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WTO’s Trade Agreement Will Boost Exports – Awolowo



  • WTO’s Trade Agreement Will Boost Exports – Awolowo

The coming into force of the World Trade Organisation’s Trade Facilitation Agreement last week will increase the volume of export of non-oil products from Nigeria to other countries, the Executive Director/Chief Executive, Nigerian Export Promotion Council, Mr. Segun Awolowo, has said.

Awolowo stated this on Monday in Abuja while reacting to the commencement of the TFA as well as highlighting some of the benefits of the agreement to the Nigerian economy.

Nigeria had in January submitted its ratification earlier in Jahrough by the Minister of Industry, Trade and Investment, Dr. Okechukwu Enelamah.

The NEPC boss described the ratification of the TFA as a major milestone for global multilateral trade, noting that the commission would work with other relevant government agencies to domesticate and implement the agreement for the benefits of the Nigerian economy

He said, “The ratification of the TFA is indeed a major milestone for global multilateral trade. I am optimistic that Nigeria will go ahead to domesticate and implement the agreement to the letter. We expect remarkable outcomes for international trade through the TFA, which aims to expedite the movement, release and clearance of goods, including goods in transit.

“It will reduce bureaucracy at the borders for faster, cheaper and easier trade, and is expected to increase trade and investment. The agreement promotes trade by establishing harmonised rules to further expedite the movement, release and clearance of goods crossing borders, including goods in transit.

“It offers opportunities, especially for the Small and Medium Enterprises to engage in formal export of goods, which have so far been informally traded across borders.”

Awolowo also said that with the agreement, a larger number of exporters would be able to partake in global value chains, thereby enabling all businesses to tap into the huge potential of trade.

He said, “The NEPC is committed to support and work closely with the relevant government agencies, the private sector and international organisations to ensure full implementation of the agreement.

“We will maximise the benefits of the TFA, especially to make export trade the catalyst for achieving national economic turnaround for sustainable development, enhanced annual incomes, improved welfare, reduced trade costs, and ultimately improve the ease of doing business index for the country.”

He also expressed optimism that many small businesses that hitherto found it impossible to trade internationally due to complex regulatory requirements would henceforth be part of the global trade as a result of the agreement.

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

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Barclays Tell High Net Worth Investors to Shun Africa and Other Emerging Economies



Barclays Bank

Barclays to High Net Worth Clients, Stay Off Africa and Other Emerging Economies

Barclays, one of the world’s largest investment banks, has started advising high net worth clients to stay off Africa and other emerging economies.

According to Barclays, despite the recent recovery noticed in emerging-market stocks, investors are better off avoiding the risks that still abound in emerging nations. Barclays Plc, however, advised high net worth clients to focus on U.S equities despite the S&P’s breakneck rally.

The investment bank said emerging economies do not have enough fiscal buffers to spend their way out of the COVID-19 pandemic and will likely continue to struggle in the near-time compared to the US with 12 percent of gross domestic product fiscal-support.

It said the huge US stimulus may halt rebound in emerging-markets stocks as more money is expected to flow into the world’s largest economy and its European counterparts.

“Compared to the U.S., emerging-market economies appear more vulnerable,” said Haider, the London-based managing director and head of global growth markets. “Their central banks have less room to maneuver, their governments may not be able to provide unlimited support and equity markets, given their sector mix, can be more challenged by an economic slowdown.”

Barclays added that even after 33 percent rebound in stocks of emerging markets since the panic selloff subsided in March, stocks are still down by 9 percent from year-to-date while the US S&P 500 stocks are up by 45 percent. Presently, their stocks trading at a 36 percent discount to US stocks, up from 25 percent three months ago.

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Crude Oil Rises to $43.1 Per Barrel on Production Cuts Extension



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  • Crude Oil Hits $43.1 Per Barrel Following OPEC’s Production Cuts Extension

Brent crude oil, against which Nigerian oil price is measured, rose by 1.25 percent on Monday during the Asian trading session following OPEC and allies’ agreement to extend crude oil cuts to the end of July.

OPEC and allies, known as OPEC plus, agreed to extend production cuts of 9.7 million barrels per day reached in April to July on Saturday.

In the virtual conference, delegates agreed that members, including Nigeria and Iraq presently struggling to attain a 100 percent compliance level must keep to the agreement or be forced to do so in subsequent months.

Nigeria, Iraq and others failed to keep to the cartel’s agreement in May after reports show that Nigeria only managed to attain a 19 percent compliance level during the month while Iraq struggled to attain just 38 percent in the same month.

Russia and Saudi Arabia, the two largest producers of the group, warned members to stick to the agreed quota if they want to rebalance the global oil market.

While the errant producers such as Iraq and Nigeria have vowed to reach 100% conformity and compensate for prior underperformance, we still think they will likely continue to have some commitment issues over the course of the summer,” said Helima Croft, head of global commodity strategy at RBC Capital Markets.

The potential return of Libyan output could also cause considerable challenges for the OPEC leadership.

Earlier on Monday, Brent crude oil hits $43.1 per barrel, more than a month record-high, before pulling back slightly to $42.83 per barrel.

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Gold Dips by 2 Percent on Better Than Expected Job Report



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  • Gold Dips by 2 Percent on Better Than Expected Job Report

Gold prices declined by 2 percent on Friday following a better than expected US non-farm payroll report.

The report showed an increase of 2.5 million payroll numbers against a decline of 7.5 million predicted by many experts.

The surprise number boosted investors’ confidence in US recovery as many dumped their haven investment (gold) for the stock market.

“We had significantly stronger-than-expected U.S. payroll numbers – an increase of 2.5 million versus an expectation of a decline of 7.5 million – that 10-million swing has brought forward expectations of the economic recovery in the United States,” said Bart Melek, head of commodity strategies at TD Securities.

Spot gold immediately declined by 1.9 percent per ounce to $1,678.81 while the U.S. gold futures slid 2.6 percent to settle at $1,683.

Gold was also being pressured by stronger yields and a slightly firmer dollar, “meaning the opportunity cost to hold gold in the portfolio has gone up,” Melek added.

The surprise didn’t stop there, US Dow Jones was up 614 points despite the protest going on the US and US-China tension.

Also, NASDAQ rose by 29 points while the S&P index added 50 points increase.

Note: Investors generally increase their investments in gold and other haven assets during a crisis to avert risk exposure and do the opposite once they sense a better economy.

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