- Foreign Phone Manufacturers Abandon Nigerian Factory Plans
Contrary to the report that some foreign manufacturer of mobile phones indicated interest in the establishment of production centers in Nigeria, indications that such plans have been abandoned have emerged.
Entry barriers into the market, coupled with the emergence of cheaper phones, have further restrained top mobile phone brands like Samsung, Nokia, Blackberry and Tecno who had in the past indicated interest in promoting technology transfer and opening a new vista of employment in the country by establishing their production plants in the country.
Statistics from Euromonitor showed that mobile phone brands owned by Transsion Holdings, maker of Tecno, Itel and Infinix, have the highest market share in Nigeria. A share which Tecno had 41 per cent of the market share, Itel 25.8 per cent and infinix 8.5 per cent.
Nokia has a market share of 8.7 per cent, while Samsung devices are the fifth fast-selling brand in Nigeria with a market share of 7.6 per cent.
Speaking at a visit to Lagos in 2018, the Chief Executive Officer, Samsung Electronics Africa, Mr Sung Yoon stated that the company would not establish a factory in Nigeria due to its low market share, infrastructural deficit and grey market in the country.
Also, Yoon said Samsung have manufacturing plants in Vietnam, China, South Africa and Korea, adding that the production of mobile devices requires over 400 components that have to be imported.
The President, Association of Telecommunications Operators of Nigeria, Mr Olusola Teniola, speaking on the barriers to entry into the Nigerian market, pointed out some barriers to market entry as import duties, taxes, and levies that were imposed on imported components of mobile phones.
Continuing on this, Teniola said the removal of the barriers will encourage investment by phone manufacturers in the country.
Again, he emphasized that the infiltration of counterfeit mobile devices that offered lower prices creates unfavourable competition for genuine manufacturers who bear huge costs in the production of quality mobile phones.
“The issue of fake phones, which represents 10 per cent of the phones that are readily available in the market, also acts as a barrier and a dissuader for manufacturers to come in.
“When you have smugglers bringing in substandard products, they can now under-price those that have actually had to take on the costs of running their businesses in Nigeria plus the cost of manufacturing in Nigeria.
“You cannot go below a certain price because it will be below your cost. So, smugglers of fake phones come in and go below your cost because they are not registered; they do not pay taxes in Nigeria and they don’t pay import duties because they smuggle their phones into the country. So, their prices are way below. That is a threat.
“This will kill the manufacturing industry, especially when the government is trying to encourage OEMs to come into the country. The government needs to remove and give incentives because there’s literally a high cost to OEMs. We need the government to assist by giving the concessions for a period of time. We need the Standards Organisation of Nigeria, the Nigerian Communications Commission and the Nigeria Customs Service to collaborate to fight the menace of fake phones that are smuggled across the borders of Nigeria.” he said.
Brent Crude Oil Approaches $70 Per Barrel on Friday
Nigerian Oil Approaches $70 Per Barrel Following OPEC+ Production Cuts Extension
Brent crude oil, against which Nigerian oil is priced, rose to $69 on Friday at 3:55 pm Nigerian time.
Oil price jumped after OPEC and allies, known as OPEC plus, agreed to role-over crude oil production cuts to further reduce global oil supplies and artificially sustain oil price in a move experts said could stoke inflationary pressure.
Brent crude oil rose from $63.86 per barrel on Wednesday to $69 per barrel on Friday as energy investors became more optimistic about the oil outlook.
While certain experts are worried that U.S crude oil production will eventually hurt OPEC strategy once the economy fully opens, few experts are saying production in the world’s largest economy won’t hit pre-pandemic highs.
According to Vicki Hollub, the CEO of Occidental, U.S oil production may not return to pre-pandemic levels given a shift in corporates’ value.
“I do believe that most companies have committed to value growth, rather than production growth,” she said during a CNBC Evolve conversation with Brian Sullivan. “And so I do believe that that’s going to be part of the reason that oil production in the United States does not get back to 13 million barrels a day.”
Hollub believes corporate organisations will focus on optimizing present operations and facilities, rather than seeking growth at all costs. She, however, noted that oil prices rebounded faster than expected, largely due to China, India and United States’ growing consumption.
