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  • Airtel Rated Best in Broadband Speed, Coverage in Nigeria

    Airtel Rated Best in Broadband Speed, Coverage in Nigeria

     

    Telecommunications services provider, Airtel Nigeria, has been declared the ‘Best in Test’ following a nationwide broadband assessment by umlaut, an international, full-service, cross-industry, end-to-end company that offers advisory and fulfilment services to clients globally.

     

    According to Hakan Ekmen, CEO of Telecommunications at umlaut, Airtel achieved the best-rated broadband coverage and user download speed among other mobile network operators, scoring the highest with 697 points, while MTN emerged second with 663 points, 9mobile with 591 and Glo with 486 points.

     

    The tests were carried out with umlaut’s crowdsourcing methodology, which was used to evaluate the mobile networks in Nigeria. Consequently, an extensive analysis revealed two-hundred and sixty-three thousand (263,000) users have contributed 707.4-million samples in 24 weeks from October 2020 until early April 2021.

     

    Speaking on the metrics of the assessment, Ekmen stated that over 80% of urban build-up and population areas were tested to arrive at the results. He went on to laud Airtel for emerging the best-rated, citing it as a remarkable feat and a positive step towards attaining digital equality in Africa.

     

    “In our nationwide assessment, 82.8% of the urban build-up area and 83.9% of the Population area were tested. We concluded that Airtel Nigeria is Best in Test, achieving the highest umlaut score with 697 points.

     

    “Airtel achieved the best-rated broadband coverage and user download speed. This is remarkable in one of the largest telecommunications communities on the African continent, a positive step towards Digital Equality”, he stated.

     

    Ekmen went on to state that umlaut’s sophisticated methodology enables the results to be comparable across network operators globally, emphasizing the transparency it provides in not only boosting network quality and performance but also improving experience for every customer.

     

    He further stated that while the results in Nigeria are quite impressive, there is still room for improvement in global comparison, however, the competition in the Nigeria’s telecoms landscape is working favorably for consumers in the country.

  • Imported Vehicles: NAJA Reveals How Nigeria Lost 50% Duties In 5 years

    Imported Vehicles: NAJA Reveals How Nigeria Lost 50% Duties In 5 years

     

    For five consecutive years, the federal government has lost half of its revenue accruing from duties paid on imported vehicles as 50 per cent of vehicles in Nigeria come in illegally through the closed borders and seaports without payment of duties to the government treasury,  investigations by the Nigeria Auto Journalists Association (NAJA) has revealed.

     

    The economic sabotage, which gained traction in the first quarter of 2016, when the land borders were shut by President Mohammadu Buhari regime, is perpetrated by either influential people/dealers who hand out signed documents to the Customs or bribe their way to clear the vehicles without due process.

     

    In connivance with unscrupulous government officials, some dealers are treated as sacred cows and they are quick to get away with anything at the ports.

     

    NAJA checks revealed that the illegal business does not stop at sea ports alone; similar dealings have been reported in major land borders across the country, including: Kpobe (Ogun State), Ijowu (Ogun State), Seme (Lagos State), Idiroko (Ogun State), Shaki (Oyo State), Daura (Katsina State), Baga (Borno State) etc.

     

    It would be recalled that the Nigeria Customs Service (NCS) had in September 2019 raided some top car marts in Lagos.

     

    The comptroller general’s Strike Force and officers attached to the Federal Operations Unit (FOU), Zone ‘A’, Ikeja stormed Berger along Apapa-Oshodi Express Road and other premises across the state.

     

    Many of them were closed on the orders of the CG Service, Col. Hameed Ali (rtd), for allegedly retailing smuggled vehicles in the shops.

     

    Major car dealers including Affordable Cars Limited, Carlink Limited, Ineh Mic Autos, Globe, Coscharis, Skymit, Arrowhead Motors, Wonder Wheels, Auto Point, among others were raided. Showrooms in other states, including, Sokoto, Katsina were equally affected.

     

    The second hand vehicles dealers were not spared as most of their showrooms were equally closed too due to reasons that have to do with documentation.

