Six themes that shaped the economy in 2021
There were bright spots for Nigeria in 2021 as the economy recovered from the COVID-induced disruptions of 2020. But there were also some low points that did Africa’s biggest economy more harm than good. Nigeria’s surprise recession exit: Nigeria exited recession growing by 0.11 percent in the fourth quarter of 2020. Nigeria’s GDP grew marginally by 0.51 percent in the first quarter of 2021 and maintained the positive trajectory by growing 5.01 percent and 4.03 percent in Q2 and Q3, respectively. Inflation rate slowed for the first time since September 2019: Nigeria’s inflation rate slowed for the first time in almost two years in April 2021 after rising steadily since September 2019. But it brought no substantial relief to Nigerians who still had to contend with high prices. CBN’s ban on sales of forex to BDCs: In the seventh month of the year, the Central Bank of Nigeria (CBN) ended the sales of foreign exchange to Bureau De Change operators. A surge in the abduction epidemic: Over 1,000 students were kidnapped and many schools were shut, according to the United Nations. Many Nigerians were also abducted and huge ransoms were demanded. Investors’ appetite for stocks waned on rising yields: The year ended 2020 with a record 50 percent gain and the Nigerian stock market has been unable to sustain the momentum in 2021, as investors’ appetite for stocks waned on rising yields on fixed-income securities. Public debt hits N38trn: Nigeria’s public debt rose to N38 trillion in the third quarter of 2021, according to data published by the Debt Management Office (DMO).
Nigerians tighten belts for Christmas as inflation bites
Millions of Nigerians are feeling the pinch of inflation, a consequence of pandemic-induced global supply-chain disruptions, weakening naira and escalating insecurity. Inflationary pressure is changing shopping habits and spoiling traditions for many Nigerians. For lower-income households with little or no cash cushions, they are making harder choices such as whether to celebrate Christmas or not, and what should and not be on their menu for the season. “Bigger and more expensive import demand brands are not going to sell much this Christmas owing to inflation, as people will go more for the locally produced and affordable variants,” Uchenna Uzo, consumer expert and faculty director at the Lagos Business School, noted. “People are going to just make do with what they can afford. Gifting is also going to be there but not on a large scale this Christmas period.” Nigeria’s naira has lost about 8.4 percent of its value in 2021, owing to a controlled exchange-rate management, bleak oil future and the pandemic impact. The country’s foreign exchange management has attracted criticism from the World Bank and different quarters. The World Bank had in November urged the central bank to improve its exchange-rate management in order to speed up other reforms, adding that the naira’s black market premium was fuelling inflation. With oil price fluctuations, foreign exchange inflows have declined by over 40 percent in the last two years, resulting in acute dollar scarcity in the economy. However, the government has focused on the demand side, which has led to worsening scarcity that has further widened inflation and inequality. Also, food production has been greatly impacted in 2021 as farmers in the country have had to abandon their farmlands owing to escalating issues of kidnapping, banditry and terrorism in major crops-producing states, leading to production shortfall.
Oil prices slide by $3 as Omicron spread weakens demand
Surging cases of the Omicron variant of COVID-19 in Europe and the United States have crashed the price of Brent, the benchmark for Nigeria’s crude by $73. This development has fuelled worries that new mobility restrictions to combat the spread of disease could hit fuel demand. On Monday, Brent crude futures dropped by $3.16, which represented 4.3 percent to $70.36 a barrel by 1506 GMT, while U.S. West Texas Intermediate (WTI) crude futures were down by $3.47 which represented 4.9percent, at $67.39. Craig Erlam, senior market analyst at OANDA, said, “Oil prices are getting pummel again as sentiment turns south and countries ponder deepening restrictions and lockdowns”. He added, “None of this bodes well for crude demand in the first quarter of the year”. In the same vein, the IEA reported last week in its Oil Market Report that global oil demand is expected to rise by 5.4 million barrels per day in 2021 and 3.3 million barrels per day in 2022 to reach pre-pandemic levels of 99.5 million barrels per day globally. However, the recovery is expected to be hampered by a new surge in COVID-19 cases, with jet fuel bearing the brunt of the damage, according to the report. Its authors noted that the emergence of the new Omicron variant had already resulted in new international travel restrictions. The IEA added, however, that while the increase in new COVID-19 cases was expected to slow demand, the already underway recovery was not expected to be completely derailed.
