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IMF approves Morocco’s $3bn economic shock request

By News desk

The International Monetary Fund (IMF) has approved financing of about $2.97 billion in the form of a Precautionary and Liquidity Line (PLL) to help Morocco ward off external economic shocks.

“The new PLL arrangement will provide insurance against external shocks and support the authorities’ efforts to further strengthen the economy’s resilience and promote higher and more inclusive growth,” the IMF Executive Board announced yesterday.

The two-year arrangement will help lower the ratio of public debt to GDP over the medium term while securing priority investment and social spending, the IMF said on its website.

Morocco’s treasury debt-to-GDP ratio for 2019 is expected to rise to 67.1 percent in 2019, up from 66.7 percent in 2018 and 65.1 percent in 2017, according to Finance Ministry data.

The ratio of public debt to GDP stood at 91.2 percent in 2017, with the government planning to reduce it to 60 percent in 2021.

In 2016, the IMF granted Morocco a two-year $3.5 billion credit line to give foreign lenders, investors and rating agencies reassurance about Morocco’s economic policies, allowing it to tap international capital markets on more favourable terms.

The external shocks that the PLL is intended to guard against could include a spike in oil prices, the central bank has said.

Senator, Minister disagree over Nigeria’s budget implementation

By News Desk

Following National Assembly member threat to boycott President Muhammadu Buhari’s 2019 budget presentation, Chairman, Senate Committee on Establishment and Public Service, Ali Ndume, has pleaded with his colleagues to jettison such plan for the nation’s development, even as he disagreeded with him on passage.

Ndume, who made the appeal on Saturday in Abuja, stressed that if the comment credited to the Minister of Budget and National Planning, Udoma Udoma, on the budget was true, it was unnecessary.

Some members of the House of Representatives had on Thursday threatened to boycott the budget presentation over reports that the minister blamed the National Assembly for delaying the process.

Hope urging his colleagues to reconsider Nigeria’s interest, Ndume said: ” I understand the reactions of the honourable members, is as a result of the unnecessary comment credited to the Minister of Budget as to who is responsible for the delay.

“My take on this is that two wrongs do not make a right and I want to appeal to my colleagues in the House of Representatives to have a rethink because the President is not responsible for what the minister was alleged to have said.

“I feel national interest should be placed above any individual or group interest. As for the Senate, the letter from Mr President as to when to present the budget has not been read,” he added.

The lawmaker pointed out that, to quicken passage, it was imperative for the budget to reach the parliament before the Christmas break.

He said: “I feel the best thing to do is for the president to present the budget, especially before we go on Christmas break.

“So that copies of the budget will be circulated to members to enable them start work on it.

“On resumption immediately after Christmas, we will start working on considering the budget for passage.

“So, I feel the reasonable thing to do is to receive Mr President in a joint session because it is very key to our national interest.

On alleged plans by Independent National Electoral Commission (INEC) to create illegal polling units in Niger and Chad, Ndume said the commission was being guided by law.

He expressed concern that the People’s Democratic Party (PDP) was crying wolf on the matter where there was none.

“I am aware of voting in various places, but I do not know if PDP wants to be INEC. The law is there and all actions of INEC will be guided by law.

“I was one of the senators in the 7th Assembly that moved for amendment of the Electoral Act to accommodate Internally Displaced Persons (IDPs).

“This was to ensure that they are not disenfranchised and I think that is what INEC is saying about the allegation by PDP.

“So, if PDP has any issue with that, I think they should look at the law first because INEC is responsible for conducting the election not PDP.”

Briefing State House correspondents at the end of the session, the Minister of Budget and Planning, Udoma said the Council will liaise with the National Assembly to determine when the president will submit the draft estimates for the consideration of the two chambers.

When asked to give details of the budget proposal, he declined to disclose the details, saying that the Nigerian constitution only allows the president to give out the details and that the President would do so when the National Assembly is ready to receive the draft/

The FEC had  on Oct. 24, approved the Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) for the 2019 to 2021 to provide template for the 2019 budget.

The session which was presided over by President Buhari approved a budget estimate of N8.73tr for the 2019 budget, N400 billion lower than that of this year.

He had explained at a consultative forum on the medium term expenditure framework (MTEF) and fiscal strategy paper (FSP) 2019 to 2021, that the decision was due to reduced government revenue projection for the year.

Udoma also said government planned to cut down the level of borrowing from N1.6 trillion in 2018 to N1.5 trillion in 2019, while the deficit component would be reduced from N1.9 trillion in 2018 to N1.6 trillion.