     

    Commenting, Remi Olaofe, the executive secretary, Nigeria Automotive Manufacturers Association, (NAMA) said “you can’t say there is no smuggling in Nigeria; our borders are porous and we have done everything we needed to do to improve it, by shutting down the borders, but they are still porous.

     

    Olaofe said it is a fallacy to say for every vehicle coming into the country, appropriate duties are being paid.

     

    Stating that NAMA has proffered solution to the menace, Olaofe said that with their portal and that of  the National Automotive Design and Development Council (NADDC, it will be 100 per cent impossible for anybody to import a vehicle and not properly register in Nigeria because the portal will indicate that the appropriate amount of money is not paid.

     

    “It is just as simple as that, but for the reason best known to the operators and the players in that market, they have refused to allow that portal to work”, he said.

     

    Advising that  vehicles must be registered for them to be driven on the road, Olaofe added that “You can’t be driving a vehicle that is not registered. To know this, they should go to the licensing office because the licensing office can not license a vehicle without first clarifying from the portal and that clears the vehicle. If that is not there, we have what is called the BIN number, will throw up a red flag”.

     

    Explaining further, Olaofe said “I don’t represent the (FBU) Fully-Built Vehicle, mine advocacy is for us to shut our doors against the FBUs. Assembling of vehicles in Nigeria is what I represent” .

     

    Confirming that the duty waiver for vehicles have been adjusted, but there is no difference in the rate of vehicles, the executive secretary said  “We are saying that it is not duty that is affecting the rate we are paying as transportation fare, but the factors are the cost of fuel, infrastructure, security on the road, wear and tear, replacement of these spare parts and the conditions of the vehicles. They bring a lot of junks into this country”.

     

    “Africa Bilateral Free Trade Agreement has taken off, where is Nigeria in the scheme of things? Assembly plants are now moved to Ghana, what do we stand to benefit? Toyota, Hyundai and co are being assembled in Ghana, are those for Ghana economy? They are for Nigeria economy”,  Olaofe added.

     

    Kunle Jaiyesimi, Deputy Managing Director, Massilia Motors, dealers of Mitsubishi brand of vehicles said most car dealers, including Masillia Motors are still selling their old stock and that his company had stocked up to December for the 2021 business.

     

    According to him, car market has really shrunk and that dealers have not really made major decisions in 2021 in terms of vehicle imports.

     

    Jaiyesimi said “to the assemblers, they are not happy with the Finance Act; it’s making the locally assembled vehicles uncompetitive compared to the Fully Built Units. For instance, Fuso and Canter (Mitsubishi) that we are assembling, it is cheaper to bring them in as FBU than locally assembling them. And that has affected our production lines.

     

    Jaiyesimi who is also the Chairman, Auto Group of the LCCI proffered solutions, saying that “the only way for us have some gain on the assembly line is for govt to remove the import duty or reduce it. If they cannot remove it, they can bring it down to five per cent” .

     

    The DMD said that, for now, they are charging 40 per cent (35 per cent import duty and five per cent for levy) on passenger cars for FBU; 10 per cent on (Semi Knocked Down (SKD) and 10 per cent on FBU buses.

     

    He argued that whatever duty reduction the government has put in place for them to enjoy is being wiped off by the exchange rate fluctuations,stressing that the CBN is not supporting vehicle importers at SKD or FBU level.

     

    Rather, he informed that stakeholders rely on the black market to pay their suppliers.

     

    ” Once you are getting your FX from the black market, whatever gain that is coming from the import duty reduction is lost in the over 25 per cent increase in the FX rate”, Jaiyesimi added.

     

    Further investigations however, show that both new vehicle dealers and second hand vehicles merchants are deeply involved in this business of short-changing the government.

     

    A key member of the United Bergers Motor Dealer Association (UBMDA), Chike Ejogu who spoke to this paper, said that dealers evade Apapa ports because of the high duties paid to clear the vehicles there.

     

    According to him, that is the major reason why dealers resort to smuggle in vehicles at cheap rates,in order to make big gains.

