Connect with us

Finance

Nigeria’s Manufacturers Spend N1.88 Trillion on Raw Materials Import in 9 Months

Manufacturers attributed to foreign exchange scarcity that made it impossible for most firms to import as usual, and in most cases compelled them to seek local alternatives

Published

on

robo - Investors King

Despite efforts to reduce importation and increase the percentage of local contents in production, Nigeria’s manufacturers still spent N1.88 trillion on raw materials importation in the first nine months of the year, according to the latest report from the National Bureau of Statistics (NBS).

The report which covers the first three quarters of the year pointed out that despite the size of importation, the raw materials imported decreased by 22.36% from the N2.43 trillion imported in the same period of 2021.

This, manufacturers attributed to foreign exchange scarcity that made it impossible for most firms to import as usual, and in most cases compelled them to seek local alternatives.

They, therefore, lamented the challenges in accessing forex at the black market where the exchange rate against the United States Dollar was as high as N800/$ a point this year.

Speaking on the situation, George Onafowokan, the Chief Executive Officer of Coleman Technical Industries, explained that the weak Naira, especially in the black market where most manufacturers source forex, was the reason for weak manufacturing activities.

He said, “The volatility which caused a 36 per cent increase in one week or so was not to anybody’s benefit. It distorted the markets. Manufacturers kept repositioning, and eventually, the whole manufacturing sector almost went into comatose. Some companies had to stop selling and production, because there was no way they could replace their stock.”

Nigeria’s manufacturers are indirectly forced to deal with the irregularities of an unstructured black market when Bureau de change operators were denied forex allocation.

“Whether you are buying raw materials or machinery, you are still dependent on the black market, unfortunately,” he said.

On his part, Ike Ibeabuchi, a manufacturer of chemicals and Chief Executive Officer of MD Company Limited said even himself has been struggling with severe raw material shortages due to forex illiquidity.

“My raw materials were depleted two months ago, but I have not been able to restock them because I cannot find dollars. Also, the dollar rate is also making it almost impossible for many of us to continue in the manufacturing business,” he said.

Another manufacturer, the Chief Executive Officer of Kenfrancis Farms, Ifeanyi Okereke, said forex inaccessibility has forced him to shut down his own company.

He said, “We started in 2016 believing in Nigeria and hoping that we could process agro products and export them, but getting raw materials to carry out this objective became a problem. Our cost of production skyrocketed and, at a point, it became clearly impossible to continue operations. We suffered severe shortages before we closed down,” he said.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

Continue Reading
Comments

Banking Sector

Jaiz Bank Reports N5.946 Billion Profit in 2022 Financial Year

Published

on

Jaiz Bank

Nigeria’s leading digital bank, Jaiz Bank Plc has announced a 45.58% increase in profit after tax to N5.946 billion for the financial year ended December 31, 2022.

In the unaudited financial statement obtained by Investors King, the lender’s income from financing contracts grew to N21.589 billion in 2022, a 41.98% increase when compared to N15.205 billion recorded in 2021 financial year.

Income from investment activities inched higer from N8.972 billion filed in the corresponding period to N9.862 billion, representing a 9.92% growth. Therefore, gross income stood at N31.450 billion in the period under review.

Bank’s share as equity investor improved by 34.73% to N27.562 billion from N20.457 billion. Net spread after provision also expanded to N20.656 billion.

The bank’s total income appreciated by 31.73% to a combined N22.635 billion in the period under review. As expected, total expenses rose by 24.63% to N15.965 billion from N12.809 billion in 2021.

Profit before tax increased to N6.669 billion while the bank paid income tax of N583.595 million. The bank declared N5.946 billion profit after tax.

In September 2022, the  Managing Director/CEO, Dr. Sirajo Salisu, who commented on the bank’s performance, said the “bank remained committed to providing value-creating ethical banking services to its growing customer base.  He assured that the Bank is positioned to continue its remarkable earnings streak for the remainder of the year, by leveraging on technology and extending its touch points across the country.”

Continue Reading

Finance

How Newly Inaugurated Grid-Connected Solar Power Plant Will Boost Nigeria’s Economy – NSIA, Others

Published

on

Solar Generator

Stakeholders in the economy and power sectors in Nigeria have revealed that the newly inaugurated 10-megawatt Kano Solar Power Project is the nation’s largest grid-connected solar PV plant.

To this end, they said the project, which was unveiled on Monday by President Muhammadu Buhari has many benefits to the nation’s economy.

According to the Nigeria Sovereign Investment Authority (NSIA) which funded the project with the sum of $ 16 million, the plant would catalyse growth in the power sector and also transform the economy.

NSIA, in a statement, said quality job was carried out on the project which was described as the current largest grid-connected solar PV plant in the country, adding that its quality installation was an evidence of successful mid-sized solar PV deployment in Nigeria.

