One year into the transition from President Jonathan to the Buhari led administration, the burden on Government remained the need to rejuvenate the Nigerian economy which has suffered from the declining global oil prices, poor governance structure, sub-optimal fiscal crisis and monetary policy actions. Recent domestic macroeconomic numbers have suffered from both global and domestic shocks which currently threaten the economic fundamentals of the country.
The Monetary Policy Committee (MPC) is scheduled to meet for its 250th meeting next week (23rd & 24th May 2016) to review global and economic developments within the last 2 months in the Nigerian economy. This is coming against the backdrop of sustained pressure on domestic output and elevated headwinds in the economy. Key indicators in the economy continue to worsen on the back of prolonged FX supply bottlenecks, delayed budget implementation, petrol market crisis, dragging consumer spending and weaker corporate earnings.
This week, after months of speculation and lobbying by the business community and multilateral agencies, the FGN finally made a move to liberalize the Petrol market by eliminating import quotas & licenses and introducing a price band for the product with a price cap of N145.00/litre and a floor of N135.00/litre.
This week’s data releases by the CBN and NBS - April 2016 Purchasing Manager’s Index (PMI) and Q1:2016 Quarterly Capital Importation data - revealed very disappointing numbers. Besides the fact that the weak numbers reflected poorly on business activities and investment confidence, they further reinforced market perception that weakening domestic fundamentals is yet abating.
President Muhammadu Buhari met with members of Nigeria’s Governors Forum (NGF) yesterday, 28th April 2016. Expectedly, the state governors requested for more palliatives to ameliorate their fiscal challenges. The proposed palliatives include: an 18-month moratorium on loans before resuming servicing, direct financial intervention and commitment of the Federal Government (FGN) to a Fiscal Restructuring Plan for Federating units which is yet to be made publicly available.
The week-long visit of President Muhammadu Buhari to China between April 11th and 15th 2016 confirmed preconceived notions that the Presidency will be pursuing a non-allied foreign policy objective, as with previous administrations, by partnering with countries both in the East and West to achieve development objectives. President Buhari’s predecessor, President Jonathan also made a similar visit to China in 2013 in which several infrastructure deals were signed but economic integration between the regions has mainly been defined in trade than finance and capital flows.
Waiting at a crowded bus stop for a ride to work, Osheme Antoine dreams of raising a big family one day. Such dreams, shared by millions, mean Nigeria's bus queues are likely to get even longer in decades to come.
President Muhammadu Buhari's budget plan for this year boosts investment in new roads, railways and power supply in the hope of dragging his nation of 188 million out of deep poverty.
The International Monetary Fund (IMF) released its revised World Economic Outlook for 2016 this week just in time for the 2016 IMF-World Bank spring meetings which commenced earlier today. The report titled, “Too Slow for too long” expectedly painted a grim picture of the global economic condition with the 2016 global growth forecast trimmed by 0.2% to 3.2% while growth forecasts across a broad spectrum of regions were also revised downward. The revision came against a backdrop of factors which have heightened uncertainty and subdued growth outlook.
The Buhari-led administration took over power following a peaceful and successful election 12 months ago, with a promise to stabilize the economy, stamp out insurgency and put an end to corruption. Devastated by the mixture of tumbling oil prices in the global market and poor domestic management, the government inherited an economy on the edge of a cliff. Chief among the disquieting challenges confronting the economy at the time included insurgency in the North-east, currency market instability, energy crisis and deteriorating economic fundamentals.