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Business News

Nigeria’s inflation expected to maintain double digit in the next one year

Nigeria’s inflation rate which has dropped for three consecutive months in 2019 is expected to moderate around the double-digit for the next one year.

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Nigeria's inflation rate, Headline inflation jumps to 11.61% in October on border closure

Nigeria’s inflation rate which has dropped for three consecutive months in 2019, is expected to moderate around the double-digit for the next one year.

This is revealed in the latest  Central Bank of Nigeria (CBN) monthly business expectation survey for the month of April.

According to the CBN survey, even though inflation is declining, the level is still expected to hover around double digit in the next one year.

The Business Expectations Survey for the month of April 2019 was conducted with a sample size of 1050 businesses comprising small, medium and large corporations covering both import- and export-oriented businesses nationwide.

Also, the survey report shows firms expected borrowing interest rates to rise in the next six months, while the exchange rate is expected to appreciate in coming months.

Business Outlook in the economy: In the survey, businesses expressed optimism in the overall confidence index (CI) of the Nigerian economy in the month of April 2019.

The businesses outlook for May 2019 showed greater confidence in the macroeconomy

According to the survey report, the optimism in the macroeconomy in April was driven by the opinion of respondents from services, industrial, wholesale/retail trade, and construction sectors.

However, the major drivers of the optimism for next month were services, industrial, wholesale/retail trade and construction.

The expectations of businesses also conform with the latest manufacturing Purchasing Managers’ Index (PMI) which shows that Nigeria’s manufacturing sector expanded for the 25th consecutive months.

Access to finance and employment outlook remains positive:  Businesses remain optimistic in their outlook on financial conditions Outlook for April 2019. Similarly, on the volume of total order and business activity in April 2019 remained positive. The average capacity utilization as the indices stood at 22.4 index point.

On the other hand, the employment outlook index by sector showed that the industrial sector indicates the highest prospects for creating jobs followed by wholesale/retail trade sector, construction sector and services.

Just as previously reported, Nigeria’s manufacturing sector continues to build momentum to reducing the high unemployment rate in Nigeria.

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[Also Read: Latest PMI shows Nigeria’s manufacturing sector expands yet again in April]

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Similarly, analysis further shows that expansion plans by sector in the next month showed that the services sector indicates a higher disposition to expansion, followed by the construction sector and the industrial sector.

However, the wholesale/retail trade sector indicated no intention of expansion in the next 12 months.

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Insufficient Power supply still a bane: Just as reported in the previous month, the April survey showed insufficient power supply remains the leading factor hindering businesses in Nigeria. The surveyed firms identified insufficient power supply, high-interest rate, unfavourable economic climate,  financial problems unclear economic laws, unfavourable political climate, insufficient demand and access to credit as the major factors constraining business activity in April.

Inflation expectations in Nigeria to moderate around 11 percent: Businesses expect inflation to maintain double digits in the next one year and hover around 11.43 and 11.37 percent respectively. However,  firms are satisfied with the management of inflation by the Government with a net satisfaction index of 4.7 percent in April 2019.

Hence, businesses owners were optimistic of better economic conditions as their
expectations on the growth of the economy rose steadily in the short run.

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Some implications of double-digit inflation: The consumer price index, which measures inflation has dropped for the third consecutive month to 11.25% in March 2019, according to the monthly inflation report released by the National Bureau of Statistics (NBS).

Despite falling inflation, Nairametrics reported that Nigeria’s Consumer Price Index increased by more than 207% between 2009 and 2019. Nigeria has recorded a double-digit inflation rate far more than it has with single digit inflation eroding much of the purchasing power available to Nigerians.

In fact, Nigeria’s minimum wage of N30,000 today was probably worth about N9,000 in March 2009. Nigeria’s last minimum wage of N18,000 signed into law in 2011. The equivalent of the latest N30,000 minimum wage was about N21,000 in March 2011. Thus the N18,000 minimum wage of 2011 is the equivalent of N25, 632 today.

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Samuel is an Analyst with over 5 years experience. Connect with him via his twitter handle

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Companies

Africa Prudential proposes dividend of N1 billion for shareholders

Africa Prudential Plc has proposed a sum of N1 billion as dividend for shareholders.

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African Prudential could be worth more than N4.55

The Board of Directors of Africa Prudential Plc has proposed a sum of N1 billion as dividend to shareholders for the period ended 31st of December 2020.

