As we progress into the dynamic landscape of 2024, without a doubt, opportunities exist for businesses to thrive, especially with the urgent need to boost international trade to the benefit of the government and its citizens.
Recently, at the FirstBank Nigeria Economic Outlook 2024, Dr. Adesola Adeduntan, Chief Executive Officer of FirstBank Group, aptly emphasised the importance of comprehending trade dynamics and government policies to harness economic opportunities effectively.
He noted that with Nigeria poised to witness significant capital expenditure and spending in various sectors, FirstBank recognised the potential for growth and is prepared to support businesses to tap into these opportunities.
Dr. Adeduntan stressed the Bank’s commitment to providing tailored financial solutions while strategic guidance remains unwavering, ensuring that businesses can thrive amidst evolving economic landscapes.
A vital financial solution provided by the Bank to promote trade in the international market is the First Global Transfer (FGT). FGT is a FirstBank-owned remittance platform built to facilitate seamless intra/inter-regional money transfer across its subsidiaries in sub-Saharan Africa; FirstBank Guinea, FirstBank Democratic Republic of Congo, FirstBank The Gambia, FirstBank Sierra Leone, FBN Ghana and FBN Senegal.
Woven into the fabric of society for 130 years, with the visionary leadership of Dr. Adesola Adeduntan, FirstBank Group is committed to keeping its customers informed about the intricate nuances of trade, government policies, and market priorities to drive sustainable growth and prosperity across the continent.
FirstBank has a rich history of pioneering initiatives that promote financial inclusion and drive export value chains.
At the FirstBank Nigeria Economic Outlook, Dr. Biodun Adedipe, the founder and Chief Consultant of B. Adedipe Associates Limited (BAA Consult) acknowledged FirstBank’s prime mover role in opening its partners’ eyes to the export value chain; he underscored the Bank’s commitment to empowering businesses to access global markets.
By sponsoring events like the Africa International Trade Exhibition (A.I.T.E 2023) in New York, the Bank also facilitates connections between Nigerian businesses and global partners, fostering trade and investment opportunities that drive economic growth.
Back to base, the Nigerian economy is currently fraught with challenges – deepened by Covid 19, climate change, bureaucratic bottlenecks and government policies that have slowed down economic activities.
Highlighting the challenges, Adedipe noted that,
- Nigeria remained import-dependent for consumption for the first 9 months of 2023. The monthly average import bill was N1.88 trillion, an equivalent of $2.33 billion.
- Over the past 10 years, imports have been growing, which is a reflection of Nigeria’s import dependence, largely for consumption.
- Whenever the dollar/naira rates widen, three things happen: it makes everyone who consumes imported items poorer due to import dependence in real terms. It makes the balance sheet of companies smaller, and the country’s GDP becomes smaller.
- For the 2024 fiscal year, N28.7 trillion was budgeted by the federal government and N16.5 by the state governments, roughly N45 trillion, which is a potential for economic boost.
- Food security should therefore, come big in Nigeria’s economic development agenda – availability and affordability, which are two of the four categories of the EIU Global Food Security Index in which the country ranked poorly at #97 in 2021 and #107 in 2022 out of 113 countries. The other two categories are quality & safety and sustainability & adaptation.
- The economy is desperate for growth and the big number in Nigeria is food inflation, at 32.84% in November 2023 (Y-o-Y, down from 34.5% in October 2023) – rising from 24.13% in Dec’2022, 24.45% in March, 25.25% in June and 30.64% in September.
Understanding the significance of food security in economic development, FirstBank emphasises the need to focus on availability and affordability. Nigeria’s poor rankings in categories such as the EIU Global Food Security Index underscore the urgency of addressing these issues.
Adedipe also noted that businesses have to respond to these in the context of core business by continually adjusting their strategy and business models. He said with the inflation rate persistently trending upwards, the CBN will have to raise the MPR and postures the same for H1’2024.
He stressed that to be profitable you cannot afford to grow slower than the rate at which the economy is growing. “If you grow slower, somebody somewhere is growing at your expense,” he said.
Further citing FirstBank’s win-win approach to business, he said “FirstBank was the first bank to deliberately open the eyes of their customers to the export value chain.”
Hence, FirstBank is taking a proactive stance towards mitigating the economic challenges facing Nigeria in 2024. Recognizing the country’s current external reserves, which can cover 8.4 months of imports on average, the bank understands the importance of addressing issues such as food inflation and post-harvest losses in the agriculture sector, estimated to be as high as 60%.
According to Adeduntan, taking these challenges into context, FirstBank is prepared to partner with its customers to navigate the local and international markets, aligning with Nigeria’s needs. He said by continually adjusting their strategy and business models, businesses can effectively respond to these challenges, turning them into opportunities for growth and prosperity.
On the part of the government, Adedipe said the enduring solution is expansive domestic manufacturing and a relentless, deliberate and focused export drive, which FirstBank is prepared to support.
In a world marked by fluctuating exchange rates and import pressures, FirstBank remains steadfast in its commitment to innovation and resilience. Through digital transformation and strategic partnerships, FirstBank continues to pioneer innovative solutions that empower businesses to navigate economic challenges effectively.
As Nigeria’s leading financial institution, FirstBank has remained resolute in fostering an environment where businesses can thrive and prosper. Its robust presence across Nigeria and international markets uniquely position its relevance to support businesses at every stage of their journey. Its commitment to diversity, inclusion, and sustainability underscores its vision to be Africa’s bank of first choice, driving accelerated growth and prosperity for all.
With a strategic focus on leveraging local and foreign economic opportunities, the bank is committed to empowering the resilience of businesses, driving financial inclusion, and fostering sustainable growth.