Specifically, the investment authority said the project would bring about development in the power sector and that more investors would pick interest in the country.

The agency also noted that the project would promote Nigeria’s credentials in the fight against climate change and make it more committed in its efforts at attaining net zero carbon emissions by 2060.

Another stakeholder, Umar-Sadiq, noted that the solar project would usher tremendous impacts in the nation’s energy sector, of which ripple effects would be felt in the economy.

Sadiq disclosed that the socio-economic and environmental impacts the plant would fetch to the country would draw international effects, adding that the country’s at providing access to clean, affordable, and sustainable energy to local industries and other consumers would be fastly met.

Also, Sadiq pointed out that more jobs would be created through the plant and thereby reducing the unemployment rate of the country.

Already, he said the project had provided about 2,000 direct and indirect jobs to the Kano community that hosted the plant, saying more than 21,000 solar PV panels, two 6MVA transformers and 52 inverters, a warehouse and storage building, control room, office and workshop, among others would be added.

Meanwhile, giving more insights into the project and its inauguration by the President, NSIA said it was appointed by Buhari to provide funds and manage it.

NSIA added that the President had given it a specific mandate to conceptualise, develop, construct, and operationalise the 10MW solar project on a 24-hectare parcel of land in Kumbotso Local Government Area of Kano State.

While disclosing that President Buhari expressed delight at the sophistication of the equipment used for the plant, the agency said that Haske Solar Company Limited, the project vehicle whose name means light in the Hausa language, was jointly owned by the Federal Government, Kano State Government, and the host LGA.

Investors King reports that the inauguration event of the solar plant was also attended by the Governor of Kano State, Umar Ganduje; Minister of Finance, Budget and National Planning; Zainab Ahmed; Chairman of NSIA Board of Directors, Farouk Gumel; Managing Director, NSIA, Aminu Umar-Sadiq, among others.

 

Continue Reading

Finance

Scandals Rock Nigerian Banks Over New Naira as Customers Lament Exploitation, Hardship

Published

on

Global Banking - Investors King

Most Nigerians, especially the average ones, appear to be going through very difficult moments of their lives over the non-circulation of the redesigned legal tender.

Their hardship has been worsened by crises of fuel hikes and scarcity, and skyrocketing prices of food items, transportation fares and other items.

The Central Bank of Nigeria had ordered Deposit Money Banks to load new naira notes on their Automated Teller Machines (ATMs) for Nigerians to withdraw.

However, checks by Investors King revealed that customers have been complaining of insufficient cash in the ATMs, adding that they are being exploited by operators of Points of Sales (PoS) who have been charging them higher for withdrawing new notes.

Further findings by Investors King showed that some bankers have been involved in shady deals with racketeers through illegal sales of the new currency.

Due to the scarcity of the new notes and failure of most commercial banks to load their ATMs with them, black marketers took advantage of the situation, allegedly purchase new notes from some bankers and sell to customers in dire need of same at exorbitant rates.

These black marketers loiter around some banks in Abuja, Lagos, Port Harcourt, among others seeking patronage from Nigerians who couldn’t get money from the ATMs and those who couldn’t withstand the long queues.

Some of the currency sellers, during separate interviews, revealed that they buy the new notes from some bank officials, adding that such act is one of the reasons why most ATMs are lacking the new notes nor dispensing the old currency

One of the currency dealers said they have been selling the redesigned notes and making huge gains. One of them who identified himself as Umar in Abuja said they often sell N10,000 for N13,000 and N20, 000 for N26,000 in all the denominations the buyer needs

Some of the racketeers claimed that they don’t really purchase the new notes from bankers, rather, they give incentives and maintain suck relationship with the officials of financial institutions.

Also, PoS operators have been fingered in the exploitation and shady financial deals as customers decried that they now pay more charges to withdraw.

PoS operators are said to now charge between N500 and N700 for withdrawal of N5000 and higher charges for withdrawal beyond N5000 that would be paid in new notes.

“It’s now difficult for one to get the money he or she suffered for in this country. People are really going through a lot these days because of this new naira notes. Banks no longer load their ATMs with new notes and where they do, the queues are so unbearable. Because of this, some people have been going to the banks to buy these new notes and sell to people.

“I almost went broke yesterday while trying to withdraw. The annoying part is that traders are now rejecting the old notes. I had to pay more charge of N500 to collect N5000 from a PoS man in my area. The man told me that he had to pay his way out in the bank before getting the new notes,” a resident of Nsukka, Gloria Kelechi narrated.

At some ATM points, customers had to fight their way out before withdrawing while others were left stranded because they couldn’t join the chaotic queues.

Continue Reading
Advertisement
Advertisement




Advertisement
Advertisement
Advertisement

Trending