     

    Ejiogu said “the whole thing worsened in early 2016 when the land borders were closed. Before the closure we used to pay N74, 000 and N96, 000 for small cars while we were paying about N170, 000″ for big vehicles like SUVs”.

     

    Ejiogu revealed that about 5,000 vehicles are smuggled through the Idiroko land border every month.

     

    Chairman, Allen B Motors Nig Limited, Lawal Azeez told NAJA that car smuggling has caused the government a fortune.

     

    According to the auto dealer, reduction of duties paid to the government will help to discourage smugglers from their illegal operation.

     

    Meanwhile, efforts made to get statistics of imported vehicles from various auto companies proved abortive.

     

    Figures from Kia were not available as of the time of filing this report. Although, Coscharis was also approached for the statistics but the auto firm is yet to respond as at the time of filing this report.

     

    The story is basically the same at West Star Associates Nigeria Limited, sole distributor of Mercedes-Benz vehicles in Nigeria. 

     

    While different regions of the world make available sales statistics on a regular basis, Mercedes-Benz representatives in Nigeria always turn down request for sales statistics. 

     

    When contacted, a source promised to make necessary contacts within the company and get back. The source did not get back as at press time at the weekend. 

     

    However, for the first quarter of 2021, despite the challenges associated with Covid-19, Mercedes-Benz Cars sold 590,999 passenger cars across the world driven by China and United States  retail sales as well as strong demand for plug-in hybrids and all-electric vehicles

     

    One of the implications of vehicle smuggling or duty evasion, NAJA checks revealed is that the vehicles of these illegal auto dealers are sold easily at cheap prices because they never pay the right duty to get them into the country. Consequently, the genuine dealers are left to suffer the outcome as they cannot sell vehicles lower than the actual cost of bringing them to the showrooms.

  • Remittances To Nigeria Drop By 28% – World Bank

    Remittances To Nigeria Drop By 28% – World Bank

     

    Remittance inflow to Nigeria dropped by 28 per cent in 2020 due to the COVID-19 pandemic, the World Bank has said.

     

    The bank added that remittance flows fell for sub-Saharan Africa by 12.5 per cent, according to its Migration and Development Brief 33 Phase 11 entitled: “COVID-19 Crisis Through a Migration Lens’’ published on Thursday.

     

    The report said the decline in remittance flows to Nigeria was largely responsible for the fall in remittance flows to sub-Saharan Africa.

     

    “The decline in flows to sub-Saharan Africa was almost entirely due to a 28 per cent decline in remittance flows to Nigeria.

     

    “Excluding flows to Nigeria, remittances to sub-Saharan Africa increased by 2.3 per cent, demonstrating resilience,’’ the report stated.

     

    According to the report, the relatively strong performance of remittance flows during the COVID-19 crisis has also highlighted the importance of timely availability of data.

     

    It stated that given its growing significance as a source of external financing for low and middle-income countries, there was need for better collection of data on remittances.

     

    It emphasised that there was need for better collection of data on remittances, in terms of frequency, timely reporting, and granularity by corridor and channel.

     

    With global growth expected to rebound further in 2021 and 2022, remittance flows to low and middle- income countries are expected to increase by 2.6 per cent to $553bn in 2021 and by 2.2 per cent to $565bn in 2022.

     

    The report stated that global average cost of sending $200 remained high at 6.5 per cent in the fourth quarter of 2020, more than double the Sustainable Development Goals (SDGs) target of three per cent.

     

    It stated that sub-Saharan Africa continued to have the highest average cost (8.2 per cent) adding that supporting the remittance infrastructure and keeping remittances flowing includes efforts to lower fees.

     

    The true size of remittances, which includes formal and informal flows, is believed to be larger than officially reported data, though the extent of the impact of COVID-19 on informal flows is unclear.

     

    “As COVID-19 still devastates families around the world, remittances continue to provide a critical lifeline for the poor and vulnerable,” said Michal Rutkowski, Global Director of the Social Protection and Jobs Global Practice at the World Bank.

     

    “Supportive policy responses, together with national social protection systems, should continue to be inclusive of all communities, including migrants,” he said.

