Manufacturing PMI Index Grows To 57.6 Points In July – CBN

CBN Reviews Capitalisation Of Tier 2 Microfinance Banks


The Manufacturing PMI in the month of July stood at 57.6 index points, the Central Bank of Nigeria (CBN) has said.

It made the disclosure in a report entitled “Purchasing Managers’ Index (PMI) July 2019 Report” published on Wednesday.

The apex bank said the growth indicated expansion in the manufacturing sector for the “28th consecutive month”.

It noted that the index grew at a faster rate when compared to the index in the previous month.

READ ALSO: 15 Killed In Niger Boat Accident

Of the 14 subsectors surveyed, the CBN said 13 reported growth in the review month, including the petroleum and coal products, transportation equipment, cement, printing and related support activities, and paper products.

Others are food, beverage and tobacco products; furniture and related products, fabricated metal products, non-metallic mineral products, plastics and rubber products, primary metal, chemical and pharmaceutical products, as well as electrical equipment.

However, the textile, apparel, leather and footwear subsector recorded a decline in the review period.

The financial regulator revealed that at 58.9 points, the production level index for the manufacturing sector grew for the 29th consecutive month in July.

According to it, the index indicates a slower growth in the month, when compared to its level in the month of June.

“Twelve of the 14 manufacturing subsectors recorded increased production level, while two recorded decline,” it said.

Similarly, the employment level index of the sector stood at 57.3 points in July, indicating growth for the 27th consecutive month.

The report said, “Of the 14 subsectors, 10 reported increased employment level, one reported unchanged employment level while three reported decreased employment in the review month.”

The apex bank explained that the July 2019 PMI survey was conducted by the Statistics Department of the CBN between July 8 and 12.

It said the respondents were purchasing and supply executives of manufacturing and non-manufacturing organisations in all 36 states and the Federal Capital Territory (FCT).

The bank said it made no representation regarding the individual companies, other than the information they have provided.

Q2 GDP: Analysts Unhappy With Performance Of Agriculture, Manufacturing Sectors


The Gross Domestic Product (GDP) report released on Monday by the National Bureau of Statistics (NBS) has left some analysts concerned about some sectors, especially the agriculture and manufacturing sectors.

The report for Q2 2018 showed that GDP slowed, growing by 1.50% in the second quarter as against the 1.95% growth in the first quarter of 2018.

Chief Executive Officer Of Cowry Asset Management, Mr Johnson Chukwu, told Channels Television’s on Channels Television programme, Business Morning said although the GDP Q2 report shows positive growth, the key sectors, however, did not perform positively.

“Although the GDP grew positively by 1.95%, the sectors that should propel job creation and economic positive are not in the positive directory,” Chief Executive Officer of Cowry Asset Management, Mr Johnson Chukwu, said on Monday in an interview on Channels Television’s on Business Morning.

“Manufacturing sector compared to the first quarter had a major contraction in terms of growth rate,” he said.

Chukwu explained that although the agriculture sector is growing in Nigeria, it is also doing so at a much slower pace. The economist blamed this on the crisis in north-central Nigeria.

He said, “(The) Agricultural sector grew by only 1.19% in the second quarter. I have also said the impact of the crisis in the Northcentral will reflect on the GDP growth status. The Manufacturing sector accounts for 9.28 in the GDP. So these key sectors are not growing.”

Another analyst, Mr Rotimi Fakayejo said the figures from the report are not unexpected but show hope ahead, but, like Chukwu, he flagged the performance of the agriculture sector.

He also expects investors to be concerned about the performance, noting, however, that not many companies in the sector are listed on the Nigerian Stock Exchange.

“I believe investors may not be able to miss out on the grey points of their investment in terms of what kind of returns they are going to get,” he said.

“So, I believe strongly that with the way it is now, the agricultural sector will draw the ire of investors and that is going to be a major focus.”

The GDP report released on Monday showed that the Agriculture sector – Crop Production, Livestock, Forestry and Fishing – contributed 18.78% to nominal GDP but the growth in the second quarter was lower than the rate recorded for the second quarter of 2017 (19.28%).

