The China-Africa debate is never far away. Lamido Sanusi, governor of Nigeria’s central bank, recently wrote in the FT of a whiff of colonialism. Much has been said about the two countries’ unequal relationship, based on China’s supposedly insatiable desire for African raw materials and for control of its mining assets.
But perhaps a bigger problem is not China’s dominance but China’s slowdown. What happens when the country doesn’t want so many of Africa’s exports? That moment may be coming sooner than you think. Continue reading »
After years of persistently high inflation, you would think taming the beast would be cause for celebration.
Not in Nigeria – or in the central bank, at any rate. Despite inflation falling to a 5-year low of 8.6 per cent year-on-year in March, the news has simply exacerbated the debate over what to do about interest rates. Continue reading »
The railway linking Lagos, Nigeria’s commercial capital, to Kano, the country’s second largest city, has reopened after more than 10 years thanks to Chinese loans and investment. Xan Rice, the FT’s West Africa correspondent, makes the 31-hour journey and asks whether the train line is a sign of progress in Africa’s second biggest economy.
Two years on from the start of its cleanup operation for Nigeria’s banking crisis, the Asset Management Corporation of Nigeria (AMCON) – the country’s ‘bad bank’ – is courting foreign investors.
Since its establishment in 2010, Amcon has issued five series of zero-coupon bonds with a combined face value of just under N5.7tn – that’s almost $36bn – which it has used to buy non-performing loans and recapitalise struggling banks. The first series – face value N1.7tn ($11bn) – matures in December 2013, and with African sovereign debt in high demand, Amcon is considering turning to international markets for refinancing. Continue reading »
Petrobras has made no secret of its wish to offload international assets. It has been trying to flog off $6bn of its Gulf of Mexico operations, although with little success to date, as part of a $14.5bn asset disposal plan that will also include refineries in Japan and the US.
So when it comes to champagne, where are the big growth markets? The Brics? To an extent, yes. But there is one country high on the list that might surprise: Nigeria, which is expected to see the second biggest increase in sales volume over the next five years. How come? Chart of the week takes a look. Continue reading »
A more hawkish tone from the Central Bank of Nigeria than many economists expected, but no change in the benchmark interest rate – yet.
The CBN on Tuesday held the benchmark at 12 per cent, in line with governor Lamido Sanusi’s earlier statement that his monetary policy committee would probably hold rates so as not to compromise the bank’s successes in fighting inflation. Continue reading »
In the last few years Nigeria’s banks have been to the bottom and back again, with the 2009 crisis, bailouts, mergers and the creation of a bad bank, Amcon. So is 2013 the year when they get a chance to shine?
According to a report from rating agency Standard & Poors, The Nigerian Banking Sector Outlook 2013: At The Start Of A New Cycle, the mixture of strong economic growth in Nigeria and political stability should underpin a year of expansion. Could anything go wrong? Continue reading »
Shell’s Nigerian subsidiary is losing over $33m a week since it shut one of its two major pipelines and said it would not be able to fulfill key contracts. The oil giant has blamed vandals for the disruption.
Shell Petroleum Development Company is likely to lose more: it cannot yet give a date when it will lift the force majeure (which allows it to break contracts due to situations beyond its control) from its Nembe Creek Trunkline. The company is due this month to export 168,000 barrels per day of Bonny Light, the grade of crude transported by the inoperative pipeline. Continue reading »
The head of Shell’s Nigerian oil unit has warned that Africa’s largest oil producing country is in crisis as a result of a “significant upsurge” in oil theft and pipeline vandalism.
Making the comments on Sunday following an aerial survey of its operations, Shell Petroleum Development Company of Nigeria’s managing director Mutiu Sunmonu said the company was losing 60,000 barrels of oil a day as a result of theft, the heaviest losses in three years. Continue reading »
Nigeria’s long-delayed 2013 budget was finally signed off on Monday by president Goodluck Jonathan, ending months of disagreements between the executive and legislature over spending plans.
A key sticking point has been setting the benchmark oil price, which determines how much the government can spend and how much it must save. The spenders have won, though concerns will linger over optimistic assumptions about the health of Nigeria’s oil industry. Continue reading »
Hot money are two words that would usually make central bankers cringe. Not in Nigeria though.
Even as foreign inflows into the country hit a two-year high in January, the central bank said it was not concerned about the risks arising from this potentially volatile influx – though that might change if flows continue to grow at their current pace. Continue reading »
Olam, the Asian agribusiness, is looking to test out an ambitious diversification plan in Africa. In a way, it shouldn’t be a surprise – Olam started in Africa as part of an Indian conglomerate producing cotton for Nigerian markets, before it began exporting agri-commodities, and eventually morphing into a fully fledged rubber-to-cashews business listed in Singapore.
It is in Africa where the company is looking to branch out into fertiliser plants, plantations and consumer goods, according to Ranveer Chauhan, managing director and regional head for Olam in Africa. Continue reading »
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