In spite of the recent oil output drop to about 1.9 million barrels per day, Udoma said government was optimistic the 2.3 million barrels a day target was achievable with production now rising to about 2.15 million barrels a day and new oil productions being put into play.

Although a $50 per barrel oil price benchmark was proposed in the ERGP, the minister had expressed confidence that with a significant rise in the price above $80 per barrel currently, government has proposed a $60 per barrel oil price for the budget.

He further stated that N305 was proposed as exchange rate to the dollar, with government working to keep inflation down after slight increases in the last two months on the heels of 18 months consecutive decline.

According to him, “Growth is expected to increase from 0.8 per cent in 2017 to 2.1 per cent this year and 3.01 per cent in 2019 with the continued implementation of the ERGP in 2019 and improved outlook for oil prices.”

N500bn Enyimba City project showed Buhari’s love for South East-UPP

By News desk

The United Progressive Party (UPP) has lauded President Muhammadu Buhari over the recent signing of agreement on the N500 billion Enyimba Economic City project.

National Chairman of the party, Chekwas Okorie, gave the commendation yesterday  in a statement in Abuja.

Okorie said by signing the agreement, the president had demonstrated that his government would support development programmes initiated by state governments without partisan prejudice.

The commendation came days after Memorandum of Understanding (MoU) for the N500bn Enyimba Economic City was signed at the Presidential Villa between the Federal Government and Abia Government.

The national chairman described the step as a landmark achievement considering FG’s commitment of 20% equity of about N100bn to the project.

He also lauded Okechukwu Enelama, the Minister of Industry, Trade and Investment who hails from Abia for facilitating the approval and his commitment to the project.

According to him, the project is estimated to provide over 650,000 direct jobs and boost economic development not only to the people of Abia, but to all Nigerians.

The chairman stressed that citing of the project conformed with UPP’s manifesto of job creation, infrastructure development and exploring comparative advantage of each state for national development.

He said in the 16 years of PDP, no initiative of such massive advantages was supported by FG in any part of the South East.

Olorire accused the PDP of willful halting of geometrics power project built to provide uninterrupted electricity power supply to the Ariaria Industrial Area covering about nine out of 17 local government areas of Abia.

The chairman also lauded the FG for injecting N33 billion to the ongoing construction of the Second Niger Bridge which the Federal Government scheduled to complete in 2022.

He listed reconstruction works going on at Enugu-Port Harcourt Expressway, Enugu-Onitsha Expressway and Owerri-Aba expressway as justification to campaign for the re-election of the president.

Saudi earmarks $113.7m for Sahel development

By Newsdesk

The Saudi Arabian Government has pledged $113.7 million to support priority investment programs in Africa’s Sahel region.

Saudi State minister for African Affairs, Ahmed Qattan, made the announcement at a donors meeting for the five-member Sahel group, held in the Mauritanian capital Nouakchott, it said.

The other countries making up the Sahel group are Burkina Faso, Chad, Mali and Niger.

German bank link to Panama Papers raided

By Newsdesk

Police raided six Deutsche Bank offices in and around Frankfurt on Thursday over money laundering allegations linked to the “Panama Papers”, the public prosecutor’s office in Germany’s financial capital said.

Investigators are looking into the activities of two unnamed Deutsche Bank employees alleged to have helped clients set up offshore firms to launder money, the prosecutor’s office said.

Around 170 police officers, prosecutors and tax inspectors searched the offices where written and electronic business documents were seized.

“Of course, we will cooperate closely with the public prosecutor’s office in Frankfurt, as it is in our interest as well to clarify the facts,” Deutsche Bank said, adding it believed it had already provided all the relevant information related to the “Panama Papers”.

The news comes as Deutsche Bank tries to repair its tattered reputation after three years of losses and a drumbeat of financial and regulatory scandals.

Christian Sewing was appointed as chief executive in April to help the bank to rebuild. He trimmed U.S. operations and reshuffled the management board but revenue has continued to slip.

Deutsche Bank shares were down more than 2 percent by 1409 GMT and have lost almost half their value this year.

OFFSHORE LINKS

The investigation was triggered after investigators reviewed so-called “Offshore-Leaks” and “Panama Papers”, the prosecutor said.

The “Panama Papers”, which consist of millions of documents from Panamanian law firm Mossack Fonseca, were leaked to the media in April 2016.

The prosecutors said they are looking at whether Deutsche Bank may have assisted clients to set up offshore companies in tax havens so that funds transferred to accounts at Deutsche Bank could skirt anti-money laundering safeguards.

In 2016 alone, over 900 customers were served by a Deutsche Bank subsidiary registered on the British Virgin Islands, generating a volume of 311 million euros, the prosecutors said.

