic situation in the country, the company said in a note to the Nigerian Exchange Limited on Thursday.

Police makers at the company deemed the decision necessary due to operational concerns which was massively impacted by record foreign exchange loss up to the tune of N153.3 billion last year.

It’s the Nigerian subsidiary of Heineken Brouwerijen B.V’s highest foreign exchange loss in the company’s history since it began operations in Nigeria 77 years ago.

The company said it recognised how the closure of the two plants would affect workers in the affected locations. But he said the company was committed to reduce the effect of the situation by providing severance packages to the affected employees.

“We recognise and regret the impact that the suspension of brewery operations in the two affected locations may have on our employees,” said Hans Essaadi, the managing director of the company.

He added, “We are committed to limiting the impact on people as far as possible and providing strong support and severance packages to all affected.”

The decision will help the company to retain 15 per cent capacity expansion over the past decade as well as reduce costs of production, Bloomberg Africa reported.

By Victor Olorunfemi, Peoples Gazette

Video - Nigeria advocates for increased patronage of locally manufactured goods

Wednesday, April 10, 2024

Video - Nigeria advocates for increased patronage of locally manufactured goods

In a bid to alleviate the country's over-dependence on imports, which has contributed to the devaluation of the Naira against the U.S. dollar, the Nigerian government is championing the consumption of domestically produced goods. However, this initiative faces challenges, with the Manufacturers Association of Nigeria citing the closure of over 700 companies and distress among 300 others due to various hurdles.

CGTN

Monday, April 1, 2024

Video - Nigeria manufacturing sector braces for higher production cost

The decision by Nigeria’s central bank to raise the policy rate affected the local manufacturing industry. Manufacturers said expensive credit will weaken the sector and impede economic growth. Annual inflation in the West African country is at over 30 percent, levels last seen in 1996.

CGTN

Video - Nigerian companies close due to economic volatility

Wednesday, March 27, 2024

Naira gains on spot market after central bank rate hike

Nigeria's naira rose to a five-week high against the dollar in intraday trading on Wednesday, a day after the central bank hiked interest rates to tame inflation and lifted restrictions on foreign investors participating in its fixed-income auctions.

The currency rose to 1,200 per dollar on the official market, LSEG data showed, strengthening above the parallel market levels at about 1,340.

Africa's largest economy has been grappling with dollar shortages that pushed its currency to a record low of 1,851 per dollar last month, though central bank Governor Olayemi Cardoso has said that dollar liquidity is improving.

Last week, Nigeria's central bank said it had cleared all of its verified foreign exchange backlog, part of its strategy to stabilise the naira and tame soaring inflation.

The central bank on Tuesday raised its monetary policy rate 200 basis points to 24.75% from 22.75%, a month after its largest hike in around 17 years.

The central bank paid 26.6% for the one-year Treasury bill at its last auction two weeks ago, but investors at Wednesday's auction expect yields to rise above secondary market quotes of around 22.75% for the one-year bill and around 20.6% for the benchmark 10-year note.

Goldman Sachs analysts Andrew Matheny and Bojosi Morule said the central bank's further rate hike and "the emphasis on improving monetary transmission mechanism by mopping up liquidity will help to rebuild policy credibility", boosting Treasury bill yields to about 28% to 29%.

In the past, lenders faced constraints in fulfilling foreign investors' bids as they incurred extra costs on settlement day if they borrowed from the central bank's discount window to pay for bills.

Foreign investors can now pre-fund their accounts and get naira at the prevailing exchange rate for the auctions, analysts said.

"With this policy mix and with more inflows likely, including a Eurobond, we remain constructive on the naira, with our forex strategists forecasting an appreciation to 1,200 versus the dollar over the next 12 months," Matheny and Morule wrote in a research note to clients on Wednesday.

The central bank hopes the auctions can attract sufficient foreign interest to boost dollar liquidity.
Tellimer economist Patrick Curran said that "while forex liquidity has improved, it is still well below pre-pandemic levels and a boost in dollar supply will be needed to support further naira appreciation."

By Chijioke Ohuocha and Elisha Bala-Gbogbo, Reuters

Monday, March 25, 2024

Video - Nigeria food banks cut back on handouts as prices soar

At a warehouse in Nigeria's commercial capital Lagos, dozens of women patiently wait their turn to receive food handouts. Among them is 68-year-old widow Damilola Salami, who received an invitation to the facility just as she had almost run out of food.

The Lagos Food Bank is a crucial lifeline to residents like Salami, but has seen supplies from private and other donors fall as inflation soars in Africa's biggest economy.

Nigeria is grappling with the worst cost of living crisis in decades, which has deepened since President Bola Tinubu rolled out bold but unpopular economic reforms after assuming office last May.

