Majority Rural Women Can’t Access Financial Services – Centre

The Executive Director of the Policy Innovation Centre, Dr Osasuyi Dirisu has said that 80 per cent of poor rural women have difficulty accessing financial services. In a pre-conference press briefing, Monday in Abuja, Dr. Osasuyi also said the situation has further made it difficult for them to drive trade and inclusiveness. The Gender and Inclusion Summit, with the theme “Building Bridges: Advancing Gender and Inclusion through the Intersection of Trade and Health”, will hold on November 28 and 29, in Abuja, Nigeria. Analysts say the event would be a catalyst for positive change, uniting voices, inspiring commitments, and mobilizing stakeholders to advance gender equality. She said, “About 80 per cent of the 133 million people who are multi-dimensionally poor live in rural settings, who are talking about access to financial services to drive trade and inclusion. Who is talking about the gaps in infrastructure to drive productivity? The PIC Executive Director noted that it is becoming increasingly difficult for women and vulnerable groups to access healthcare making Nigeria one of the countries with the worst indices for maternal mortality, new-born to child birth. “There needs to be real conversation around gender inclusion centred around trade for that is the powerhouse that drives productivity and drives conversation around GDP that we are able to address issues around inflationary pressures and ensure that we have a productive society. “The summit is special because we are not just talking about health, we are talking about trade. We are talking about an intersection where vulnerability is likely to occur,” Dr. Osasuyi said.   Speaking about the upcoming event, the Chief Executive Officer Designate of the Nigerian Economic Summit Group, Dr Tayo Aduloju stated that ‘’To facilitate the advancement of a gender-inclusive society, it is necessary to consider how trade, investment, and health policies/interventions affect women, men, and vulnerable populations differently. Despite their significant contributions to informal trade, women continue to have limited access to resources and markets. There are also significant gaps in access to health services and Nigeria’s maternal mortality remains among the highest in the world.” He further stated that “Considering these realities, the high-level forum on the SDGs has partnered with the Policy Innovation Centre (PIC) to ensure seamless delivery of the Gender and Inclusion Summit 2023”. PIC, an initiative of the Nigeria Economic Summit Group (NESG), is the first national institutionalized behavioural initiative in Africa supporting governments and stakeholders to make behaviourally informed decisions and generate contextually relevant evidence for high-impact interventions in critical thematic areas.

Naira Freefall: FG To Receive $10bn Forex Inflow – Finance Minister

The fortunes of the naira may soon be reversed with the Finance Minister, Wale Edun assuring that about $10 billion naira is expected to flow into the economy in a matter of week Edun made this known during a panel session at the ongoing Nigeria Economic Summit Group (NESG) question and answer session concerning stabilizing the foreign exchange market and enshrining liquidity in the market. Since the unification of the foreign exchange market in June, the naira’s value has slumped by over 100 per cent on the parallel market. The current CBN management has introduced a slew of measures to provide liquidity but the chasm between the rate on the I&E window and parallel market continues to widen. The minister said, “in addition, from the supply of foreign exchange through NNPC, increased production, reduced expenditure, from transactions such as forward sales, from our discussions with sovereign wealth funds, that are ready to invest and provide advanced alongside that investment, there is a line of sight of $10 billion worth of foreign exchange in the relatively near future in weeks rather months.” The Minister further said President Tinubu has signed two executive orders geared towards ensuring liquidity in the forex market. He said, “Mr. President announced that he had taken measures to ease illiquidity in the forex market which we know is very problematic at this time.” “The market is illiquid; it’s not functioning properly because there is no supply and there are various reasons for that. The solution that the President has put on the table is that he has signed an executive order that effectively allows under forbearance all the cash that is in the domestic economy to legally come into the formal money supply” “Along with that, there is another executive order that allows domestic issuance of foreign currency instruments so that they will have the incentive to provide that foreign exchange from whatever source.”