They also said Deutsche Bank employees are alleged to have breached their duties by neglecting to report money laundering suspicions about clients and offshore companies involved in tax evasion schemes.

The investigation is separate from another money laundering scandal surrounding Danish lender Danske Bank, where Deutsche Bank is involved.

US, China stocks gains, dollar weaker as Democrats win House

By News Desk,

Wall Street stock futures and Asian shares held earlier gains on Wednesday after Democrats won control of the U.S. House of Representatives, boosting the party’s ability to block President Donald Trump’s political and economic agenda.

The Democrats’ House win creates a clear hurdle for Republicans to easily pass legislation through both chambers of Congress, clouding the outlook for some of Trump’s key economic proposals.

In Asian trade, major broadcasters projected the Democrats would wrest House control, while the Republicans were seen retaining the Senate.

While both outcomes were broadly in line with market expectations, a reason markets did not sell off, the prospect of political gridlock creates some uncertainty for investors. The dollar weakened against most of its major counterparts.

In equities markets, U.S. S&P500 futures ESc1 rose 0.3 percent, MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.3 percent and Japan’s Nikkei gained 1.2 percent

“It has clearly become difficult for Republicans to pass additional tax hikes or amendments to Dodd-Frank regulations (on financial institutions) for instance,” said Tomoaki Shishido, fixed income analyst at Nomura Securities.

Investor sentiment had been volatile in Asian trade with stocks and the dollar swinging on the Republicans’ fluctuating prospects of retaining the House.

While a split Congress would put a brake on Trump’s agenda, such as tax cuts or deregulation, some investors think the Democrats may agree to more spending.

“There are still areas with compromise for spending, so even with a split government I expect more fiscal stimulus ahead. There is some possibility for compromise on infrastructure spending as well,” said Steve Friedman, New York-based senior economist at BNP Paribas Asset Management.

“If there is additional fiscal stimulus, it suggests that fiscal policy is more of a tailwind for U.S. growth and it should, all things equal, be supportive for stocks.”

On the other hand, many investors also expect Trump to continue to take a hard line on tariffs, which he can impose without Congressional approval. That keeps alive worries about a trade war between China and the United States.

Trump’s massive tax cut, enacted in December, and a spending agreement reached in February have helped lift the U.S. economy, but they have also widened U.S. federal budget deficit.

As a result, Treasury supply has been growing, pushing U.S. bond yields higher.

The election results pushed down the 10-year U.S. Treasuries yield about 2 basis points to 3.193 percent, off its seven-year high of 3.261 percent touched a month ago. But the debt market also remains under pressure from this week’s record volumes of longer-dated government debt supply.

Oil prices were soft after a 2 percent fall the previous day, with U.S. crude futures hitting an eight-month low as Washington granted sanction waivers to top buyers of Iranian oil and as Iran said it has so far been able to sell as much oil as it needs to.

U.S. West Texas Intermediate (WTI) crude CLc1 futures traded 0.5 percent lower at $61.91 a barrel having hit a low of $61.31 on Tuesday, the weakest price since March 16.

In the currency market, the dollar dipped on the U.S. election results. Against the yen, it was 0.2 percent lower at 113.23, reversing earlier gains to one-month high of 113.82 yen.

The euro rose 0.3 percent to $1.1467 and the British pound gained 0.3 percent to $1.3140, hitting a three-week high.

Sterling extended gains made the previous day on hopes of a Brexit deal breakthrough after Brexit Secretary Dominic Raab said “Thumbs Up” on his way out of a cabinet meeting.

That helped sterling recover losses following remarks from a senior member of the Northern Irish Democratic Unionist Party earlier that it looked like Britain would exit the EU without a deal.

Osinbajo, Ambode, Sanwo-Olu monitor Tradermoni disbursement in Lagos

By Olawale Abdul-Fatah

Vice President, Prof. Yemi Osinbajo and Lagos State Governor Akinwunmi Ambode, monitored the Tradermoni scheme in the state, targeted at assisting traders to boost their businesses in the country.

It would be recalled that scope behind the scheme was to ensure that two million petty traders receive N10, 000 and on repayment of their loan, receive 15, 000 and on and on.

Osinbajo, who was also accompanied by All Progressives Congress, APC governorship candidate Lagos, Babajide Sanwo-Olu, visited Ketu, Bariga and Oshodi markets.

In an interview with newsmen after the inspection, Senior Special Assistant to the Vice President on Media, Laolu Akande, stressed that the visit to the state was to see the impact of the scheme.