"There is nothing for us to eat, we are hungry," said Salami as she waited for her share of food and cooking oil. "Our children are out of school because of the increase in fees. Now, the children are at home and there is no food."

Mabel Wade, an 80-year-old charcoal seller, said sustenance was scarce and she often relied on neighbours before she was told of the food bank.

"Sometimes there is no food to eat at all... Sometimes, it is biscuit and water," she said, after registering for food stamps.

Last month a stampede broke out and killed seven people at a food distribution centre in Lagos.
World Bank data shows that 46% of Nigeria's population was deemed poor in 2023. Twenty million of them live in urban areas.

In the past, the imposing warehouse of Lagos Food Bank would be fully stocked with bags of Nigerian staples like rice, beans and vegetable oil. Not anymore.

Founder Michael Sunbola said the facility's major donor had cut supplies by 93%, citing the high cost of food.

The food bank has now dialled back on quantities, providing families with enough supplies for a few days at a time when once their parcels would have lasted two weeks. The facility is also having to "narrow down the number of people we want to reach out to", said Sunbola of the people invited to use the service.

"Now, we do only women from the age of 50," he told Reuters.

No Hunger Initiatives, a food bank serving mostly internally displaced people in the capital Abuja, faces similar problems.

The number of people seeking food handouts has tripled since May 2023 but the facility is unable to keep up because donors have cut back supplies by half due to rising inflation, said Kumdet Yilkon, a senior official.

By Ope Adetayo, Reuters

Video - Impact of rising food prices in Nigeria on Ramadan

Video - Nigeria secures $134 million to tackle food crisis

Video - Rising Food Prices spark protests and smuggling in Nigeria

Video - Car dealers in Nigeria say country's economic woes hurt their business

According to data released by the National Bureau of Statistics, Nigeria registered a significant increase in used-vehicle imports last year. However, dealers say the growth could be even stronger if not for a crippling cost-of-living crisis and falling local currency.

CGTN

Protests in Nigeria over skyrocketing inflation as local currency hits record low value

Video - Why Are Multinationals Like P&G, GSK and Sanofi Leaving Nigeria?

Thursday, March 14, 2024

Video - Impact of rising food prices in Nigeria on Ramadan

As the holy month of Ramadan continues, Muslims in Nigeria are grappling with the issue of high living costs. There are concerns that they may have to reduce expenses due to the growing inflationary pressures.

CGTN

Video - Bakers in Nigeria threaten shutdown amidst rising production costs

Video - Rising Food Prices spark protests and smuggling in Nigeria

Tuesday, March 12, 2024

Video - Nigeria secures $134 million to tackle food crisis

The facility from the African Development Bank will be used to grow essential crops such as rice, maize, cassava, and soybeans. It's part of the Nigerian government's effort to tackle the nation's deepening food crisis. About 8 percent of Nigerians are food insecure, according to the International Monetary Fund.

CGTN

Video - Rising Food Prices spark protests and smuggling in Nigeria

Video - Nigerian companies close due to economic volatility

The Manufacturers Association of Nigeria says as many as 700 companies shut down in the country in 2023. The group blames the closures on various economic difficulties, including exchange rate volatility, rising inflation, and a general worsening of the investment climate.

CGTN

Nigeria tightens security as food theft continues amid soaring inflation

Video - Bakers in Nigeria threaten shutdown amidst rising production costs

People turn to 'throw-away' rice for food in Nigeria due to high rise in cost of living

As the rising cost of living continues to bite, many in northern Nigeria are turning to rice grains that millers normally reject after processing or sell to farmers to feed their fish.

These are referred to in the Hausa language, widely spoken in the north, as afafata, which means "battling" because they are literally a battle to cook and eat as the grains are so hard.

"A few years ago, people didn't care about this type of rice, and we usually threw it away along with the rice hulls, but times have changed," Isah Hamisu, a rice mill worker in the northern city of Kano, told the BBC.

Despite the grains being broken, dirty and tough, afafata's cheaper price has made it more attractive for humans and helped poorer families to be able to afford to eat one of the staple foods in the country.

Fish farm owner Fatima Abdullahi said her fish love it but because people are now eating afafata, its price has risen.

Prices in Nigeria are increasing at their fastest rate for nearly 30 years. On top of global pressures, President Bola Tinubu's cancellation of the fuel subsidy plus the devaluation of the currency, the naira, have added to inflation.

A standard 50kg (110lb) bag of rice, which could help feed a household of between eight and 10 for about a month, now costs 77,000 naira ($53; £41). This is an increase of more than 70% since the middle of last year and exceeds the monthly income of a majority of Nigerians.

In the face of this many are struggling to cope and in some states there have been cost-of-living protests.

