- The CBN held its benchmark interest rate at 14 percent on Tuesday, its governor said, but warned that the country’s recession could be prolonged if strong and bold measures were not adopted. Governor Godwin Emefiele said members of the monetary policy committee were faced with either holding or cutting the benchmark interest rate. He said they chose to leave rates unchanged for the sixth consecutive meeting because the risks associated with easing monetary policy included “a resurgence of inflation” and the “possible exit of foreign portfolio investors”. “In consideration of the headwind confronting the domestic economy and the uncertainty in the global environment, the committee decided by a vote of six to two to retain the MPR (monetary policy rate) at 14 percent,” said Emefiele. Most analysts expected the regulator to keep rates unchanged. The bank also kept its cash reserve ratios for commercial banks at 22.5 percent.
- Nigeria’s acting president will meet again with community leaders from the oil rich Niger Delta next week in a bid to shore up a fragile truce between militants and the government there. Delegations including Acting President Yemi Osinbajo have held talks since late last year with leaders in the oil-producing states. But the local leaders have said the efforts to secure peace are empty promises, and a return to violence in the area would derail any broader recovery in the crude-dependent economy. “Next week there is going to be a follow-up meeting between the acting president and the stakeholders of the Niger Delta,” said a spokesman for Osinbajo. The government, including an inter-ministerial committee headed by the acting president, and Niger Delta stakeholders will also issue a report next week, he said. In the meeting next week, the government and representatives from the Delta will discuss key issues such as legalising illicit refineries and turning them into so-called “modular refineries”, which the administration hopes to start from next month. The contentious cleanup of the heavily polluted Ogoni region and plans to open a maritime university in October, which many community leaders have voiced support for, will also be discussed, said the spokesman. Oil exports are now set to exceed 2 million bpd in August, the highest in 17 months, from as little as just over 1 million bpd at certain points last year.
- 9mobile, the mobile operator formerly known as Etisalat Nigeria, has appointed Citigroup and Standard Bank to find an investor to buy into the firm and three companies have shown interest. India’s Bharti Airtel, which already has a presence in Nigeria, as well as Britain’s Vodafone and French telecom company Orange, have shown interest, a banking source told Reuters. “These are still early interest signals but they are looking at the company as an attractive entry strategy,” the source said. CBN governor, Godwin Emefiele, said earlier on Tuesday that advisers had been appointed to manage the sale of 9mobile, which is the fourth-largest mobile operator in Nigeria. The CBN and NCC intervened this month to save the company from collapse and prevent creditors putting it into receivership, leading to a change in its board and management, as well as the new name 9mobile. 9mobile has 20 million subscribers, a 14 percent share of the Nigerian market. South Africa’s MTN is the market leader with 47 percent, Nigeria’s Globacom has 20 percent and Bharti Airtel’s local subsidiary has 19 percent.
- The IMF projects that Nigeria’s economy will grow at a faster pace than the South African economy in the 2018 fiscal year. According to its World Economic Outlook for July 2017, the IMF said Nigeria will grow at 1.9 percent in 2018, while South Africa will only climb by 1.2 percent. In 2016, the Nigerian economy contracted by 1.6 percent, while South Africa expanded by 0.3 percent. Projections for 2017 put South Africa’s growth at 1 percent, while Nigeria is expected to muster just 0.8 percent. The Bretton Woods institution — which held global growth projections at 3.5 percent in 2017 and 3.6 percent in 2018 — said growth was marked down in South Africa, due to elevated political uncertainty. “In Sub-Saharan Africa, the outlook remains challenging. Growth is projected to rise in 2017 and 2018, but will barely return to positive territory in per capita terms this year for the region as a whole—and would remain negative for about a third of the countries in the region,” the IMF said.