He added that the visit was also to assure the traders not captured among the two million beneficiaries that they would be captured in the next tranches.

“And the visit of the president to Lagos was to see the impact of the scheme and interact with the traders in markets. And he assured them that the fund will be increased to capture more people.

“Our plan is that between now and December, we would have captured the two million traders. Already, we have handed the fund to 800, 000. We have enumerated all the two million and we know who they are.

“That doesn’t mean that this is the end of the programme. Our plan is to achieve the two million before the end of the year and add more people to subsequent tranches,” he added.

The Vice President’s aide stated that the initiative launched under the Government Enterprise and Empowerment Programme, GEEP, in partnership with the Bank of Industry BOI, has assisted 1.1 million Nigerians.

According to him, over 1.1 million Nigerians – market women, traders, artisans, farmers – are currently beneficiaries of GEEP, which comprises FarmerMoni, MarketMoni and TraderMoni.

“There are over 809,000 beneficiaries under TraderMoni while the rest were beneficiaries of FarmerMoni loans and MarketMoni for farmers and Small and Medium Enterprises, SMEs in the country.”

Earlier, Executive Director, Bank of Industry, Toyin Adeniji, urged beneficiaries to refund the loan within six months.

“It isn’t a national cake. The fund is targeted at empowering the traders. We expect that if they pay back, they are not only helping themselves but also the community.

The Chief Officer of GEEP, Uzoma Nwagba, said there were other products such as the ‘Farmers Moni’, which provides farmers the opportunity to access loans up to N300,000.

He urged beneficiaries to do their best to pay back the loans so that others can get the opportunity to benefit from the programme.

AfDB gives $50m to Fidelity bank for SMEs

By News Desk,

The African Development Bank (AfDB) has approved a $50 million line of credit to Nigeria’s Fidelity Bank Plc to support small and medium sized.

The money is also meant to support women-owned enterprises in selected transformative sectors, including close to a hundred SMEs in manufacturing, health and education.

Approved by the Bank’s Board on 10 October 2018, the facility is fully dedicated to financing micro, small and medium sized enterprises (MSMEs), with a minimum of 30 percent going to women-owned enterprises.

The loan will enhance Fidelity Bank’s liquidity and help meet the demand for medium-term funding to players in the target sectors, contributing to improved quality of lives, job and wealth creation and tax-revenue generation.

The facility complements the Government of Nigeria’s long-term development strategy, as espoused in its Vision 20:2020 agenda.

Aligned with Nigeria’s Economic Recovery and Growth Plan 2017-2020 (ERPG), the funding will ultimately boost enterprise competitiveness and expand Nigeria’s economic base.

The ERPG seeks to stimulate Nigeria’s economic growth, catalyse macroeconomic stability, foster diversification of the economy, and enhance social inclusion as well as governance.

According to AfDB, SMEs account for 30 per cent of Fidelity Bank’s loan portfolio.

The selection of the tier 2 Nigerian bank for this seven-year credit facility (with a grace period of two years) is based on its strong niche presence in the SME and mid-sized corporate space.

It is also in recognition of the bank’s credit management and strong track record with the African Development Bank. The Nigerian lender has previously received US$18 million and US$75 million lines of credit from the development finance institution in 2001 and 2013, respectively.

“Fidelity Bank is a niche player, focused on the SME space and this US$50 million credit line will contribute to strengthening its presence in its key market segments,” said Ebrima Faal, Senior Director, Nigeria Country Office at the African Development Bank.

“The Nigerian financial institution also continues to meet its ongoing credit obligations under the terms of previous support received from the African Development Bank.”

The line of credit to the Nigerian financial institution is consistent with the Bank’s Ten-Year Strategy (2013–2022). It also aligns with two of its High 5 priorities – Industrialize Africa and Improve the quality of life for the people of Africa.

Founded in 1987, Fidelity Bank Plc has grown from its marginal position into a stable banking institution.

Currently the 10th largest commercial bank in Nigeria by asset size, it was listed on the Nigerian Stock Exchange in May 2005.

It has a broad client base of about four million customers nationwide, served from a network of over 240 branches and business offices, supported by alternative service delivery channels like ATMs, mobile and electronic banking, and agency banking channels.

Following its renewed digital banking and retail drive, Fidelity Bank was ranked 4th best bank in Nigeria in the retail market segment in the KPMG Banking Industry Customer Satisfaction Survey (BICSS) in 2017.

U.S.-China trade war ends 1 million U.S. jobs promise – Jack Ma

By Business Desk,

Alibaba Chairman, Jack Ma said the company can no longer meet its promise to create 1 million jobs in the United States due to U.S.-China trade tensions, Chinese news agency Xinhua reported on Wednesday.