  • Nigeria Now Crypto Trading Platform Biggest Market, Hits $1.5 Billion with Over 1.5 Million Users

    Nigeria Now Crypto Trading Platform Biggest Market, Hits $1.5 Billion with Over 1.5 Million Users

     

    Paxful, the leading global peer-to-peer fintech, has disclosed that Nigeria is its biggest market with an impressive volume which currently stands at $1.5 billion to date.

     

    The P2P platform made this known while also announcing an impressive increase in the number of its Nigerian users to almost 1.5 million.

     

    The Chief Executive Officer and Co-founder of Paxful, Ray Youssef, said, “Our mission at Paxful is to give everyone equal access to finance no matter who they are or where they are so they can control their own money and build the future they want with financial freedom.

     

    “The financial system is failing 99 per cent of the world’s population; it is disconnected and out of date. This means there is no way out of income inequality for a lot of people in the world. With cryptocurrencies, we see an alternative: a way to rest the financial system based on equality.”

     

    He added, “We are on track for a 20 per cent+ increase in volume this year. We are seeing growth in all our markets and especially among groups or in countries where there’s a real need for cryptocurrencies: where the traditional financial system is failing people, whether that is because of extreme volatility, strict capital controls or high transaction costs.

     

    “People are looking for freedom from these constraints and find that in cryptocurrencies. So, there is a real increase in people using cryptocurrencies for their original purpose – as currencies and not just as a speculative asset.”

     

    Paxful announced that over $5bn had been traded to date on its platform globally, with over six million users.

     

    It said as of April 2021, the top four countries by volume on Paxful aside from Nigeria were China, United States, India, and Kenya.

    Founded in 2015 and completely bootstrapped since then, Paxful is a peer-to-peer platform where you can buy and sell digital currencies as the means of exchange and make payments, transactions, and send money.

     

    With close to 400 different ways to buy and sell digital currencies from gift cards to online wallets, bank transfers, Paxful connects you to almost any financial network in the world. The platform just added ETH to the cryptocurrencies available.

     

    Paxful is a peer-to-peer finance platform for people to make payments, transactions, and send money by buying and selling cryptocurrencies as a means of exchange.

     

    Founded in 2015 by Ray Youssef and Artur Schaback, Paxful’s mission is to help everyone have equal access to finance no matter who or where they are.

     

    Over 5 million people use Paxful to buy and sell Bitcoin (BTC) and Tether (USDT) with almost 400 different payment methods.

     

    Ray Youssef, co-founder, and CEO of Paxful, set up the Built with Bitcoin Foundation to help people have access to education and water. To date, the foundation has built four schools (two in Rwanda, one in Kenya, and one in Nigeria. The Built with Bitcoin Foundation is funded by Paxful and in part by donations from Paxful users.

  • WTO DG, Okonjo-Iweala, Arrives Nigeria On Working Visit

    WTO DG, Okonjo-Iweala, Arrives Nigeria On Working Visit

     

    The new Director-General of the World Trade Organisation, Dr Ngozi Okonjo-Iweala, on Saturday, arrived in Nigeria on a one-week working visit.

     

    Okonjo-Iweala resumed at the Geneva-based WTO on March 1, 2021, breaking a 26-year record by becoming the first female and first African director-general of the global trade and dispute settlement body.

     

    Addressing newsmen shortly after her arrival via the Nnamdi Azikwe International Airport, Abuja, on Saturday, the 66-year-old former Finance Minister said she is in the country to see how to better assist Nigerian entrepreneurs and improve the economy.

     

    She stressed the need for Nigeria to explore its share of trade in Africa through the African Continental Free Trade Area agreement.

     

    The former World Bank director also said she will meet with President Muhammadu Buhari and a number of ministers in the coming days.

     

    The Nigerian development economist, known for her African print Ankara wears and peculiar headgear usually tilted at a convenient angle, said in a recent interview that she unabashedly “love being African and being Nigerian”.

