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Category: Business

  • FG Announces VAT Exemptions for Diesel, LNG, CNG, and Electric Vehicles

    FG Announces VAT Exemptions for Diesel, LNG, CNG, and Electric Vehicles

    The Federal Government has announced value-added tax (VAT) exemptions on several key energy products, including diesel, Liquefied Natural Gas (LNG), Compressed Natural Gas (CNG), and electric vehicles, in an effort to reduce prices and enhance energy security, Okay.ng reports.

    This was revealed in a statement on Wednesday by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy. The exemptions are part of broader measures aimed at easing the cost of living and accelerating Nigeria’s transition to cleaner energy sources.

    “The VAT Modification Order 2024 introduces exemptions on a range of key energy products and infrastructure, including Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment,” the statement read.

    Edun emphasized that the initiative is also designed to drive Nigeria’s shift to cleaner energy sources while lowering the financial burden on citizens.

    In addition to VAT exemptions, the Minister also announced tax incentives for deep offshore oil operations and gas production through the Oil & Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order 2024. These incentives are expected to position Nigeria’s deep offshore basin as a leading destination for global oil and gas investments.

    “These reforms are part of a broader series of investment-driven policy initiatives championed by His Excellency, President Bola Ahmed Tinubu, in line with Policy Directives 40-42,” Edun added.

    “They reflect the administration’s strong commitment to fostering sustainable growth in the energy sector and enhancing Nigeria’s global competitiveness in oil and gas production.”

  • Keyamo Hails Return of Emirates Airlines, Promises Competitive Pricing on International Routes

    Keyamo Hails Return of Emirates Airlines, Promises Competitive Pricing on International Routes

    Festus Keyamo, Minister of Aviation and Aerospace Development, has stated that the return of Emirates Airlines to Nigeria will foster healthy competition and lead to more competitive pricing on international routes, Okay.ng reports.

    Keyamo made the remarks on Wednesday following his arrival in Lagos State aboard an Emirates aircraft from the United Arab Emirates (UAE), marking the airline’s resumption of operations in Nigeria.

    Emirates had previously halted flights to Nigeria in 2022 due to issues surrounding trapped funds.

    “With this, we have more competition on different international routes now. That is what it’s all about, to ensure healthy competition,” Keyamo said.

    “A healthy competition leads to competitive pricing for the benefit of the Nigerian people.”

    The Minister also revealed that the government has secured a code-sharing agreement with Emirates Airlines to benefit domestic operators, ensuring that Nigerian airlines have the right of first refusal on these agreements.

    “Dubai, in particular, is a major hub of the world, it links virtually every country. For our airlines too, I can tell you that we also secured some kind of code-sharing agreement,” he added.

    Emirates Airlines officially resumed flight operations to Nigeria on October 1, 2024, following a two-year suspension.

  • CBN Governor Cardoso Defends Naira Float Policy to Restore Exchange Rate Credibility

    CBN Governor Cardoso Defends Naira Float Policy to Restore Exchange Rate Credibility

    Olayemi Cardoso, the Governor of the Central Bank of Nigeria (CBN), has explained that the decision to float the Nairain the foreign exchange market was a strategic move aimed at closing the gap between the official and parallel exchange rates, thus restoring market credibility.

    Cardoso made this statement over the weekend while addressing members of the Harvard Club of Nigeria in Lagos.

    Cardoso noted that his predecessors had considered floating the Naira but ultimately abandoned the idea, fearing massive depreciation and its ripple effects on the macroeconomic landscape.

    However, Cardoso, speaking for the first time since assuming office a year ago, said the floatation was necessary to tackle the speculative trading that thrived due to the disparity between the official and black market rates.

    “The decision to float the naira, although met with public criticism, was essential to align the official exchange rate with market reality. The disparity between the official and parallel rates encouraged arbitrage and speculation, eroding trust in the market,” Cardoso said.

    Cardoso acknowledged that the CBN’s credibility was at the core of its policy actions, adding that, “Without credibility, no policy, however well-intentioned, can succeed.”

    He stressed that the bold move was essential for addressing long-standing inefficiencies, adding that the speculative trading had reduced since the policy’s implementation, and gradual stability was returning to the currency markets.

