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In recent weeks, the CBN has released some press releases and statements and guidelines. You can read them below as well as the recent speech by the CBN Governor at the CIBN Conference.
CBN - Circuiar On The Universal Banking Model - Sept 7 2010 (118).
CBN - Commercial Banking License Guidelines (172).
CBN - Guideline For Granting Liquid Asset Status To State Govt Bonds (151).
CBN - Press Release - Update On Capitalization of Wema Bank and Unity Bank - Oct 4th 2010 (118).
CBN Power Initiative To Slash banks Overhead By 30 (131).
CBN Governor Keynote Address At 4th Annual Banking And Finance Conference of CIBN (371).
Communique for September 21 MPC (176)The <a href=”http://www.nigerianstat.gov.ng/”>National Bureau of Statistics</a> recently released the Consumer Price Index for August 2010. You can read the full report below. But here is the summary:
<blockquote>CONSUMER PRICE INDEX: AUGUST 2010
(BASE PERIOD NOVEMBER 2009 = 100)
BRIEF METHODOLOGY:
This edition of the Statistical News contains the revised Consumer Price Index (CPI) based on Nigeria Living Standard Survey (NLSS) 2003/2004. The consumption expenditure data were revalued to November 2009 which is the base period for the revised CPI.The May 2003 based and September 1985 based indices are being continued using factors derived from the new CPI. All of these indices will yield the same price change for any commodity group contained in all the series.
A new sub index – Imported Food Index- is available in the revised CPI.A TOTAL of 10534 informants spread across the country provide price data for the compilation of theNew CPI each month. Also, 740 product specifications are priced in each centre for computation of the New CPI. More enquiries relating to the CPI revision can be obtained from ofnwaboku@nigerianstat.gov.ng or kocimo@nigerianstat.gov.ng.
ALL ITEMS INDEX
The Composite Consumer Price Index (CPI) rose by 13.7 percent year-on-year in August 2010. This is higher than 13.0 percent recorded in the previous month in the new CPI series. The monthly change of the CPI was 1.8 percent increase when compared with July 2010. The urban All Items monthly index rose by 1.3 percent while the corresponding rural index recorded 2.1 percent increase when compared with the preceding month. The year-on-year average consumer price level as at August 2010 for Urban and Rural dwellers rose by 10.9 and 15.6 percent respectively. The percentage change in the average composite CPI for the twelve-month period ending August 2010 over the average of the CPI for the previous twelve-month period was 13.5. This was marginally higher than what was recorded by making similar comparison in July 2010. The corresponding 12- month average percent change for urban and rural indices rose by 10.2 and 15.3 respectively.
FOOD INDEX
Average monthly Food prices rose by 2.0 percent in August 2010 when compared with July of same year. The level of the Composite Food Index was higher than the corresponding level a year ago by 15.1 percent. The average annual rate of rise of the index was 14.7 percent for the twelve-month period ending August 2010. The rise in the index was caused mainly by slight increase in the prices of some food items like yam, potatoes, meat, fish, cooking oil, fruits and vegetables.
ALL ITEMS LESS FARM PRODUCE
The “All items less Farm Produce” index which excludes the prices of agricultural products rose by 1.5 percent in August 2010 when compared with July 2010. The increase was due to price rise observed with some pharmaceutical products and household equipments. In the twelve-month to August 2010, the index rose by 12.4 percent while the average annual rate of rise of the index was 11.5 percent for the twelve-month period ending August 2010.</blockquote>
They also released the Revised GDP for 2009 and the Estimates for Q1 and Q2 2010. The GDP economy grew by over 7% in Q2 2010. Here is an excerpt:
<blockquote>On an aggregate basis, the economy when measured by the Real Gross Domestic Product (GDP), grew by 7.69 percent in the second quarter of 2010 as against 7.45 percent in the corresponding quarter of 2009 as shown in Figure 1.
The 0.24 percentage point increase in Real GDP growth observed in the first quarter of 2010 was accounted for by the increase in production in the oil sector and wholesale & retail trade activities in the economy. The nominal GDP for the second quarter of 2010 was estimated at 6,824,477.43 million naira as against the 5,872,694.58 million naira during the corresponding quarter of 2009 thus indicating an increase.
