Connect with us

Markets

Nigeria Spends N3.4tn to Import Rice, Fish, Others Annually

Published

on

food storage
  • Nigeria Spends N3.4tn to Import Rice, Fish, Others Annually

Nigeria spends about N3.4tn annually on importation of four food items – rice, wheat, fish, and sugar – statistics obtained from the Central Bank of Nigeria have shown.

A document of the Federal Government also showed that the amount spent on importation by the country was expected to increase to N9.9tn in 2017 owing to slow economic recovery.

However, after recovery, it was projected that the country would begin to see a significant reduction in the level of importation from N9.9tn in 2017 to N9.34tn and N8.79tn in the 2018 and 2019 fiscal periods, respectively.

The Acting Director, Trade and Exchange Department, CBN, Mr. Woritka Gotring, said the huge preference for imported items especially rice, wheat, fish and sugar by many Nigerians if left unchecked could worsen the economic recession currently facing the country.

Gotring stated this while responding to questions from our correspondent shortly after delivering a lecture on challenges of foreign exchange management in Nigeria under economic recession.

He said the depletion in the country’s external reserves was largely caused by the huge demand for foreign exchange, adding that this was a major reason a lot of actions were taken in that direction by the apex bank in recent times.

Gotring said while the economy was going through tough times owing to the decline in foreign exchange inflows, the problem could be better managed with patronage of made in Nigeria products.

He said, “Foreign exchange rate is one of the most important means through which a country’s relative level of economic health is determined.

“The slump in global oil prices has hit Nigeria hard, plunging the country into recession. It is evident that the economy is going through tough times with declining inflows and continuous demand pressure for foreign exchange arising from high import bill.”

He said that it was the resilience of the informal sector that had been reducing the impact of the economic crisis on Nigerians.

He said if not for the resilience shown by the informal sector where a lot of people were engaged in various economic activities, it would have been difficult to manage the economic crisis.

He said despite the fact that a lot of people in the informal sector were employed in one form of economic activity or the other, the infrastructure gap in the country was limiting the potential of the sector.

In order to enable the country to conserve its foreign exchange, he called for policy consistency that would encourage capital flow and promote local production, fiscal discipline, the enhancement of local manufacturing capacity and import substitution.

Gotring also called for increased investment in agriculture, mining and solid minerals, and infrastructure in order to lower the cost of doing business.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Crude Oil

Crude Oil Pulled Back Despite Joe Biden Stimulus

Published

on

Oil 1

Crude Oil Pulled Back Despite Joe Biden Stimulus

Crude oil pulled back on Friday despite the $1.9 trillion stimulus package announced by U.S President-elect, Joe Biden.

Brent crude oil, against which Nigeria’s oil is priced, pulled back from $57.38 per barrel on Wednesday to $55.52 per barrel on Friday in spite of the huge stimulus package announced on Thursday.

On Thursday, OPEC, in its latest outlook for the year, said uncertainties remain high in 2021 with the number of COVID-19 new cases on the rise.

OPEC said, “Uncertainties remain high going forward with the main downside risks being issues related to COVID-19 containment measures and the impact of the pandemic on consumer behavior.”

“These will also include how many countries are adapting lockdown measures, and for how long. At the same time, quicker vaccination plans and a recovery in consumer confidence provide some upside optimism.”

Governments across Europe have announced tighter and longer coronavirus lockdowns, with vaccinations not expected to have a significant impact for the next few months.

The complex remains in pause mode, a development that should not be surprising given the magnitude of the oil price gains that have been developing for some 2-1/2 months,” Jim Ritterbusch, president of Ritterbusch and Associates, said.

Still, OPEC left its crude oil projections unchanged for the year. The oil cartel expected global oil demand to increase by 5.9 million barrels per day year on year to an average of 95.9 million per day in 2020.

But also OPEC expects a recent rally and stimulus to boost U.S. Shale crude oil production in the year, a projection Investors King experts expect to hurt OPEC strategy in 2021.

Continue Reading

Crude Oil

OPEC Says Uncertainties Remain High in 2021

Published

on

Nigeria's economic Productivity

OPEC Says Uncertainties Remain High in 2021

The Organization of the Petroleum Exporting Countries (OPEC) on Thursday said global uncertainties remained high going forward in 2021 but kept its oil demand forecast unchanged.

In the cartel’s latest oil outlook for 2021, oil demand is expected to increase by 5.9 million barrels per day year on year to 95.9 million barrels per day. The prediction was unchanged from December’s assessment.

However, OPEC and allies, said: “Uncertainties remain high going forward with the main downside risks being issues related to COVID-19 containment measures and the impact of the pandemic on consumer behavior.”

“These will also include how many countries are adapting lockdown measures, and for how long. At the same time, quicker vaccination plans and a recovery in consumer confidence provide some upside optimism.

Crude oil rose to $57 per barrel this week after incoming US President Joe Biden announced it would inject $1.9 trillion stimulus into the world’s largest economy.

But the recent rally in the commodity and stimulus announcement is expected to boost US crude oil output and disrupt OPEC+ production cuts strategy for the year.

The 2021 supply outlook is now slightly more optimistic for U.S. shale with oil prices increasing, and output is expected to recover more in the second half of 2021,” OPEC said.

Still, OPEC, in its forecast “assumes a healthy recovery in economic activities including industrial production, an improving labour market and higher vehicle sales than in 2020.”

“Accordingly, oil demand is anticipated to rise steadily this year supported primarily by transportation and industrial fuels,” the group said.

Continue Reading

Crude Oil

Brent Crude Oil Rose to $56.25 Per Barrel

Published

on

oil

Brent Crude Oil Rose to $56.25 Per Barrel

Oil price surged following the declaration of Joe Biden as the President-elect of the United States of America last week after Trump’s mob invaded Capitol to disrupt a joint Senate session.

Also, the large drop in US crude inventories helped support crude oil price to over 11 months despite the second wave of COVID-19 crushing the world from Asia to Europe to America.

Brent crude oil, against which Nigerian Crude oil is priced, rose to $56.25 per barrel on Friday before pulling back to $55.422 per barrel on Monday during the London trading session.

Experts attributed the pullback to the rising number of COVID-19 cases in Asia with about 11 million people already locked down in Hebei province in China.

Covid hot spots flaring again in Asia, with 11 million people (in) lockdowns in China Hebei province… along with a touch of FED policy uncertainty has triggered some profit taking out of the gates this morning,” Stephen Innes, chief global market strategist at Axi, said in a note on Monday.

China, the world’s largest importer of crude oil, has joined the United Kingdom and others declaring full or partial lockdown to curb the second wave of COVID-19.

Continue Reading

Trending