CAPITALDIGEST, DAILY NEWS. 17 JANUARY, 2022.
MONDAY 10/1/2022 – NIPCO Positions Workforce for New Petroleum Downstream Regime
With the downstream sector of the Nigerian oil and gas industry set for total deregulation in the coming months, in accordance with the provisions of the Petroleum Industry Act (PIA), NIPCO Plc has positioned its workforce for improved service delivery in 2022. Managing Director and Chief Executive Officer of NIPCO, Mr. Suresh Kumar, in his New Year message, appreciated the company’s employees’ resilience over the years, noting that the new year offers a lot of opportunities which must be optimised by the fuel marketing company. The federal government is targeting to completely deregulate the petroleum downstream sector from the second half of this year. Deregulation seeks to remove unnecessary government meddlesomeness in the pricing of petroleum products and usher in a market regime where prices will be determined by market forces, with resultant improved competition and increased investments. The NIPCO CEO said the company would continue to take its pride of place within the context of the emerging downstream sector under the PIA. He however urged the employees to brace up for the challenges ahead, affirming that their dedication and commitment had contributed immensely to the company’s resilience over the years. Kumar said : “The entire workforce of the company needs to develop more synergy towards sustaining the company’s milestones and moving it to a higher level of efficiency for her to continue to occupy its pride of place within the context of the emerging downstream sector under the PIA. “Our collective contributions in the outgoing year towards achieving milestones set by the promoters are commendable, nevertheless this is not to suggest that there is no room for improvement. I want you to note that with the enactment of the PIA, we all should be on our toes in order to improve our bottom line.” He assured of his continued commitment to put in the right welfare for the workforce to enable them put in their best without sacrificing merit in the scheme of things.
TUESDAY 11/1/2022 – CBN MAY INCREASE INTEREST RATE THIS YEAR, SAYS REPORT
A new report has said likely stronger dollar demand will convince the Central Bank of Nigeria of the need to tighten monetary conditions as with the trend across global central banks to manage foreign exchange reserve depletion. Sigma Pensions said this in the report titled ‘Nigeria 2022 outlook: Consolidating on recovery but persisting large imbalances present headwinds’. According to the report, the large fiscal borrowing requirements amid less liquid financial system conditions in 2022, relative to the last two years, suggest ample scope for heightened market expectations about higher interest rates. It said, “We expect the oil sector to exit recession in 2022 as Nigeria’s crude production rebounds from the 1.6mbpd low base in 2021 towards a range of 1.8-1.85mbpd and as most OPEC+ curbs are removed by May 2022. “Given our price and production expectations, we expect Nigeria’s external balance to improve as oil export receipts normalise to trend levels amid persisting import demand suppression on account of the CBN’s currency policy. “We expect Nigeria’s economic growth to stabilise around 3.4 per cent in 2022, reflecting improvements across telecoms, trade, manufacturing, and oil.” According to the report, a large fiscal borrowing plan and higher political risk premiums are expected ahead of the 2023 general elections.
WEDNESDAY 12/1/2022 – INTEREST RATE: 12 BANKS BORROW N9.81TRN FROM IFC, ADB, CBN, OTHERS IN 3 YEARS
Following availability of funds at single digit interest rate, a total of 12 banks borrowed a whooping N9.81trillion from international finance institutions, Central Bank of Nigeria (CBN), among others, between 2018 and 2020. Banks operating in the country have continued to borrow from international financial institutions such as International Finance Corporation (IFC), African Development Bank, JP Morgan Securities Limited, among others to finance key projects in Nigeria and Africa countries where they operate. The banks also access facilities such as Shared Agent Network Facility (SANEF), Non Oil Export Stimulation Facility (NESF), Anchor Borrowers’ Fund, Economic Recovery Fund (ERF), among others from CBN to support targeted sectors. THISDAY investigation revealed that United Bank for Africa Plc (UBA) leads Tier-1 banks chart in borrowing from these international finance institutions and CBN followed by Zenith Bank Plc and Access bank Plc. On the flipside, Unity bank Plc borrowing from the CBN leads the Tier-2 banks chart. Other banks that have access funds from these international financial institutions and CBN are; Access Bank Plc, Zenith Bank Plc and FBN Holdings Plc. Others are; Fidelity Bank Plc, FCMB Group Plc, Union Bank of Nigeria Plc, Stanbic IBTC Holdings, Wema Bank Plcand Sterling bank Plc.
THURSDAY 13/1/2022 – FG PLEDGES INCREASED FOREX SALE TO MANUFACTURERS
The Federal Government through the Minister of Industry, Trade and Investment, Niyi Adebayo, has assured manufacturers of its support to enable them to get good returns on their investments. The minister, who gave the assurance while playing host to a delegation of Expand Global Industries Limited, pointed out that although many manufacturing companies were battling shortage of foreign exchange, the Federal government was doing everything to assist them to access forex, particularly for the importation of machineries for those using local raw materials for their production. He maintained that the ministry would continue to assist manufacturers to remove any identified bottlenecks that could impede their production process, especially with respect to the ease of doing business. The Special Assistant to the minister on Media made this is known in a statement issued on Monday and titled, “Minister assures manufacturers of govt support.” The statement quoted the minister as saying that “his ministry would continue to partner with manufacturers to ensure that they were kept in business for the good of the investors.”
FRIDAY 14/1/2022 – CBN FAILS TO CURB INFLATION, HALT NAIRA SLIDE, SAYS REPORT
A United States-based magazine, Global Finance, says the Central Bank of Nigeria has failed to curb rising inflation and stop the naira from sliding against the United States dollar. This was disclosed in an October 2021 report titled ‘Central Banker Report Cards 202: The Art of Timing’, which provides reviews and ratings on the performances of different central banks in different countries across the world. Using a scale of A to F with A being the highest grade and F being the lowest, based on a series of objective and subjective metrics, Global Finance rated Emefiele-led CBN a “C” grade. The rating and review focus on the performance of the apex bank from July 1, 2020, to June 30, 2021. According to the report, measures to stabilise the naira by the CBN has not been fruitful The report read in part, “In recent years, Nigeria’s central bank has engaged in deliberate measures to ensure the stability of the Naira. The measures have included a tight grip on the local currency and even halting the sale of forex to bureau de changes.