- Economy Shrinks Again, MAN, LCCI See recovery in Third Quarter
The National Bureau of Statistics on Tuesday released the Gross Domestic Product report for the first quarter of this year, which showed that the economy contracted by 0.52 per cent in the period.
With the negative growth rate of -0.52 per cent, the Nigerian economy is still in recession.
The rate of growth for the first quarter of 2017 is, however, an improvement over the revised -1.73 per cent GDP growth rate as of December 2016.
This is the fifth consecutive quarter of contraction that the economy would record since the first quarter of 2016.
The NBS report read in part, “In the first quarter of 2017, the nation’s GDP contracted by 0.52 per cent (year-on-year) in real terms, representing the fifth consecutive quarter of contraction since Q1 2016.
“This is higher than the rate recorded in the corresponding quarter of 2016 and higher by 1.21 percentage points from the rate recorded in the preceding quarter.”
However, the rate of growth, which is an improvement over the previous quarter, appears to be in line with the expectations of the Federal Government that the country will come out of recession by June this year.
The Minister of Information and Culture, Lai Mohammed, had on April 29 said that Nigeria was gradually moving out of recession.
He said going by a recent statement by the Central Bank Governor, Mr. Godwin Emefiele, the country would exit recession by the end of June.
The NBS in the report stated that during the first quarter, the aggregate GDP stood at N26.02tn in nominal terms, representing an increase of 17.06 per cent over the N22.23tn recorded in the first quarter of 2016.
During the period under review, it explained that the average oil production was 1.83 million barrels per day, which was 70,000 barrels higher than the figure for the fourth quarter of 2016.
It added that real growth of the oil sector slowed by 11.64 per cent year-on-year in the first quarter of 2017, representing a decline of 4.81 per cent relative to the rate recorded in the corresponding quarter of last year.
Quarter-on-quarter, the oil sector, according to the report, grew by 14.86 per cent in the first three months of this year.
As a share of the economy, the NBS report stated that the oil sector contributed 8.90 per cent of the total real GDP in the first quarter, down from the 10.02 per cent recorded in the corresponding period of 2016.
For the non-oil sector, the bureau said growth was largely driven by the activities in the agriculture sector, particularly crop production, Information and Communication Technology, manufacturing, transportation, and other services.
It said, “The non-oil sector grew by 0.72 per cent in real terms during the reference quarter. This was 1.05 per cent higher than the rate recorded in the fourth quarter of 2016, and 0.90 per cent higher than the corresponding quarter of 2016.
“In real terms, the non-oil sector contributed 91.10 per cent to the nation’s GDP, higher from the share recorded in the first quarter of 2016 (89.98 per cent), but lower than the share recorded in the fourth quarter of 2016 (93.25 per cent).”
The report put the real growth rate of the agricultural sector in the first quarter of 2017 at 3.39 per cent year-on-year, representing an increase of 0.30 percentage points from the corresponding period of 2016.
For the manufacturing sector, the report stated that the real GDP growth in the sector in the first quarter of this year was 1.36 per cent year-on-year, higher than the same quarter of 2016 by 8.36 percentage points.
This, it added, was the first positive growth rate recorded in the sector for over a year.
The Manufacturers Association of Nigeria and the Lagos Chamber of Commerce and Industry have expressed optimism that following the 0.52 per cent contraction of the GDP in the first quarter, the economy should come out of recession in the second or third quarter.
“The 0.52 GDP contraction recorded in the first quarter is an improvement over the 1.73 contraction the economy recorded in December 2016. We are already on the verge of moving from the negative territory to positive territory. In December, it was -1.73 per cent; in March, it was -0.52; it is an improvement,” the Director-General, LCCI, Mr. Muda Yusuf, said.
“Some of the positive developments we witnessed in Q1 such as better foreign exchange policy, improvement in ease of doing business and creation of FX window will be reflected in the Q2 result that will be released later this year,” he added.
The President, MAN, Mr. Frank Jacobs, said he was not surprised by the negative GDP growth number because the country was not going to come out of recession overnight.
Jacobs said, “In as much as we are trying to get out of recession, it is not going to happen overnight. We expect that from Q3, we will begin to come out of recession. The current figure only shows that we are not yet out of the woods yet. We have to see how to manage production and seek to cope with some of the challenges facing manufacturers.”
Remarking on the outcome of Tuesday’s Monetary Policy Committee meeting, the MAN president said, “There is a need for a special window for manufacturers to access credit at five per cent interest rate. This will help them to play their role of creating jobs and also earn revenue in order to pay taxes.”
Global Oil Drops as Coronavirus Infections Rises in India and Other Nations
Oil prices declined on Monday during the Asian trading session amid rising concerns that the surge in coronavirus in India and other nations could force regulators to enforce stronger measures at curbing its spread and eventually affect economic activity and drag on demand for commodities like crude oil.
Brent crude oil, against which Nigerian oil is priced, declined by 22 cents or 0.33 percent to $66.55 per barrel at 8:19 am Nigerian time on Monday, following a 6 percent surge last week.
The US West Texas Intermediate (WTI) declined by 18 cents or 0.29 percent to $62.95 per barrel, after it gained 6.4 percent last week.
The decline was after India reported 261,500 new coronavirus infections on Sunday, taking the country’s total cases to almost 14.8 million, second to only the United States that has reported over 31 million coronavirus infections.
“With … a resurgence of virus cases in India and Japan, topside ambitions continue to run into walls of profit-taking,” said Stephen Innes, chief market strategist at Axi.