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Lekki-Epe road, health top priorities as Lagos raises N137.3bn bond
Completion of the ongoing 10-km regional road in Eti-Osa, the Lekki-Epe expressway and critical healthcare infrastructure are top priorities for the Lagos State government, as it announced a successful issuance of a N137.3 billion capital market bond on Monday.
According to a statement by the government of West Africa’s largest city, necessary documents required by the Securities and Exchange Commission (SEC) to facilitate the issuance of 13 percent fixed-rate bond have been signed by the state’s attorney general, issuing parties and trustees of the funds. “The statutory instruments that will facilitate the raising of N137.328 billion bond by Lagos State government from the capital market to deliver key infrastructure in critical sectors of the economy are now met,” the government said in a document sighted by BusinessDay. The state set out to raise N125 billion from the capital market but closed the bids with N137.3 billion, following oversubscription. The development, Sanwo-Olu said, demonstrated a “strong response” from the investing community and testified to the confidence of investors in the State’s ability to deliver on its infrastructural and socio-economic developmental objectives, while meeting repayment obligations. Compared to the initial offer of N125 billion, the issuance was 9.84 percent oversubscribed. The governor said proceeds from the bond would be used to finance key infrastructure projects in healthcare, environment and road construction, including the 10-km regional road in Eti- Osa, six-lane Lekki-Epe expressway, Ijeododo road in Alimosho and Oba Sekumade road in Ikorodu, among others.
Shatu Garko makes history as the first Hijabi Miss Nigeria
Shatu Garko, an 18-year-old hijab model made history as she emerged winner of the 2021 Miss Nigeria beauty pageant held in Lagos recently, making her the first muslim to win the pageant since its inception in 1957. Garko, a horse-riding lover, represented the North West region of Nigeria during the pageant. Being the youngest contestant, Garko who hails from Kano State, was crowned the 44th Miss Nigeria after beating 17 other finalists at the event. The prizes won include N10 million, a one-year residency at a luxury apartment, a brand new car and brand ambassadorship opportunities. Speaking shortly before the coronation, “Winning this competition means a lot to me. I have always wanted to be Miss Nigeria. I’d like to thank Miss Nigeria and its sponsors. I would also like to thank my mum for supporting and loving me,” Garko said. She also noted that she is passionate about proving that religion and culture are not barriers to following one’s dreams. Nicole Ikot was the first runner-up, while Kasarachi Okoro emerged the second runner-up. The winner of the 2020 edition of the pageant, Etsanyi Tukura, was present to hand over the crown to her successor at the ceremony. According to the organisers, thousands of applications were submitted before the top 37 were selected, and an additional three wildcard semi-finalists. Members of the public were also given a chance to contribute to the process of choosing the 21 finalists who made it into the Miss Nigeria Bootcamp, which was further pruned to the top 18 finalists.
Bisola Ojikutu appointed Executive Director of the Boston Public Health Commission
Boston Mayor Kim Janey announced recently that Bisola Ojikutu, MD, MPH will be the next Executive Director of the Boston Public Health Commission (BPHC). Ojikutu’s appointment was unanimously approved by the Board of Health on July 1. Ojikutu is currently an Associate Physician within the Division of Global Health Equity and the Division of Infectious Diseases at Brigham and Women’s Hospital, and an Assistant Professor of Medicine and an Assistant Professor of Global and Social Medicine within the Department of Global and Social Medicine at Harvard Medical School. “I am pleased Boston found a dedicated infectious disease physician with extensive public health, leadership, and advocacy experience to lead BPHC. I look forward to working with Dr. Ojikutu to build a healthier Boston for all our residents,” Mayor Janey said.
Ojikutu brings comprehensive experience leading and developing programming to address inequity and social determinants of health that serve as barriers to prevention, care and treatment of infectious diseases among vulnerable populations including women, immigrants, and Black and Latinx individuals. Her clinical research and community service activities have focused on achieving health equity and developing strategies to provide the highest quality care to vulnerable populations, both domestically and internationally with a focus on overcoming racial and ethnic disparities in access to HIV prevention and treatment.
