- Microfinance Tool for Poverty Alleviation, Says Rwanda Envoy
The Rwandan High Commissioner to Nigeria, Ambassador Stanislas Kamanzi, has described micro finance as a potent tool for poverty alleviation and wealth creation.
Kamanzi, who spoke last week at The Bullion Lecture organised by Centre for Financial Journalism in Lagos, believes that micro finance is essential to people-centred development, as it is an important stimulant of the creation of a middle income class that is critical for African economies to substantially take off.
Kamanzi, who was the special guest at the lecture, said it was important for lay people to understand the tenets and mechanisms of micro finance, challenging financial journalists to play a key role in this connection and to build on synergies with the operators in micro finance.
He stated that in the past decade, Rwanda had been able to move more than a million people above the poverty line through a combination of strategic investment meant to uplift livelihoods of identified poor communities and tapping their own capacity to solve their problem, with a minimal push from government. He revealed that micro finance was pivotal in making those strategies work and transform into a success story of poverty reduction.
Giving further insight into how micro finance has helped to lift millions of people out of poverty in his country, Ambassador Kamanzi said this was achieved through a programme termed Vision 2020 Umurenge, abridged as VUP.
He said the programme was created to accelerate the achievement of the Millennium Development Goals (MDGs) at grassroots level, explaining that it combines labour intensive projects providing jobs for active members within communities, while catering social protection for the vulnerable and impotent ones, by way of financial grants for daily subsistence.
He stated that “VUP builds on assessing the fundamental needs of beneficiary communities, mobilising resources, human and financial, to correct development shortfalls”, explaining that “beneficiaries are enrolled in saving schemes, with the objective of promoting the emergence of micro-investment and sustainable self-reliance”.
According to him, VUP implementation was combined with the streamlining of micro finance institutions at local government (Sector entity) level called UMURENGE SACCO, for the promotion of savings and ease of access to credit within rural communities.
Kamanzi added that micro finance also proved to be a problem-solver as far as improving livelihoods of indispensable professionals whose big numbers defy any attempt for significant salary increase, relative to other macro-economic considerations, especially in developing African countries.
He stated that “in Rwanda UmwalimuSACCO was established in 2006 to that end. Its creation was triggered by the need to expand financial services to teachers including in rural areas. The MFI has more than 70,000 members, with very high rural penetration. It has substantively empowered teachers to have easy access to credit to finance projects contributing to the elevation of their well-being”.
Libyan Oil Field and Gas Link to Italy Reopen After Protesters Withdraw
Following a brief interruption, operations at an oil field in western Libya and a natural gas link to Italy have resumed as protesters retreated from the facilities.
The demonstrators withdrew after receiving assurances from the government regarding their demands.
The Wafa oil field, which typically produces between 40,000 to 45,000 barrels per day, recommenced shipments after a temporary halt prompted by guards’ demands for improved compensation.
Similarly, the gas pipeline connection to Italy is once again operational, according to sources familiar with the situation who preferred anonymity due to the sensitivity of the matter.
Protests disrupting energy infrastructure and output are not uncommon in Libya.
In recent times, demonstrations have frequently disrupted operations, with the significant Sharara oil field experiencing prolonged suspension last month due to similar protests, invoking a force majeure clause in contracts.
The resumption of activities marks a relief for both the Libyan energy sector and Italy, which heavily relies on the natural gas link for its energy needs.
However, the incidents underscore the ongoing challenges faced by Libya in maintaining stability within its vital energy infrastructure amidst socio-political unrest.
Efforts to address the grievances of protesters and ensure sustained operations remain pivotal for the country’s economic well-being and regional energy dynamics.
Oil Prices Dip on Monday as Dollar Gains
Oil prices experienced a downturn, extending losses from the previous session as the U.S. dollar surged against global counterparts to impact market sentiment.
Brent crude oil, against which Nigerian oil is priced, slipped by 0.2% to $81.48 a barrel while U.S. West Texas Intermediate crude (WTI) declined by 0.3% to $76.27 a barrel.
The upward trajectory of the dollar renders oil more costly for holders of other currencies, contributing to the decline in oil prices.
This downward trend follows a week of losses, with Brent declining approximately 2% and WTI falling over 3%.
Market participants attribute these fluctuations to concerns about inflation potentially delaying anticipated cuts to high U.S. interest rates. Such expectations have been suppressing global fuel demand growth.
Analysts observe a retreat in the risk-on sentiment, coinciding with heightened expectations of prolonged interest rates.
Tina Teng, an independent analyst based in Auckland, notes that the recent market rally led by Nvidia has stalled, as elevated rate expectations bolster the U.S. dollar, thereby pressuring commodity prices, including oil.
Despite geopolitical tensions such as the Israel-Hamas conflict and attacks on ships in the Red Sea, which could have traditionally boosted oil prices, the impact remains modest.
Moreover, investors are monitoring developments surrounding Russian oil supply following recent U.S. sanctions on Moscow’s leading tanker group.
Amidst these uncertainties, Qatar’s decision to increase liquefied natural gas production further adds to global energy supplies.
Crude Oil Dips Slightly on Friday Amid Demand Concerns
On Friday, global crude oil prices experienced a slight dip, primarily attributed to mounting concerns surrounding demand despite signs of a tightening market.
Brent crude prices edged lower, nearing $83 per barrel, following a recent uptick of 1.6% over two consecutive sessions.
Similarly, West Texas Intermediate (WTI) crude hovered around $78 per barrel. Despite the dip, market indicators suggest a relatively robust market, with US crude inventories expanding less than anticipated in the previous week.
The oil market finds itself amidst a complex dynamic, balancing optimistic signals such as reduced OPEC+ output and heightened tensions in the Middle East against persistent worries about Chinese demand, particularly as the nation grapples with economic challenges.
This delicate equilibrium has led oil futures to mirror the oscillations of broader stock markets, underscoring the interconnectedness of global economic factors.
Analysts, including Michael Tran from RBC Capital Markets LLC, highlight the recurring theme of robust oil demand juxtaposed with concerning Chinese macroeconomic data, contributing to market volatility.
Also, recent attacks on commercial shipping in the Red Sea by Houthi militants have added a risk premium to oil futures, reflecting geopolitical uncertainties beyond immediate demand-supply dynamics.
While US crude inventories saw a slight rise, they remain below seasonal averages, indicating some resilience in the market despite prevailing uncertainties.
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