     

     

  • Nigeria Loses N151.78bn Crude Oil Monthly – NNPC

    Nigeria Loses N151.78bn Crude Oil Monthly – NNPC

    Nigeria is currently losing an average of 200,000 barrels of crude oil daily, the Nigerian National Petroleum Corporation stated on Wednesday.

     

    Brent, the oil against which Nigeria’s crude is priced, was $66.75 per barrel on Wednesday, while the official exchange rate of the dollar stood at 379/$.

     

    From the above figures, it showed that the country was losing about N151.79bn in 30 days, going by the 200,000 barrels of crude oil being lost daily, as revealed by NNPC.

     

    Group Managing Director, NNPC, Mele Kyari, disclosed the volume of crude oil lost daily in Nigeria while speaking at a meeting with the Chief of Defence Staff, Major General Lucky Irabor.

     

    The NNPC boss was quoted in a statement issued in Abuja by the corporation’s spokesperson, Kennie Obateru, as saying, “We have two sets of losses, one coming from our products and the other coming from crude oil.

     

    “In terms of crude losses, it is still going on. On the average, we are losing 200,000 barrels of crude every day.”

     

    On his part, Irabor promised to galvanise the military to provide maximum security for the nation’s oil and gas assets.

     

    He said, “I am delighted that you made this effort, and I tell you that the Armed Forces of Nigeria will collaborate with you to protect NNPC’s assets.”

     

    Irabor acknowledged the role of the oil and gas sector to the economy and stated that there was need for collaboration between the NNPC and the Armed Forces to protect oil and gas facilities.

     

    “It is my intention to cooperate maximally with you and to give necessary instructions to all officers in the Armed Forces,” he said.

     

    In a related development, a professor of law at the University of Lagos, Dayo Ayoade, has said the Federal Government was losing huge revenue in the upstream sector through the inadequacy of the measurement infrastructure.

     

    Between 2009 and 2019, the lecturer said, the nation lost 500 million barrels of crude oil valued at $44.7bn which was not assessed for royalty and tax.

     

    Disclosing this at a virtual meeting on illicit financial flows organised by the Independent Corrupt Practices and Other Related Offences Commission in Abuja on Wednesday, Ayoade pointed out that Nigeria currently relied on crude oil producers for determination of crude oil volumes.

     

    He said, “Nigeria currently relies on holders and producers of crude oil for determination of volumes of crude oil.

  • Telecoms Sector, Others Take Nigeria out of Recession as Sector Boosts GDP by 12.45% -Danbatta

    Telecoms Sector, Others Take Nigeria out of Recession as Sector Boosts GDP by 12.45% -Danbatta

    The Executive Vice Chairman of the Nigerian Communications Commission (NCC), Professor Umaru Danbatta, has reiterated that the nation’s telecommunications industry is one of the sectors whose performance lifted the country out of recession in the fourth quarter of 2020, contributing 12.45 percent to the country’s Gross Domestic Product (GDP).

     

    According to the latest data released by the National Bureau of Statistics (NBS), telecommunications & Information Services under Information and Communication grew by 17.64 per cent in Q4 2020 from 17.36 per cent in Q3 2020 and 10.26 per cent in Q4 2019.

     

    In the latest NBS report, agriculture, industries, and services sector, under which telecommunications is categorised, contributed 26.95 per cent, 18.77 per cent, and 54.28 per cent respectively. This is a pointer to the fact that telecommunications, trade, services and crop production are the main drivers of Nigeria’s exit from recession.

     

    In specific terms, NBS report showed that largest sub-sectors in Q4 2020 are crop production at 3.68 per cent, crude petroleum and natural gas at 8.2 percent, trade at 14.9 per cent, telecommunications & information services at 12.45 per cent, and real estate at 5.7 per cent, the report says.

     

    In a statement signed by NCC’s Director, Public Affairs, Dr. Ikechukwu Adinde, the telecommunications sector has, in the last five years been a major driver of the digital economy agenda of the Federal Government, as it has continued to provide the needed digital sinews that support the economy, especially during the COVID-19 pandemic and its attendant restriction period.

