Aside heavy investments, the minister said encouraging local
manufacturing would also help Nigeria to increase exports that would in
turn bring foreign currencies into the country.
“The way to go out of recession is to inject more money into circu-
lation and this could be achieved through active participation of the
private sector and by encourag- ing the manufacture of ‘Made in Nigeria’
products, which the 22nd Nigerian Economic Summit, is championing and
it is billed to hold from October 10-12, 2016, at the Transcorp Hilton,
Abuja,” Udoma said.
According to him, the 22nd Nigerian Economic Summit with the theme
‘Made in Nigeria’, is in line with the President Muham- madu Buhari
administration’s commitment to diversify the productive base of the
economy away from oil.
“Our current economic chal- lenges are rooted in our reliance on a
single commodity, which is crude oil, whose price has fallen, leading to
a drastic fall in our revenues. The Nigerian economy is currently in
reces- sion and faced with contracting GDP growth, rising inflation and
unemployment rates, as well as declining level of external reserves,”
Udoma said.
According to him, the goal of Nigerian Economic Summit Group (NESG)
is to unlock the economic potentials of the non-oil and high-employment
sectors, so as to achieve a sustainable inclusive growth that will
ensure that the majority of Nigerians become more productive, thereby
reducing poverty.
“We are deliberately working towards diversifying the Nigerian
economy by ensuring that non- oil sector drives the economy because this
is the sector that contributes the most to GDP, and has more capacity
to employ.
“The basic strategy is to reflate the economy through fiscal stimu-
lus and strategic implementation of annual budgets. What this means is
that we are geared to strategically spend our way out of recession.
Unfortunately, we have not met all our planned expenditures for 2016 due
to low revenue out-turns. However, we have ensured that the resources
that we release are targeted at priorities that will stimulate
activities in the economy,” Udoma added.
Director, NESG, Mrs. Wonu
Adetayo, assured Nigerians that the
summit would implement resolutions that would be reached at the summit,
for the good of the country.
No Respite as Naira Weak- ens to New Low
of N440/$ Meanwhile, the Naira sus- tained its downswing on the
parallel market as it depreciated toanewlowofN440tothe dollar yesterday,
as against N436 to the dollar from the previous day.
The development was once more attributed to the perennial scarcity of the dollars in the market.
However, on the interbank FX market,
naira pared some of its previous day loss as the spot rate of the naira
climbed to N307.79 to the dollar yesterday, stronger than the N313.07 to
the dollar it closed on Thursday.
This is just as Nigeria’s external
reserves fell further to $24.744 billion as of September 22, 2016, from
the $24.759 billion it was as of September 21, 2016.
The situation on the parallel market was attributed to the refusal by banks to sell dollars to Bureau de Change (BDC) operators.
The President, Association of Bureau de
Change Operators of Nigeria (ABCON), Mr. Aminu Gwadabe, had told THISDAY
on Thursday that none of his members were able to access dollars from
banks as directed by the Central Bank of Nigeria (CBN).
“As I speak to you, no BDC has been able
to access FX since Monday. It is very unfortunate that the liquidity in
the market has dried up. That is too bad for the market,” the ABCON
boss said in a phone chat with THISDAY.
The central bank had directed agent
banks to approve interna- tional money transfer operators to sell
foreign currency accruing from inward money remittances to licensed
BDCs.
Naira Woes Creates Boom for Top Palm Oil
Producers In a related development, Nigeria’s ban on importers
accessing foreign exchange for certain products is proving a boom for
the country’s biggest palm-oil producer as it stokes demand for domestic
goods. Profit at Presco Plc, a Benin City-based manufacturer of the
edible oil, more than doubled in the six months through June as sales
jumped 60 per cent to N7.5 billion ($24 million), according to results
published in July.
The outlook for the next four years is a
10 per cent annual profit growth, its Managing Director, Felix Nwabuko
said in an interview with Bloomberg.
“The policy is bringing a boost to us in
the sense that people who would ordinarily have imported, using
government foreign exchange, are not doing that anymore,’’ he said.
Nigeria’s central bank stopped importers
of 41 items, including palm-oil and textiles, from ac- cessing official
foreign-exchange markets in June 2015. The measure was part of a plan
to prop up the naira after it plunged against the dollar following a
drop in the price of crude, the country’s biggest source of
foreign-exchange.
A 15-month dollar peg that ended on June
20 caused a foreign currency shortage that contributed to West Africa’s
biggest economy contracting in the first two quarters and drove
inflation to the highest rate in more than a decade.
The peg removal led the naira to weaken
37 per cent against the dollar. That hasn’t improved the availability of
U.S. currency and most foreign investors are yet to return.
Presco also faces challenges from the
dollar scarcity as it imports fertilisers, chemicals and equipment
including spare parts for plants, to increase output. Obtaining
foreign-exchange “is tough – some months you don’t get, sometimes you
get a little bit of what you need,” Nwabuko said.
The company, which operates 16,900
hectares (41,761 acres) of palm-oil plantations and sells its output
locally, plans to increase the export of palm-kernel oil to Europe,
mainly the Netherlands, to enable it access dollars and cushion the
impact of the scarcity in Nigeria,” Nwabuko said.
Exports contributed 5 per cent of
revenue from January to August and the company plans to increase
palm-kernel crushing capacity to 100 tons daily by 2018, from 60 tons
currently.
Presco doesn’t plan to export palm-oil
as “it has enough market locally and price comparison- wise, there is no
real advantage in exporting palm-oil out of Nigeria,” the MD said.
The company plans to increase oil-palm
plantation to 31,400 hect- ares by 2021 from 16,900 while it targets to
raise palm-oil mills capacity to 120 tons per hour from 60 tons, Nwabuko
said.
0 comments:
Post a Comment