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ECONOMY

Policy Trilemma and Interest Rate Behaviour in Nigeria
Policy makers face trade-off in dealing with exchange rate management, monetary independence and concerns about capital mobility simultaneously. This study empirically examines the effects of Nigeria’s trilemma policy path on interest rate using data spanning from 1997:Q1 to 2017:Q3. It equally incorporates the role of external reserves in buffering these effects.
The Economics of Big Brother Naija (BBN)
A huge part of the revenue from SMS goes to the telecoms operators. Specifically, MTN rakes in 70% of the revenue, Glo rakes in 80% while Airtel rakes in 75%. Withholding tax of 10% is also charged and the value-added service provider (the shortcode- 32052) receives 5%. By taking the average, we estimate that Multichoice only receives 15% of the SMS revenue. Hence, It is not as rosy as you might have been thinking especially when it comes to revenue from the SMS voting platform. Multichoice gets more revenue from sponsorships than from the voting platforms.
Implication of the Forex Ban on Food Items
With 84% of Nigeria’s export (as at Q2’2020) as oil products, we reiterate that Nigeria does not really have an import problem. Nigeria has an export problem and until that problem is solved, average Nigerians will always suffer higher commodity prices due to the demand management strategy of the CBN anytime external shocks occur in the oil market.
[Archive] From Recession to Growth: The Story Of Nigeria’s Recovery from the 2016 Economic Recession
Being a Paper presented by Godwin I. Emefiele, Governor, Central Bank of Nigeria at the Special Convocation of the University of Nigeria, Nsukka, on Friday, May 17, 2019 at the Princess Alexandra Auditorium, University of Nigeria, Nsukka, Enugu State
2021-2023 MTEF: Key Implications and Market Impact
We recently received the 2021-2023 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) released by the budget office of the Federation. We have thus provided an update on the key highlights, their implications and market impacts.
Analysis of Nigeria’s Fiscal Revenue from January to April 2020
₦1.25 trillion was expected to be generated in January and February, however, ₦952.5 billion and ₦845.1 billion was generated respectively implying that only 76% and 68% of expected revenue were achieved. The month (March) which ushered in the Great Lockdown, saw a steep decline in revenue by 14% to ₦729.64 billion (M-o-M) compared to ₦1.32 trillion expected to be collected showing underperformance of 45% revenue collection. Mild recovery was experienced in April's revenue to ₦915.28bn against ₦1.32trillion expected, an improved 70% target revenue generated.
Nigeria’s Double Whammy of Inflation and Unemployment Increases
Persistent rise in the general price of goods within an economy is acclaimed inflation. Increasi...
Fallacy of an African Giant
This exposition tries to carry out a comparative analysis between Nigeria and selected economies in Africa. South Africa in Southern Africa, Egypt from Northern Africa, Kenya from East Africa and our neighbour (Ghana) in the same West African coast.
The Inflation Interplay in Nigeria
Five years ago, 5 naira and 10 naira currency were a significant part of our national denomination, and you could walk into any shop and get sweets, biscuits for that amount. This same 5 and 10 naira are becoming hard to come by, with little or no purchasing power. Coins have gone into extinction, confined to the books of accounts only, telling us the currency keeps losing its value with the passage of time.

