18 Nov

Daily Watch – Analysts surprised as economy grows in Q3, Dasuki probe reveals stunning figures

  • The Minister of State for Petroleum Resources, Ibe Kachikwu has directed the Department of Petroleum Resources to seal off fuel stations found to be hoarding petroleum products and dispense the petroleum free to the public. The Minister gave the directive after a working visit to some retail outlets in Abuja. Kachina also said that Nigeria would have to find a long-term solution to the frequent scarcity of petrol in the country, and that he was working with President Buhari, the Minister of Petroleum Resources, to find long term solutions to the situation. “If we don’t deal with those systemic issues, these things will continue to repeat themselves…we have to look at the pricing dynamics and see how we can sustain supply at this sort of current environment,” he said.
  • The NBS has announced that the economy grew by 2.84% year-on-year in Q3 2015, up by 0.49% from the preceeding quarter. It said growth of the oil sector increased by 1.06% (year-on-year) in Q3 of 2015, and 4.65% points from the corresponding quarter of 2014, as oil production rose to 2.17 million barrels per day (mbpd) up from 2.05 mbpd production in the Q2 2015. Growth in the Non-oil sector grew by 3.05% in Q3 2015, 4.45% points lower than the corresponding quarter in 2014. It said non-oil growth was largely driven by the activities of Crop Production, Financial Services, Telecommunications, and Trade. Non-Oil sector contributed 89.73% to the nation’s GDP, while the Oil sector represented 10.27% of GDP. The new numbers have come as a surprise to most analysts as the general consensus was that growth would actually decline from its Q2 levels. Since prevailing economic conditions, which continued into Q3 from Q2 appeared very restrictive to growth. As the conditions did not improve significantly, growth was not expected to rebound until much later.
  • A thirteen-man committee set up by the Office of the National Security Adviser to audit the procurement of arms and equipment in the Armed Forces and Defence sector from 2007 to date has released an interim report. So far the total extra budgetary interventions articulated by the committee is Six Hundred and Forty Three Billion, Eight Hundred and Seventeen Million, Nine Hundred and Fifty Thousand, Eight Hundred and Eighty Five Hundred Naira and Eighteen Kobo (N643, 817,955,885.18). The foreign currency component is to the tune of Two Billion, One Hundred and Ninety Three Million, Eight Hundred and Fifteen Thousand US Dollars and Eighty Three Cents ($2,193,815,000.83). These amounts exclude grants from the State Governments and funds collected by the DSS and Police. It was observed that in spite of this huge financial intervention, very little was expended to support defense procurement.
  • The Ford Motor Company has rolled out its first made-in-Nigeria vehicle, the Ranger, a pickup, which was assembled in Lagos in partnership with its local dealer firm, Coscharis Motors. The unveiling of the new vehicle came about three months after the American automaker announced the decision to set up an assembly plant in Nigeria after the Government’s decision to impose a 70 per cent tariff on imported vehicles to encourage local production. According to Jeff Nemeth, CEO Ford Sub-Saharan Africa, the Ford Ranger trucks will be assembled at the SKD level, using body parts and components imported from Ford’s assembly plant in South Africa.
  • The Ikeja City Mall, the largest in Lagos, has been sold to South African Real Estate Investment Trust (REIT) Hyprop Investments Limited (Hyprop) and Attacq Limited. In a press release announced by Hyprop it acquired a 75% interest in Ikeja City Mall whilst Attacq  acquired the remaining 25%. Actis and local partner Paragon Holdings sourced the development site in 2008. RMB Westport, initially appointed by Actis as the development manager in 2008, invested as an equity partner in 2010. Actis has now sold its 60% majority stake, while Paragon Holdings and RMB Westport have both sold their 20% stakes in the mall.