- Nigeria Needs Urgent Reform for Stable Economy, Says IMF
The International Monetary Fund (IMF) is expected to warn Nigeria its economy needs urgent reform, according to a report seen by Reuters that could delay talks over $1.4 billion in international loans.
The Washington-based fund will urge Nigeria, a major oil producer, to introduce immediate changes to its exchange rate policy, and say its recent reform plan is not enough to drag Africa’s biggest economy out of recession, according to the 68-page report.
“Much more needs to be done,” the IMF said in the document, written after a final meeting between its representatives and top officials in the capital Abuja before the fund issues its verdict on Nigeria’s economy, expected on March 29.
“Further actions are urgently needed,” it said.The report – from the fund’s acting secretary and addressed to members of its executive board – is set to form part of the IMF’s verdict, although Nigeria can request alterations.
Three people familiar with the negotiations said it would send an important signal to institutional lenders.The World Bank has been in talks with Nigeria for a loan of at least $1 billion for more than a year and the African Development Bank (AfDB) has $400 million on offer, but discussions have stalled over economic reforms.
Nigeria is seeking the funding for infrastructure investment and to help plug an expected record deficit in this year’s budget as it boosts spending to try to end a recession.
“The tone of the IMF will be critical in terms of signalling,” said one of the people familiar with the negotiations, who spoke on condition of anonymity because they were not authorised to speak to media.Two of the people with knowledge of the loan talks said the lenders were unlikely to withhold funding entirely.
President Muhammadu Buhari has rejected a devaluation of the naira currency and backed curbs imposed by the central bank that force firms to buy dollars needed for imports for a premium on the black market.
Nigeria has at least five exchange rates – the official one, a rate for Muslim pilgrims travelling to Saudi Arabia, one for school fees abroad and a retail rate set by licensed exchange bureaus.
The IMF said that if Nigeria did not remove foreign exchange restrictions and unify the exchange rates, it risked “further deterioration in (forex) reserves” and “disorderly exchange rate depreciation.”The report said Nigeria should also tackle its over-dependence on oil, low government revenues, a large infrastructure deficit, a rising debt service and double-digit inflation.
Nigeria has not asked the IMF for fiscal support. An IMF spokeswoman declined to comment.A spokesman for the presidency directed inquiries to the ministries of finance and budget and national planning. The finance ministry and central bank did not respond to repeated attempts to seek comment. A budget and planning ministry spokesman declined to comment.
A World Bank spokeswoman said the lender was continuing its discussions with Nigeria and other partners and “will determine with the government the most appropriate lending instrument to support the implementation” of reform plans.
The AfDB declined to comment.
Earlier this month, Nigeria released an Economic Recovery and Growth Plan (ERGP) for 2017 to 2020 calling for a market-determined exchange rate. But it offers few concrete steps.
The ERGP “is more optimistic on growth than (IMF) staff… does not explicitly call for tighter monetary and fiscal policy in the near term, and assumes no immediate change in exchange rate policy – all of which are essential to reduce vulnerabilities and increase investors’ interest,” said the IMF.Delays in adopting these policies increase vulnerabilities and risk reforms being politicised ahead of the 2019 elections, the IMF said.
Nigeria’s woes go beyond its economy, said the report, piling additional challenges onto the government. The northeast is in the throes of a humanitarian crisis caused by the Boko Haram Islamist insurgency, which is threatening millions with starvation.
Adoption of a fully flexible exchange rate would likely see the naira, which is propped up by the central bank but trades around 30 percent weaker on the parallel market, plummet in value.
Buhari, a 74-year-old former military ruler who led the country for 20 months in the 1980s, resisted pressure from the IMF and World Bank to devalue the naira in his previous tenure before being deposed in a coup.Two of the people with knowledge of the negotiations said even without the IMF’s proposed reforms, the World Bank and AfDB were likely to offer the loans to Nigeria.
“There might be some eye-rolling but then they’ll still go through with the loans,” said one, a diplomat, adding that the World Bank could offer its money in tranches as a way of holding back and enforcing reforms.
The report said Nigeria should articulate a sustainable fiscal policy and adopt structural reforms to diversify the economy away from its dependence on oil and promote competitiveness.
“The outlook is challenging, with growth expected to remain flat and macroeconomic imbalances to persist,” it said.
Klaus Leidorf on
U.S. New Home Sales Jump 108% Over the Last 10 Years
Data presented by Buy Shares indicates that the United States’ new home sales annual rate has grown by 108.45%. The growth was recorded between 2010 and 2020.
