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Consumer Confidence Projected to Rise in Q4

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  • Consumer Confidence Projected to Rise in Q4

The Central Bank of Nigeria’s (CBN) Consumer Expectation Survey (CES) has predicted a positive outlook for next quarter as well as the next 12 months.

Specifically, the index projected 24.7 and 30.1 points for next quarter and the next 12 months respectively.

The outlook, which was contained in the third quarter Consumer Confidence, attributed the Q4 projection to expected increase in net household income as well as the anticipated improvement in Nigeria’s economic conditions and expectations to save a bit and/or have plenty over savings in the next 12 months.

Most respondents expected prices of goods and services to rise in the next 12 months, with an index point of 16.7 points.

The major drivers were: transportation, education, medical care, electricity, house rent, and telecommunications.

The overall buying conditions index for consumers last quarter for big ticket items stood at 35.1 points.

This indicated that majority of consumers believed that last quarter was not the ideal time to purchase big-ticket items like consumer durables, motor vehicles, among others.

“Overall buying intention index in the next twelve months stood at 46.4 index points, indicating that majority of consumers do not intend to buy these items in the next 12 months.

“The buying intention indices for motor vehicle and house & lot were below 50 points, indicating that respondents have no plans to purchase motor vehicles and houses in the next twelve months.

“However, the index for consumer durables stood above 50, indicating that respondents have plans to purchase furniture, gas cooker and electronics in the next twelve months,” it added.

It further noted that with indices of -2.6 and 16.4 points, consumers expected borrowing rate to fall while the naira was expected to appreciate in the next 12 months.

The unemployment index for the next 12 months remained positive at 25 points in Q3 2018, indicating that majority of the consumers expect the unemployment rate to rise in the next 12 months.

The CES for Q3 2018 was conducted during the period September 24 – October 4, 2018, covering a sample size of 1,770 households drawn from 207 Enumeration Areas (EAs) across the country, with a response rate of 96.9 per cent.

Respondents’ distribution by educational attainment showed that 14.8 per cent had university education, 14.8 per cent had higher non-university education, while 26.8 per cent had senior secondary school education. Respondents with junior secondary and primary school education accounted for 6.8 and 18.9 per cent, respectively, while those with no formal education accounted for the balance of 17.9 per cent.

The consumers’ overall confidence outlook improved in Q3 2018, as more consumers were optimistic in their outlook.

The index at 1.5 points was 12.0 points higher than the index in the corresponding period of 2017. Some respondents attributed this favourable outlook to improved economic condition.

The overall consumer confidence index was computed as the average of the three indices, namely: Economic Condition, Family Financial Situation and Family Income.

Economic Condition refers to the perception of the respondent regarding the general economic condition of the country.

Financial Situation refers to the level of savings, investments, other assets including cash at hand and outstanding debts.

Family Income includes primary income and receipts from other sources received by all family members as participants in any economic activity or as recipients of transfers, pensions, grants, and the like.

The confidence index or diffusion index is computed as the percentage share of respondents that answered in the affirmative less the percentage share of respondents that answered negative in a given indicator.

A positive CI indicates that respondents with a favourable view outnumber those with an unfavourable view, except for unemployment, change in prices and interest rate for borrowing money, where a positive CI indicates the opposite.

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.

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NCDMB and NEXIM Sign $30 Million Agreement to Support Oil and Gas Services Firms

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The Nigerian Content Development Monitoring Board (NCDMB) and the Nigerian Export-Import Bank (NEXIM) yesterday signed a $30 million agreement on working capital and capacity building fund to support oil and gas services firms.

Simbi Wabote, Executive Secretary, NCDMB and Managing Director, NEXIM Bank, Abba Bello, signed the funding agreement at the Abuja office of the Nigerian content monitoring agency.

Wabote said the Oil Producers Trade Section, Independent Petroleum Producers Group and Petroleum Technology Association of Nigeria had raised concerns over funding challenges confronting oil services firms, as this had made most of the companies to consider downsizing their staff.

He said, “The OPTS and IPPG had at some point raised before the NCDMB the inability of most indigenous contractors to provide services to them due to challenges of funding.

