By Comfort Barida
- Emirates Airlines have announced its decision to suspend their Abuja-Dubai operations beginning October 30, 2016. The decision is due to challenges they have encountered in sourcing for foreign exchange, low patronage, and other operational issues, which have reduced the profitability of flying the route.
- Kenya Airways, has also announced it would suspend flights to Abuja effective November 15, 2016, as part of its restructuring and loss-saving efforts.
- Lufthansa Airline has said it has no plans to reduce flight operations in Nigeria despite the challenges.
- According to the Nigerian Electricity Supply Industry (NESI), Nigeria’s power sector is losing an average of N549 billion yearly to gas supply challenges. The situation has continued to deprive the country of over 2,479 Mega Watts (MW) daily. They also confirmed that the sector is losing an estimated N1.525 billion daily due to power generation constraints.
- The Kaduna State Government has earmarked N3.12bn for various electricity projects in the state in 2017. The projects would be coordinated by the State Power Supply Company. The government indicated that it would secure N1.5 billion loan from India Exim to finance the power project.
- The Central Bank of Nigeria (CBN) has granted airline operators, along with sectors that deal with raw materials and machineries for manufacturing companies and agricultural chemicals in the country a special foreign exchange (forex) concession to enable clearance of outstanding debts at inter-bank market rate.
- Manufacturers allege sharp practices in Forex allocation by banks.
Banking and Financial Institutions
- Access Bank Plc. has successfully raised US$300 million Eurobond from the international bond market. The bank recently accessed the international market to raise the bond, with a maturity date of October 2021 and at a coupon of 10.5 per cent. This makes Access Bank the first Nigerian bank to raise a bond from the international market this year despite the country’s economic challenges.
- A number of commercial banks have stopped their naira cards from dispensing dollars via ATMs to customers in foreign countries as well as the use of naira debit or credit cards for online transactions priced in foreign currencies. This decision will affect students studying abroad who have to use their naira cards. It will also affect travellers and shoppers abroad.
Oil and Gas Sector
- According to Dr. Ibe Kachikwu, Minister of State for Petroleum, Nigeria government spends N3tr on importation of petroleum products from January 2015 to April 2016.
- NIPCO Plc., acquired a 60% stake in Mobil Oil Nigeria from United States oil giant, ExxonMobil. This is expected to increase confidence in the downstream segment of Nigeria’s oil and gas industry. The transaction has been seen by experts as a continuation of the divestment strategy by international oil companies operating in the country.
Nigerian National Assembly
- The National Assembly has resorted to bank overdrafts to pay its staff their monthly salaries and allowances. However, the facilities do not include the controversial running cost of N4.5 billion paid to lawmakers and their aides.
Nigerian Economy Update
- Nigeria maintains its lead over South Africa and remains Africa’s largest economy – according to the International Monetary Fund. In its latest report, the IMF projected that Nigeria’s Gross Domestic Product would hit $415.08bn at the end of 2016, from $493.831bn, being its GDP at the end of 2015. South Africa’s GDP would hit $280.367bn by end of 2016, down from $314.732bn it recorded a year ago. Nigeria had lost its position as the biggest economy on the continent to South Africa in August this year after the recalculation of the nation’s GDP.
- The Federal Government has commenced the pilot phase of the National Housing Programme with the sum of N35bn. According to the Minister of Power, Works and Housing, Babatunde Fashola, the National Housing Programme would bridge the huge housing gap in the country, create thousands of jobs, as well as ensure sustainable and affordable homes for the beneficiaries.
- The Minister of State for Petroleum, Dr. Ibe Kachikwu, announced on Tuesday a deal with the Indian government which is expected to immediately put $15bn cash in the coffers of the Nigerian government in exchange for oil contracts that would be supplied in the years ahead.
- The Economic and Financial Crimes Commission (EFCC) has proposed a review of Nigerian laws to enable anti-graft agencies in the country retain a percentage of the loot recovered to fund their operations.
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