Homes sales spear amid pandemic
The highest sales were recorded this year at 697, 542 as of September 28th, a growth of 2.9% from last year’s 677,386. Over the last decade, the lowest sales were registered in 2011 at 309,853, a drop of 7.40% from 2010’s 334,624.
From the data, it is clear that the new home sales have been rising despite the economic uncertainties. According to the research report:
“The rise in new home sales is a good indicator considering that the United States real estate market was among the worst hit by the coronavirus pandemic. The high sales show a rising momentum as the economy continues to recover from the pandemic.”
The research also overviewed the sales relating to the existing homes where the annual rate jumped by 128%. From the data, the highest sales were recorded this year at about 1.3 million. Last year, the figure stood at 1.2 million. The lowest sales were recorded ten years ago at 577,774.
An overview of the new home median sale price shows a spike of 46.96% The existing home median sale price had a growth of 62.08%. In 2020, the new home sale median price was $332,560, while ten years ago the figure stood at $219,484. On the other hand, the median sale for existing homes stands at $280,134 while ten years ago, the price was $174,843.
USAID/Power Africa Announces $2.6m in Healthcare Electrification Grants to Solar Energy Companies in Nine Countries in Sub-Saharan Africa
Power Africa, through the United States Agency for International Development (USAID), announces grants totaling $2,620,650 to solar energy companies to provide reliable, affordable off-grid electricity to nearly 300 healthcare facilities in sub-Saharan Africa.
Nearly 60 percent of all healthcare facilities in sub-Saharan Africa have no access to electricity, and of those that do, only 34 percent of hospitals and 28 percent of health clinics have reliable, 24-hour access. Energy is critical for powering essential devices, medical and sterilization equipment, diagnostics, cold storage for vaccines and medication, information technology, and lights to enable the delivery of continuous health care services. Efficient health services and responses to diseases – including COVID-19 – depend on reliable access to electricity.
In support of the accelerated provision of off-grid solar energy to healthcare facilities in sub-Saharan Africa, Power Africa is awarding grants to the following solar energy companies:
- Havenhill Synergy Ltd. (Nigeria)
- KYA-Energy Group (Togo)
- Muhanya Solar Ltd. (Zambia)
- Nanoé (Madagascar)
- OffGridBox (Rwanda)
- OnePower (Lesotho)
- PEG Solar (Ghana)
- SolarWorks! (Mozambique)
- Zuwa Energy (Malawi)
These companies will utilize Power Africa funding to provide off-grid solar electricity solutions to 288 healthcare facilities across the nine countries represented.
“Solar energy holds great potential to expand and improve health care delivery in sub-Saharan Africa, and off-grid solar technology offers a clean, affordable, and smart solution to electrify healthcare facilities located beyond the reach of national electricity grids,” said Mark Carrato, Power Africa Acting Coordinator. “Power Africa’s experience shows that off-grid solar energy systems can be rapidly deployed to even the most rural facilities.”
“These awards demonstrate what we can accomplish when the public and private sectors join together to break down the barriers to reliable electricity for rural healthcare facilities,” said Chris Milligan, Counselor to USAID, on September 22, 2020 during a virtual event announcing the grant awardees.
ABOUT THE GRANTEES AND HOW THEY WILL POWER HEALTHCARE IN RURAL COMMUNITIES
Havenhill Synergy will electrify 21 rural healthcare facilities in Oyo State, Nigeria, using an energy-as-a-service business model. The facilities are mostly within peri-urban communities with limited reliable electricity access. Havenhill will provide long-term operation and maintenance of the solar energy systems.
KYA-Energy Group will electrify 20 health centers in Togo. In addition to electricity access, KYA will provide automated solar hand washing stations for infection prevention and solar phone charging stations for generating additional income.
In partnership with the Churches Health Association of Zambia, Muhanya Solar Ltd. will provide electricity access to seven rural health facilities in Zambia. Muhanya will also electrify staff housing to generate revenue for the operation and maintenance of the solar systems installed at the health facilities.
Nanoé will electrify 35 rural health facilities in the Ambanja and Ambilobe districts of Madagascar. The company will deploy nano-grids with the health facilities as anchors and connections running to staff housing. Electricity will be sold to the surrounding communities to generate income for the operation and maintenance of the nano-grids.
With their containerized solution, OffGridBox will provide renewable energy and clean water to six rural clinics in Rwanda. The company will also set up a pay-as-you-go (PAYGO) business model, selling electricity and clean water to the surrounding communities.