The economy, which can be broken into two broad output groups, that is, Oil and Non-oil sectors, had both sectors witnessing increased output in the second quarter of 2010. The non-oil sector growth was driven by growth in activities recorded in the wholesale & retail trade sector, while the oil sector output increased as a result of the Federal Government’s amnesty and post amnesty development programme for the Niger Delta which restored peace in the area thereby ensuring re-entry/ recommencement of operations and encouraging investments in the sector.</blockquote>
You can download the report below:
National Bureau of Statistics - Revised 2009 GDP and Estimates for Q1-Q2 2010 (662)
In: Economy
27 Sep 2010In August, the Federal Government of Nigeria received the report of the Presidential Task Force given the responsibility of coming up with a road map for reforming the power sector. Here is their executive summary:
Introduction and Executive Summary
The growth, prosperity and national security of any country is critically dependent upon the adequacy of its electricity supply industry. Indeed the link between electricity supply and economic development is such that the health of the industry is a matter of deep and personal concern to all citizens. Nigeria is no exception. Over the past two decades, the stalled expansion of Nigeria’s grid capacity, combined with the high cost of diesel and petrol generation, has crippled the growth of the country’s productive and commercial industries.
It has stifled the creation of the jobs which are urgently needed in a country with a large and rapidly growing population; and the erratic and unpredictable nature of electricity supply has engendered a deep and bitter sense of frustration that is felt across the country as a whole and in its urban centres in particular. Electricity consumers and the citizenry as a whole demand a fundamental reversal of the long and debilitating malaise which has blighted the industry and, in doing so, bridled the tremendous energy and creativity of this great and populous nation. More particularly they demand real and immediate improvements in service levels.
In response to this demand, the Federal Government will not pretend that the task ahead will be an easy one. But it is determined to root out the canker which lies at the very heart of the industry. More particularly, the Federal Government has stressed the need to return to the task of pursuing the fundamental changes to the ownership, control and regulation of the sector that have been outlined in the National Electric Power Policy (2002) and enshrined in the Electric Power Sector Reform (EPSR) Act of 2005.
To meet our Vision 20:2020 target of 40,000MW will require investments in power generating capacity alone of at least US$ 3.5 billion per annum for the next 10 years. Correspondingly large investments will also have to be made in the other parts of the supply chain (i.e. the fuel-to-power infrastructure and the power transmission and distribution networks). These sums cannot and will not be funded and directed by the Federal Government. Rather, central to the development of the sector will be the need to incentivise the private sector to partner with government in this endeavour. At the same time, however, the Federal Government is acutely aware that improvements in service levels cannot wait until the industry has been commercialised.
The Government is, therefore, taking active steps to ensure modest but genuinely realisable improvements in the amount and quality of electricity supplied to customers in all regions of the country. In summary, this Roadmap outlines our plan to accelerate the pace of activity with respect to reforms already mandated under the EPSR Act and, at the same time and in support of this, a renewed drive to improve on short term service delivery.
You can read the abridged and full versions of their reports below:
Presidential Task Force – Roadmap for Power Sector Reform – Full
Presidential Task Force – Roadmap For Power Sector Reform – Summary
FSDH Securities, IBTC Asset Management and Access Bank have all prepared well-written and thorough Economic Reports for Q2 2010. They are worth reading. They also provided outlooks for the rest of the year. Their outlooks were generally positive. Here is Access bank’s outlook for the rest of the year:
<blockquote>
- GDP growth to stay above 6% in the near – medium term. NBS recently projected that the economy would grow by 7.74% by end-2010, up from 6.66% recorded in 2009. However, the growth trajectory may be undermined by a downward spiral in oil price at the international market, amid weak demand fundamentals, poor state of infrastructure, sustained inflationary pressures and the possibility of breakdown of FG’s Amnesty Programme.
- Moderate inflationary pressures due to CBN’s AMCON, SME and Power Sector Intervention Funds. Expansionary nature of the budget, moderate increase in commodity prices, announcement effect of salary increase for public sector employees and the proposed removal of petroleum products subsidy may pose additional upside risks to price stability. However, inflation appears to be effectively balanced by the continued underperformance of monetary aggregates, well-anchored inflationary expectations, weak aggregate demand, adequate supply of food and petroleum products, as well as stability in Naira’s exchange rate.
