Connect with us


Nigeria’s Manufacturing Index Sustains Decline



  • Nigeria’s Manufacturing Index Sustains Decline

The Manufacturing Purchasing Managers’ Index (PMI) stood at 47.7 index points in March 2017, indicating decline in the manufacturing sector for the third consecutive month, but at a slower rate.

The PMI reflects the economic health of the manufacturing sector. The PMI is based on five major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment.

According to the latest PMI report for March, posted on the Central Bank of Nigeria’s (CBN) website, 13 of the 16 sub-sectors reported declines in the review month in the following order: primary metal; transportation equipment; plastics and rubber products; electrical equipment; paper products; printing and related support activities; petroleum and coal products; non-metallic mineral products; furniture and related products; cement; fabricated metal products; computer and electronic products; and chemical and pharmaceutical products.

However, the appliances and components; food, beverage and tobacco products; and textile, apparel, leather as well as footwear sub sectors reported expansion in the review period.

But the production level index for manufacturing sector expanded in March 2017.

The index at 50.8 points indicated an expansion in production level as compared to contraction in the previous month. Seven manufacturing sub-sectors recorded increase in production level during the review month in the following order: appliances & components; petroleum & coal products; textile, apparel, leather & footwear; food, beverage & tobacco products; cement; computer & electronic products; and furniture & related products.
The non-metallic mineral products sub-sector remained unchanged, while the primary metal; transportation equipment; electrical equipment; plastics & rubber products; paper products; chemical & pharmaceutical products; printing & related support activities; and fabricated metal products recorded declines in production in March 2017.

At 45.6 points, the index declined for the third consecutive month but at a slower rate when compared to the level achieved in February 2017. Twelve sub-sectors recorded declines in the following order: primary metal; plastics & rubber products; petroleum & coal products; printing & related support activities; electrical equipment; transportation equipment; computer & electronic products; paper products; fabricated metal products; furniture & related products; cement; and non-metallic mineral products. The remaining four sub-sectors grew in the following order: appliances & components; food, beverage & tobacco products; textile, apparel, leather & footwear; and chemical & pharmaceutical products.

Similarly, at 51.3 index points, the supplier delivery time index for the manufacturing sub-sectors improved in March 2017. Nine sub-sectors recorded improved suppliers’ delivery time in the following order: computer & electronic products; electrical equipment; paper products; plastics & rubber products; chemical & pharmaceutical products; primary metal; printing & related support activities; food, beverage & tobacco products; and fabricated metal products.

The appliances & components; petroleum & coal products; and transportation equipment sub-sector remained unchanged, while the cement; textile, apparel, leather & footwear; furniture & related products; and nonmetallic mineral products sub-sectors recorded declines in delivery time in March 2017.

Employment level index in March 2017 stood at 43.6 points, indicating a decline in employment level for 25 consecutive months.

However, the index declined at a slower rate when compared with the level in the preceding month. Of the 16 sub-sectors, 15 recorded declines in the following order: electrical equipment; primary metal; petroleum & coal products; transportation equipment; non-metallic mineral products; cement; chemical & pharmaceutical products; paper products; furniture & related products; plastics & rubber products; computer & electronic products; fabricated metal products; textile, apparel, leather & footwear; printing & related support activities; and food, beverage & tobacco products. The appliances & components sub-sector recorded growth during the review period.

In the same vein, at 49.1 points, the raw materials inventory index declined for the third consecutive months. Of the 16 sub-sectors, nine recorded declines in raw materials inventories in the order: paper products; plastics & rubber products; non-metallic mineral products; computer & electronic products; printing & related support activities; petroleum & coal products; electrical equipment; furniture & related products; and chemical & pharmaceutical products. The cement and primary metal sub-sectors remained unchanged, while the remaining five sub-sectors recorded increase in inventories in the order: transportation equipment; appliances & components; textile, apparel, leather & footwear; food, beverage & tobacco products; and fabricated metal products.

The composite PMI for the non-manufacturing sector declined for the 16 consecutive months. The index stood at 47.1 points, indicating a slower decline when compared to the 44.5 points in February 2017. Of the 18 non-manufacturing sub-sectors, 11 recorded declines in the following order: construction; professional, scientific, & technical services; real estate, rental & leasing; management of companies; repair, maintenance/washing of motor vehicles; accommodation & food services; wholesale/retail trade; arts, entertainment & recreation; information & communication; utilities; and health care & social assistance. The remaining seven sub-sectors: public administration; educational services; agriculture; water supply, sewage & waste management; electricity, gas, steam & air conditioning supply; transportation & warehousing; and finance & insurance reported growth in the review month.

The business activity index stood at 49.8 points in March 2017, from its level of 45.4 points in February 2017.

At 46.4 points, the new orders index declined for the 15 consecutive months in March 2017, but at a slower rate. Of the 18 sub-sectors, 10 declined in the following order: construction; management of companies; professional, scientific, & technical services; information & communication; wholesale/retail trade; utilities; real estate, rental & leasing; repair, maintenance/washing of motor vehicles; accommodation & food services; and arts, entertainment & recreation.