OnePower will electrify seven rural health facilities in Lesotho, using the facilities as anchor loads for mini-grids. In addition to powering the health facilities, the mini-grids will provide electricity access for rural communities served by the facilities.
PEG Solar will provide electricity access to 91 rural community healthcare facilities in Ghana. PEG will adopt a private sector approach to energy service delivery for public health facilities, enabling rapid electrification of the facilities while significantly reducing the upfront financial burden of transitioning to solar energy.
SolarWorks! will electrify 92 rural healthcare facilities in Mozambique’s Sofala province. To ensure sustainability of the systems beyond the grant implementation period, SolarWorks! will cover operational and maintenance costs of the solar energy systems for five years.
Zuwa Energy will install solar energy solutions in nine health facilities in Malawi. Electricity access will enable the facilities to provide higher-quality health services throughout the day and more comprehensive services at night. Additionally, Zuwa will electrify staff housing with the aim to increase staff wellbeing and retention rates.
“Through these grants, USAID is investing in a set of pilot projects that demonstrate how healthcare electrification can be delivered in a commercially sustainable manner, with strong private sector involvement,” said David Stonehill, the Lead for Power Africa’s Beyond the Grid initiative. “These grants demonstrate the Power Africa model in action: We use a modest amount of public funding to de-risk transactions, thus opening the door for private investment.”
Market Cap of Five Largest Hotel Chains Decline by $25.2bn Amid Coronavirus Crisis
World`s Five Largest Hotel Chains Lost $25.2bn in Market Cap Amid Coronavirus Crisis
The coronavirus outbreak has affected every sector across the globe, but the hotel industry is among the hardest hit. Although hotels implemented increased safety and sanitation measures and cautiously reopened for the summer travel season, recovery to pre-COVID-19 levels could take years.
According to data presented by Stock Apps, the combined market capitalization of Wyndham Hotels and Resorts, Choice Hotels International, Marriott International, Intercontinental Hotels Group, and Hilton Worldwide Holdings, as the five largest hotel chains in the world, hit $79.2bn in September, a $25.2bn plunge since the beginning of 2020.
Marriot International Witnessed the Biggest Market Cap Drop in 2020
To curb the spread of the virus, countries across the world have imposed lockdown rules, leading to thousands of canceled vacations, and closed hotels between March and May. Although many of them lifted off travel restrictions in the last three months, the first two quarters of the year produced colossal revenue and market cap drops to the largest hotel chains globally.
The market cap of Wyndham Worldwide, the biggest hotel chain in the world by the number of hotels, stood at $5.89bn in December, revealed the Yahoo Finance data. By the end of March, this figure dropped to $2.93bn. Although the second and third quarter of 2020 brought a recovery, the combined value of stocks of the U.S. corporation, which owns 8,092 hotels, stood at over $5bn in September, an $870 million plunge since the beginning of the year.
The second-largest hotel chain globally, Choice Hotels International, lost $440 million in market capitalization amid the coronavirus crisis. In December 2019, the total value of stocks of the company that owns 7,118 properties amounted to $5.76bn. During the last nine months, this figure dropped to $5.32bn.
However, statistics indicate that Marriot International, the third-largest hotel chain with 5,974 hotels in more than 110 countries, witnessed the most significant drop in market capitalization since the beginning of the year. In December, the combined value of stocks of the Washington-based corporation stood at $49.51bn. By the end of the second quarter, it halved to $24.25bn. Although the company’s market cap recovered to $33.86bn in September, this figure still represents a 31% plunge since the beginning of 2020.
Intercontinental and Hilton Lost $8.3bn in Total Stock Value
Intercontinental Hotels Group ranked as the fourth largest hotel chain globally, with 5,070 hotels across nearly 100 countries. Statistics indicate the market capitalization of the British multinational hospitality company amounted to $12.3bn in December 2019. After falling to $6.2bn in March, it rose to $9.7bn in September, a 21% plunge amid the coronavirus crisis.
The total value of Hilton Worldwide Holdings stocks, the fifth-largest chain of hotels globally, dropped by $5.66bn since the beginning of 2020. In December, the market cap of the hotel group that generated around $9.45bn in revenue last year stood at $30.94bn. After a sharp drop caused by the Black Monday crash, it recovered to $25.28bn in September. Nevertheless, the figure represents an 18% fall since the beginning of the year. Statistics show two hotel groups lost $8.3bn in combined market capitalization amid the coronavirus crisis.
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