Manufacturing Activities Increased In May – CBN

The Central Bank of Nigeria has released its manufacturing and non-manufacturing report showing an increase in all the indices measured in the month of May.

Manufacturing activity measured by Purchasing Managers’ Index was reported higher at 52.5 reading, posting a second consecutive month increase.

Ten of the 16 sub-sectors surveyed grew in the month under review.

The CBN’s report shows production level higher at 58.7 points, new orders rose to 50.5 and employment level index was at 50.7, indicating growth in new jobs after 26 consecutive months of contraction.

On the non-manufacturing front, the composite PMI was higher to 52.7 last month, after 16 months’ back-to-back contraction.

The Central Bank’s manufacturing data contrast with the report by investment and securities firm FBNQuest, which shows PMI during the month was down to 54.0 against 58.9 level in April.

FBNQuest’s report said four of the five sub-indices measured in the report declined in the month that ended on Wednesday.

Awka Residents Protest Against Poor Electricity Supply

EEDC, Awka, Protest, electricityElectricity consumers in Awka the Anambra state capital, have called on the Enugu Electricity Distribution Company to speed up the installation of transformers, that would aid in the improvement of power supply in the area.

In a protest involving mainly traders from various communities, residents of Awka stormed the office of the EEDC carrying placards with various inscriptions.

According to them, the persistent low power supply is badly hurting their businesses.

Electricity is a basic necessity with which many businesses can thrive.

However, the absence of it has caused a lot of discomfort for business owners who compulsorily have to resort to other means to generate power or face the risk of a fallen business.

Hospitals, media organisations, SME’s such as frozen food sellers, beauty salons, cyber businesses among others have to run on generators which consume a lot of fuel and eat deep into their pockets.

With the pump price of fuel having recently gone up and the current economic situation in Nigeria, business owners continue to complain of little profit to show for their efforts.

In a bid to help the economic situation, many financial analysts have offered various suggestions on diversifying the economy of the oil-focused nation, back into areas like agriculture and manufacturing.

There are hopes that as financial institutions, the government and the private sector jointly work towards stabilising the economy, SMEs in Nigeria would soon begin to find doing business less difficult.

Reps To Investigate Nigeria’s Foreign Exchange Policy

Reps, Foreign Exchange, NigeriaIn a bid to find ways to stabilize the foreign exchange market in Nigeria, an ad-hoc committee of the House of Representatives, is to meet with the Central Bank of Nigeria, Bureau De Change, banks and other establishments operating in the sector.

This was one of the resolutions reached by lawmakers when considering a motion on the lingering scarcity of foreign exchange in the country.

The house has also mandated the committee to know the establishments that have obtained foreign exchange at subsidized rates from the Central Bank and how the funds were spent.

According to the report read by a member of the House of Representatives , Ali Isa, despite the “CBN’s weekly release of forex to the BDC’s and banks, the value of the Naira against the dollar and pounds sterling, continues to depreciate, further worsening the economic conditions of the country”.

The continuous weakening of the Naira against the dollar, has “affected the production of goods services and has consequently made life more difficult for most Nigerians,” the report stated.

The committee is however expected to report back in four weeks.

Businesses shut Down

One of such businesses affected by a prolonged scarcity of foreign exchange is Tomato Paste Producer, Erisco Foods Limited.

The CEO of the company, Eric Odinaka Umeofia on Wednesday said he would have to shut down his factories if the situation persists.

He added that his company has been frustrated by the National Agency For Food And Drug Administration And Control (NAFDAC), Ministry of Trade and Investment and the Central Bank of Nigeria (CBN).

Mr. Umeofia like many other business owners said the stifling business conditions would result in him having to lay off 1,500 of his 2,052 employees.

The recession, combined with a shortage of dollars, and short aviation fuel supply have also had a major impact on the aviation sector with airlines winding down operations.

IMF Predicts Weak Global Economic Growth In Q4 2016

IMF, Economic growth, 2016The International Monetary Fund (IMF), says global economic growth will remain weak this year, following a slowdown in the United States and Britain’s vote to leave the European Union.