     

    “Since the outbreak of the pandemic, government institutions, businesses and individuals have relied heavily on telecoms services to carry out their daily operations and official routines. In response to the increased demand, the Commission put a number of regulatory measures in place to ensure seamless access by Nigerians to telecommunication services and protect against any adverse impact on the quality of service enjoyed by consumers.

     

    “The steady growth of the telecoms sector over the years with its pervasive positive impact on all other sectors of the economy in terms of increased automation of processes and digital transformation in service delivery has been remarkable. The growth trend since 2015 has reawakened hope that the economic diversification dreams of the country may finally be a reality as the sector continues to energize significant economic activities in the services sector of the economy.

     

    “Through effective regulatory regime emplaced by the Commission, under the leadership of its Executive Vice Chairman (EVC), Prof. Umar Garba Danbatta, telecoms investment grew from about $38 billion in 2015 to over $70 billion currently.”

     

    According to NCC, broadband penetration also increased from 6 per cent in 2015 to 45.02 per cent at December, 2020, indicating that 85.9 million Nigerians are now connected on 3G and 4G networks which provide enhanced high-speed Internet that has continued to boost efficiency and increase productivity across the economic spectrum.

     

    Recent statistics also indicate that between 2015 and December, 2020, active voice subscriptions have increased from 151 million to 204.6 million, with teledensity standing at 107.18 per cent. Basic active internet subscriptions grew from 90 million to 154.3 million during the period.

     

    The Commission is committed to its culture of quality regulation of the telecommunications industry that ensures a stable and robust sector which drives the digital economy agenda of the Federal Government and ultimately leads in the growth of the country’s GDP.

     

  • How Nigeria Exit 2020 Recession

    How Nigeria Exit 2020 Recession

     

    • Four main sectors got us out of recession

     

    The National Bureau of Statistics reported on Thursday that Nigeria posted a real GDP growth rate of 0.11% for the 4th quarter of 2020, which means the country just about slipped out of recession.

     

    This is Nigeria’s first positive GDP growth rate following three consecutive quarters of contraction.

     

    Whilst this is a welcome development, The Blurb Team @Nairametrics reports that this is historically the slimmest GDP Growth rate Nigeria has recorded since 2011 when the country’s GDP composition was rebased. However, the growth was just about enough to help Nigeria achieve a much sought-after V-shaped recovery. A slim GDP growth rate will always be more appreciated than any form of contraction.

     

    A further breakdown of the GDP growth rate in terms of contribution to GDP reveals Agriculture grew by 3.4%, Industries  contracted 7.3%, and Services grew by 1.31% respectively. In terms of contribution to GDP, Agriculture, Industries, and Services comprised 26.95%, 18.77%, and 54.28% respectively. From here we can deduce how Nigeria got out of recession.

     

    Digging into the data

    Digging into the data reveals the major drivers of Nigeria’s exit out of recession. The largest sub-sectors in the economy as of the 4th quarter of 2020 were Crop Production at 3.68%, Crude Petroleum and Natural Gas at 8.2%, Trade at 14.9%, Telecommunications & Information Services at 12.2%, and Real Estate at 5.7%.

     

    All 5 sub-sectors recorded significant improvement in their Real GDP Growth numbers including those that are still in contraction.

    • For example, Crop Production’s GDP grew in the 4th quarter by 3.42% compared to 1.39% in the previous quarter, nearly double quarter on quarter. Crop Production constitutes a significant portion of Nigeria’s GDP and most of all.

     

    • Trade GDP, which constitutes 15.5% of the total GDP, contracted by 3.2% compared to a 12.12% contraction in the prior quarter. This is an example of a sector that improved hugely despite still being in a contraction.

     

    • The Telecommunication sector grew by 17.64% in the 4th quarter of the year compared to 17.36% in the prior quarter. At 12.2%, the Telecommunication sector is now one of the largest in the economy. We believe this sector is a major reason why Nigeria got out of the recession.

     

    • Finally, the Real Estate sector, which had been in contraction since the second quarter of 2019, finally snapped out of recession in the 4th quarter, when it grew by 2.81%.

