By Lukman Otunuga, Senior Research Analyst at FXTM,
In addition, there were political uncertainties amid elections which settled down following the re-election of President Buhari. However, shortly after the investors’ attention turned back to the economy as the Central Bank of Nigeria (CBN) unexpectedly cut interest rates for the first time in three years, in March 2019. Thus, increasing the specter of inflationary pressures.
Nigeria’s economy still managed to average around two percent per quarter this year. The CBN may have taken a precautionary measure to protect the economy from external risks. The move had been enough to satisfy monetary policy makers because the CBN refused to join the global easing train, in the second half of 2019, when over 40 central banks cut interest rates. Instead, hoping to avoid inflationary pressures, the CBN played a larger role in the overall economy by increasing the loan to deposit ratio from 60% to 65%, with plans to increase the ratio to 70% by 2020.
External risks that influenced Nigeria in 2019
The US-China developments will remain a primary factor influencing Nigeria’s economy in 2020. As Nigeria enjoys the position of being the biggest destination for Chinese investors in Africa, any slowdown in China’s economy is likely to affect Nigeria’s export and investment markets.
Additionally, there were widespread concerns over slowing global growth after major economic institutions like the International Monetary Fund, World Bank, Organization for Economic Co-operation and Development and World Trade Organization cut growth projections amid the consequences of the US-China trade war.
Concerns over Nigeria’s growth were further heightened by Brexit uncertainties, particularly with regards to trade relations. It must be kept in mind that trade deals with the UK and African countries are negotiated through the EU which plays a middle man. With the agreement becoming void when Britain departs from the Europe, this presents significant disruptions and economic risk to African nations who heavily trade with the UK. The UK was Nigeria’s seventh-largest trading partner during the final third quarter of 2019 with total trade amounting to roughly $1.3 billion. A question on investors’ minds is whether Brexit could disrupt trade between Nigeria, the EU and the UK in the near term.
The bright spot amongst the clouds of uncertainty is the pick-up in crude Oil price benchmarks. WTI Crude and Brent concluded 2019 with gains, appreciating roughly 23.5% and 27.0%, is good news for Nigeria.
What to expect in 2020
While crude Oil benchmarks were rising, a troubling trend made its mark when crude Oil pipeline shut-ins and shut-downs cost Nigeria N88.22bn in November 2019.
Although the commodity has appreciated roughly 4% since the start of 2020 as geopolitical tensions in the Middle East trigger fears over negative supply shocks in the markets, this may be not enough to sustain oil prices in the medium to longer term. If Oil falls in 2020, it will hit revenues, which in turn may weaken the Naira and spur inflation. This should discourage the CBN from cutting interest rates. Another vulnerability in a falling Oil price scenario stems from state fuel subsidies, which rise along with the cost of Oil, potentially impacting the bottom line for Nigeria’s record 10.59 Naira budget for 2020.
The year 2020 may be end of the Brexit process and offers an opportunity for Nigeria to reach a trade agreement with the UK, something that could support economic growth.
If the global trade outlook continues improving and the US-China trade disputes reach a final deal, the impact would be positive for the Nigerian economy. Especially, if China’s GDP growth rebounds.
2020 may be another rough year if the US-China trade disputes or Brexit issues take a turn for the worse, but there is a potential for a good year in the event of reaching a satisfactory conclusion for both. This would calm market concerns and supporting growth along with crude Oil prices.
NCC, Digital Encode Support NITRA Innovative Tech Forum On Post-COVID-19 Strategies
The Nigerian Communications Commission (NCC), Nigeria’s telecommunications regulator and Digital Encode, Cybersecurity and Compliance advisory company, have indicated interest to partner with the Nigeria Information Technology Reporters Association (NITRA), the national umbrella body of ICT reporters, as it organizes a forum that will x-ray the industry’s future plans for ICT growth post pandemic era.
The event, slated to hold on October 15, 2020, will seek to discuss the needs for a fortified ICT sector after the COVID-19 era, and the level of preparedness of ICT stakeholders to embrace the challenge of being pivotal to the stability and growth of all other sectors.
A statement from NITRA National Secretariat in Lagos indicates that due to the pandemic and need to observe the COVID-19 protocol on social distancing, the event will be held via a Webinar.
This year’s theme, “Multi-stakeholder Approach To National Recovery Post-Pandemic”, is in line with the annual event’s generic theme, ‘NITRA Innovative Tech Forum’, a contribution by NITRA to the development of Information and Communication Technologies (ICTs) innovations and policies in Nigeria.
