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Nigeria Aims for $1 Trillion Economy by 2030 with New Inclusion Initiative



Nigerian Breweries - Investors King

In a bold move to propel Nigeria towards a $1 trillion economy by 2030, the federal government has launched an ambitious initiative aimed at establishing an operating model and framework for economic and financial inclusion.

This initiative, announced on Wednesday, underscores the administration’s commitment to combating poverty and driving sustainable economic growth from the ground up.

Vice President Kashim Shettima, speaking during the kickoff meeting for the initiative, highlighted its significance as a core component of President Bola Ahmed Tinubu’s Renewed Hope Agenda.

The Vice President emphasized that this project symbolizes the administration’s dedication to enhancing financial and economic inclusion across Nigeria.

“This initiative represents our unwavering commitment to providing universal access to financial services and creating a broad-based prosperity that will lift millions out of poverty,” Shettima said. “At the heart of every strategy championed by President Tinubu, there has been a need to prioritize inclusive economic growth and development.”

The launch of the Aso Accord on Economic and Financial Inclusion on April 25, 2024, laid the groundwork for this multi-faceted blueprint.

The accord aims to achieve universal access to financial services, addressing both economic and security challenges through inclusive growth.

Vice President Shettima noted several positive outcomes from the administration’s efforts, including the recent upgrade of Nigeria’s credit outlook to positive by Fitch Ratings.

This upgrade reflects growing confidence in Nigeria’s economic trajectory and the progress of policy reforms aimed at easing the country’s debt service burden.

“While such an upgrade by a distinguished institution reflects growing confidence in our economic trajectory, particularly in light of policy changes aimed at easing our debt service burden, we remain mindful of the short-term impacts of these reforms,” Shettima said.

“Hence, we are prioritizing measures to mitigate immediate effects, from the Student Loan Act, which democratizes access to education, to the relentless efforts of the Federal Ministry of Agriculture and Food Security in combating food insecurity.”

The Vice President stressed that the approach to inclusive growth must be strategic and sustainable, hence the elevation of economic and financial inclusion to the agenda of the National Economic Council (NEC).

This body includes governors from all 36 states and the FCT minister, who participate in crucial policy deliberations alongside other stakeholders.

“You have been entrusted with a vital national assignment, and I have full confidence that you will bring your best efforts to ensure its success,” Shettima told the implementation team.

“As we embark on this essential initiative, I call upon each of you to contribute your insights, expertise, and dedication. Only through such resolve and discipline can we forge a robust operating model that will drive economic and financial inclusion across our nation, ensuring every Nigerian has the opportunity to thrive.”

Technical Advisor to the President on Financial Inclusion, Dr. Nurudeen Abubakar Zauro, reported substantial progress in implementing the Aso Accord on financial inclusion.

The initiative has garnered support and funding from notable organizations, including the Bill & Melinda Gates Foundation through the Lagos Business School.

Dr. Zauro detailed the ongoing efforts to set up the operating model and legal framework to ensure the project’s smooth takeoff and alignment with the Renewed Hope Agenda.

The team includes Augmentum Advisory, Banwo & Ighodalo, and Ndarani (SAN) & CO. He also highlighted plans for capacity-building initiatives and high-profile training for permanent secretaries and finance commissioners to enhance practical knowledge of financial inclusion.

Prof. Olayinka David-West, Project Manager at the Lagos Business School, commended the administration for prioritizing economic and financial inclusion.

She noted that the initiative aims to establish a legal framework and national coordination to drive ownership and successful implementation across the country.

The project seeks to galvanize relevant authorities and stakeholders to key into the initiative, creating a robust platform for inclusive economic growth that will transform Nigeria into a $1 trillion economy by 2030.

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

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Goldman Sachs Urges Bold Rate Hike as Naira Weakens and Inflation Soars



Central Bank of Nigeria (CBN)

As Nigeria grapples with soaring inflation and a faltering naira, Goldman Sachs is calling for a substantial increase in interest rates to stabilize the economy and restore investor confidence.

The global investment bank’s recommendation comes ahead of the Central Bank of Nigeria’s (CBN) key monetary policy decision, set to be announced on Tuesday.

Goldman Sachs economists, including Andrew Matheny, argue that incremental rate adjustments will not be sufficient to address the country’s deepening economic challenges.

“Another 50 or 100 basis points is certainly not going to move the needle in the eyes of an investor,” Matheny stated. “Nigeria needs a bold, decisive move to curb inflation and regain investor trust.”

The CBN, under the leadership of Governor Olayemi Cardoso, is anticipated to raise interest rates by 75 basis points to 27% in its upcoming meeting.

This would mark a continuation of the aggressive tightening campaign that began in May 2022, which has seen rates increase by 14.75 percentage points.

Despite this, inflation has remained stubbornly high, highlighting the need for more substantial measures.

The current economic landscape is marked by severe challenges. The naira’s depreciation has led to higher import costs, fueling inflation and eroding consumer purchasing power.

