FXTM Research Analyst
The news that
Nigeria’s economy cooled down to 2.05 percent in the first quarter of 2019
compared to 2.38 percent in Q4’18 has left investors wondering about the
chances of growth gathering momentum during the second half of the year. http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html On the one hand, it’s an encouraging
sign we’ve seen the fastest first-quarter growth since 2015, driven mainly by
the non-oil sector which grew 2.47 percent. On the other hand, the Oil sector
shrank by 2.4 percent, sending a worrying signal that the sector isn’t doing as
well as it should be even amid rising Oil prices.
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It is becoming
increasingly clear that economic growth is unlikely to reach the ambitious Economic Recover and Growth Plan (ERGP)
target of seven percent but it may hit the Central Bank of Nigeria’s target of
2.47 percent. http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html For this to happen, the growth trend in
the Oil sector would need to rebound and the services sector would need to
sustain its current strength. Added momentum could stem from Oil prices should
they hit a bullish streak going forward, supporting the economy as the Oil
trade still accounts for a handsome chunk of the nation’s foreign exchange
earnings.
There are other
potential areas of growth. Regionally there is a significant development which
could increase economic efficiencies and trade within Africa - the African Continental Free Trade Area
(AfCFTA) which comes into effect on May 30. Although Nigeria hasn’t yet joined
AfCFTA, there’s still a chance it will do so, once discussions are completed
with stakeholders. http://www.tectono-business.com/2016/06/are-you-estate-surveyor-or-property.html In addition to opening intra-Africa
trade relations, the AfCFTA gives multi-national companies the chance to set up
in one African country and be passported to another 52 countries within a
common market made up of over one billion people. Increased access to foreign
expertise and investment could improve local manufacturing and processing
systems while driving more growth and jobs creation. In the best-case scenario,
standardised trading agreements across AfCFTA may open up trading channels
which could lead to increased company sales, revenues and profits. Nigeria
sells just 12.7 percent of its total exports to other African countries, so if
the treaty is ratified there’s scope for increased government and company
revenues from a boost in trade.
Fellow Nigerians,
are you aware that our crude oil will soon become useless? Yes, it will, in no
distant time, become valueless owing to the fact that the countries that rely
on it as their only source of energy are developing more affordable alternative
sources of energy. When this finally happens, what will we do? How are we
currently preparing for this imminent economic doom? Which other sector will
continue to stabilize our economy? Nigerians, the only solution is developing
the agricultural sector. In fact, this is the only solution. Very soon, the
major source of revenue will become agriculture and agro-exports. How are you
positioning yourself to play big in agro-export business? Why don’t you get a
practical manual that explains the stages of export trade from processing and
packaging of commodities to receipt of payment by the foreign buyers? Yes, arm
yourself with the contemporary trends in export trade. This manual explains
export operations, export management, export documentations and methods of payment
in export trade? Yes, it is a contemporary step-by-step guide to export trade.
It tells all the contemporary dynamics in export trade. To get it, click on this
link: http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html
In general, there
needs to be a stronger push in diversifying away from Oil reliance to other
sources of sustainable growth. http://www.tectono-business.com/2016/06/are-you-estate-surveyor-or-property.html An important part of sustainable growth
is investment sentiment and the current economic stability along with easing
inflationary pressures which may lead to a more dovish Central Bank of Nigeria (CBN) monetary policy by way of interest
rate cuts. If so, a reduction in interest rates would stimulate borrowing and
investment from local businesses, which in turn would support economic growth.
A more robust economy plus foreign exchange reserves rising towards $45 billion
would likely provide ammunition for the CBN to defend the Naira.
Another factor
impacting on Nigeria’s recovery is the external threat of the US-China trade
negotiations which could end up pressuring Oil prices if the result is a global
slowdown, meaning less demand for Oil. http://www.tectono-business.com/2015/07/tectono-business-review-in-conjunction_21.html The USD is staying strong amid the
trade tensions and should they intensify further, they will hit emerging
markets where it hurts – in their currency exchanges. This would undermine the
Naira while pressuring consumer spending and on top of that, falling Oil prices
would likely dent government revenues.
Looking ahead,
there is scope for Nigeria’s economy to gather momentum in the second half of
the year, provided some key basics of growth are kept in focus: supportive
monetary policy; keeping consumer spending healthy; sustaining investor
confidence; and improving economic infrastructure, particularly in the Oil
sector. http://www.tectono-business.com/2015/07/tectono-business-review-in-conjunction_21.html Even if the risks stemming from
US-China trade disputes are out of Nigeria’s hands, shoring up the domestic
economy could help it weather any storms. The worst-case alternative is less
attractive. If a global slowdown is triggered due to the trade tensions,
economic growth in Nigeria may follow suit, meaning the CBN will face more
difficult challenges to support the Naira and wider economy through monetary
policy.
Are you an exporter? Do you like
to master the contemporary dynamics of non-oil export trade and avoid getting
defrauded by the foreign buyers of your exportable products? Click on the link
below: http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html
Are
you tired of your car’s same old look? Is your vehicle losing shape &
colour? Do you desire your vehicle to look like a
brand new one? Then, it is the
right time to come to GOF Autos Limited for priming, panel
beating, painting (with Sikkens paint) and oven baking at rate of N70,000
for cars and N80,000 for SUVs. For details, click: http://www.tectono-business.com/2017/06/gof-autos-limited-best-automobile.html
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