- Power Lags Behind Other Sectors in Job Creation
The power sector has recorded the lowest number of jobs created out of all the priority sectors identified by the President Muhammadu Buhari’s administration.
In an analysis of the Job Creation Report by the National Bureau of Statistics showed that the power sector recorded deficits in job creation in 2016.
The government had identified the diversification of the economy as one of the six major strategic intervention areas, highlighting reforms in the agriculture, power, manufacturing, information and communications technology and tourism sectors as gateway to achieving this.
In the fourth quarter of 2015, the power sector generated only one job, which rose marginally to four in the first quarter of 2016. However, a deficit of 80 was recorded from April to September 2016.
Job creation in the manufacturing sector also had -20.6 per cent growth rate between October 2015 and March 2016; and significant growth of 127 per cent between April and September 2016.
However, some subsectors like motor vehicle assembly, chemical and pharmaceutical, textile, and oil refining recorded negative growth in job creation between April and September 2016.
The agriculture sector created lots of jobs in the period under review, with the majority in the crop production subsector.
The first and second quarters of 2016 saw the sector recording a significant 627.76 per cent rise in new jobs, which increased by 4.53 per cent in the third quarter.
In 2016, the government designed several projects to generate and distribute 7,000megawatts of electricity.
To achieve this, it was reported that the government had agreed to a €50m loan with the French government for capacity building and upgrade of power training facilities in Nigeria.
It was learnt that the country had also signed a $237m agreement with the World Bank to improve power and that an agreement was reached with the Chinese government to improve Nigeria’s power infrastructure.
In an interview recently, the Chief Executive Officer, Egbin Power Plc, Mr. Dallas Peavey, said that the operators had lost huge sums of money and were weighed down by the debts owed by the government.
He had said, “We have never made a profit. We are owed N86bn and we have lost $300m in the last three years directly out of our pocket, because we haven’t been paid and because we have invested that money and we have got no returns.
“We don’t expect the returns immediately, but at some point, every business has to be able to sustain itself with profits or returns on its investment.”
Gold Gained Ahead of Joe Biden Inauguration 2021
Gold price rose from one and a half month low on Tuesday ahead of President-elect Joe Biden’s inauguration on Wednesday.
The precious metal, largely regarded as a haven asset by investors, edged up by 0.2 percent to $1,844.52 per ounce on Tuesday, up from $1,802.61 on Monday.
He said, “The key factor appears to be the (U.S.) currency.”
As expected, a change in administration comes with the change in economic policies, especially taking into consideration the peculiarities of the present situation. In fact, even though Biden, Janet Yellen and the rest of the new cabinet are expected to go all out on additional stimulus with the support of Democrats controlled Houses, economic uncertainties with rising COVID-19 cases and slow vaccine distribution remained a huge concern.
Also, the effectiveness of the vaccines can not be ascertained until wider rollout.
Still, which policy would be halted or sustained by the incoming administration remained a concern that has forced many investors to once again flee other assets for Gold ahead of tomorrow’s inauguration.
Crude Oil Holds Steady Above $55 Per Barrel on Tuesday
Brent Crude oil, against which Nigerian crude oil is priced, rose from $54.46 per barrel on Monday to $55.27 per barrel as of 9:03 am Nigerian time on Tuesday.
Last week, Brent crude oil rose to 11 months high of $57.38 per barrel before pulling back on rising COVID-19 cases and lockdowns in key global economies like the United Kingdom, Euro-Area, China, etc.
While OPEC has left 2021 oil demand unchanged and President-elect Joe Biden has announced a $1.9 trillion stimulus package, experts are saying the rising number of new cases of COVID-19 amid poor vaccine distribution could drag on growth and demand for oil in 2021.
On Friday, Dan Yergin, vice-chairman at IHS Markit, said in addition to the stimulus package “There are two other things that are going with it … one is of course, vaccinations — in the sense that eventually this crisis is going to end, and maybe by the spring, lockdowns will be over.”
“The other thing is what Saudi Arabia did. This is the third time Saudi Arabia has made a sudden change in policy in less than a year, and this one was to announce (the) 1 million barrel a day cut — partly because they are worried about the impact of the surge in virus that’s occurring,” he said.
Also, the stimulus being injected into the United States economy could spur huge Shale production and disrupt OPEC and allies’ efforts at balancing the global oil market in 2021.
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.
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