Five fascinating business facts – Part 12

$3.5bn

Gluten-free food, the “war on sugar” and the resurgence of butter are three consumer trends changing what ends up on supermarket shelves. They are also posing challenges for commodities producers and traders who historically have had to worry only about production and overall supply, rather than appetite for foods perceived to be healthier or “natural”.

The global gluten-free retail market has grown from $1.7bn in 2011 to $3.5bn in 2016 and is forecast to grow to $4.7bn in 2020, according to Euromonitor, the consumer data group.

“The market started to grow beyond people who were just needs-based and into a lifestyle choice,” says Michael Detlefsen, managing director of Pomegranate Capital in Toronto, a private equity company.

$910bn

The world’s largest sovereign wealth fund is pushing for a radical overhaul of chief executive pay, arguing that the long-term incentive schemes favoured by many companies are flawed and should be scrapped.

Norway’s $910bn oil fund, which on average owns 1.3 per cent of every listed company in the world, will start pressing companies to end such incentives and instead force chief executives to own substantial stakes in their companies for periods of at least five and preferably 10 years. It will also urge boards to name a ceiling for possible pay.

The oil fund’s intervention is highly significant as it is one of the world’s most influential investors — especially on the issue of responsible investing — but it has long shied away from speaking publicly about pay.

$2.99bn

Africa’s trade deficit with the rest of the world has fallen to its lowest level for nearly three years, partly off the back of a firming of commodity prices that has improved the continent’s terms of trade.

The pan-African trade deficit narrowed to a monthly average of $2.99bn in the three months to January, according to figures collated by UBS, based on data from the IMF. This was just a third of the peak deficit of $8.76bn a month, recorded in the last three months of 2015, and the lowest reading since April 2014.

However the recovery also has a darker side, being in part driven by economic weakness that has slashed demand for imports across much of the continent and in particular Nigeria, its largest economy.

18.74%

The Nigerian government is offering such good rates on bonds and Treasury bills that the country’s banks would rather tie their money up in state debt than lend to businesses or consumers.“Banks in Nigeria have a reduced incentive to lend to the private sector because of the favorable interest on government securities,” Akintunde Majekodunmi, a banking analyst at Moody’s Investors Service, said by phone from London on Wednesday. “They have increased appetite for government securities, which may cannibalize private-sector credit.”Lending in Africa’s biggest oil producer just about stalled in 2016, according to Moody’s estimates, as the economy contracted for the first time in 25 years and unpaid loans soared. There is easier money to be made from government debt auctions where yields of 18.74 percent on Nigerian 12-month T-bills, the highest level since February 2012, and rates on 10-year naira bonds of 16.3 percent, come with a lot less risk.

N2.5trn.

The domestic debt of Nigeria’s thirty-six states is at a high of N2.5trn according to data from the debt management office, DMO. Surprisingly, oil rich Delta state is at the top of this no so enviable list of debtor states with a total of N320bn in obligations.

Most of the states it would seem are depending more on federally collected revenues and loans to survive.

Central Bank data for 2015 show that internally generated revenue (IGR) provided only 26.4% of the total revenue of the 36 states and the Federal Capital Territory, compared with 21.8% the previous year.

Aggregate IGR, however, declined to N756bn from N801bn in 2014. Again, Lagos State emerged as the leading state, achieving an IGR/total revenue ratio of 69%. Enugu was next in line with 53% while Ogun, Rivers and Abia managed ratios of 50%, 44% and 32% respectively according to an FBN Quest analysis.