Ma has already warned that the trade war between the world’s two largest economies could last decades and that China should focus exports on the “Silk Road” trade route, citing Africa, Southeast Asia and Europe.

Ma met U.S. President Donald Trump two years ago and laid out the Chinese e-commerce giant’s plan to bring one million small U.S. businesses onto its platform to sell to Chinese consumers over the next five years.

“This commitment is based on friendly China-U.S. cooperation and the rational and objective premise of bilateral trade,” Ma told Xinhua on Wednesday.

“The current situation has already destroyed the original premise. There is no way to deliver the promise.”

While Ma had not detailed how he would add those jobs, he has said that he wanted to encourage American small businesses to sell on Alibaba marketplace Tmall and Taobao, reasoning that every new business that joined the platform would have to hire a person to manage the extra sales.

Investors seemed unfazed by Ma’s comments, with Alibaba shares closing up 3.8 percent on Wednesday. They have declined 5.7 percent so far this year, including those gains.

Trump on Monday imposed 10 percent tariffs on about $200 billion worth of imports from China, and threatened duties on about $267 billion more if China retaliated.

China responded a day later with tariffs on about $60 billion worth of U.S. goods as planned, but reduced the level of tariffs it will collect on the products.

Ma’s latest comments come on top of others he recently made about the escalating trade skirmish and show his support for Beijing’s stance on how additional tariffs will affect businesses and the country’s cornerstone One Belt One Road foreign policy initiative.

“The U.S. like competition, China likes harmony, they’re two different cultures,” Ma said at an investor conference in Shanghai on Tuesday.

Nigeria records first strong GDP growth after recession

By News Desk,

The Nigerian Bureau of Statistics (NBS) has reported that for the first time since Nigeria’s exit from recession, the Gross Domestic Product (GDP) has recorded growth.

Driven by the non-oil sector, GDP which grew by 2.05 per cent in the second quarters of 2018 represented the strongest growth in non-oil GDP since fourth quarter of 2015.

“Non-oil GDP growth was -0.18% in Q1 2016, -0.38% in Q2 2016, 0.03% in Q3 2016, -0.33% in Q4 2016, 0.72% in Q1 2017, 0.45% in Q2 2017, -0.76% in Q3 2017, 1.45% in Q4 2017and 0.76% Q1 2018.

“GDP grew strongly in Q2 2018 by 2.05%. Non-oil growth was driven by transportation which grew by 21.76% supported by growth in construction which grew by 7.66% and electricity which grew by 7.59%.

“Other non-oil sectors that drove growth in Q2 2018 include telecommunication which grew by 11.51%, water supply and sewage which grew by 11.98% and broadcasting which grew by 21.92%.’’

The non-oil sector performance was however constrained by agriculture that grew by 1.3% compared to 3.00% in Q1 2018 and 3.01% in Q2 2017.

Q2 2018 GDP growth was also constrained by oil GDP with crude oil and gas production contracting by -3.95% compared to 14.77% in Q1 2018 and 3.53% in Q2 2017

Services GDP recorded its best performance in 9 quarters, growing by 2.12% in Q2 2018 compared to -0.47% in Q1 2018 and -0.85% in Q2 2017.

Statistician General and Chief Executive Officer of National Bureau of Statistics (NBS), Dr. Yemi Kale, last week denied reports quoting that Nigerian economy had yet to recover from recession.

Kale categorically said that Nigeria was out of recession and that at no time did he suggest otherwise.

His denial was contained in a statement released on Monday by the Bureau’s Public Relations Officer, Mr. J. Ichedi.

NBS said that it reported in the second quarter of 2017 that the country was out of recession as the country recorded the first positive growth in Gross Domestic Product (GDP) following five quarters of contradiction.

He said that economic growth as measured by GDP has remained positive ever since with 0.72% in second quarter of 2017; 1.17% in third quarter of 2017; 2.11% in fourth quarter; and 1.95% in first quarter of 2018.

Ichedi said that NBS had continued to explain that there would be economic recovery after the recession.

The economic after recession moves gradually towards sustainable strong growth which “is the stage we are now’’.

This is the position which the CEO told Arise Television in an interview, he said.

The CEO, he said, told the television that the economy was in the second state of recovery and heading toward sustainable growth which is the last stage’’.

“This should not be wrongly interpreted as the economy is still in recession,’’ Ichedi said.

According to a report by a local newspaper on Monday, the Statistician-General was quoted to have lamented the performance of the nation’s economy in the second quarter of the year.