Nigeria’s Underperforming In Oil, Gas Sector Due To Insecurity – Lokpobiri

Minister of State for Petroleum Resources (Oil), Mr Heineken Lokpobiri, has said that the challenge of insecurity in the Niger Delta was responsible for the underperformance of the petroleum sector. The Minister, who said this in a meeting with the Abuja Chapter of the Energy Correspondent Association Friday in Abuja, added that it was also affecting Nigeria’s oil production output.   While noting that the issue was making it difficult for the country to meet its OPEC production quota, Lokpobiri said the government was working to address the drawback. He was hopeful that by the end of 2023, the country would increase its oil production to about 2 million barrels per day. Due to massive crude oil theft and pipeline vandalisation, Nigeria’s oil production presently hovers between 1.3-1.4 million barrels per day. “My sole agenda is to increase production. Once we increase production we will get more revenue for the country. You know Nigeria is still more dependent on oil. “Though the non-oil sector is also supporting the economy, a substantial part of our forex comes from oil. “The reason why we are underperforming is because of insecurity and we are gradually tackling those problems. “So, my ambition is to see how I can lead the sector to increase production so that we can get more revenue to deal with the fund and strategic rationale projects in the country. “I get the reports from relevant authorities. Today, we are doing about 1.4 million barrels of crude. So, we are steadily increasing but our target is to see how we can get to two million barrels,” he said. Lokpobiri urged the industry players to join hands together to find a permanent solution to the issue. He said the federal government was discussing with International Oil Companies and local producers to find a lasting solution to the insecurity challenge. He said the engagement was already yielding positive results. “We have identified where the problem is, and where we are getting the shortfall and we are already engaging them within the next few weeks, we will be able to give you how far we have gone in that direction. In an earlier remark, President of the association, Mr Victor Nnodim, assured the minister of the association’s readiness to partner with him as he sought to fulfill his agenda of ramping up crude oil production and delivering a better petroleum industry for the country. “We will support you to achieve your mandate,” he said.

IMF Downgrades Nigeria’s Economic Growth By 2.9%

The International Monetary Fund (IMF) has downgraded Nigeria’s economic growth by 2.9 per cent for 2023. In July, the Fund had projected a 3.2 per cent growth for Nigeria in 2023. The lender however warned that the growth would be impacted by security issues in the oil sector. In its October World Economic Outlook with the themed, ‘Navigating Global Divergences,’ posted on its website Tuesday, the IMF said, “Growth in Nigeria is projected to decline from 3.3 per cent in 2022 to 2.9 per cent in 2023 and 3.1 per cent in 2024, with negative effects of high inflation on consumption taking hold. “The forecast for 2023 is revised downward by 0.3 percentage point, reflecting weaker oil and gas production than expected, partially as a result of maintenance work.” The International lender, while commenting on its new prediction for the country, said: “ For the sub-Saharan African region, growth is expected to decline to 3.3 per cent in 2023 due to worsening weather shocks, the global slowdown, and domestic supply issues, the IMF said.  However, growth would pick up by 2024 to 4.0 per cent in 2024, which is still below the region’s historical average of 4.8 per cent. It also stated that global economic growth was projected to slow from 3.5 per cent in 2022 to 3.0 per cent in 2023 and 2.9 per cent in 2024, well below the historical (2000–19) average of 3.8 per cent, the IMF declared. “Advanced economies are expected to slow from 2.6 per cent in 2022 to 1.5 per cent in 2023 and 1.4 per cent in 2024 as policy tightening starts to bite. Emerging market and developing economies are projected to have a modest decline in growth from 4.1 per cent in 2022 to 4.0 per cent in both 2023 and 2024″, the IMF said. The global financial institute stated that global inflation is expected to decelerate to 6.9 per cent in 2023 and 5.8 per cent in 2024 from the present 8.7 per cent in 2022.  

