Macroeconomic Report & Economic Updates
September 2, 2016
Nigeria Economic Update (Issue 37)
Recent
data by the CBN shows a decline in manufacturing capacity utilization by 2.0
percentage points to 50.7 percent in 2016Q2. Foreign exchange
challenges in addition to cash squeeze in the review quarter, led to the
decline in capacity utilization. This has hindered activities in the sector
while impacting negatively on business confidence. Nonetheless, the CBN
recently directed authorized FX dealers to dedicate 60 percent of FX purchases
to manufacturers. This policy measure is therefore expected to meet
the sectors critical FX need for the purchase of imported raw material and
other machineries, while boosting the potential for economic growth in the long
term.
Related
Nigeria Economic Update (Issue 37)
OPEC Monthly oil report reveals that Nigeria
recorded the highest month-on-month increase in crude oil production among the
OPEC member countries in August 2017. Specifically, at an increasing rate of 8
percent, domestic oil production rose to pre-2016 level of 1.86 million barrels
per day in August 2017. With ongoing repairs in the sector, oil
production could get to 2.2 million barrels per day in the near term, albeit
the prior voluntary agreement to cap production at 1.8 million barrels per day.
Going forward, there is need to address poor planning and policy
inconsistencies in the sector, in order to ensure the influx of investors who
have channeled their investments to other African countries due to laxity in
policies in the sector.