“The recovery looks more V-shaped than we had originally thought it would be,” she said. Occidental previous projection had oil production recovering to pre-pandemic levels by the middle of 2022. The CEO Now believes demand will return by the end of this year or the first few months of 2022.
“I do believe we’re headed for a much healthier supply and demand environment” she said.
Oil Jumps to $67.70 as OPEC+ Extends Production Cuts
Oil Jumps to $67.70 as OPEC+ Extends Production Cuts
Brent crude oil, against which Nigerian oil is priced, rose to $67.70 per barrel on Thursday following the decision of OPEC and allies, known as OPEC+, to extend production cuts.
OPEC and allies are presently debating whether to restore as much as 1.5 million barrels per day of crude oil in April, according to people with the knowledge of the meeting.
Experts have said OPEC+ continuous production cuts could increase global inflationary pressure with the rising price of could oil. However, Saudi Energy Minister Prince Abdulaziz bin Salman said “I don’t think it will overheat.”
Last year “we suffered alone, we as OPEC+” and now “it’s about being vigilant and being careful,” he said.
Saudi minister added that the additional 1 million barrel-a-day voluntary production cut the kingdom introduced in February was now open-ended. Meaning, OPEC+ will be withholding 7 million barrels a day or 7 percent of global demand from the market– even as fuel consumption recovers in many nations.
Experts have started predicting $75 a barrel by April.
“We expect oil prices to rise toward $70 to $75 a barrel during April,” said Ann-Louise Hittle, vice president of macro oils at consultant Wood Mackenzie Ltd. “The risk is these higher prices will dampen the tentative global recovery. But the Saudi energy minister is adamant OPEC+ must watch for concrete signs of a demand rise before he moves on production.”
Gold Hits Eight-Month Low as Global Optimism Grows Amid Rising Demand for Bitcoin
Gold Struggles Ahead of Economic Recovery as Bitcoin, New Gold, Surges
Global haven asset, gold, declined to the lowest in more than eight months on Tuesday as signs of global economic recovery became glaring with rising bond yields.
The price of the precious metal declined to $1,718 per ounce during London trading on Thursday, down from $2,072 it traded in August as more investors continue to cut down on their holdings of the metal.
The previous metal usually performs poorly with rising yields on other assets like bonds, especially given the fact that gold does not provide streams of interest payments. Investors have been jumping on US bonds ahead of President Joe Biden’s $1.9 trillion coronavirus stimulus package, expected to stoke stronger US price growth.
“We see the rising bond yields as a sign of economic optimism, which has also prompted gold investors to sell some of their positions,” said Carsten Menke of Julius Baer.
Another analyst from Commerzbank, Carsten Fritsch, said that “gold’s reputation appears to have been tarnished considerably by the heavy losses of recent weeks, as evidenced by the ongoing outflows from gold ETFs”.
Experts at Investors King believed the growing demand for Bitcoin, now called the new gold, and other cryptocurrencies in recent months by institutional investors is hurting gold attractiveness.
In a recent report, analysts at Citigroup have started projecting mainstream acceptance for the unregulated dominant cryptocurrency, Bitcoin.
The price of Bitcoin has rallied by 60 percent to $52,000 this year alone. While Ethereum has risen by over 660 percent in 2021.
News3 weeks ago
Doctors Warn Covid Will Become Endemic and People Need to Learn to Live With it
Bitcoin2 weeks ago
Bitcoin Rebounds To $50,881 Per Coin on Wednesday
Bitcoin3 weeks ago
Bitcoin Surges Above $50,000 Per Coin on Tuesday, Sets a New All-Time High
News2 weeks ago
U.S. COVID-19 Deaths Hit 500,000
Economy3 weeks ago
Petrol Subsidy May Hit N11.2bn Per Week
Economy4 weeks ago
Petrol Landing Cost Rises to N180, Oil Crosses $60
Cryptocurrency4 weeks ago
Why CBN Bans Banks from Facilitating Cryptocurrency Exchanges
News3 weeks ago
WAEC Releases 2020 Result, Just 39.8 Percent Passed