This is according to a disclosure signed by the firm’s secretary, Joseph Jibunoh and sent to the Nigerian Stock Exchange, as seen by Nairametrics.

According to the notification, the proposed dividend will be paid electronically to qualified shareholders on the 26th of March, 2021, subject to appropriate withholding tax and approval from the company’s Annual General Meeting (AGM) scheduled a day earlier.

The breakdown of the proposed dividend shows that a sum of 50 kobo will be paid for each outstanding 2,000,000,000 ordinary shares of the company, held by its shareholders, totalling N1 billion. The proposed dividend is 28.6% lower than the 2019 figures of N1.4 billion.

The comparative decline in the company’s proposed dividend for the year might be attributed to a recent dip in profit and other key metrics recorded by the firm in its latest audited financial statement for 2020. For example, the firm posted a profit of N1.45 billion for the year, indicating a decline of 13.98% YoY. In addition, its earnings per share declined by 14.29% to print at 72 kobo.

What you should know

  • Africa Prudential had recently announced the appointment of Mrs Zubaida Rasheed as Director.
  • Africa Prudential Plc, formerly known as UBA Registrars Ltd, was incorporated as a private limited liability company on 23rd March 2006. It was listed in the NSE on 17th of January, 2013.

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Corporate Press Releases

Konga launches revolutionary membership programme, Konga Prime

Konga Prime puts money back into the pockets of subscribers by helping them make great savings.

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Konga, Nigeria’s leading composite e-Commerce giant, has rolled out Konga Prime, a revolutionary membership programme, with a lot of benefits for shoppers.

Konga Prime members enjoy unlimited free shipping, have access to exclusive offers and early bird deals, among others.

The incentives-filled loyalty programme went live on Monday March 1st, 2021.

Specifically, Konga Prime brings together a suite of exciting benefits which delivers great value to subscribers, helping them enjoy exclusive deals and other incentives such as faster deliveries of their orders. In addition, Konga Prime puts money back into the pockets of subscribers by helping them make great savings, incomparable to that offered by any other retail platform.

Furthermore, members of Konga Prime including busy individuals and families get to enjoy premium access to the full range of Konga’s cutting-edge assets. Among these are its powerful e-Commerce engine and online presence as well as the nationwide reach of a growing list of over 31 stores spread across the nooks and crannies of Nigeria. With this, Konga Prime members can take advantage of nationwide delivery of their items as fast as the next day.
Also, members have the added incentive of unlimited free delivery from Konga.com and access to discounts that make shopping faster and cheaper for all categories of shoppers.

Interested subscribers can sign up for Konga Prime here: https://www.konga.com/konga-prime Membership of Konga Prime is available to all customers, effective March 1st, 2021, beginning with Lagos and Abuja, the Federal Capital Territory (FCT). Equally important, Konga is currently offering specially discounted rates for interested subscribers to sign up for Konga Prime. In other words, subscription rates for Konga Prime membership have been slashed by as much as 50% for early bird subscribers.

In Lagos, membership of Konga Prime is currently up for N1,000 a month, as against N2,000 and N2,490 for three months, instead of N4,950 along with a 7-day free trial period. For Abuja, membership rates presently stand at N1,290 a month, as opposed to N2,500 and N3,490 for three months, instead of N6,950.

Meanwhile, the Konga Prime rollout is set to be extended to other states soon.

Vice President, Konga Online, Kenny Oriola, says the initiative is one that will deliver great value for members, including exclusive access to a growing list of special offers. These include unlimited free delivery, early access to exclusive deals as well as partner benefits and rewards.

“This initiative was implemented to provide a platform that allows our esteemed customers enjoy great value, including having their orders delivered to their preferred location for free. Saving time and money is not just the end goal here, but having access to exclusive deals, and mouth-watering discounts on special products also makes this service one to subscribe to.

‘‘Today, we kick-off this initiative in Lagos and Abuja. Subsequently, other states across the country will benefit from this service. We urge all interested subscribers to take advantage of the ongoing discounted rates to sign up for this value-adding programme,’’ he disclosed.

Further, Oriola submits that in the future, Konga will leverage its wide-ranging assets to add additional benefits for members in a variety of services and offerings, adding that the list of benefits will continue to grow over time.

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