In its latest World Economic Outlook released on Tuesday, the IMF expects the world’s economy to expand by 3.1% this year, unchanged from its July projection, while a slight recovery of 3.4% is expected in 2017.

The IMF reduced its forecast for the United States to 1.6% in 2016, down from 2.2% in July, while China, the world’s second largest economy is projected to expand 6.6 percent in the current year and 6.2% next year.

Chief Economist and Economic Counsellor of IMF, Maurice Obstfeld said “taken as a whole, the world economy has moved sideways.

“We have slightly marked down 2016 growth prospects for advanced economies while marking up those in the rest of the world,” he added.

Nigeria’s Economic Recession

Nigeria is one of the countries that is currently experiencing a recession with the IMF concluding that the economy would contract by 1.8%.

The county’s revenue is said to have fallen by as much as 33%, which according to the United Nations resulted in the contraction of the Gross Domestic Product (GDP) in the first three months of 2016.

The largely subsistence agricultural sector has not kept up with rapid population growth, and Nigeria, once a large net exporter of food, now imports large quantity of its food products.

However, economic and financial experts have been proferring solutions which might help revive the economy.

There have been suggestions to diversify the economy and shift attention back to agriculture, manufacturing, and private sector investment.

#Brexit woes

Meanwhile, IMF says with Britain’s vote to leave the EU,  which is both historic and world-changing, it should serve as a wake up call to countries that in several ways have relied on it.

Mr. Obstfeld says although the market reaction to Brexit was reassuringly orderly, the ultimate impact remains very unclear.

He added that the vote has however resulted in more sentiments towards emerging market economies like Nigeria.

200 Ex-Militants Graduate In Automobile Manufacturing, Plastic Design Training

Niger-Delta-militantsAbout 200 trainees from the 2nd batch of militants under the Presidential Amnesty Programme have graduated in various fields of training.

The training include automobile manufacturing, plastic designs and production.

About 200 graduated from automobile manufacturing, while 80 others went into plastic designs and production.

The Presidential Amnesty Coordinator, Brig. Gen. Paul Boro (Rtd) addressed them as professionals and emphasised that the training does not end on their graduation day but will continue as they keep adding value to their lives and to the country.

He commended President Muhammadu Buhari for his commitment towards sustaining the program adding that it has yielded huge results.

Anambra State Governor, represented by the Commissioner for Education, Professor Kate Omenugha, added that talents abound in Niger Delta youths and harnessing them will be best for the country.

The training led to a breakthrough as the automobile trainees successfully manufactured a 21-seater luxury bus.

Brig. Gen. Boro said it is “a world record achievement in mechanical engineering” and urged them “to utilise every skill acquired in the academy to develop themselves, the Niger Delta and the nation at large”.

The graduating trainees expressed their readiness to commence contributing their quota in the national economic grid but urged the federal government to accelerate their empowerment process.


Diversification Of Nigeria’s Economy Now A Matter Of Urgency – Buhari

diversificationPresident Muhammadu Buhari on Friday in Guangzhou, China, said that his administration would take urgent steps to ensure the diversification of Nigeria’s economy by encouraging new investments in mining, agriculture and manufacturing.

Speaking at a reception in his honour by the Communist Party of China, President Buhari said that Nigeria would welcome the support of the Chinese government, foreign investors and local businesses for efforts to diversify the nation’s economy.

The President noted that the diversification of the Nigerian economy was long overdue as continued reliance on crude oil exports had always made the economy vulnerable to shocks.

‘‘This time we will be more deliberate. The government and businesses will be involved,” President Buhari said.

In his remarks, the Secretary of the Communist Party, who is also the Governor of the Guangdong Province, Mr Hu Chinhua, pledged that the region will support the implementation of all the bilateral agreements reached with the Chinese government during President Buhari’s visit.

President Buhari also visited the Sino-Singapore Knowledge City in Guangzhou, which showcases advancements by China in medical, science and technological inventions.