    In his address titled “Leadership in Challenging Times: Restoring Credibility, Building Trust, and Containing Inflation,” Cardoso also highlighted the CBN’s efforts to control inflation, which remains a primary focus.

    He noted that the National Bureau of Statistics (NBS) reported recent declines in inflation for July and August 2024, indicating that the CBN’s actions were yielding positive results.

    Cardoso defended the CBN’s decision to raise the Monetary Policy Rate (MPR) to 27.25%, describing it as a “bold move” necessary to curb excess liquidity and rein in inflation. He added that, while higher interest rates were painful for borrowers, they were crucial for long-term economic stability.

    “Leadership is about making hard choices to secure long-term stability over short-term comfort in moments like these,” Cardoso said.

  • Jumia to Exit South Africa and Tunisia Markets by End of 2024

    Jumia to Exit South Africa and Tunisia Markets by End of 2024

    E-commerce giant Jumia has announced plans to exit its operations in South Africaand Tunisia by the end of 2024 as part of its strategy to concentrate resources on its most promising markets.

    The decision follows a comprehensive evaluation of the company’s performance in both countries, which accounted for only a small portion of its total orders and gross merchandise volume (GMV).

    According to Jumia, South Africacontributed 3.5% of total orders and 4.5%of GMV for the year ending December 31, 2023, while Tunisia accounted for 2.7% of total orders and 3.0% of GMV.

    The company believes that ceasing operations in these markets will improve its overall efficiency and allow it to focus on markets with higher growth potential.

    Jumia’s CEO, Francis Dufay, explained the rationale behind the move:

    “Since assuming the role of CEO, I have focused on initiatives aimed at strengthening our business and placing us on a path to profitability. After a thorough analysis, we made the difficult decision to close down our operations in South Africa and Tunisia.”

    Dufay noted that competitive and macroeconomic challenges in both countries limited their growth potential and failed to meet Jumia’s expectations for contributing to the company’s broader business objectives.

    The decision will reduce Jumia’s presence from 11 countries to 9, with the company now focusing its efforts on its key markets in West and East Africa.

    Jumia believes this strategic shift will help accelerate growth and improve operational efficiency across its remaining markets.

    “Jumia believes that exiting these markets and refocusing resources on its other nine markets will leave the company better positioned to accelerate overall growth and further improve efficiency,” the company said in a statement.

    Jumia has faced difficulties in recent quarters, particularly with currency depreciation in key markets like Nigeria and Egypt.

    Despite an increase in the number of orders, the company reported a decline in the total value of orders to $170 million in Q2 2024.

    Jumia’s exit from South Africa and Tunisiais expected to be completed by the end of 2024.

  • CBN Governor Cardoso Reaffirms Commitment to Developing Future Leaders in Finance and Social Sciences

    CBN Governor Cardoso Reaffirms Commitment to Developing Future Leaders in Finance and Social Sciences

    The Governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, has emphasized the Bank’s commitment to nurturing the next generation of leaders in the financial and social sciences sectors.

    Cardoso stressed the importance of addressing the shortage of skilled professionals in finance-related fields within Nigerian universities, noting that developing a robust pipeline of talent is critical to Nigeria’s future economic success.

    Cardoso made these remarks during a recent strategic engagement at the CBN Head Office in Abuja with the President and Chairman of the Governing Council of the Nigerian Economic Society (NES), Professor Adeola Adenikinju, NES officials, and representatives of the Nigerian Economics Students Association (NESA).

    The CBN Governor reiterated the need for collective efforts to empower youth, creating opportunities and providing them with tools to excel in their fields and become globally competitive.

    He highlighted that the meeting laid the foundation for developing talents that would be instrumental in driving Nigeria’s Financial System Strategy.

    Following presentations from NES and NESA on research initiatives and recommendations, Mr. Cardoso underscored the need for a mentorship collaborationbetween the CBN, NES, and NESA.

    He expressed the Bank’s willingness to support such efforts, aiming to foster a deeper understanding of economic concepts while promoting career growth and innovation in the financial sector.

    Cardoso also pointed out the need for clearer communication of economic and monetary policies, stating that complex concepts often hinder effective communication.

    He encouraged young economists to play a key role in demystifying economic principles and providing fresh perspectives that resonate with a wider audience.

    In addition, the CBN Governor reaffirmed the Bank’s readiness to work with NES and NESA to enhance mentorship, support research, and boost female representationin economics and finance.