     

    • Thus, Trade, Telecommunications, Real Estate, and Crop Production GDP performances are the reasons why we are out of recession.

     

    Are we out of the woods?

    The result of the latest round of GDP figures does not in any way suggest the Nigerian economy is out of the woods. The economy is in a critical condition and most sectors are still in contraction, even those growing could easily fall back into a recession. However, we do know which sectors will drive economic growth in the country.

     

    For Nigeria to record faster economic growth than the slim 0.1%, we will need the telecoms, Trade, and Real Estate sectors to grow rapidly. So much focus has been placed on oil and gas for years, but there is no better time to move away from oil than now. Logistics, transportation, and ease of doing business challenges inhibiting trade must be resolved if this sector is to drive growth.

     

    A lot has been said about border closure and import substitution as being a zero-sum game for trade. However, a lot of intrastate trades still take place in Nigeria that involve strictly made in Nigeria goods. Yet, the issues listed above remain huge challenges.

     

    Real Estate, being a major job-creating sector, is also pivotal to putting money in the pockets of unskilled workers who feed off the indirect jobs it creates. For the sector to thrive, the government will need to solve the high-interest rate regime which has been the bane of progress for this sector for decades.

     

  • Again, Nigeria Exits Recession

    Again, Nigeria Exits Recession

    Nigeria’s Gross Domestic Product (GDP) grew by 0.11% (year-on-year) in real terms in the fourth quarter of 2020, representing the first positive quarterly growth in the last three quarters.

     

    This is contained in the Nigerian Gross Domestic Product report, published by the National Bureau of Statistics (NBS).

     

    According to the report, the growth was largely driven by positive growth recorded in the information and communication sector (15.9%) and agriculture (3.42%).

     

    Highlights

    The oil sector plunged by 19.76% (year-on-year) in real terms as against a contraction of 13.89% recorded in Q3 2020.

     

    The non-oil sector on the other hand grew by 1.69% in real terms, an improvement compared to the contraction of 2.51% recorded in Q3 2020. It however was slower than 2.26% recorded in the corresponding period of 2019.

    The service sector contributed 54.28% to the GDP in Q4 2020, followed by agriculture, which contributed 26.95%, and industries with 18.77%.

     

    Non-oil accounted for 94.13% while the oil sector accounted for 5.87% of the total GDP for Q4 2020.

     

    Oil sector

    The oil sector contracted by 19.76% (year-on-year) in Q4 2020, a downturn compared to a similar contraction of 13.89% recorded in the previous quarter (Q3 2020).

     

    It also represents a decline of 26.12% points when compared to a positive growth of 6.36% recorded in the corresponding period of 2019.

     

    The sector’s contribution to Nigeria’s GDP also reduced to 5.87% in Q4 2020 from 8.73% recorded in Q3 2020 and 7.32% in Q4 2019.

     

    In Q4 2020, average daily oil production of 1.56 million barrels per day (mbpd) was recorded, representing a 6.59% and 22% declines when compared to 1.67mbpd and 2mbpd recorded in Q3 2020 and Q4 2019 respectively.

    The decline in the oil sector activity can be attributed to the crash in global crude oil prices, which was triggered by the oil price war between Saudi Arabia and Russia.

     

    Non-oil Sector

    The non-oil sector grew by 1.69% in real terms in Q4 2020, slower than the 2.26% recorded in the corresponding quarter of 2019, but better than the 2.51% negative growth rate recorded in the preceding quarter.

     

    Growth in the sector was largely driven by Information and Communication (Telecommunications & Broadcasting).

     

    Other drivers were Agriculture (Crop Production), Real Estate, Manufacturing (Food, Beverage & Tobacco), Mining and Quarrying (Quarrying and other Minerals), and Construction.

     

    In real terms, the Non-Oil sector contributed 94.13% to the nation’s GDP in the fourth quarter of 2020, higher than the share recorded in the fourth quarter of 2019 (92.68%) and the third quarter of 2020 (91.27%).

     

    Key sectors’ performance

    The agricultural sector, in the fourth quarter of 2020, grew by 3.42% (year-on-year) in real terms, an increase by 1.11% points from the corresponding period of 2019, and an increase of 2.03% points from the preceding quarter which recorded a growth rate of 1.39%.