Professional Accountants Have Contributed To Nigeria’s Economic Woes – Expert

A governance expert, public affairs analyst and Chairman of the Board, Amaka Chiwuike-Uba Foundation (ACUF), Dr Chiwuike Uba, has revealed that accountants have contributed to the economic woes of Nigeria in the last few years as a result of their professional silence and inactions. Speaking on Thursday in Abuja during the 28th annual conference of the Association of National Accountants of Nigeria (ANAN), on ‘Role of Professional Accountants in Economic Reforms’, Uba, a lead presenter, said some accountants have had opportunities to support economic reforms of successive administrations, but ended up corrupting the system. The ACUF boss said poor management of debt and guarantees have created unnecessarily high debt service costs and could cause significant fiscal risks. Uba also revealed that professional accountants play a crucial role in economic reforms by providing financial expertise and advice to various stakeholders, including governments, businesses and organisations. He said: “Professional accountants’ actions and inactions might have contributed to Nigeria’s economic conundrum. I am expressing this opinion because some professional accountants, who had the opportunity to support economic reforms in the past, ended up corrupting and messing up the system even more.  “In some instances, professional accountants, including one of the former Accountants General of the Federation, were involved in a corruption case that amounted to billions of naira. “Currently, over 90 of Nigeria’s revenue is being spent on payment of interest on debt. Poor debt management procedures can lead to increased costs of borrowing, poor decision making and possible default on debt repayment with associated consequences. “They equally play a pivotal role in promoting financial stability, transparency and sustainable economic growth. Professional accountants should, therefore, among others, play these roles: record, report and continuously monitor debt and guarantees and, based on monitoring feedback, provide expert advice. They should regularly monitor the ratio of average monthly debt service deducted from revenue. “Audit reports need to include more forward-looking, qualitative and non-financial data in the field of financial reporting with more information on risks. Timely reporting of audit findings to generate increased value for stakeholders and enable real-time decision-making is key. The idea of producing audit reports in arrears needs to be corrected.  “The last audited financial statements that are publicly available on the website of the Office of the Auditor General were the 2019 accounts. Incidentally, the account was published on August 18, 2021, which was 19 months, 18 days from the end of the financial year.” Dr Uba stressed the need for increased communication of financial statements and auditor’s reports through the publication of the reports for public access, adding that management letters from public companies should also be made available more widely beyond sharing it with the audit committee. “Performance and accountability have become vital elements in the governance framework. Improving performance and accountability with an eye on delivering more appropriate, efficient and effective public service is the hallmark of good governance. The ability of professional accountants to defend or account for performance according to some ethical framework is part of the accountability framework. “Audits, investigations and advisory services are required to reduce risk, improve transparency and accountability, and maintain the public trust. To satisfy this key element needed to achieve the objectives of economic reforms, professional accountants engaged in auditing should carry out Value for Money (VFM) auditing by confirming whether proper arrangements were in place to secure economy, efficiency and effectiveness in the use of public resources,” he added.

