The continuous dollar scarcity and shrinking forex liquidity in Nigeria’s currency market as lately led the naira to depreciate against the dollar to sell at N446 a deferential of one naira from its previous close of N445 to $1
The ever-increasing dollar outflow from Nigeria in recent months has negatively affected its foreign reserve plummeting to $34.66 billion according to the latest data obtained from Nigeria’s Central bank website
Lately, at the forward market, the naira recently depreciated exchanging at an all-time high against the dollar, with the 5 years non-deliverable forwards falling to N570/$1 from N413/$1Nigeria’s central bank maintains it has enough dollars to meet demand as it commenced the sale of forex last week.
However, Thelma Ugonna Ohiri-Anyanwu, CFA a leading financial expert in Nigeria’s tier 1 bank explained the need for monetary policy stakeholders to readjust the value of the naira. She said
“My recommendation would be to officially devalue the naira which I believe is long overdue, this would make importation more expensive and encourage exportation of goods by local manufacturers which in the long run will increase the dollar inflows, thereby leading to the strengthening of the Naira.
“She buttressed on advising Nigeria’s Central Bank in increasing import tariffs rather than an outright ban on selected import items, she continued by saying
“Nigeria’s central bank needs to remove the current ban on forex allocations for the importation of goods and rather implement trade policies that would increase tariffs on luxurious imported goods and give subsidies to local manufacturers who export their products.
This would encourage local producers to be more creative, improve their products, and export these products, leading to an increase of improved domestically produced products, thereby, diversifying the economy and reduce the country’s reliance on the China economy.
I would also recommend the reduction of the monetary policy rate to help stimulate the real economy and stall stagflation.
Just recently in a recent report released by Bloomberg, the Manufacturers Association of Nigeria (MAN) said that its members were finding it very difficult to access U.S dollars for their business transactions.
Meanwhile, just last month, Nigeria’s central bank resumed the provision of foreign-dominated currencies to commercial banks based in the country
Nigeria’s central said the resumption of the exercise was for onward sales to small and medium enterprises (SMEs) wishing to undertake the importation of essentials needed to help revamp the economy devastated by the deadly COVID-19 pandemic.
COVID-19 Update in Nigeria
On the 6th of March 2021, 195 new confirmed cases and 10 deaths were recorded in Nigeria
The spread of novel Corona Virus Disease (COVID-19) in Nigeria continues to record significant increases as the latest statistics provided by the Nigeria Centre for Disease Control reveal Nigeria now has 158,237 confirmed cases.
On the 6th of March 2021, 195 new confirmed cases and 10 deaths were recorded in Nigeria.
To date, 158,237 cases have been confirmed, 137,645 cases have been discharged and 1,964 deaths have been recorded in 36 states and the Federal Capital Territory.
A total of 1.54 million tests have been carried out as of March 6th, 2021 compared to 1.49 million tests a day earlier.
COVID-19 Case Updates- 6th March 2021,
- Total Number of Cases – 158,237
- Total Number Discharged – 137,645
- Total Deaths – 1,964
- Total Tests Carried out – 1,544,008
According to the NCDC, the 195 new cases are reported from 17 states- Lagos (70), Kaduna (22), Abia (20), Edo (18), Kano (10), Akwa Ibom (9) Rivers (7), FCT (7) Borno (6) Bauchi (5), Osun (5), Oyo (5), Plateau (3), Ekiti (3), Niger (2), Ogun (2) and Zamfara (1).
Meanwhile, the latest numbers bring Lagos state total confirmed cases to 56,374, followed by Abuja (19,328), Plateau (8,939), Kaduna (8,623), Oyo (6,761), Rivers (6,651), Edo (4,645), Ogun (4,419), Kano (3,830), Ondo (3,066), Kwara (2,953), Delta (2,582), Osun (2,449), Nasarawa (2,248), Enugu (2,078), Katsina (2,060), Gombe (2,010), Ebonyi (1,951), Anambra (1,811), Akwa Ibom (1,588), and Abia (1,568).
Imo State has recorded 1,551 cases, Borno (1,297), Bauchi (1,232), Benue (1,188), Adamawa (942), Niger (917), Taraba (863), Ekiti (825), Bayelsa (779), Sokoto (769), Jigawa (496), Kebbi (401), Cross River (334), Yobe (288), Zamfara (221), while Kogi state has recorded 5 cases only.