     

    The sector also contributed 26.95% to the overall GDP in real terms in Q4 2020, higher than the contribution in Q4 2019 but lower than Q3 2020 which stood at 26.09% and 30.77% respectively.

     

    Real GDP growth in the manufacturing sector in the quarter under review stood at –1.51% (year on year), lower than the corresponding period of 2019 and the preceding quarter by 2.75% points and 0.01% points respectively.

     

    The real contribution to GDP in Q4 2020 was 8.60%, lower than the 8.74% recorded in the fourth quarter of 2019 and 8.93% recorded in Q3 2020.

     

    In real terms, the Trade sector contracted by 3.2% (year-on-year) in the fourth quarter of 2020, which was 2.62% points lower than the rate recorded in Q4 2019, and 8.92% points higher than in the preceding quarter.

     

    Trade’s contribution to GDP was 15.46%, which is lower than the 15.99% it represented in the corresponding period of 2019, but higher than the 13.88% recorded in the previous quarter.

     

    Information and communication recorded a growth rate of 14.95% in real terms, an increase of 6.45% points over the corresponding period of 2019.

     

    The sector contributed 15.06% to aggregate real GDP in Q4 2020, higher than the same quarter of the previous year in which it represented 13.12% and higher than the preceding quarter, in which it represented 13.47%.

     

    What this means

    The positive growth in real GDP indicates that the Nigerian economy has recovered from the pandemic-induced recession which disrupted economic activities in most part of 2020. The country will look to post capitalise on this to boost the economy further in subsequent quarters.

  • How Nigeria Can Benefit From Okonjo-Iweala-Led WTO – LCCI

    How Nigeria Can Benefit From Okonjo-Iweala-Led WTO – LCCI

    The Lagos Chamber of Commerce and Industry has highlighted steps Nigeria needs to take in order to fully take advantage of the opportunities offered by the World Trade Organisation under the leadership of Dr Ngozi Okonjo-Iweala.

     

    The LCCI, in a statement on Monday, felicitated with Nigeria on the appointment of Okonjo-Iweala as the Director-General of WTO.

     

    The Director-General, LCCI, Dr Muda Yusuf, said, “While the emergence of Dr Okonjo-Iweala as the new WTO Director-General is very gratifying and calls for celebration, there is a need to manage expectations around the outcomes for the Nigerian economy, given the numerous productivity and competitiveness issues the country is grappling with.

     

    “Ultimately, these are the factors that would determine the benefits that would accrue to the economy from global trade.”

     

    According to him, Nigeria needs to build capacity for international competitiveness of its products and services so as to benefit from the WTO.

     

    He said, “Also imperative is the need to address trade facilitation issues, especially around port processes, ports infrastructures, international trade documentation, foreign exchange policies, trade policies and industrial policies. We need to promote local value addition and backward integration to strengthen competitiveness of our domestic industries.

     

    “We must undertake reforms of our tariff policy in accordance with the principles of comparative advantage, which would enable the country to optimise opportunities in the global trade arena and enhance the citizens’ welfare.”

     

    According to Yusuf, it is critical to develop an African Continental Free Trade Area strategy that would enable the country to leverage trade opportunities both continentally and globally.

     

    “There is a need to improve on our strategy in managing the coronavirus pandemic ranging from ensuring compliance to safety protocols to vaccine procurement and distribution,” he said.

     

    The LCCI DG said Okonjo-Iweala’s emergence came at a time when the global trading system was faced with numerous challenges, including supply chain disruptions precipitated by the coronavirus pandemic, rising protectionism and unilateralism, growing economic nationalism, and imposition of trade restrictions covering substantial amount of international trade, among others.

     

    “Africa has peculiar challenges in the global trade arena. The continent is deeply integrated into the global supply chain and this underscores the low participation level of African economies in international trade,” he said.

     

    According to him, it is very pertinent for African economies to build capacity within the continent in order to take advantage of the opportunities in global trade.