Unity Bank Suffers N35bn Loss On FG’s FX Policy

Unity Bank Plc’s profit in the first half of 2023 was impacted by foreign exchange revaluation on the back of Nigeria’s recent FX liberalization policy, resulting in the lender suffering a revaluation loss of N35 billion within the period. In the retail lender’s financials for the period, notwithstanding the FX liberalization policy and its impact on the bottom-line, the bank grew its FX trading income significantly by 17 per cent to N239.8 million from N204.4 million in the corresponding period of 2022, underscoring the Bank’s strategic focus on diversifying and growing its earnings portfolio. According to the bank, deposits grew to N333.38 billion, representing a marginal increase of 2 per cent compared to N327.42 billion recorded in the first half of 2022 in its Half-Year unaudited financial statement submitted to the Nigeria Exchange Group Limited. The net loans portfolio reduced significantly by 31 percent to N198.6 Billion as at 30 June 2023 from N289.4 Billion as at 31st December 2022. The Bank’s NPL Ratio remained moderate at below 3 per cent while liquidity ratio stood strong at over 45 per cent. The Managing Director/CEO of Unity Bank Plc, Mrs. Tomi Somefun noted that the significant disruptions which characterized the operating environment has impacted the positions of the Bank to the extent that we have constraints in income generation on the back of revaluation of the bank’s net foreign liabilities occasioned by the Naira devaluation during the period. Mrs. Tomi stated: “In the light of the prevailing FX revaluation in the financial system, what we have is a market-driven impact which is adjustable envisaged from the positive economic outcomes of the government policies in the near term. “Be that as it may, the negative shareholders’ fund has improved considerably through the injection of N135 billion which moderated the negative shareholders’ fund from (-ve) N275 Billion in December 2022 financial year-end to (-ve) N178 Billion as at the end of June 2023, after absorbing the FX revaluation loss suffered in the second quarter of 2023. “We are however, focused with clear-cut plans to close out on our recapitalization programme very soon to enable us do business as expected in the fast-growing markets in Nigeria” She further stated that while we remain optimistic that the government’s policy initiatives will lead to cause correction in the market, the Bank has accelerated measures to ramp up asset creation and liability generation in the short and medium term. “The Bank is aggressively driving its retail growth in every segment of the market, expanding strategic partnerships; and growing commercial banking business to develop new and sustainable income lines for the Bank as well as pay sufficient attention to fast-paced process automation, cost and resource efficiency, targeted value chain relationships, and product marketing to enhance value creation in the market.