The water supply, sewage & waste management sub-sector remained unchanged, while the remaining seven sub-sectors recorded growth in the order: public administration; electricity, gas, steam & air conditioning supply; finance & insurance; agriculture; educational services; health care & social assistance; and transportation & warehousing.

Money Market Weekly Review

Money market rates last week traded within a band of 12.2 per cent and 13 per cent. The week opened with system liquidity of N13.9 billion as money market rates –open buy back (OBB) and overnight rates settled at 12.7 per cent apiece owing to CBN’s open market operations (OMO) mop ups and special market interventions.

The central bank in a bid to squeeze excess liquidity from the system conducted OMO auctions on all trading days of the week save for Wednesday. An OMO maturity worth N51.5 billion hit the system on Thursday; however, the impact was offset by the OMO sales conducted that same day bringing system liquidity to N92.1 billion.

Also, this week, there will be maturing treasury bills of N35 billion, N33.5 billion and N166.4 billion for the 91-day, 182-day and 364-day tenors respectively as well as rollovers of the same amounts.

Forex Market Review

After sustaining intervention in the currency market to achieve a convergence between official and unofficial rates, the CBN issued a directive to banks last week to sell forex for BTA, PTA, School and medical fees to retail users at N360/$1, from the N375/$1 it sold in the preceding week.

The central bank sold to banks at N357/$1 while Bureaux de Change (BDCs) who are to sell to end-users at N362/$1 were sold to at N360/$1.

A sum of $100 million wholesale forward intervention was offered and fully allotted to banks last Monday while another $100 million was offered to wholesale dealers last Thursday.

But the exchange rate on the parallel market which had appreciated earlier in the week to N375/$1 on Tuesday, weakened to N390/$1 last Friday.

In furtherance of its determination to sustain liquidity in the FX market, the CBN last Thursday announced its decision to commence bi-weekly FX sales to licenced BDCs operators from today. Sales amount to BDCs will also be increased to $10,000 (US$5,000/bid) at a new rate that will be announced today. Licenced BDCs are to fund their accounts on Mondays and Wednesdays while they receive their purchases on Tuesdays and Thursdays respectively.
“In line with the above, we expect market rates to continue to appreciate until the CBN attains a market reopening rate,” analysts at Afrinvest stated.

Nevertheless, the CBN at the weekend disclosed that it had received reports that some customers seeking to buy forex for BTA, PTA, medical and school fees were being frustrated by some banks with the false claim that the CBN is not allocating enough forex for such invisible items.

The central bank, which made the accusation in a statement by its acting Director, Corporate Communications, Mr. Isaac Okorafor, titled: “There is Adequate Forex for PTA, BTA, Tuition & Medical Fees,” said such claim by the banks was totally untrue.

According to the CBN, all banks have more than enough stock of forex in their possession for the purpose of meeting genuine customers’ demand for BTA, PTA, tuition and medical fees.

“Indeed, on a weekly basis, the CBN has been selling at least $80 million to banks for onward sale to their customers for these invisible items.

“Members of the public seeking to buy forex for the above-mentioned purposes are, therefore, advised to go to their banks and obtain their forex,” it added.

It urged any customer that is not attended to within 24 hours for BTA/PTA or 48 hours for tuition and medical fees should call a dedicated number or send an email to the Consumer Protection Department of the CBN, with the name and branch of the non-cooperating bank.

“Furthermore, no customer should accept to buy forex from any bank at more than the currently prescribed rate of N360/$1,” it added

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq,, Investorplace, and many more. He has over two decades of experience in global financial markets.

Continue Reading


Computer Village Traders Demand Refunds as Lagos State Cancels Katangowa Project



Traders at the renowned Computer Village in Lagos find themselves in a state of uncertainty following the abrupt termination of the multibillion-naira Katangowa project by the Lagos State Government.

The project, which was aimed at relocating the bustling tech market from its current site in Ikeja to the Agbado/Oke-Odo area of the state, has left traders in a state of limbo.

Despite the cancellation of the project reportedly occurring two years ago, traders claim they were not informed by either the government or the developers, Bridgeways Limited.

This lack of communication has left them in a precarious position, particularly concerning the substantial upfront payments made by some traders to the developers.

Chairman of the Computer Village Market Board, Chief Adebowale Soyebo, expressed dismay at the lack of communication from the authorities regarding the project’s termination.

He explained that neither the government nor the contractors had officially informed them of the decision, leaving traders in the dark about the fate of their investments.

Traders who had made payments to Bridgeways Limited now seek clarity on the refund process. The absence of official communication has compounded their concerns, with many uncertain about the fate of their investments.

While acknowledging the payments made by traders, Lagos State Governor’s Adviser on e-GIS and Urban Development, Dr. Olajide Babatunde, assured that the government would facilitate refunds.

He, however, said there is a need for proper identification and verification to ensure that affected traders receive their refunds accordingly.

The termination of the Katangowa project has reignited debates about the relocation of Computer Village.