BUSINESS & FINANCE

Financial Highlights of SEPLAT in the first 9 months of 2020
Although revenue declined, we note that the cost of sales surged during the period. Specifically, cost of sales was N103.94 billion compared to N70.65 billion recorded in the corresponding period of 2019. This was due to 95% increase in operational and maintenance expenses (N23.56 billion) and 59.4% increase in depletion, depreciation and amortisation (N33.75 billion).
Financial Highlights of Bua Cement Plc in 9M-2020
Gross profit grew by 13.6% compared to the corresponding period of 2019. The gross profit growth is however slow due to the fact that the growth in cost of sales was more than the growth in revenue. While revenue grew by 13.6% y/y, the cost of sales grew by 28.8%. Hence, gross profit printed N71.73 billion.
Financial Highlights of AIICO Insurance Plc in the First 9 Months of 2020
With profit after tax increasing by 16.7% and earnings per share declining by 30.8%, then we suspect the decline must have been due to the listing of additional shares during the year.
Financial Performance of Dangote Cement Plc in the First 9 Months of 2020
In the first 9 months of 2020, Dangote Cement (DANGCEM) plc was able to grow its revenue by 12% on the basis of solid production volume (+5.6% y/y to 18.40 million tonnes) with an overall effect on sales volume (+6.6% y/y to 19.21 million tonnes).
NNPC 2019 Financial Performance in Four Visuals
A simple analysis of the 2019 NNPC Group and NNPC Corporation Financial Performance
How Profitable is the Lagos Property Market?
This report examines the property market in Nigeria based on the data obtained from the NIESV.
Analysis of the Financial Performance of MTN Nigeria Communications Plc in Half Year 2020
MTN Nigeria increased its subscribers base by adding 6.8m to its network totaling 71.1m mobile subscribers as of June 2020. Total revenue generated was up by 12.5% (y/y) to ₦638.08bn for the first half of the year, compared to ₦566.95bn generated in the same period in 2019. Growth in revenue was largely driven by a 12.6% increase in revenue from Services provided which accounted for 99.8% of total revenue (₦636.99bn). Service revenue included revenue from its core activities of providing voice calls, data services, digital platforms, fintech (MoMo), and Other services (SMS, USSD, etc.).
Is a Wave of Bankruptcies Heading for the Offshore Oil Industry?
Offshore drilling major Valaris became the latest victim of the crisis this week as it filed for bankruptcy in the U.S., proposing a swap of some $6.5 billion in debt that will see creditors become its owners. But it is just the latest headache for offshore drillers. There is more than $20 billion in offshore drillers' debt still out there—and there are not many new drilling contracts.
H1’20 Review of Activities in Nigeria Equities Market
Although Stock bourses are forward looking in nature, they generally portray the momentum of the economy. An upward trend could signal investors' confidence in the market while otherwise could mean sell-offs and economic activities are going south.

ANALYTICS

[INFOGRAPHICS] Banks' Proportion Of Low-Cost Deposit(% CASA Mix, H1:2020)
High CASA mix enables banks to record lower Interest expenses, hence, a higher net interest margin.
[INFOGRAPHICS] Regional Unemployment Rate (August 2020)
The regional paradox - The Richer the oil, the higher the unemployment.
[INFOGRAPHICS] E-Business % Of Revenue of Nigerian Banks (H1'2020)
Nigerian Banks Electronic Transaction Revenue a question on efficiency of cashless policy.
[INFOGRAPHICS] Cash As A % Of Total Payments(Selected Countries)
Cashless policy a myriad in Nigeria payment transactions amongst other countries.
[INFOGRAPHICS] South African Vs Nigeria Banks (H1'2020)
South African banks are bigger than Nigerian banks in terms of Total Assets. However, Nigeri...
[INFOGRAPHICS] Poverty Rate By Sectors In Nigeria
Nigeria's Poverty Rate by Sectors Will able-bodied young people be better off or worse of...
[INFOGRAPHICS] Loan Book and Non-Performing Loan of Nigerian Banks as at H1'2020
Loan Book and Non-Performing Loan of Nigerian Banks as at H1'2020
[INFOGRAPHICS] FDI Inflows Into Selected African Countries In 2019
FDI Inflows into selected African countries in 2019

AFRICA & WORLD ECONOMY

A Long, Uneven and Uncertain Ascent
This crisis is far from over. Employment remains well below pre-pandemic levels and the labor market has become more polarized with low-income workers, youth, and women being harder hit. The poor are getting poorer with close to 90 million people expected to fall into extreme deprivation this year. The ascent out of this calamity is likely to be long, uneven, and highly uncertain. It is essential that fiscal and monetary policy support are not prematurely withdrawn, as best possible.
China and the Burgeoning African Debt Crisis
Contrary to the swirling rumors on African social media and in the local press about the supposed imminent danger of Chinese asset seizures in Zambia, it’s not the Chinese that are the problem here… it’s bondholders on Wall Street and in The City.
Emerging Stronger From the Great Lockdown
The managing director and the chief economist of the International Monetary Fund lay out a strategy for sustained recovery.
COVID-19 Response in Emerging Market Economies: Conventional Policies and Beyond
The economic impact of the COVID-19 pandemic on emerging market economies far exceeded that of the global financial crisis. Unlike previous crises, the response has been decisive just like in advanced economies. Yet, conventional policies are reaching their limit and unorthodox policies are not without risks.
Global Imbalances and the COVID-19 Crisis
A new IMF External Sector Report shows that overall current account deficits and surpluses in 2019 were just below 3 percent of world GDP, slightly less than a year earlier. The latest forecasts for 2020 imply only a further narrowing by some 0.3 percent of world GDP, a more modest decline than after the global financial crisis 10 years ago.
Impact of Conflict and Political Instability on Banking Crises in Developing Economies
A new IMF staff paper investigates whether rising conflict and political instability globally over the past several decades has led to more banking crises in developing countries. The study focuses on the potential impact of conflict and political instability on systemic banking crisis in 92 developing countries over the period 1970-2016.
COVID-19 is Reducing Domestic Remittances in Africa: What does it Mean for Poor Households?
The amount remitted by migrants from Sub-Saharan Africa (SSA) has grown tenfold in two decades, from $4.8 billion in 2000 to $48 billion in 2018. This reflects a steady increase in the number of people who decided to move in search of a better life: from 21.6 million in 2000, the number of migrants from Africa grew to 36.3 million in 2017.
COVID-19 Crushes Global Economy but Emerging Markets are in Bigger Troubles
By 2021, it is of high expectation that the world will return to normalcy, and economies around the world should recover from the adverse effect of coronavirus spread. However, emerging markets may continue to wallow in economic crisis as contemporary issues like weak GDP growth rate, unemployment rate, high debt profile, income inequalities, among others, remain in the picture, most of which have been worsened by the global pandemic effects.
The Impact of COVID-19 (Coronavirus) on Global Poverty: Why Sub-Saharan Africa Might be the Region Hardest Hit
COVID-19 is taking its toll on the world, causing deaths, illnesses and economic despair. But how is the deadly virus impacting global poverty? Here we’ll argue that it is pushing about 40-60 million people into extreme poverty, with our best estimate being 49 million.

