The Federal Government has announced plans to introduce a consumer credit funding programme and a single-digit mortgage scheme aimed at easing financial burdens on Nigerians.

The initiative was revealed by the Minister of Finance and Coordinating Minister of the Economy, Mr Olawale Edun, during Access Bank’s Corporate Forum in Lagos on Thursday.

Edun stated, “Consumer credit is coming for Nigerians. It will be for the funding of manufacturing and sales of manufacturing products by giving people the opportunity to pay as they go, especially for more durable products.”

He stressed the government’s commitment to providing nearly single-digit interest rates for 25-year mortgages to stimulate the construction sector.

In addition to these financial initiatives, Edun noted the government’s collaboration with farmers, stating that 60,000 farmers would receive necessary resources, with results expected by early next year.

“This government may not be talking too much but we are working on so many things un­derground for the benefit of Ni­gerians. By next January, February, Nigerians will begin to see these harvests coming out. Things like cassava and tubers,” he said.

“Let me just emphasise once again, that all is being done to en­sure that the commitment of Mr. President to help the vulnerable, to provide them with direct trans­fers means that they can decide what is their priority, which is a very good way of intervening. As we found during COVID-19, there is the determination to succeed in that area.”

Edun also noted that the country has seen a net inflow of $2.35 billion into the Central Bank of Nigeria’s (CBN) foreign reserves over the past seven months, which has contributed to the stability of the naira.

He said, “This uptick has been the case for the past sev­en months of the year 2024. We have relative currency stability. And of course, the all-important margin of the rates. We’ve seen a gradual elimination of multiple exchange rates. We also have foreign exchange liquidity. The gross reserves are up. There has been a net inflow in the first seven months of this year of about $2.35 billion every month.

“On the fiscal side as well, government revenues are grow­ing and the key to government revenue is not so much that the government has revenue to com­pete with the private sector.”

Looking ahead, Edun projected improved gross domestic product (GDP) growth for Nigeria by 2026, with an aim to increase crude oil production to two million barrels per day before the end of 2024.

He stressed that electricity tar­iff will remain above 200kwh in bands ‘A and B’; telecom tariff will increase substantially; there will be an efficient forex auction system; unencumbered foreign reserves will be at $20 billion; inflation will continue to decline to 22 per cent; and MPR will be reduced to 20 per cent per annum.

Economist Bismarck Rewane echoed these optimistic projections, forecasting a 3.5 per cent growth in the Nigerian economy by 2026. He anticipated ongoing reforms in tariffs, foreign exchange systems, and inflation rates.

Roosevelt Ogbonna, Managing Director of Access Bank, stressed the importance of understanding the government’s fiscal policy for businesses, stating, “Government is still a large part of our economic narrative.”

The Central Bank of Nigeria (CBN) has clarified its position regarding the Monetary, Credit, Foreign Trade, and Exchange Policy Guidelines for the Fiscal Years 2024 – 2025.

The CBN on Friday clarified its position as outlined in a Monetary Policy Circular No. 45 which the Apex Bank published on its official website and X account.

“The attention of the Central Bank of Nigeria {CBN) has been drawn to certain instances of misinterpretation or misrepresentation of its biennial publication on Monetary, Credit, Foreign Trade, and Exchange Policy Guidelines published on Tuesday, September 17, 2024,” the circular read.

“In response, the CBN has temporarily withdrawn the document to minimize risk of any further misrepresentation.

“As is stated explicitly in the document to guide stakeholders, the CBN reiterates that the publication is a compilation of previously issued policies and guidelines issued by the Bank up to a cut-off date, typically December 31 of the relevant year.

“As in all previous editions, the current document is intended to achieve the following objectives: A single reference source for the ease and convenience of stakeholders, a valid compilation of policies, directives, and guidelines for adjudication in conflict situations involving stakeholders and an additional clarification of policies and guidelines.

“As a compendium of previously issued policies and guidelines, the provisions are applicable only to the extent that there have been no updates or revisions to the guidelines and policies contained therein. This is stated explicitly in the document to quide stakeholders.

“In fine with prior editions, the most recent publication (January 2024) contains policies and guidelines issued by the Bank up to 31 December 2023, some of which will remain relevant during the period 2024-2025 However, several others may cease to apply owing to revisions or updates that become applicable in the aftermath of its publication.

“This Is clearly stated in the document as follows:
The Guidelines may be adjusted by the CBN without prior notice, to address new developments in the domestic ond global economies in the period. However, such amendments shall be communicated to the relevant institutions/ stakeholders in supplementary circulars.”

The CBN said the publication further provides the public with avenues for obtaining clarifications on the whole or any part of the document on pages 147 and 148.

It said some recent media publications referencing aspects of the Guidelines refer to policy positions of the bank issued prior to December 31, 2023 which have changed in the light of revisions and updates in 2024. In the light of these clarifications, it has asked stakeholders to note some things.

