Macroeconomic Report & Economic Updates
June 24, 2016
Nigeria Economic Update (Issue 27)
Naira strengthened against the dollar in the review week. Specifically, the
Naira appreciated by 2.7 percent to N355/$ (parallel market rate) on June 17, 2016,
following the release of the flexible FOREX policy guidelines by the CBN on
June 15, 2016. The new policy effectively adopts a single market structure
hosted at the autonomous/inter-bank market. The inter-bank trading scheduled to
commence on June 20, 2016 will be market-determined, officially eliminating the
N197/$ peg. To ensure foreign exchange liquidity, primary market dealers have
been introduced while the CBN will participate in the market through periodic interventions.
FDI, FPI And Other Investments
FDI, FPI and other Investments: Portfolio investment has continued to fall rapidly since 2014, while FDI inflows remain subdued since 2010
Nigeria Economic Review
The global economy grew by 2.7 percent in the fourth quarter of 2016 (2016Q4) relative to 2.5 percent in 2016Q3, due to rising investment and consumption demands in developed and emerging economies as well as a rise in commodity prices. However, over the entire year, global GDP growth stood at 2.6 percent in 2016, relative to the growth of 3.09 percent recorded in 2015. Notably, output grew progressively in the US over the year, while the steady growth recorded in the UK since the start of the year stalled in 2016Q4. Also, the declining growth recorded in France since 2015 took a positive turn in 2016Q4, the rest of the Eurozone witnessed a fall in output in the quarter. While emerging economies recorded mixed experiences, many Sub-Saharan African countries showed signs of recovery in the period.
Regional Integration In Africa: Some Recent Developments And Challenges
African countries have been left out of the recent benefits accruing from international trade. For example, they accounted for only 3.2 percent of world trade in 2013 compared to 5 percent in the mid-1960s. Regional integration can reverse this weak performance as it holds the promise for countries to gain from the resultant economies of scale and enhanced competitiveness. It will also help to expand the markets for foreign direct investment.