The CBN has attempted to ease the currency’s scarcity by selling dollars to local foreign exchange bureaus, but these efforts have yet to stabilize the naira significantly.

“Developments since the last meeting have definitely been hawkish,” noted Matheny. “The naira has weakened further, exacerbating inflationary pressures. The CBN’s policy needs to reflect this reality more aggressively.”

In response to the persistent inflation and naira weakness, analysts are urging the central bank to implement a more coherent strategy to manage the currency and inflation.

James Marshall of Promeritum Investment Management LLP suggested that the CBN should actively participate in the foreign exchange market to mitigate the naira’s volatility and restore market confidence.

“The central bank needs to be a more consistent and active participant in the forex market,” Marshall said. “A clear strategy to address the naira’s weakness is crucial for stabilizing the economy.”

The CBN’s decision will come as the country faces a critical period. With inflation expected to slow due to favorable comparisons with the previous year and new measures to reduce food costs, including a temporary import duty waiver on wheat and corn, there is hope that the economic situation may improve.

However, analysts anticipate that the CBN will need to implement one final rate hike to solidify inflation’s slowdown and restore positive real rates.

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Currency Drop Spurs Discount Dilemma in Cairo’s Markets



Egyptian pound

Under Cairo’s scorching sun, the bustling streets reveal an unexpected twist in dramatic price drops on big-ticket items like cars and appliances.

Following March’s significant currency devaluation, prices for these goods have plunged, leaving consumers hesitant to make purchases amid hopes for even better deals.

Mohamed Yassin, a furniture store vendor, said “People just inquire about prices. They’re afraid to buy in case prices drop further.” This cautious consumer behavior is posing challenges for Egypt’s consumer-driven economy.

In March, Egyptian authorities devalued the pound by nearly 40% to stabilize an economy teetering on the edge. While such moves often lead to inflation spikes, Egypt’s case has been unusual.

Unlike other nations like Nigeria or Argentina, where costs soared post-devaluation, Egypt is witnessing falling prices for high-value items.

Previously inflated prices were driven by a black market in foreign currency, where importers secured dollars at exorbitant rates, passing costs onto consumers.

Now, with the pound stabilizing and foreign currency more accessible, retailers are struggling to sell inventory at pre-devaluation prices.

Despite price reductions, the overall consumer market remains sluggish. The automotive sector has seen a near 75% drop in sales compared to pre-crisis levels.

Major brands like Hyundai and Volkswagen have slashed prices by about a quarter, yet buyers remain cautious.

The economic strain is not limited to luxury items. Everyday expenses continue to rise, albeit more slowly, with anticipated hikes in electricity and fuel prices adding to the pressure.

Experts highlight a period of adjustment as both consumers and traders navigate the volatile exchange-rate environment. Mohamed Abu Basha, head of research at EFG Hermes, explains, “The market is taking time to absorb recent fluctuations.”

Meanwhile, businesses face declining sales, impacting their ability to manage operating costs. Yassin’s store has offered discounts of up to 50% yet remains quiet. “We’ve tried everything, but everyone is waiting,” he laments.

The devaluation has spurred a shift in economic dynamics. Inflation has eased, but the pace varies across sectors. Clothing and transportation costs are up, while food prices fluctuate.

With the phasing out of fuel subsidies and potential electricity price increases, Egyptians are bracing for further financial strain. The recent 300% rise in subsidized bread prices adds another layer of concern.

The situation underscores the balancing act between maintaining consumer confidence and attracting foreign investment.

Economists suggest potential stimulus measures, such as lowering interest rates or increasing public spending, to boost demand.

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MPC Meeting on July 22-23 to Tackle Inflation as Rates Set to Rise Again



Interbank rate

The Monetary Policy Committee (MPC) is set to convene on July 22-23, 2024, amid soaring inflation and economic challenges in Nigeria.

Led by Olayemi Cardoso, the committee has already increased interest rates three times this year, raising them by 750 basis points to 26.25 percent.

Nigeria’s annual inflation rate climbed to 34.19 percent in June, driven by rising food prices. Despite these pressures, the Central Bank of Nigeria (CBN) projects that inflation will moderate to around 21.40 percent by year-end.

Market analysts expect a further rate hike as the committee seeks to rein in inflation. Nabila Mohammed from Chapel Hill Denham anticipates a 50–75 basis point increase.

Similarly, Coronation Research forecasts a potential rise of 50 to 100 basis points, given the recent uptick in inflation.

The food inflation rate reached 40.87 percent in June, exacerbated by security issues in key agricultural regions.

Essential commodities such as millet, garri, and yams have seen significant price hikes, impacting household budgets and savings.

As the MPC meets, the National Bureau of Statistics is set to release data on selected food prices for June, providing further insights into the inflationary trends affecting Nigerians.

The upcoming MPC meeting will be crucial in determining the trajectory of Nigeria’s monetary policy as the government grapples with economic instability.

The focus remains on balancing inflation control with economic growth to ensure stability in Africa’s largest economy.

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