The CBN said one example is the Cyber Security Levy which was suspended in May 2024, superseding the circular reported in the guidelines.

It explained that certain technical aspects of the guidelines have been widely misreported and misrepresented.

For example, the Apex Bank said that reports have mistakenly sought to link the fuel subsidy removal to external reserves.

It clarified that such reports essentially missed the analytical basis for the original statement which was intended to observe a potential risk that was to be mitigated by policy.

More recently, it said policies of the bank around the naira exchange rate and those of the fiscal authorities have positively altered the outlook of the subject in question.

“In summary, the guidelines must primarily be viewed as a record of policies, circulars and directives issued by the bank up to the end of 2023. They are not new directives and should not be reported as such,” the circular read.

“The bank will continue to provide clear monetary policy direction and advice for the overall good of the economy. We urge all stakeholders to seek clarification of information about the bank before publishing.”

PZ Cussons, the multinational consumer goods company, has announced plans to sell its African subsidiaries, including its Nigerian operations, as part of efforts to mitigate the impact of the ongoing foreign exchange crisis.

The company’s decision follows the significant devaluation of the naira by 70%, which has heavily affected its financial performance.

In its preliminary results for the fiscal year ending May 31, 2024, PZ Cussons confirmed receiving multiple expressions of interest from potential buyers for its African business. The company is considering both partial and full sales to reduce its exposure to the naira’s volatility.

“Over the last 12 months, we have made continued operational progress and delivered against the strategic priorities set out at the start of the year, against the backdrop of macro-economic challenges,” PZ Cussons said in its preliminary results published on its website for the year ended May 31, 2024.

“At the same time, we have taken the important first steps to transform our business and maximise shareholder value, by refocusing our portfolio on where we can be most competitive.

“The period was marked by a 70 per cent devaluation of the Nigerian naira, which has had significant implications on our reported financials. We have worked hard to mitigate the impact of this on the group, while continuing to serve Nigerian consumers who are facing unprecedented inflation and economic difficulties.”

PZ Cussons noted the challenges posed by macroeconomic conditions in Nigeria but stressed its commitment to serving Nigerian consumers, despite the economic difficulties and inflation. The company’s UK Personal Care division, however, reported a notable improvement with double-digit revenue growth.

Regarding its Nigerian operations, PZ Cussons recorded a foreign exchange loss of £107.5 million, primarily due to the devaluation of the naira. The company’s Nigerian subsidiary, PZ Cussons Nigeria Plc, posted a significant loss of N94.78 billion in Q3 2023/24, in contrast to a profit of N11.2 billion in the same period in 2022. The subsidiary also remains in a negative net asset position, with liabilities exceeding assets by N46.4 billion.

In a separate development earlier this year, the Securities and Exchange Commission (SEC) rejected PZ Cussons’ bid to acquire minority shares in its Nigerian subsidiary and delist from the Nigerian Exchange. The company had sought to buy out the remaining 26.73% minority stake but was denied approval by the SEC.

PZ Cussons is now moving forward with its closed period, which began on September 1, 2024, and will continue until after the release of its unaudited financial statements for the first quarter ending August 31, 2024.

Bismarck Rewane, the Managing Director and CEO of Financial Derivatives Company Limited, has forecasted that Nigeria’s economy will expand by 3.5 percent by 2026, bringing the nation’s gross domestic product close to $400 billion.

He shared this information during the Access Bank Customer Forum held in Lagos on Thursday.

 “The Nigerian economy will grow at 3.5 per cent (approximately $400bn). Nigeria is on track to becoming the second-largest economy in sub-Saharan Africa,” Rewane said.

He mentioned that the nation’s foreign exchange auction system would improve in efficiency, with unrestricted foreign reserves expected to hit $20 billion.

“There will be an efficient forex auction system, and unencumbered foreign reserves will hit $20bn,” he noted.

Rewane forecasted that inflation would fall to 22 percent by 2026, anticipating a yearly decrease in the monetary policy rate to 20 percent. This reduction is expected to result in a drop in the amount of non-performing loans within the banking sector.

“We will see inflation drop to 22 per cent, and the MPR is likely to come down to 20 per cent, which will reduce bad loans,” he explained.

Even with these encouraging developments, Rewane cautioned that the naira is expected to exchange at N1,550 per dollar in the black market, highlighting intervention funds, remittances from abroad, and exchange rate regulations as crucial elements influencing the currency’s value.

Rewane attributed these enhancements to intervention funds, remittances from the diaspora, and policies aimed at adjusting the exchange rate.

“These gains are driven by intervention funds, remittances, and adjustments to exchange rate policies,” he noted.

He stated that total factor productivity is projected to grow to 2.6 percent by 2026, an increase from 2.4 percent in 2024, and that the nation’s trade balance is anticipated to reach $9.3 billion, up from $8.42 billion.