Earlier this month in Niger state, central Nigeria, protesters blocked roads and held placards saying that they were being suffocated by the rising prices.

A few days later there was a similar demonstration in Kano in the north-west. In the aftermath, Governor Alhaji Abba Kabir Yusuf admitted there was starvation in his state and said a solution must be found.

The solution, for now, for some is found in afafata.

Hajiya Rabi Isah, based in Kano state, told the BBC that if it were not for this type of rice her children would go hungry as she cannot afford the normal kind.

"Normal rice is 4,000 naira ($2.70) per bowl which is beyond my means, I can only afford afafata which is 2,500 naira ($1.69) now," she said. One bowl of rice from the market can feed an average family in Kano for a day.

"Without afafata, feeding my family would be a major issue for me."

Market sellers have also noticed a difference.

Saminu Uba, who works in Kano's Medile market, said the afafata side of his business is booming.

"Most people can no longer afford normal rice and they come for this which is cheaper even though it tastes less good," he told the BBC.

One of his customers, Hashimu Dahiru, admits people are having to find ways of adapting.

"The cost of goods is alarming - in just two months the price of everything has doubled,'' he said.

"Our wives spend hours removing stones and dirt from the rice before cooking and even then it ends up tasting not nice, but we have to eat to survive."

The presidency has said it is doing all it can about the situation, including the distribution of more than 100 tonnes of grains such as rice, millet and maize in the hope that it would cushion the effects of inflation and help lower the market price.

But the president's aide Bayo Onanuga upset many recently when he said that Nigeria still had one of the lowest costs of living in Africa.

The increasing price of rice is not a new problem though.

President Tinubu's predecessor, Muhammadu Buhari, banned the importation of rice to encourage more Nigerian farmers to grow the crop, but local producers have been unable to meet the demand.

Before then Nigerian markets were filled with rice from Thailand at an affordable price for many.

Mr Tinubu has lifted import restrictions, but now the shortage of foreign currency and the falling value of the naira has made bringing in rice trickier.

By Mansur Abubakar, BBC

Nigeria tightens security as food theft continues amid soaring inflation

Video - Rising Food Prices spark protests and smuggling in Nigeria

Thursday, March 7, 2024

Foreign Minister says Nigeria plans to join BRICS

Nigeria intends to seek membership in the BRICS organization after carrying out necessary measures within its state, according to Yusuf Tuggar, the Foreign Minister of Nigeria, who said this in an interview with RIA Novosti.

The head of Nigeria's Foreign Ministry arrived in Moscow for an official visit on Wednesday.

"We have this intention. As I've already mentioned, Nigeria has a democratic system with deliberative elements. Therefore, before taking such measures, we usually carry out active interaction with various interest groups and different internal bodies," said Tuggar.

The minister noted the significance of the presence of Nigeria's Vice President, Kashim Shettima, at the most recent BRICS summit in South Africa.

"We are extremely interested in this, and we look forward to this," stressed the Nigerian Foreign Minister.

Oreanda

Monday, March 4, 2024

Residents break into Abuja govt warehouse, steal food

Some residents of the Nigerian capital, Abuja, broke into a government warehouse in the city to loot food items.

The incident happened on Sunday morning, Daily Trust reports. It started around 7 a.m. and continued till about 9 a.m., residents told the newspaper.

Sunday’s incident happened amid the current economic crisis in the country which has seen the prices of goods and services increase by over 200 per cent without a corresponding increase in income.

The cost of living crisis was caused by the removal of subsidies on petrol and the floating of naira; policies justified by the government as necessary for the economy.

PREMIUM TIMES reported that the cost of living crisis has led to protests in several parts of Nigeria.

The warehouse looted by the Abuja residents on Sunday was also reportedly looted during the COVID-19 crisis in 2020.

The police, however, told Daily Trust that police officers had arrived at the scene and normalcy had been returned.

PREMIUM TIMES will provide more details of Sunday’s incident in subsequent reports.

By Popoola Ademola, Premium Times

Video - Rising Food Prices spark protests and smuggling in Nigeria

Nigeria tightens security as food theft continues amid soaring inflation

Nigeria's National Emergency Management Agency (NEMA) announced Sunday (Mar. 3rd) it was increasing security at its facilities, Amid increased cases of attacks on warehouses.

The Director General of NEMA has instructed Zonal Directors and Heads of Operations to strengthen security in and around the Agency’s offices and warehouses nationwide “to forestall any breaches”.

Africa's largest economy is also the continent's most populous country.

Nigerians are living through one of the west African nation's worst economic crises in years with inflation rising to nearly 30% and the consequences of monetary policies that have pushed the Naira to an all-time low against the dollar.

