18 Jan

Daily Watch – Avengers vow to hit hard, NBS says ‘middle class’ grew during recession

  • Militants have threatened to attack off-shore oil facilities within days, raising fears of a repeat of a 2016 wave of violence that helped push Africa’s biggest economy into recession. The Niger Delta Avengers – the fighters behind many of the 2016 attacks – said they had planned the assaults after giving up on talks to give their impoverished region a greater share of the oil revenue it produced. “This round of attacks will be the most deadly and will be targeting the deep sea operations of the multinationals,” the group said on its website. It said its targets would include the Bonga Platform and the Agbami, EA and Akpo fields. The militants also said they would target the Nigerian oil company Brittania-U. Shell operates the Bonga and EA fields while Chevron is the operator of Agbami. Akpo stakeholders include Total, China’s CNOOC, Brazil’s Petrobras and Nigeria’s Sapetro.
  • The AfDB says it maintains a positive outlook on Nigeria’s economy in 2018. In its 2018 African Economic Outlook, it projected that Africa’s largest economy would grow 2.1 percent in 2018 and 2.5 percent in 2019. According to the multilateral lender, this outlook is anchored on higher oil prices and production, as well as stronger agricultural performance. Notwithstanding the short-term positive outlook, the AfDB said Nigeria still faces significant challenges, including forex shortages, disruptions in fuel supply, power shortages, and insecurity in some parts of the country. “In addition, revenue mobilization efforts are insufficient; at 5 percent, value-added tax rates are among the lowest in the world, and revenue administration is inefficient. Poverty is unacceptably high with nearly 80 percent of Nigeria’s 190 million people live on less than $2 a day,” the report surmised.
  • The FG has released ₦1.2 trillion to fund capital projects in the 2017 Appropriation Act, the DMO said on Tuesday. Nigeria expects to raise $700 million from multilateral sources, as part of a $3.5 billion borrowing programme contained in the 2017 spending plan, the debt office added. The government raised $2.8 billion in the international market last year, selling $2.5 billion in Eurobonds in November and another $300 million in diaspora bonds. The DMO said in light of the 2017 budget only being finalised in July last year, the ₦1.2 trillion disbursement for capital projects over the intervening six months period was a strong and positive development.
  • The NBS says the richest 20 percent of Nigerians owned 46.63 percent of national income in 2016. According to its ‘Snapshot of Inequality in Nigeria’ report, the bottom 10 percent (the “poorest of the poor”) in the population consumed just 2.56 percent of goods and services. Using consumption as a proxy for income, in 2004, the top 10 percent (the “super-rich”) consumed 26.59 percent of all goods and services, a number which increased to 33.72 percent in 2013 but decreased to 31.09 percent in 2016. The report added that “the top 20 percent were responsible for 42.40 percent of national income/expenditure in 2004. This increased to 48.28 percent in 2013 but declined to 46.63 percent in 2016.” The statistics agency said the biggest gainers between 2013 and 2016, a period which saw the economy tip into a recession was the middle class. The upper class’ share of national income had been rising between 2004 and 2013 before dropping in 2016. “The middle class, on the other hand, accounted for 30.26% of national income/expenditure in 2016, higher than 29.14% in 2013.” the report said.