    He expressed optimism that these collaborations would contribute to building a resilient and inclusive financial sectordriven by talent, innovation, and diversity.

    Speaking on behalf of NES, Professor Adeola Adenikinju highlighted key areas for collaboration, including research support, internships, and leveraging social media for communication.

    He emphasized the importance of bridging the mentorship gap within the economics community, a key focus area for NES.

    The National President of NESA, Comrade Bakre Israel Boluwatife, expressed gratitude for the engagement with the CBN, stating that NESA looks forward to contributing to research efforts in areas such as inflation and money supply.

  • Nigeria’s Foreign Exchange Inflows Reach $57 Billion by August 2024, Says CBN

    Nigeria’s Foreign Exchange Inflows Reach $57 Billion by August 2024, Says CBN

    Nigeria’s foreign exchange (FX) inflowsreached an impressive $57 billion by August 2024, according to a report from the Central Bank of Nigeria (CBN).

    The update was revealed by Mr. Muhammad Abdullahi, the CBN’s Deputy Director of Economic Policy, during a meeting with foreign investors in Washington D.C..

    Abdullahi highlighted significant improvements in the country’s FX situation, pointing to a near doubling of capital importation to $6.9 billion as of August 2024, compared to $3.9 billion recorded throughout the entire 2023 financial year.

    The report also noted a remarkable increase in diaspora remittances, which surged to a record $3.5 billion, surpassing the $3.2 billion total received in 2023.

    In addition, the CBN reported a 100% FX outflow through the autonomous market, indicating enhanced efficiency in the foreign exchange market.

    The bank’s direct intervention in the market has reduced significantly, now accounting for just 5% of the total market turnover

  • FirstBank Clarifies Platform Upgrade, Assures Banking Services Will Not Be Affected

    FirstBank Clarifies Platform Upgrade, Assures Banking Services Will Not Be Affected

    • First Bank of Nigeria (FBN) has clarified that its upcoming platform upgrade is limited to its suppliers’ platform and will not affect its digital banking services.

    The bank made this known in a statement on Friday, dispelling misconceptions that its core banking services would be disrupted.

    In the statement, Folake Ani-Mumuney, Group Head of Marketing and Corporate Communications at FBN, explained that reports circulating in the media had misinterpreted the bank’s communication regarding the transition from its current I-Supplier platform to a new cloud-based supplier system.

    The transition, she noted, is intended solely for the bank’s vendors and will have no impact on customer-facing banking services.

    “We wish to address a misleading report circulating in the media regarding a system upgrade at FirstBank. The message which was incorrectly interpreted and reported was sent to, and intended for, our vendors only,” Ani-Mumuney said.

    She further clarified that no system upgrade is currently underway for banking services, and all customer applications and transactions will remain fully operational throughout the supplier platform transition.

    “Please be informed that no system upgrade is currently underway, and all our customer applications are fully operational. We are not experiencing disruption to our services, and our banking systems, customer transactions, channels, etc., will not be affected by the enhanced supplier platform.”

    FBN reassured customers that its banking services would continue without interruption, emphasizing its commitment to seamless service delivery.

    The bank’s cloud-based supplier platformtransition is scheduled to take place from October 26 to November 3, 2024, with the new solution expected to go live on November 4, 2024.

  • CBN Debunks Claims of Phasing Out Old Naira Notes by December 2024

    CBN Debunks Claims of Phasing Out Old Naira Notes by December 2024

    The Central Bank of Nigeria (CBN) has refuted reports suggesting that the old series of N200, N500, and N1,000banknotes will cease to be legal tender by December 31, 2024.

    In a statement released on Thursday, the CBN, through its acting Director of Corporate Communications, Sidi Hakama, confirmed that the Supreme Court’s order extending the use of the old naira notes indefinitely still stands.

    The CBN emphasized that discussions in various forums about the discontinuation of these notes were false and intended to create confusion in the nation’s payment system.

    “The attention of the Central Bank of Nigeria (CBN) has been drawn to discussions at different fora suggesting that the old series of the N200, N500, and N1,000 banknotes shall cease to be legal tender on December 31, 2024. We wish to state categorically that such claims are false and calculated to disrupt the country’s payment system,” the CBN said.