Jonathan Advocates “Stronger, Beneficial Partnerships” Between OPEC Nations

JONATHANNPresident Goodluck Jonathan has called for a deeper, stronger and more cooperative partnership between Nigeria and other members of the Organization of Petroleum Exporting Countries (OPEC), State House press release said on Thursday.

The President’s call came after he had separate meetings with the new ambassadors of Qatar and the United Arab Emirates (UAE) to Nigeria.

Upon receiving their letters of credence, President Jonathan stressed the need for better partnerships, noting that “such partnerships will improve the decision-making process within OPEC and open up more opportunities for investment and socio-economic collaboration among its members”.

The release, signed by Presidential Spokesman, Reuben Abati, noted that “the President told the new Ambassador of the UAE, Mr. Mahmud Mohammed Mahmud Al-Mahumud and the new Qatari Ambassador, Mr. Abdul Aziz Bin Mubarak Seed Al Muhannadi that the cordial diplomatic and political relationship between Nigeria and other OPEC member-countries ought to be translated into more beneficial engagements.”

President Jonathan further noted that the “ongoing Transformation Agenda of the Federal Government has thrown up more opportunities for investments in agriculture, real estate development, power generation, manufacturing and other areas in Nigeria”.

He urged the UAE, Qatar and other OPEC countries to take advantage of the immense potential of Nigeria’s large market and the new investment opportunities in the country which offer quick and high returns.

“We have already seen companies from the UAE investing in telecommunications, and in real estate, and they are doing very well. We want to see them also in agriculture, manufacturing, oil and gas, and other areas’’ President Jonathan told the new ambassadors.”

Abati also disclosed that both Ambassadors “assured the President that they will do their best to improve trade and economic relations between their respective countries and Nigeria during their tenures”.

President Jonathan also had a farewell audience with the outgoing Ambassador of Finland, Mrs. Rita Korpivaara.

The President commended Ambassador Korpivaara’s efforts to enhance bilateral relations between Nigeria and Finland.


2014 Budget: Nigerians Should Also Cut Spending On Rent, Feeding – Ogunsanwo

A Data and Information Analyst, Babajide Ogunsanwo, has called on Nigerian workers to cut down on their recurrent expenditure, which includes expenses on feeding and rent as the most recent data from the Nigerian Bureau of Statistics reveal that “on average, the Nigerian man and woman spend 76 percent of their salaries on recurrent spending.”

Ogunsanwo said this while speaking on Channels Television’s flagship programme, Sunrise Daily, adding that the call for government to reduce the recurrent expenditure of the nation should first be put into practice at domestic levels.

“What we need to realize in the budget of 2014 is to understand that we all have roles to play,” he said, adding that “even though we expect the government to reduce the recurrent expenditure, we also have our roles to play by lowering our own recurrent expenditure as citizens, and prioritise our spending.”

He added that the Goodluck Jonathan led administration should not be blamed for the high and increasing recurrent expenditure in the national budget as the issue existed as far back as 1971 “when recurrent expenditure was over 83 percent of the national budget.”

He advocated that Nigerian parents should spend more on education as “on an average, the Nigerian parent spends less than one percent of their income on the education of their children.”

Ogunsawo, who lauded the Finance Minister’s presentation of the 2014 budget, spoke on the impact it would have on the youth.

While speaking on the impact the budget could have on job creation, the analyst said that there was evidence that the government is making dramatic changes in that area, as only 800,000 jobs were created in 2006 – 2011 while 1.3 million jobs were created in 2013.

The created jobs were in the informal sector and manufacturing sector.

He noted that the “reason why the youths don’t feel the impact of the jobs that are being created is because only 31 percent of these jobs are full-time jobs… so we are creating so many jobs but the jobs aren’t really targeted towards full-time private sector jobs.”

On manufacturing:

Ogunsanwo said that the manufacturing sector was improving, adding that “In 1982, for every one naira of goods we exported, we imported 52 naira. In 1999, for every one naira of good exported, we imported 23 naira. As it is today, for every one naira of goods we export, we only import 12.”

He expressed hope that the slope would change significantly as “1968 was the only year we exported more goods than we imported.”