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COVID-19: Rising Unemployment Rate in Nigeria



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  • COVID-19: Rising Unemployment Rate in Nigeria

It is no longer news that the COVID-19 pandemic has negatively impacted Nigeria’s labour market and eroded recent economic gains.

According to the International Monetary Fund, Nigeria’s economy could contract as much as 3.4 percent in 2020 while the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, had said without a well-structured stimulus package, the nation would plunge into an economic recession this year.

Earlier this month, Access Bank announced it was letting go 75 percent of its workforce to better manage the impact of COVID-19 pandemic on the organization and stay afloat. This was after Arik and other airlines cut April’s salaries by 80 percent and compelled all staff to go on compulsory leave starting from May 1st.

Hadi Siriki, the Minister of Aviation, during a COVID-19 briefing in Abuja a few days ago, said the aviation sector is losing about N17 billion per month, saying many of the domestic airlines would not make it out of COVID-19 pandemic without government’s support.

The nation’s unemployment rate stood at 23.1 percent or 20.9 million with youths’ underemployment/unemployment rate current at 55.4 percent in a nation with the largest youth population in Africa and one of the largest in the world.

The rising unemployment rate amid zero new job creation highlighted Nigeria’s precarious situation, especially when the nation’s weak foreign reserves, inability to sell crude oil, rising capital flight and expected high layoffs are factored in.

Experts have said the Central Bank of Nigeria needs to lower interest rates to stimulate economic growth and compel deposit money banks to further increase credit facility to the private sector or rather increase loan to deposit ratio from 65 percent to 70 percent.

However, the effectiveness of that method is uncertain given the recent reports that several businesses are holding off on loan applications due to the disruption in global supply chain and the recent Naira devaluation. The central bank had devalued the Naira to protect the foreign reserves and curb excessive capital outflow by foreign investors liquidating their investments in Nigeria.

Therefore, except the Federal Government lowered interest rate and aggressively stimulate the economy across key sectors, the unemployment rate will jump above 30 percent as more companies will layoff regardless of government position.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade experience in the global financial markets.


Nigeria’s Real Estate Sector Shrinks by 8.06% in the Third Quarter -NBS



Economic uncertainty plunged Nigeria’s real estate sector by 8.06 percent in the third quarter of the year, according to the National Bureau of Statistics (NBS).

Nigeria’s statistics office said “In nominal terms, real estate services recorded a growth rate of –8.06 per cent in the third quarter of 2020, indicating a decline of –11.78 per cent points compared to the growth rate at the same period in 2019, and by 9.12 per cent points when compared to the preceding quarter.

“Quarter-on-quarter, the sector growth rate was 18.92 per cent.

“Real GDP growth recorded in the sector in Q3 2020 stood at -13.40 per cent, lower than the growth recorded in third quarter of 2019 by –11.09 per cent points, but higher relative to Q2 2020 by 8.59 per cent points.

“Quarter-on-quarter, the sector grew by 17.15 per cent in the third quarter of 2020.

“It contributed 5.58 per cent to real GDP in Q3, 2020, lower than the 6.21 per cent it recorded in the corresponding quarter of 2019.”

Nigeria’s economy contracted by 2.48 percent in the first nine months following a 6.10 percent and 3.62 percent contraction in the second and third quarters respectively.

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Nigeria Requires N400 Billion Annually to Maintain Federal Roads -Senator Bassey




The Chairman of the Senate Committee on road maintenance, Senator Gersome Bassey, on Friday said Nigeria requires about N400 billion annually to maintain federal roads across the country.

The Senator, therefore, described the N38 billion budgeted for road repairs in the 2021 proposed Budget as grossly inadequate. According to him, nothing meaningful could be achieved by the Federal Roads Maintenance Agency (FERMA) with such an amount.

He said, “For the 35 kilometres federal roads in the country to be motorable at all times, the sum of N400bn is required on yearly basis for maintenance.”

Bassey “What the committee submitted to the Appropriation Committee in the 2021 fiscal year is the N38bn proposed for it by the executive which cannot cover up to one quarter of the entire length of deplorable roads in the country.

“Unfortunately, despite having the power of appropriation, we cannot as a committee jerk up the sum since we are not in a position to carry out the estimation of work to be done on each of the specific portion of the road.

“Doing that without proposals to that effect from the executive, may lead to project insertion or padding as often alleged in the media.”

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Scarcity of Day-Old-Chicks Cripple Poultry Farmers in Akwa Ibom




Despite billions of Naira spent on Akwa Prime Hatchery and Poultry Limited by the Executive Governor of Akwa Ibom State, Udom Emmanuel, poultry farmers in the state said they had to order day-old-chicks from outside the state as the 200,000 capacity poultry farm developed specifically to make day-old-chicks and other poultry products available at affordable prices is almost empty at the moment.

The farmers expressed frustration over many challenges they face in the course of bringing day-old-chicks from outside the state. Usually, Ibadan, Enugu and sometimes as far as Kaduna, while the hatchery built and inaugurated in 2016 remains idle.

Mr Ekot Akpan, one of the poultry farmers who spoke with the pressmen said the state had not had it this bad.

Akpan said: “For the 12 years that I have been in poultry farming, this is the first time that poultry farmers have been so harshly affected by both economic and non-economic factors. And, quite unfortunately, nobody is available to offer any explanation.

“Farmers have been left at the whims and caprice of owners of the means of production.

“There seems to be no government regulation of the poultry industry. How, do you explain a situation where you wake up suddenly and the price of a day old chick is selling for N600, a bag of feed goes as high as N6,000.

“And, in a state that government claims to be pursuing agriculture as one of his cardinal programmes.

“For instance, in 2016, the state government said it has constructed an hatchery, and the intention according the government was to ensure availability of day old chicks at affordable price to farmers, but, quite, unfortunately, that effort has not yielded any tangible result.

“Farmers are still getting their day old chicks from Ibadan, Kaduna, and Enugu. So, the question now is where is the hatchery?

“One would have expected that farmers would be buying old chicks at humane prices, but, from all indications they acclaimed hatchery is a ruse. So, which one is the Akwa Prime Hatchery producing,” he said.

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