“This was especially when we got struck by the COVID-19 pandemic. I recall receiving several letters particularly from IPPG trying to see how we can support this.”

He added, “I also recall receiving similar letters from PETAN when the COVID-19 struck and most of their members had nothing to do anymore.

“This is because companies were shut down and their members were threatening on how to downsize and take Nigerians off their payrolls.

“Based on this, we then set up a committee to say how do we support these firms with the provision of working capital.”

Wabote noted the roll-out date for the fund would be July 1, 2021 and that the fund size of $30m would be boosted by matching funds of the same amount to be provided by NEXIM in naira (to be converted at prevailing official exchange rate).

“The scheme shall cover loans for working capital support and capacity building, oil service contracts, invoice discounting including acquisition of low-end equipment to service short-term contracts/service obligations,” he stated.

He said the target market comprised Nigerian oil service providers which belonged to a professional association in the Nigerian oil and gas industry and commercially viable with a business relationship with either an international oil company or a major Nigerian oil firm.

“Maximum amount that can be borrowed by a single obligor is $1m or its naira equivalent at the official exchange rate prevailing at the time of borrowing,” Wabote said.

He added, “Tenor shall be up to 12 months for working capital loans and up to three years for capacity building loans with moratorium of up to 12 months.

“The applicable interest rate shall be five per cent per annum all-in for dollar-denominated loans and eight per cent all-in per annum for naira-denominated loans and the rate shall be fixed throughout the tenor of the loan.”

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LivingTrust Mortgage Bank Appoints Mr. Timothy Olorunsogo Gbadeyan as Company’s Secretary

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LivingTrust Mortgage bank has appointed Mr. Timothy Olorunsogo Gbadeyan as company secretary/head of legal services.

The bank disclosed in a statement signed by Ikechukwu Omuku, the Finance Officer/Head, Investor Relations, LivingTrust Mortgage Bank Plc.

The statement reads “We wish to notify The Nigerian Stock Exchange and the investing public of the appointment Mr. Timothy Olorunsogo Gbadeyan as Company Secretary/Head, Legal Services of LivingTrust Mortgage Bank Plc.

“Mr. Gbadeyan is a consummate corporate attorney with experiential background in deals advisory, real estate finance, facioring, general commercial transactions, corporate governance, company secretarial services and regulatory compliance. Until his appointment, he was the Head of Legal Services of Infinity Trust Mortgage Bank Plc.”

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Farmforte, Others Signs MoU To Strengthen and Sustain Growth in Agricultural Sector

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Farmforte Limited has signed a strategic Memorandum of Understanding with the Agricultural Fresh Produce Growers and Exporters Association of Nigeria; HYBR, a pan-African innovation firm; and ALTS, a consulting and strategy development firm.

The firm said in a statement on Sunday that the partnership would strengthen common interest cooperation and stimulate inclusive and sustainable growth within the agricultural sector, by capitalising on the synergy and comparative advantage offered by each organisation.

Speaking during the signing ceremony, Farmforte Co-Chief Executive Officer, Osazuwa Osayi, said, “Our mid to long-term strategic goals are further reaffirmed, as this partnership will facilitate the sharing of knowledge, ideas, and expertise across the agricultural sector.

“We will collectively address initiatives and approaches concerning agricultural investments, food security, and the overall robustness of the value chain.”

He said the collaboration would also unlock the full potential of the sector and place it on a renewed path for success, especially within a post-pandemic economy.

The President of AFGEAN, Tajuddeen Dantata, said, “By creating dialogue and fostering investment in the horticulture sector, this partnership will endeavor to support Farmforte in its exporting efforts by improving operational efficacy and cost-savings, while ultimately driving socio-economic growth in the country.”

The Chief Executive Officer, HYBR, Charles Ojei, said to drive inclusion, sustainability, job creation, and Nigeria’s overall economic growth, the optimisation of the agriculture value chain was critical.

“This collaboration is a fusion of the complementary capabilities of all partners to move a bigger agenda forward.”

The Managing Partner, ALTS, Akintunde Sawyerr, said, “The goal of this partnership is to support Farmforte’s vision of becoming the largest agribusiness by 2035 via scalable and world-class innovation across its enterprise.”

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