AGENCIES

Data Disruption: The Impact of COVID-19 on Inflation Measurement
Lockdowns, working from home, and physical distancing caused people to spend larger shares of their household budgets on food and housing, while fewer people bought nonessentials, like airline tickets and clothing. And with incomes down as millions have lost their jobs, spending on nonessential items will likely remain depressed.
Bridging the Digital Divide to Scale Up the COVID-19 Recovery
Digitalization has in the past few years enabled developing countries, in particular, to leapfrog on financial inclusion. Countries like Kenya, Ghana, Rwanda and Tanzania have made great advances in connecting their citizens to financial systems by leveraging on mobile phone technology.
How COVID-19 will Increase Inequality in Emerging Markets and Developing Economies
Despite the pre-pandemic gains in poverty reduction and lifespans, many of the EMDEs have struggled to reduce income inequality. At the same time, they saw persistently high shares of inactive youth (i.e., not in employment, education, or training), wide inequality in education, and large gaps remaining in economic opportunities for women. COVID-19 is expected to make inequality even worse than past crises since measures to contain the pandemic have had disproportionate effects on vulnerable workers and women.
COVID’s Impact in Real Time: Finding Balance Amid the Crisis
The IMF analyzed the economic effects of lockdowns and voluntary social distancing using two high-frequency proxies for economic activity: mobility data from Google and job openings posted on the website Indeed. As illustrated in the top chart below, over the entire sample of 128 countries used in the analysis, lockdowns and voluntary social distancing contributed equally to the drop in mobility during the first 3 months of a country’s epidemic.
Fiscal Policy for an Unprecedented Crisis
The COVID-19 crisis has devastated people’s lives, jobs, and businesses. Governments have taken forceful measures to cushion the blow, totaling a staggering $12 trillion globally. These lifelines have saved lives and livelihoods. But they are costly and, together with sharp falls in tax revenues owing to the recession, they have pushed global public debt to an all-time high of close to 100 percent of GDP.
A Bridge to Economic Recovery: Be Aware of Financial Stability Risks
Despite a global economic crisis comparable only to the Great Depression, near-term financial stability risks have been contained with the help of unprecedented monetary policy easing and massive fiscal support across the globe. But many economies had pre-existing vulnerabilities—which are now intensifying, representing potential headwinds to the recovery.
Public Investment for the Recovery
Governments around the world are taking extraordinary measures to respond to the COVID-19 crisis. While maintaining the focus on addressing the health emergency and providing lifelines for households and businesses, governments need to prepare economies for the transition to the post-COVID-19 world—including by helping people get back to work.
Reform of the International Debt Architecture is Urgently Needed
The COVID-19 pandemic has pushed debt levels to new heights. Compared to end-2019, average 2021 debt ratios are projected to rise by 20 percent of GDP in advanced economies, 10 percent of GDP in emerging market economies, and about 7 percent in low-income countries.
Monetary Policy for all? Inequality and the Conduct of Monetary Policy
nequality in both advanced economies and emerging markets has been on the rise in recent decades. The COVID-19 pandemic has exacerbated and raised awareness of disparities between the rich and poor.
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