“Total factor productivity will increase to 2.6 per cent, and our trade balance will grow to $9.3bn,” he stated.

Rewane forecasted that petrol prices would settle at N900 per litre, supported by a reliable supply ensured by production from the Dangote refinery and modular refineries.

“We expect petrol to stabilise at N900 per litre due to increased production from Dangote refinery and modular refineries,” he said.

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He also estimated that the stock market capitalization could increase to N58 trillion, following the inclusion of major companies like Dangote Refinery and the Nigerian National Petroleum Corporation.

Regarding commodity prices, Rewane forecasted that a crate of tomatoes would be priced at N20,000, a bag of rice would cost N75,000, and a bag of beans would hit N110,000 by 2026.

The head of FDC highlighted that inflation continues to be a significant obstacle for Nigerian businesses, impacting their profit margins.

Additionally, the Minister of Finance and Coordinating Minister of the Economy mentioned that Nigeria’s foreign reserves have experienced a net inflow of approximately $2.35 billion into the Central Bank.

“There has been a net inflow in the first seven months of this year of about $2.35bn every month,” Edun stated, adding that the increase had played a key role in stabilising the naira in the forex market.

“We also have foreign exchange liquidity. The gross reserves are up,” the minister continued.

He attributed the growth to the government’s efforts, saying, “On the fiscal side as well, government revenues are growing.”

Edun emphasized that the country’s tax-to-GDP ratio was at 10%, with revenue to GDP at 15%, and urged increased investment in infrastructure and social safety nets to improve these low figures.

Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, voiced concerns about the current economic outlook, comparing it to the more optimistic projections made by Bismarck Rewane.

“Our projection is slow, and I do not pray that Bismarck’s projection comes to pass,” Oyedele said.

He emphasized the challenges of divestment, inadequate education, and increasing unemployment, pointing out that the Nigerian currency had depreciated in value by ten times more than the Kenyan shilling.

He emphasized the importance of making decisions based on data.

“We must leverage data and evidence to ensure it serves our interests,” he stated.

Oyedele mentioned that the Federal Government aims to lower corporate income tax in the upcoming years. He also noted that the government seeks to lessen the tax burden on businesses while focusing on improving collection efficiency to boost revenue.

The Central Bank of Nigeria (CBN) has scheduled its 297th Monetary Policy Committee (MPC) meeting for September 23 and 24, 2024, at its headquarters in Abuja.

This follows the last meeting held in July under the leadership of the central bank’s governor, Olayemi Cardoso, where the Monetary Policy Rate (MPR) was raised by 50 basis points to 26.75 per cent.

The increase aimed to combat inflation and create a favourable environment for foreign investments.

The upcoming meeting comes after a year of aggressive rate hikes totalling 800 basis points to address rising inflation, which eased slightly to 32.15 per cent in August due to improved food supply.

The CBN has reaffirmed its commitment to orthodox monetary policies aimed at further reducing inflation.

Nigerian Breweries Plc has announced the launch of its N599.1 billion Rights Issue, aimed at addressing overdue foreign exchange commitments and repositioning the company for improved performance.

The brewing giant is offering 22.61 billion ordinary shares at N26.50 each to existing shareholders, allowing them to purchase 11 new shares for every five held as of July 12, 2024. The Rights Issue, which began on September 2, will close on October 11, 2024.

During the “Facts Behind the N599.1 Billion Rights Issue” presentation held at the Nigerian Exchange Limited (NGX), Managing Director Hans Essaadi explained that currency devaluation and higher interest rates have significantly impacted the company’s financials, leading to losses.

He, however, stressed the long-term viability of investing in Nigeria and expressed confidence that the Rights Issue would restore profitability and enable the resumption of dividend payments.

“These are tough times for our business. We started expanding our facilities two years ago, for which FX commitments were required, with a view to future-proofing the business. This led to our incurring a substantial debt due to the devaluation of the naira. Despite this challenge amongst others, we believe that investing in Nigeria is the right thing to do as the long-term fundamentals remain strong” he said.

He added that the company’s expansion into the wine and spirits market, following its acquisition of Distell Wines and Spirits Nigeria Limited, is part of a broader strategy to create long-term value for shareholders.

The Chief Executive Officer of NGX, Jude Chiemeka, commended Nigerian Breweries for utilising the “Facts Behind the Figures” platform to present its strategic business recovery plan.

He noted that the transparency and operational updates shared by the company are crucial in fostering market activity and investor confidence.

Company Secretary and Legal Director Uaboi Agbebaku also explained that the majority of the funds raised will go toward settling outstanding FX obligations, reducing the company’s exposure to future currency devaluations. The remainder will be used to lower naira-denominated debt, thereby decreasing interest expenses.

Nigerian Breweries, a member of the Heineken Group, is Nigeria’s largest brewing company and produces well-known brands such as Heineken, Maltina, Amstel Malta, and Gulder from nine breweries across the country.