Prof. Umar Danbatta, executive vice chairman, NCC is expected to deliver the keynote speech at the event and will throw more light on Federal Government’s plans, programmes and policies on post-pandemic strategies using ICT.
Dr. Adewale Obadare and Dr. Seyi Akindeinde, founders of Digital Encode, while accepting to support the event expressed their readiness to offer their expertise in Cybersecurity for organisations to prepare against cyber- attacks with the new normal.
They will also highlight areas that are high risks that need fortification in terms of cybersecurity.
Speaking on the event, Mr. Chike Onwuegbuchi, national chairman, NITRA, noted that as the COVID-19 pandemic continues to leave its negative trails across the globe, economic reboot for countries will not only depend on how well they readapt to the new normal, but also more on their recovery plans.
According to him: “While the federal government has consistently expressed its willingness to set all policies in place to engender growth, and accelerated implementation of these policies, private sector firms have also shown great hunger for the task ahead in post-COVID-19 era.
However, the question that needs to be answered is whether all stakeholders are ready for the required task ahead.”
The event will also offer participating companies opportunities to publicize some of their individual efforts at contributing to reacting a soft landing or lifeline for SMEs and other ancillary companies as the pandemic threatens their survival.
Digital Encode is a multi-award winning and leading consulting and integration firm that specializes in the design, management, and security of business-critical networks, telecommunications environments and other Information Technology (IT) infrastructures.
NCC Threatens Illegal Users of GSM Boosters with Arrest, Prosecution
Nigerian Communication Commission (NCC) has warned telecom consumers to desist from using illegal GSM boosters.
The commission also said that anyone caught using a GSM booster without obtaining approval of a duly licensed network operator will face arrest and prosecution.
GSM boosters are devices that transmit and receive telecommunications signals and can therefore interfere with other radio frequency equipment.
Ikechukwu Adinde, director, public affairs, NCC, said in a notice published on NCC website, that only licensed network operators are allowed to use GSM boosters.
The booster, also known as amplifier or repeater is made up of three main elements – exterior antenna, amplifier, and interior antenna.
They form a wireless system to boost cellular reception
“Members of the public should note that, willful interference with any wireless telegraphy is an offence under Section 16 of the Telegraphy Act, 2004,”it said
The agency said it will not condone any flagrant breach of this law.
It has also enforced measures to prosecute offenders.
Accordingly, monitoring mechanisms have been put in place and anyone caught using a GSM booster without obtaining approval of a duly licensed network operator will face arrest and prosecution.
“Any member of the public with useful information regarding the illegal use of GSM Boosters should contact the Commission on 09-4617000/7351 or send an email to [email protected],” the notice said.
“Individuals desirous of using GSM Boosters should note that they can only do so in conjunction with licensed network operators,” it added.
Tizeti Selects Nokia to Provide LTE Fixed Wireless Access Solution for High-Speed internet Services in Nigeria
Tizeti announced that it selected Nokia’s Fastmile Long Term Evolution (LTE) technology to enable usprovide superior internet services to over 1 Million subscribers in Port Harcourt, Edo and Ogun in Nigeria.
Tizeti will deploy Nokia’s AirScale Base Station TDD-LTE and FastmileFixed Wireless Access (FWA) gatewaysto deliver premium internet and Virtual Private Network (VPN) services to Residential, Small and Medium Enterprises (SMEs).
The solution will also enable Tizeti’sto deliver a more robust, high-speedinternet service to subscribers and the flexibility to seamlessly evolve to 5G Fixed Wireless Access when needed.
Nokia’s FWA solution enables Tizeti to fast-track broadband access and provide a best-in-class broadband experience to its subscribers.
Nokia’sAirScale Base Stations ensure high-quality connectivity and coverage and enablesTizeti to evolve the network in line with customer demand.
Nokia’sFastmilegateways connect wirelessly to the existing network to createa fastbroadband connection and enhanced Wi-Fi experience in the home.
The Nokia Network Services Platform will help Tizeti to simplify operations and quickly respond to changing market demands.
Kendall Ananyi, Tizeti, said:“We are committed to providing the best-in-class network experience to our subscribers. We are confident that Nokia’s proven technology and expertise will help us differentiate our services based on quality. This a crucial project for us as it introduces LTE in our networks and allows us to bring new and innovative services to our subscribers.”
Eniola Balogun, Nokia, said:“We are thrilled to work with Tizeti on the initiative to upgrade their network to bring the latest products and services to its subscribers. Nokia Fastmile will help Tizeti to cost-effectively enhance the customer experience.
The project will also enable them to delight their subscribers by providing more reliable data services.
On the other hand, Tizeti will benefit by adding new revenue streams.”
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