    “For the avoidance of doubt, the order of the Supreme Court of Nigeria on Wednesday, November 29, 2023, granting the prayer of the Attorney-General of the Federation and Minister of Justice to extend the use of old Naira banknotes ad infinitum, subsists.

    “Similarly, the CBN’s directive to all its branches to continue to issue and accept all denominations of Nigerian banknotes, old and re-designed, to and from deposit money banks (DMBs) remains in force.

    “It will be recalled that the Supreme Court ordered that the old series of N200, N500, and N1,000 banknotes shall continue to be legal tender alongside the redesigned versions. Accordingly, all banknotes issued by the Central Bank of Nigeria (CBN) will continue to remain legal tender indefinitely.”

    CBN advised Nigerians to continue to accept all naira banknotes — old or redesigned — for their day-to-day transactions.

    “We, therefore, advise members of the public to disregard suggestions that the said series of banknotes will cease to be legal tender on December 31, 2024,” the apex bank said.

    “We urge Nigerians to continue to accept all Naira banknotes (old or redesigned) for their day-to-day transactions and handle them with the utmost care to safeguard and protect their lifecycle.”

  • IMF Clarifies It Did Not Push for Nigeria’s Fuel Subsidy Removal

    IMF Clarifies It Did Not Push for Nigeria’s Fuel Subsidy Removal

     The International Monetary Fund (IMF)has clarified that it was not responsible for Nigeria’s recent decision to remove fuel subsidies, a move that has sparked criticism due to the resulting inflation and economic hardship for many Nigerians.

    The decision, according to the IMF, was made independently by the Nigerian government.

    Speaking during a press conference at the IMF and World Bank Annual Meetings in Washington D.C., the IMF’s African Region Director, Mr. Abebe Selassie, stressed that the IMF had no direct involvement in the policy decision.

    “The decision was a domestic one. We don’t have programmes in Nigeria. Our role is limited to regular dialogue, as we have with other nations like Japan or the UK,” Selassie said.

    While acknowledging that the IMF offers guidance on public resource management, Selassie pointed out that Nigeria’s decision to remove fuel subsidies aligns with its long-term strategy to enhance public resource efficiency and foster sustainable economic growth. He emphasized that the choice was deeply rooted in domestic and political considerations.

    “Ultimately, these are profound domestic and political decisions that the government had to make,” he noted.

    Selassie recognized the significant economic impact the reforms have had on Nigerians and urged the Nigerian government to implement social investment programmes to cushion the effects on vulnerable populations.

    “We recognize the significant social costs involved. The government can mitigate these by expanding social protection for the most vulnerable,” Selassie added.

    The IMF reiterated its support for Nigeria’s efforts to balance public resource management while encouraging the government to invest in infrastructure, healthcare, and education to support long-term economic stability.

  • IFC, CBN Partner to Boost Local Currency Financing

    IFC, CBN Partner to Boost Local Currency Financing

    The International Finance Corporation (IFC), a member of the World Bank Group, and the Central Bank of Nigeria (CBN)have entered into a strategic partnership to increase local currency financing in Nigeria.

    This move aims to support private businesses across key sectors of the Nigerian economy, including agriculture, housing, infrastructure, energy, small and medium enterprises (SMEs), and the creative and youth economy.

    The agreement will enable IFC to manage currency risks while expanding its investment in the Nigerian naira, facilitating more than $1 billion in financing over the coming years. This funding is essential for boosting critical sectors that require long-term local currency financing.

    CBN Governor Yemi Cardoso highlighted the significance of this collaboration, stating, “This pioneering initiative between IFC and CBN will unlock much-needed long-term local currency financing for private businesses in Nigeria at economically viable rates. It will serve as a catalyst for economic growth and advance the Federal Government’s agenda for economic diversification.”

    Makhtar Diop, Managing Director of IFC, noted the importance of expanding access to affordable local currency financing, emphasizing that it will enhance lending in naira and support job creation across the country. Diop said, “Expanding access to affordable local currency financing for small businesses in Nigeria is essential for IFC to address the increasing demand for diverse funding options and to better manage currency risk.”

    With an active portfolio of $2.13 billion in Nigeria—second highest in Africa—local currency financing is a top priority for IFC as it seeks to support the country’s economic development through innovative financial instruments and partnerships.