Subsidy Removal, New School Year, and A Strangulating Economy

As a new academic season unfolds in 2023, Nigerian parents are grappling with the far-reaching consequences of the recent removal of petrol subsidies. The resulting increase in school fees and tuition costs has sent shockwaves through households across the nation. This article by our correspondent, VIVIAN MICHAEL, delves into the challenges faced by parents as they navigate the intricate web of the current economic situation while ensuring their children receive an education. The Annual September Dilemma: For many Nigerian parents, September has become a month of dread. It marks the start of the new academic year, ushering in a season fraught with financial implications. The return of millions of students to school after a long vacation compounds the pressure of back-to-school expenses, particularly for students progressing to higher grades. However, the academic year of 2023 bears an unprecedented burden. The removal of petrol subsidies by President Bola Ahmed Tinubu merely three months ago, coupled with the fluctuating value of the naira, has thrust parents into a financial dilemma. They are now expected to pay nearly double the fees they have grown accustomed to. As schools at all levels reopen nationwide, parents are grappling with the immense financial pressure they face. The hike in school fees and the escalating prices of essential items have exacerbated their struggles. Income levels have largely remained stagnant, and the country’s inflexible economy has exacerbated the hardship experienced by its citizens. Small-scale businesses, a significant source of livelihood for many, continue to be hampered by erratic power supply, forcing them to rely on costly fuel-powered generators. Adding to the woes, salaries have remained unchanged. To compound the situation, schools now require parents to provide bank payment evidence before admitting their children, further straining already stretched budgets. Uncertain Grace Periods and Financial Stress: Parents express concerns about whether schools will extend the customary grace period of two weeks after resumption before sending ‘defaulting’ children home. The mere thought of paying these escalated fees, along with the accompanying expenses for educational materials, is enough to elevate the blood pressure of many parents during this time. Private School vs. Public School Debate: Families with children in private schools criticize the government’s allocation of priorities. They argue that government schools lack essential instructional materials and motivated teachers, leading to the burden of exorbitant fees in private institutions. The prevailing sentiment is that those who desire the best education for their children do not patronize public schools due to their dire condition. Some parents have reacted to this predicament by transferring their children from private to public schools, where fees are substantially lower. Others have opted for schools with reduced fees. The Heart-Wrenching Dilemma of Roseline Agboola: Roseline Agboola, a 45-year-old civil servant and mother of three, shares her lamentations about the soaring cost of school fees as students prepare to return to school. She considers withdrawing her children from a private school due to the fee increase. However, a friend who teaches in a public school advises against it, citing inadequate facilities for a conducive learning environment. Roseline finds herself in a daunting situation, forced to struggle to pay the new fees, which have risen dramatically. Her predicament is echoed by many parents who, like her, rely solely on their salaries. Rita Obi’s Shocking Financial Reality: Mrs. Rita Obi, also a civil servant, is astonished by the drastic price increase for her two-year-old school bus service, which has risen from N15,000 to N35,000—a staggering 100% increment. While she acknowledges the economic challenges, Rita is disheartened by the unexpected surge in expenses, emphasizing the need for divine grace and enablement to cope. Ahmed Awofolu’s Frustration and Uncertainty: Ahmed Awofolu’s frustration is palpable as he grapples with the uncertainty of how to proceed. He contemplates sacrificing the quality of education by transferring his children to a more affordable school within walking distance or accessible via inexpensive transportation. Ahmed highlights the significant expenses associated with his children’s education, from tuition to books, school bus fees, excursions, and other miscellaneous costs. He is at a loss for a solution, expressing his reliance on divine intervention and miracles to navigate this challenging period. Olakunle Abiodun’s Plea for Government Assistance: Olakunle Abiodun, a parent with five children in school, appeals to the government for financial assistance. He acknowledges the difficulty of paying school fees for his children, particularly those in private schools. Abiodun’s family has resorted to paying fees in instalments to manage the financial strain. Ifeoma Asika’s Optimism Amid Economic Struggles: In the midst of these economic challenges, Ifeoma Asika, a small-scale businesswoman, shares her optimism. She acknowledges that both the high and mighty are experiencing similar hardships. Ifeoma emphasizes the need for resilience, believing that people will overcome these tough times and emerge stronger. She also shares her experience of enrolling all her children in school without undue stress by discovering a school with more affordable fees. The removal of subsidies and the economic challenges faced by Nigerian parents as they send their children back to school in 2023 paint a stark picture of their struggles. The increase in school fees, stagnant incomes, and rising costs of educational materials have placed an enormous burden on families. Some have opted to shift their children from private to public schools, while others grapple with the financial dilemma. Parents are making difficult decisions, contemplating sacrifices, and praying for miracles as they strive to provide their children with an education. They call on the government to consider subsidies or financial support to alleviate the strain. Despite the hardships, there is resilience and hope that Nigerians will overcome these trying times and emerge stronger in the end.

Naira Devaluation: Dangote, 8 others take N113.63bn hit

Dangote Cement led eight other companies on the NGX in foreign exchange losses recording a significant foreign exchange loss of N113.63 billion, representing a 179.47 per cent year-on-year increase, the highest in the past five years as a result of the devaluation of the Naira. The Naira went from N465/$ at the end of May 2023 to N756/$ in June 2023, resulting in a net exchange loss of N116.1 billion on third-party loans and payables within the Nigerian entities. While some companies experienced significant declines in some performance indicators, others performed relatively better. A review of the financial performance of Berger Paints, Beta Glass, BUA Cement, CAP, Dangote Cement, MEYER, Notore, and WAPC, reveals that among these companies, Dangote Cement, Notore, and BUA Cement, reported a combined foreign exchange losses of -N129.811 billion, while Beta Glass, CAP, and WAPCO reported an aggregate foreign exchange gain of N3.49 billion. However, when considering the cumulative impact of foreign exchange fluctuations, it led to an overall reduction of 8.19 per cent in their total pre-tax profit, which amounted to N372.573 billion in the first half of 2023 Dangote Cement led in foreign exchange losses recording a significant foreign exchange loss of N113.63 billion, representing a 179.47 per cent year-on-year increase, the highest in the past five years. According to the first half of 2023 financial notes, the net exchange loss on foreign-denominated transactions was primarily attributed to the sharp devaluation of the Nigerian Naira in June 2023. These losses had a direct effect on the decline in pre-tax profit, which decreased from N264.89 billion to N239.86 billion during the reviewed period. Notore also reported a substantial foreign exchange loss of N14.05 billion in the first half of 2023. Coupled with low revenue and a significant increase in finance costs, this contributed to a pre-tax loss of N38 billion, representing a 1,558 per cent decline. The company managed to generate revenue of N7.92 billion, a substantial decline of 68.97 per cent for the first half of 2023. BUA Cement reported a foreign exchange loss of N2.137 billion in the first half 2023, marking a significant year-on-year increase of about 103 per cent. Coupled with elevated interest expenses, this dampened pre-tax profit, resulting in only a marginal increase of 2.75 per cent to N76.425 billion when compared to the first half of 2022. WAPCO – Lafarge led the foreign exchange gainers, recording a N2.237 billion gain in foreign exchange. This contributed to a growth of 18 per cent in pre-tax profit. However, despite this positive performance, the company experienced a year-on-year decline of 5.16 per cent in profit after tax, primarily due to high-income tax expenses.