Businesses in Japan believed the world’s third-largest economy will experience a fourth round of coronavirus infections, with many bracing for an additional slow down in economic activity.
While Japan has had fewer COVID-19 cases when compared with other major economies, concerns about a new wave of infections are fast rising, according to responses in Reuters poll.
On Tuesday, April 20, 2020, Hong Kong will suspend all from India, Pakistan and the Philippines because of imported coronavirus infections, authorities stated in a statement released on Sunday.
India’s COVID-19 death rose by a record 1,501 to hit 177,150.
Global Markets Near Record Peaks and Will Get Stronger: deVere CEO
As the FTSE 100 hits 7,000 points for the first time since the Covid pandemic, global stock markets are poised to “get even stronger”, says the CEO of one of the world’s largest independent financial advisory and fintech organisations.
The observation from Nigel Green, the chief executive and founder of deVere Group, comes as London’s index jumped over the important threshold in early trading in London, gaining over 0.5% to 7024 points.
Mr Green notes: “London’s blue-chip index is up 40% since the worst lows of the pandemic.
“This landmark moment represents the wider optimistic sentiment gripping global markets which are near record peaks.
“We can expect global stock markets to get even stronger as investors look to seize the opportunities from economies reopening.
“They are looking towards economies rebounding in a post-pandemic era due to the monetary and fiscal stimulus, pent-up cash and demand, and strong corporate earnings.
“The current ultra-low interest rate environment and the under-performance of bonds will also act as a catalyst for stock markets.”
However, the CEO’s bullish comments also come with a warning.
“I would urge investors to proceed with caution as there are some headwinds on the horizon, including relations between the U.S. and China, the world’s two largest economies, which could be coming to a tipping point in coming weeks.
“As such, in order to capitalise on the opportunities and mitigate risks, investors must ensure proper portfolio diversification.”
Mr Green concludes: “A variety of factors are going to drive global stock markets. Investors will not want to miss out and should work with a good fund manager to judiciously top-up their portfolios.”
Refinitiv Expands Economic Data Coverage Across Africa
Building on its commitment to drive positive change through its data and insights, Refinitiv today announced the expansion of its economic data coverage of Africa. The new data set allows investment managers, central bankers, economists, and research teams to use Refinitiv Datasteam analytical data for detailed exploration of economic relationships and investment opportunities among data series covering the African continent.
Securing reliable, detailed, timely, locally sourced content has not been easy for economists who have in the past had to use international sources which often can take many months to update and opportunities to monitor the market can be missed. Because Africa is a diverse continent, economists and strategists need more timely access to country-specific data via national sources to create tailored business, policy, trading and investment strategies to meet specific goals.
Africa continues to develop critical infrastructure, telecommunications, digital technology and access to financial services for its 1.3bn people. The World Bank estimates that over 50% of African inhabitants will be under 25 by 2050. This presents substantial opportunities for investors who can spot important trends and make informed decisions based on robust and timely economic data.
Stuart Brown, Group Head of Enterprise Data Solutions, Refinitiv, said: “Africa’s growing, dynamic and fast evolving economies makes it a focal point for financial markets today and in the coming decades. As part of LSEG’s commitment to empowering the global markets with accurate and timely data, we are excited about making these unique datasets available via the Refinitiv Data Platform. Our economic data coverage of Africa will provide our customers with deeper and broader inputs for macroeconomic analyses and enable more effective investment strategies and economic research.”
Refinitiv Africa economic data coverage:
- Africa economics content comprises around 500,000 nationally sourced time series data covering 54 African nations
- Content is sourced from national statistical offices, central banks and other key national institutions
- The full breadth of economics categories in Datastream including national accounts, money and finance, prices, surveys, labor market, consumer, industry, government and external sectors
- International sources including OECD, World Bank, IMF, African Development Bank, Oxford Economics & more provide comparable data & forecasts across the continent
Refinitiv® Datastream® has global macroeconomics coverage to analyze virtually any macro environment, and better understand economic cycles to uncover trends and forecast market conditions. With over 14.2 million economic times series map trends, customers can validate ideas and identify opportunities using Refinitiv Datastream. Access its powerful charting tools, 9,000 pre-built chart templates and chart studies for commonly used valuation, performance, and technical and fundamental analysis.
Refinitiv continually grows available data – the China expansion in 2019 covered a unique combination of economic and financial indicators. Refinitiv plans to expand Southeast Asia covering Thailand, Vietnam, Philippines and Malaysia with delivery expected in 2021. This ensures that Refinitiv will have much needed emerging market economic content.
Finance4 weeks ago
List of Microfinance Banks’ USSD Codes In Nigeria
Education2 weeks ago
COVID-19: 2021 WASSCE May Not Hold in May/June – WAEC
Education2 weeks ago
JAMB Puts 2021 UTME/DE Registration on Hold
Brands2 weeks ago
LG To Close Mobile Phone Business Worldwide
Technology3 weeks ago
FG Extends NIN-SIM Linkage by Four Weeks
Telecommunications4 weeks ago
Nokia, Safaricom Partner to Launch East Africa’s First Commercial 5G Services in Kenya
Government2 weeks ago
Approved Ibom Deep Sea Port, Proposed $1.4B Fertilizer Plant Will Change Akwa Ibom’s Economic Status – Gov. Udom
Economy3 weeks ago
Business Activities Fall as PMI Drops to 57.3– CBN