One of the nation's most powerful trade unions launched protests last week demanding immediate measures to quell hunger.

In a letter to the president, it notably called for the “Opening of all food storage silos across the country,” to ensure equitable distribution.

The decision by the National Management Agency comes after residents broke into a facility in the capital Abuja to steal food items including bags of maize.

The incident reportedly went on for hours.

Africa News

Video - Rising Food Prices spark protests and smuggling in Nigeria

Friday, March 1, 2024

Central Bank of Nigeria revokes licences of 4,173 exchange bureaus

Nigeria's central bank said on Friday it had revoked the licences of 4,173 exchange bureaus that failed to comply with its guidelines and directives, including rendering returns of transactions and payment of required renewal fees within the due period.

The central bank, which resumed dollar sales to exchange bureaus this week, outlawed street-trading of foreign exchange and raised minimum capital levels for exchange bureaus to at least 2 billion naira ($1.3 million) under new guidelines released on Feb. 23.

The moves are part of broader reforms to Nigeria's forex market which has been grappling with chronic foreign exchange shortages.

Central Bank of Nigeria (CBN) spokesperson Hakama Sidi Ali said the licences of the affected exchange bureaus were also revoked due to non-compliance with anti-money laundering and terrorism finance regulations.

"The CBN is revising the regulatory and supervisory guidelines for Bureau de Change operators. Compliance with the new requirements will be mandatory for all stakeholders in the sector when the revised guidelines become effective," Sidi Ali said in a central bank statement.

By Elisha Bala-Gbogbo, Reuters

Thursday, February 29, 2024

Video - Bakers in Nigeria threaten shutdown amidst rising production costs

Master bakers across the country contemplate shutting down operations due to escalating prices and excessive taxes. They want the government to bring down the cost of bread production and reduce import duties on baking materials and equipment.

CGTN

Video - Central bank of Nigeria raises interest rate to 22.75%

The interest rate hike is in response to surging inflation which has reached 29.9 percent. The rise in inflation is largely driven by fiscal deficits, rising food prices, a weakening naira, and the removal of a fuel subsidy.

CGTN

Wednesday, February 28, 2024

Video - Nigeria inflation hits high of 29.9%

Inflation in Nigeria soared to 29.9 percent in January, the highest mark in nearly 30 years. Food costs, which rose at an average rate of 35.4 percent in the same month, are the main driver of the rising cost of living.

CGTN

Nigeria unveils big rate hike as hardship prompts worker protests

Nigeria's central bank delivered its largest rate hike in absolute terms in around 17 years on Tuesday to tame soaring inflation, amid nationwide trade union protests over price rises that have left people struggling to meet their basic needs.

Central Bank of Nigeria Governor Olayemi Cardoso said the 4-percentage-point increase to 22.75% was needed as previous rate hikes had not cooled price pressures enough.

Inflation has reached almost 30%, its highest in almost three decades, driven by a steep fall in the naira currency , the removal of a fuel subsidy, fiscal deficits and conflict in food-producing parts of Africa's most populous nation and biggest economy.

Labour unions protesting on Tuesday said two of President Bola Tinubu's key reforms - allowing the naira to devalue twice in less than a year and scrapping the fuel subsidy - were making people's lives a misery.
"We are suffering in Nigeria. It was not like this before. There is real hunger," said fashion designer Surijadeen Idayat at a protest in the capital Abuja.

In a sign of the desperation, a deadly stampede broke out at a food distribution site on Friday, authorities said.

"This was not the situation a year ago. I have to cut down the number of meals in the family," said Ibrahim Mamuda, a 56-year-old resident of the northern city of Kano who said he has twelve children and that they are only eating one meal a day.

Tinubu has defended his bold but unpopular reforms, which he hopes will help him double Nigeria's growth rate to 6% annually from roughly 3% now.

In an effort to ease the pressure on vulnerable households, his government this week approved the resumption of direct cash transfers to those in need.

MAMMOTH HIKE

Tuesday's mammoth rate hike brings Nigeria closer to Ghana, which defaulted on its debts in 2022 and cut interest rates from 30% to 29% in January, and the insurgency-hit Democratic Republic of Congo, which has an interest rate of 25%.

Nigeria's international dollar bonds initially rose as much as 0.5 cents on the dollar as Cardoso spoke, before falling to again trade below their previous closing price.

Capital Economics analyst David Omojomolo said that Cardoso had "stepped up to the plate" by showing greater appetite to tackle Nigeria's inflation problem than the central bank had done previously.

But he said further inflation surprises or naira weakness could force another hike.

By Chijioke Ohuocha and Elisha Bala-Gbogbo, Reuters

Video - Nigeria vows to address rising cost of living amid protests