Join us to discuss the challenges and opportunities for women in trade in Africa.

Participants will have the opportunity to provide insights and suggestions on policies that would support more inclusion of women and address the binding constraints to women empowerment in domestic and international trade.

Register here: https://us02web.zoom.us/webinar/register/WN_pZf6ROckSH2RgliNWanPnw?t=1645001351445

According to the National Bureau of Statistics (NBS), Nigeria's headline inflation rate increased on a month-on-month basis, from 15.40 percent in November 2021 to 15.63 percent in December 2021¹. This represents a 1.8 percent increase, breaking an eight-month streak of headline inflation declines since April 2021. However, on a year-on-year comparison, the headline inflation rate decreased by 0.13 percent from 15.75 percent recorded in December 2020. The in-creased rate of inflation recorded in December is largely attributed to the increase in aggregate demand as a result of the festive season. Expectations are that the rate of inflation for January would decline due to lower demand levels. However, a double-digit inflation rate translates to lower purchasing power, which also translates to a lower quality of life. It is, therefore, important that policies aimed at improving aggregate supply be prioritized. This can be achieved by leveraging and scaling up the real sector intervention programs of the Central Bank of Nigeria (CBN), improving economic infrastructure to boost productivity, and improving national security to address the sub-optimality in agricultural productivity.

The Nigerian National Petroleum Company (NNPC) Limited remitted N511.7 billion to the federation account between January and October 2021, against the projected sum of N2.09 trillion, resulting in a shortfall of N1.58 trillion.³ This is according to data obtained from the NNPC. The shortfall can be attributed to two main factors: low revenue generation by NNPC limited and huge deductions. From the data, the projected revenue from January to October was N4.15 trillion whereas revenue generated was N2.77 trillion, indicating revenue shortfall of about 33.3 percent. Remittance to the federation account was plunged by deductions, which was N2.26 trillion, and represented 81.6 percent of gross revenue. The highest deduction was under-recovery of PMS/Value shortfall (subsidy), which was N1.03 trillion, and contributed about 37.2 percent of total deductions. Given the importance of NNPC limited remittance to federal account, the shortfall signals a potential crisis as most states are highly dependent on the monthly allocation from the FAAC. The situation suggests that states need to implement strategies that would boost their internally generated revenue to cover growing fiscal obligations. At the federal government level, the government should leverage on the petroleum industry act, which stipulate that petroleum subsidy ends by February 2022. With less than three months to go, the government is expected to intensify engagements with relevant stakeholders on the economic impact of petroleum subsidies and to specify how the saved funds will be used. Also, given that the subsidy removal would hurt the poor through increased transportation cost, the government is expected to design framework on how the proposed social interventions would mitigate potential welfare losses associated with subsidy removal. These interventions are expected to improve revenue available to the government for productive investments, which in turn, would bolster the rate of economy recovery from the pandemic.

Discussions are underway between the Nigerian National Petroleum Corporation (NNPC) and a range of foreign and Nigerian trading houses with the NNPC aiming to raise $1 billion oil prepayment towards the revamping of the Port Harcourt refinery.¹ The funds acquired are expected to be repaid through the delivery of refined products over a span of seven years. In 2019, the refineries of Nigeria lost approximately N167 billion ($439.47 million) leading to the shutting down of the refineries in April 2020 for rehabilitation. If the project is successful, Nigeria’s fuel import bill will be reduced. Additionally, it would be the country’s second oil-backed financing since the onset of the COVID-19 pandemic. Currently, a key financing source is the African Export-Import (Afrexim) Bank. Some foreign banks have stated their aversions to participating or contributing to the project due to their consideration of Nigeria as a high-risk country and low credit availability. The use of sales of refined products to finance the rehabilitation of the refinery provides the appropriate incentive for successfully completing the project. However, the use of public-private partnerships in managing the refinery should be considered in order to enhance efficiency and effectiveness.