Katsina govt confirms receipt of N2bn palliative from FG

The Katsina State Government has confirmed the receipt of N2 billion out of the N5 billion palliative approved to the states by the Federal Government. Dr Bala Salisu-Zango, the state’s Commissioner for Information, Culture and Home Affairs made the clarification while reacting to insinuation that the federal government released N5 billion to the state. He said that: “The attention of the state government has been drawn to news going round in the media that N5 billion has been released to states by the Federal Government for palliative. “I wish to state that, Katsina State Government received only N2 billion for procurement of grain to be distributed to the citizens of the state”. Salisu-Zango said the state government had so far utilised N2 billion to procure 40,000 bags of rice for distribution to vulnerable persons in all the polling units across the state. He said the government would also utilise the next tranche of the fund from the federal government to purchase maize for distribution to deserving households. He warned that the state government would punish anyone found wanting in the palliative distribution exercise. 

Nigeria’s economy resilient despite hard reforms –Report

Cape Economic Research and Consulting, an economic think-tank group, has projected that Nigeria’s economic outlook for the third quarter of 2023 maintains its resilience, albeit with a moderated tone, driven by substantial policy reforms. In its Economic Newsletter for August, which was shared with NIGERIAN ANCHOR on Saturday, the think-tank emphasized that the effects of subsidy removal and the recent exchange rate policy adjustment are gradually permeating the economy, resulting in elevated inflationary pressures and anticipated dampening of aggregate demand. The report underscores the lasting impact of subsidy removal and exchange rate unification until households and businesses fully adapt to the new economic landscape. The implementation of essential support measures is anticipated to bolster the economy’s resilience. Consequently, the report predicts that output growth will remain positive during the third quarter of 2023. CAPE observed that the heightened cost of production, fueled by significant increases in input costs, including wages, has led to a slowdown in production. As the government prepares to roll out relief measures to mitigate the repercussions of recent policies on the economically disadvantaged, aggregate demand and output are projected to respond favorably. The report anticipates a further increase in inflation for August 2023. Projections indicate that headline food and core inflation could rise to 23.51%, 26.41%, and 21.34% respectively. The main drivers of this forecast are food prices, exchange rates, and short-term assets, contributing 5.94%, 1.96%, and 0.44% respectively. CAPE also highlights the macroeconomic implications of persistent negative interest rates, including low savings and investment, the emergence of parallel markets with higher interest rates, inefficient resource allocation, and suboptimal investment efficiency. Additionally, these rates constrain the government’s capacity to raise resources through bond issuance. The newsletter sheds light on the tightening stance adopted by numerous central banks in both advanced and emerging economies throughout 2022 and the first half of 2023. While this approach has led to price moderation in some economies, core inflation remains relatively persistent. However, these measures have brought about output moderation and financial stability, accompanied by an elevated risk of potential financial crises.