April 11, 2012
Oil prices remain above $120 per barrel signifying that Nigeria’s budgets, exchange rates and foreign reserves are not currently under any unnecessary threat.
According to FAO, Food Price Index (FFPI) averaged 216 points in March 2012, virtually unchanged from 215 points in February. Among the various commodity groups, only oils prices showed strength, compensating for falling dairy quotations, while the indices of cereals, sugar and meat prices were largely unchanged from last month’s level.
The BRICS (Brazil, Russia, India, China and South-Africa) held their fourth summit in New-Delhi, India on March 29, 2012 and they identified key concerns areas as:-
Faltering global recovery and complexities around the Euro zone
Sustainable development and climate change; and
Developing political scenario in the MENA region
The BRICS, according to members of the group, represents 43% of global population, and seek promotion of peace, security and development in a multi-polar, interdependent, complex and globalising world.
In economics, they note that:
The build-up of sovereign debt and concerns over medium to long-term fiscal adjustment in advanced countries is creating an uncertain environment for global growth.
Excessive liquidity from aggressive policy actions taken by central banks to stabilize their domestic economies have been spilling over into emerging market economies, fostering excessive volatility in capital flows and commodity prices.
The immediate priority is to restore market confidence and get global growth back on track and stressed the critical need for advanced economies to adopt responsible macroeconomic and financial policies, avoid creating excessive global liquidity and undertake structural reforms to lift growth that create jobs
They called for a review of IMF quotas; and re-orientation of the World Bank into an institution that promotes equal partnership between nations and hinted of plans to set up a BRICS development bank.
They also called for an open and merit-based appointment process for the World Bank leadership.
Meanwhile the sub-national units appear to be bracing up for a season of healthy regional competition.
In March, the South-West states launched a Development Agenda for Western Nigeria with the DAWN document and then Ogun State held an Investment Forum in Abeokuta on March 26-27 2012. Lagos State’s 6th Economic Summit (Ehingbeti 2012) will follow from April 23-25 and the South-South BRACED States take the baton in Port-Harcourt on April 26-28, 2012.
On its part, the Federal Government made several positive policy pronouncements in March 2012:-
Potential review of Nigerian Railway Act 1955 to allow private investment.
Selection of Manitoba of Canada as preferred manager of the Transmission Company of Nigerian (TCN), the monopoly transmission company under the power sector reforms.
Agreement for set-up of 100 large scale integrated rice mills in conjunction with private investors.
Contract for rehabilitation of Julius Berger Terminal at old Warri Port
It remains to see if political will to see these and other decisions and policies through exists.
On the private sector side, there were also some positive news:
Transcorp’s Teragro subsidiary inaugurated Teragro Ben Fruit Juice Concentrate Plant in Makurdi, Benue State.
Dangote Group announced a possible 2013 London Stock Exchange listing with the prospect of Aliko Dangote stepping down as Chairman; and
The NSE announced the appointment of 10 market makers-Stanbic IBTC; RenCap; Future View Securities; Vetiva Capital; ESS/DunnLoren Merrifield; WSTC; Capital Bancorp; FBN Securities; Greenwich Securities; and CSL Stockbrokers.