- Singapore Braces for Globalization Backlash as Trade Fears Grow
Singapore, on track to post its worst economic performance since the 2009 global financial crisis this year, is bracing for more uncertainty as rising protectionism poses risks for the export-dependent nation.
While the government is forecasting economic growth of as much as 3 percent in 2017 — double the maximum it sees for this year — the city-state faces mounting global concerns that could affect trade, including financial market volatility following the U.K.’s vote to leave the European Union, the threat of debt defaults in China and the aftermath of the U.S. election.
“Political risks and uncertainties have risen, and could in turn lead to greater economic uncertainties,” Loh Khum Yean, permanent secretary at the Ministry of Trade and Industry, told reporters in Singapore. “An increasing backlash against globalization could further dampen global trade, which is already weak.”
U.S. President-elect Donald Trump won support by tapping into workers’ anger over job losses linked to globalization. He has pledged not to revive the Trans-Pacific Partnership, a free-trade pact signed by countries including Japan, Australia and Singapore, and to impose higher tariffs on China. Singapore is vowing to push ahead with TPP, Loh said.
The city-state Thursday cut the top end of its 2016 growth forecast to 1.5 percent from 2 percent and estimated non-oil domestic exports probably fell as much as 5.5 percent. The economy contracted an annualized 2 percent in the third quarter from the previous three months, the Ministry of Trade and Industry said in a report.
For next year, the government’s export forecast ranges between a 1 percent decline to a 1 percent gain.
“We find it hard to see the economy improving from this year, going into next year,” Brian Tan, an economist at Nomura Singapore Ltd., said by phone. “You have the protectionist stuff, European elections coming next year, so many risks, it’s hard for us to share the government’s optimism.”
The U.S. is Singapore’s third-largest trading partner, while China is the largest. Loh said Singapore is concerned about “rising corporate credit levels” in Asia’s biggest economy, as a sharper-than-expected correction in the real-estate market could lead to surging defaults in property-related loans.
While the U.K. is a smaller trading market for Singapore, uncertainty about Brexit negotiations could lead to bouts of volatility in financial markets and possibly a slowdown in growth in the U.K. and the euro area in general, Loh said.
Krystal Tan, an economist with Capital Economics Ltd. in Singapore, said she’s anticipating growth in the city-state of about 1.5 percent next year, even as exports stabilize. Borrowing costs, which are closely tied to U.S. interest rates, may rise and curb household and business spending, she said.
“It’s a bit surprising that they have the upper range of their forecast so high at 3 percent,” Tan said by phone. “I would expect the government to cut the top of the forecast gradually over the next few months.”
Nigeria to Become Leading Gold Producer in West Africa – Adegbite
Adegbite Says Nigeria to Become Gold Hub in West Africa
The Minister of Mines and Steel Development, Olamilekan Adegbite, has said Nigeria is on its way to becoming a leading gold producer in West Africa.
Adegbite made the statement in Abuja while taking stock of his first year in office as minister.
He said, “Indeed, the international roadshows we have had in the past have produced fruits. Today, we have Thor exploration in Osun State through the Segilola Gold project.
“The exploration firm is projected to start producing (gold) in the first half of next year. The project is expected to create about 400 direct jobs and 1,000 indirect jobs.”
According to Adegbite, the Federal Government has licensed two gold refineries that would refine in line with the London Bullion Market Association standard.
He added, “Numerous industries will spring up when our gold economy becomes full-fledged. Some of them will include equipment leasing and repairs, logistics and transport, as gold requires a specialised means of transport, security, insurance, aggregators, and so on.”
The minister noted that for the first time, the country had mined, processed and refined gold under the Presidential Artisanal Gold Mining Development Initiative for use as part of Nigeria’s external reserves.
Adegbite also stated that the mines ministry had initiated a process that would lead to local capacity development in the production of barite.
“Presently, the barite that is used in the oil and gas industry is imported. But we are resolved to reverse this trend. As you may know, barite is a critical weighting material in drilling fluids due to its high specific gravity,” he said.
NUPENG, Lagos State Agree to Call Off Strike
NUPENG Agrees With Lagos State, Call Off Strike
The Nigeria Union of Petroleum and Gas (NUPENG) has ordered Lagos State Petroleum Tanker Drivers (PTDs) to call off its ongoing strike.
This was disclosed in a joint communique signed by the Lagos Commissioner of Energy and Mineral Resources, Olalere Odusote, and the NUPENG Deputy National President, Solomon Kilanko.
It would be recalled that Investors King had reported that NUPENG directed all PTDs to withdraw their services from Lagos State effective from Monday 10 August 2020 because of the persistent extortions and harassments of PTDs by both uniform security agencies and touts.
However, on the 10th of August, the commencement day of the strike, Lagos State government met with the leadership of NUPENG to address the union concerns and eventually agreed on a way forward.
Part of the communique reads “The Lagos State Government met today with the representatives of NUPENG, which agreed to call off its strike immediately.
“Other decisions taken at the meeting are security – the state government will meet the heads of all security agencies and secure their commitment to ensure the free passage of petroleum products vehicles given their importance to the economy.”
“Area boys’ – the menace of ‘area boys’ will be handled by relevant government agencies and a dedicated phone number will be established, within the next week to ensure the petroleum products transporters have prompt access to security agencies.”
The communique also stated that the Lagos State government will set up a standing committee to communicate with the union on an ongoing basis, saying it will help address a similar issue going forward. See the complete communique below.
Crude Oil Expands Gain on US Stimulus talks, Better Than Expected Chinese Factory Data
Crude Oil Gains on US Stimulus, Better Than Expected Chinese Factory Data
Oil prices extended its gains on Tuesday following a better than expected factory data from China and a possible agreement between Democrats and Republicans on economic stimulus.
“The oil complex is heavily reliant on that aid. We need people to be able to boost economic activity to spur demand,” said John Kilduff, partner at Again Capital in New York.
President Trump on Monday said House Speaker, Nancy Pelosi and Senator Chuck Schumer, top Democrat in the chamber of Congress, wanted to meet him to discuss or make a deal on coronavirus-related economic stimulus.
The possibility of a stimulus deal, coupled with a reduction in China’s factory deflation in the month of July due to the surge in oil prices and improved industrial activity bolstered the outlook of the energy sector.
China is the world’s largest importer of crude oil. Therefore, improved factory activity generally boosts the oil market.
Also, the announcement from Iraq that it planned to cut an additional 400,000 barrels per day in August and September to compensate for its previous overproduction above OPEC+ quota aided the oil market this week.
“This would send out a strong signal to the oil market on various levels. That said, this would also require the international companies operating in Iraq to join in with the cuts,” Commerzbank analyst Eugen Weinberg said.
The Brent crude oil, against which Nigerian oil is priced, expanded from $41.30 per barrel it traded on Monday to $45.40 per barrel on Tuesday at 10:10 am Nigerian time.
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