Lock Down and Curfew
In a move to combat the spread of the pandemic disease, President Muhammadu Buhari directed the cessation of all movements in Lagos and the FCT for an initial period of 14 days, which took effect from 11 pm on Monday, 30th March 2020.
The movement restriction, which was extended by another two weeks period, has been partially put on hold with some businesses commencing operations from May 4. On April 27th, 2020, Nigeria’s President, Muhammadu Buhari declared an overnight curfew from 8 pm to 6 am across the country, as part of new measures to contain the spread of the COVID-19. This comes along with the phased and gradual easing of lockdown measures in FCT, Lagos, and Ogun States, which took effect from Saturday, 2nd May 2020, at 9 am.
On Monday, 29th June 2020 the federal government extended the second phase of the eased lockdown by 4 weeks and approved interstate movement outside curfew hours with effect from July 1, 2020. Also, on Monday 27th July 2020, the federal government extended the second phase of eased lockdown by an additional one week.
On Thursday, 6th August 2020 the federal government through the secretary to the Government of the Federation (SGF) and Chairman of the Presidential Task Force (PTF) on COVID-19 announced the extension of the second phase of eased lockdown by another four (4) weeks.
Governor Babajide Sanwo-Olu of Lagos State announced the closed down of the Eti-Osa Isolation Centre, with effect from Friday, 31st July 2020. He also mentioned that the Agidingbi Isolation Centre would also be closed and the patients relocated to a large capacity centre.
Due to the increased number of covid-19 cases in Nigeria, the Nigerian government ordered the reopening of Isolation and treatment centres in the country on Thursday, 10th December 2020.
On 26th January 2021, the Federal Government announced the extension of the guidelines of phase 3 of the eased lockdown by one month following the rising cases of the coronavirus disease in the country and the expiration of phase 3 of the eased lockdown.
On 28th February 2021, the federal government confirmed that the first tranche of Covid-19 vaccines will arrive in Nigeria on Tuesday, March 2nd, 2021.
CBN tasks multinationals on domestic production as P&G signs $35m deal to produce Oral-B locally
The CBN Governor has called on multinationals operating in the country to work towards the production of their goods in Nigeria.
The Central Bank of Nigeria, as part of its agenda to strengthen the manufacturing sector, has tasked multinational manufacturing companies in the country to consider setting up their manufacturing lines in Nigeria.
Godwin Emefiele, the CBN Governor made this statement during the contract signing ceremony between Procter & Gamble (P&G) and Colori Cosmetics Nigeria in Lagos.
The contract which is a move towards stimulating localization of production was birth from CBN’s policy-driven efforts to encourage improved production of goods that can be produced locally.
The Governor of Nigeria’s apex bank who was the host at the contract signing ceremony encouraged other multinational firms to consider the opportunities that Nigeria offers and begin to set up their manufacturing lines in Nigeria, noting that this move will help in creating jobs and wealth for the growing population.
Emefiele who also spoke on the economic stabilization policies implemented by the CBN to set Nigeria on the path of recovery explained that the manufacturing sector will continue to be a key focus of the efforts by the monetary and fiscal authorities towards driving the recovery of the Nigerian economy.
Why this matters
- The investment deal which is worth $35 million is set to present the well-diversified consumer goods giant with the opportunity to commence the domestic production of Oral-B toothpaste in Nigeria.
- The contract between P&G and Colori Cosmetics Nigeria will facilitate the local production of Oral-B products by P&G in Nigeria, as part of the commitment by the CBN to strengthen the manufacturing sector.
- This move is expected to make Nigeria a competitive producer of the product, and also cut the importation of toothpaste from the US, where P&G is based.
Nairametrics | Company Earnings
Access our Live Feed portal for the latest company earnings as they drop.
- Seplat falls into a loss in FY 2020
- 2020 FY Results: Cornerstone Insurance Plc reports a 61.1% decline in profit
- Ellah Lakes increases operating expenses by 33.36% in HY 2020
- 2020 FY Results: Nigerian Breweries reports a 54.3% decline in profits in 2020
- Abbey Mortgage Bank projects N51.08 million profit in Q2 2020.