What To Expect From The Markets This Week - 300718

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Saturday, July 28, 2018 08:00 AM / Proshare Content


Nigeria: Economic Dashboard @ 270718

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From the Editor’s Desk                                        

The Debt Management Office (DMO) recently published the Debt Sustainability Analysis Report for 2017. The report stated that external debt to gross domestic product stood at 4.9% at the end of 2017, while the DMO foresees debt to GDP maintaining its current northward trajectory, thereby notching upwards to 5.2% and 5.5% at the end of 2018 and 2019. 

 The upward trajectory in debt to GDP is a product of negative output gap been witnessed fused with the growing absorption of external debt.  At the same time, external debt to debt service stood at 2.2%, which is expected to creep upwards to 3.9% and 3.4% at the end of 2018 and 2019. More importantly, reflecting the higher concentration of external debt to debt servicing over the next two years largely due to macro imbalances and high export concentration. 

Holistically, the report stated that external debt to export ratio as at 2017 stood at 0.46. However, with the pace of debt dwarfing the pace of export diversification combined with oil prices hovering below $80, a surge in external debt to export is imminent, thus  torpedoing from 46% at the end of 2017 to 75% in 2027.  A dilution in the ratio is expected afterwards.

 

Fig 1: External Debt 

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Source: DMO   

 

Presently, external debt to revenue ratio stands at 73.4% but expected to climax to 94.5% in 2027. The report on one hand underlines the aggressive absorption of external debt adopted by the fiscal side but it also buttress our point of a lack of  income policies. We agree that macro imbalances and structural composition best dictates country specific debt threshold. Thus, a one fit all scenario of 50% threshold could be largely deceiving, thus aligning with the DMO.  Although the idea of reviewing the existing debt threshold from 19.39% of GDP to 23.5% of GDP in order to provide a leg room for fiscal authorities is inevitable; such threshold elapses in 2017. However, debt   threshold are a function of GDP not revenue. For a country that has a history of revenue windfalls, this has its limitation. Regardless there is need to address both the lack of bite in income policies, which is currently a product of slow momentum in growth coupled with macro imbalances.  The inability to address such contour will leave fiscal policy in a hard pressed position in the near future.                

 
News Post:  DMO Publishes 2017 Debt Sustainability Analysis

 

Download the Full Report Here 
                                                                                

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Monday July 30, 2018

ABC Transport Plc will be marked down this day by the Nigerian Stock Exchange having declared a dividend of N0.03k in the preceding week. 

The Feed Nigeria Summit will hold this day in Abuja just as the 2018 African Legacy International 2nd Emerging Business Destination Summit holds on the same day. 

What did we miss?
 

Tuesday July 31, 2018

The management of African Finance Corporation Outgoing President & CEO will visit the exchange this day while Union Bank Plc holds its Investor Conference Call. 

The Nigeria Agriculture Awards and the Nigeria Mortgage Refinance Company (NMRC) Annual General Meeting will hold this day in Abuja and Lagos, respectively.
 

Wednesday August 1, 2018

MRS Plc Annual General Meeting will hold this day in Lagos, while the Board and Executive Management of Notore Plc visits the Exchange to present its “facts behind the listing presentation 

The 1st National Conference on Sustainable Development Goals will hold this day in Abuja, while the Nigerian American Chamber of Commerce (NACC) August Breakfast Meeting holds. 

A Networking Exhibition Conference “We Want the Youths to Know” supported by Zenith Bank will hold this day in Lagos with the theme “Success Stories”.                                                                                                       

Thursday August 2, 2018

John Holt Plc and Ikeja Hotel Plc will hold their Annual General Meeting this day in Enugu and Lagos, respectively. The Nigerian Association of Small and Medium Enterprises (NASME), Lagos state Chapter will hold the 2nd Edition of its Annual Business Round Table this day with the theme “Building a Globally Competitive Economy through MSMEs” 

The Association of Enterprise Risk Management Professionals Nigeria will this day hold the ERM: Tools & Techniques - MCRE (Mandatory Continuing RISK Education) Workshop, while the Nigerian Council of Registered Insurance Brokers (LAC) holds her Mid Year Workshop with the theme “Insurance Broking: Transition & Disruptions”.
 

Friday August 3, 2018

?The Cheetah Africa Launch: Fintech and Blockchain Conference 2018 will hold this day in Lagos, just as the Official Launch of the Ifedolapo Damilola Adedipe Foundation (IDAF) takes place.

 

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Check out our Events Calendar for event details and follow us on Web, TV, APP and Social Media for updates as the week unfolds. Yours to Serve!

 

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Contact for Details:

For further information, enquiry or submission of information, kindly email market@proshareng.com and research@proshareng.com Tel: 0700PROSHARE (070077674273). We are waiting to hear from you!

 

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