Traders assert that the issue of relocation should not be raised until the new site is at least 70% completed, as per their agreement with the government.

The cancellation of the Katangowa project underscores the challenges associated with large-scale urban development projects and the importance of transparent communication between stakeholders to avoid such situations in the future.

As traders await further directives from the government, they remain hopeful for a resolution that safeguards their interests and ensures the continuity of one of Nigeria’s most prominent tech markets.

Continue Reading


Government Begins Disbursement of N200bn Support Fund to Manufacturers and Businesses



business solution - Investors King

The Ministry of Industry, Trade and Investment has initiated the disbursement of the long-awaited N200 billion Presidential Conditional Grant Scheme.

This is the beginning of a vital phase in the government’s strategy to provide financial assistance to manufacturers and businesses across Nigeria.

The scheme, which is being administered through the Bank of Industry (BOI), has been divided into three categories of funding, totaling N200 billion.

The disbursement process comes after an exhaustive selection process and verification of applicants to ensure transparency and accountability in the allocation of funds.

Doris Aniete, spokesperson for the Ministry of Industry, Trade and Investment, announced the progress in a statement posted on the trade minister’s official X (formerly Twitter) handle.

Aniete highlighted that verified beneficiaries have already started receiving their grants, signaling the beginning of the phased disbursement strategy.

“We are pleased to inform you that the disbursement process for the Presidential Conditional Grant Programme has officially commenced. Some beneficiaries have already received their grants, marking the beginning of our phased disbursement strategy,” stated Aniete.

She further disclosed that by Friday, April 19, a substantial number of verified applicants are set to receive significant disbursements.

However, Aniete emphasized that disbursements are ongoing, and not all applicants will receive their grants immediately, assuring that all verified applicants will eventually receive their grants in subsequent phases.

The initiation of the disbursement process comes after more than eight months since President Bola Tinubu announced the grant for manufacturers and small businesses.

The scheme aims to mitigate the adverse effects of recent economic reforms and foster sustainable economic growth by empowering businesses with financial support.

President Tinubu had outlined the government’s commitment to strengthening the manufacturing sector and creating job opportunities through the disbursement of N200 billion over a specified period.

The funding is intended to provide credit to 75 enterprises, each able to access up to N1 billion at a low-interest rate of 9% per annum.

However, the implementation of the programme has faced challenges, including delays and criticisms regarding the registration process.

Femi Egbesola, President of the Association of Small Business Owners, expressed concerns over the slow pace of data collation and suggested that genuine businesses were being discouraged from accessing the loans.

Despite the hurdles, the commencement of the disbursement process signifies a significant step forward in the government’s efforts to provide vital support to manufacturers and businesses, potentially revitalizing economic activities and driving growth across various sectors.

As beneficiaries begin to receive their grants, the impact of this initiative on the nation’s economic landscape is eagerly anticipated.

Continue Reading

Company News

MicroStrategy Rally Crushes Short Sellers, Wiping Out $1.92 Billion



MicroStrategy- Investors King

Short sellers betting against MicroStrategy found themselves facing significant losses as the company’s rally wiped out $1.92 billion since March.

This development comes amidst a rally that has seen MicroStrategy’s stock outperform bitcoin, causing a considerable hit to those who had taken a bearish stance on the tech firm.

According to data from S3 Partners, short sellers have been on the losing end since March, as MicroStrategy’s stock surged, highlighting the impact of the rally on those betting against the company’s success.

This loss underscores the challenges faced by short sellers in a market where certain stocks experience rapid and unexpected price increases.

The rally in MicroStrategy’s stock is attributed to several factors, including the approval of several spot bitcoin exchange-traded funds (ETFs) by the Securities and Exchange Commission (SEC) earlier in the year.

This move by the SEC brought bitcoin, a once-nascent asset class, closer to the mainstream and fueled investor interest in companies like MicroStrategy, known for their significant holdings of the cryptocurrency.

MicroStrategy, which held nearly 190,000 bitcoin on its balance sheet as of the end of 2023, has indicated its intention to continue increasing its exposure to the digital currency.

The company’s decision to sell convertible debt to raise money for additional bitcoin purchases further bolstered investor confidence and contributed to the stock’s rally.

Analysts at BTIG noted that the premium for MicroStrategy’s stock reflects investors’ desire to gain exposure to bitcoin indirectly, especially those who may not have the means to invest directly in the cryptocurrency or ETFs.

The company’s ability to raise capital for bitcoin purchases is seen as a positive sign for shareholders, adding to the optimism surrounding its stock.

However, despite the recent rally and optimism surrounding MicroStrategy, the crypto industry as a whole continues to be heavily shorted.

Short interest in nine of the most-watched companies in the crypto space remains high, standing at 16.73% of the total number of outstanding shares, more than three times the average in the United States.

Moreover, concerns persist regarding the SEC’s stance on cryptocurrencies, with some experts suggesting that the approval of spot bitcoin ETFs may not necessarily indicate a broader acceptance of other similar products, such as spot ethereum ETFs.

Continue Reading