- Naira to stay stable against the US Dollar in the near term. CBN remains the largest supplier of foreign exchange in the economy and with expected increases in sale of FX by oil companies following FG’s peace deal with militants, Naira would further stabilize at current levels. Naira’s outlook remains tied to size of external reserves, FX demand, sustained high crude oil price, as well as development in global economy.
- Domestic interest rate to remain stable at current levels. Decline in statutory returns and the erosion of confidence in the market pose upside risks to a stable interest rate outlook. However, the CBN extension of its guarantee for all interbank transactions from December 2010 to June 30, 2011 will likely stabilize rates at current levels.
- Equities market to experience rebound from recent lows. Improved investors’ optimism and expected positive effect of the AMCON arrangement would likely put key indicators of the equities market in an upward trajectory in the medium term, when the company is expected to buy up banks’ toxic assets.
- The bond market is set to receive a boost. We also anticipate an increase in state and corporate bond issues to better fund longer term projects. Also FG has plans to finance N897 billion of its total deficit worth N1.5 trillion from the local bond issues.
- Banks earnings likely to be suppressed, as competition is expected to reduce profit margin, especially with respect to interest rate spread. A resurgence in massive deposit mobilization drive may distort the relatively stable interest rates in the money market.</blockquote>
Courtesy of FSDH Securities, IBTC, and Afrinvest, here are the NSE stats and reports for the week ended August 6th 2010: Afrinvest Bi-Weekly Report – Aug 6th 2010IBTC Weekly Market Watch – Aug 6th 2010FSDH Weekly Report – Aug 6th 2010 Lead Capital – Weekly Report – Aug 6th 2010 The NSE reports for June [...]
The Asset Management Corporation (AMCON) Bill was <a href=”http://www.bloomberg.com/news/2010-07-19/nigeria-president-goodluck-jonathan-signs-asset-management-corporation-law.html”>signed into law on July 19th</a>. You can call it the “Bad Bank Bill”. It will create the company (AMCON) that will buy the bad debt from the banks. The hope is that it will stimulate bank lending and ensure the health of the banks.
Here is <a href=”http://www.cenbank.org/”>CBN</a>’s press release after the bill was signed:
<a href=”http://www.cenbank.org/Out/2010/pressrelease/gov/PRESIDENT%20GOODLUCK%20JONATHAN%20SIGNS%20AMCON%20BILL.pdf”>CBN Press Release On The Signing Of The AMCON Bill</a>
<a href=”http://drop.io/hidden/ahltwvu68gm7ccy/asset/dmV0aXZhYmFua2luZ3VwZGF0ZWFtY29ubmlnZXJpYXMtYmFkYmFuay1wZGY%253D”>Vetiva Banking Update – July 2010 – Analysis Of Bad Bank Bill</a>
The Monetary Policy Committee of the Central Bank of Nigeria met on July 5th to review domestic economic conditions during the first half of 2010 and the challenges facing the Nigerian economy against the backdrop of developments in the international economic and financial environments in order to reassess the options for monetary policy for the [...]
Here are the major points from the recently released Central Bank of Nigeria’s April 2010 Economic Report.: Moderation in the major monetary aggregates in April 2010 General decline in banks’ deposits and lending rates Oil and non-oil receipts were than budgeted Inflation rate was at 12.5% at the end of April 2010 Oil receipts accounted [...]
You can download the recently released CBN’s Economic Report for Q1 2010. Here is an excerpt from the summary section: Provisional data from the National Bureau of Statistics (NBS) estimated GDP growth in the first quarter of 2010 at 6.7 per cent, compared with 8.2 per cent in the preceding quarter. The projected growth was [...]
Here are the monthly Economic Reports and Views presented by B.J. Rewane for May and June 2010 at the Lagos Business School. He summarizes the major events of the month and offers some analysis of these events and how they affect the economy.
Here is the Monthly Economic News and Views presentation given by B.J. Rewane at the Lagos Business School Executive Breakfast Meeting.
LBS April 2010 (295)The last meeting of the Monetary Policy Committee of the CBN was held on March 1st – 2nd. Here is the excerpt from the communique on the key decisions made:
This blog is dedicated to informing users on the latest business and economic news news from the CBN and Nigerian Stock Exchange. Happy reading!