Business
MAN Calls For Jaw- Jaw On Inflation Control
The Manufacturers Association of Nigeria (MAN) says that it has become necessary for stakeholders comprising the government, central bank, private sector, and civil society to address how best to bring the rising inflation in the economy under control.
As reported by the National Bureau of Statistics (NBS), in July 2023, Nigeria experienced a surge in inflation, with the rate reaching a new 18-year high of 24.08 percent.
This marks an increase of 1.29 percent from the previous month’s rate of 22.79 percent.
Segun Ajayi-Kadir,
Director – General of MAN, said that it’s important to note that addressing inflation is a complex and long-term endeavor that requires a coordinated effort from various stakeholders, including the government, central bank, private sector, and civil society.
He believes that the combination of recommendations from the stakeholders, can help mitigate inflationary pressures and promote sustained economic growth.
Commenting on the inflationary impacts on the manufacturing sector, he said that it has leads to decreased demand for products which adversely affects manufacturers’ sales.
” As you would expect, the current inflationary condition in Nigeria is adversely affecting the operation of the manufacturing sector, just like most other sectors of the economy.
Some of the impacts of the rise in inflation on manufacturing include:
▪︎Increase in the cost of Production: Rising inflation often leads to higher costs of raw materials, labour, and other production inputs.
▪︎Reduced Profit Margin: As costs increase due to inflation, manufacturers might struggle to pass on these cost increases to consumers in the form of higher prices.
This results in reduced profit margins, especially as it is becoming more difficult to pass the burden to the consumers as a result of income squeeze leading to price resistance.
▪︎Supply Chain Disruptions: Inflation is disrupting supply chains, making it difficult for manufacturers to obtain necessary materials and components.
This will lead to delays in production and potentially halt operations as key supplies become scarce or unavailable.
▪︎Uncertainty in Planning: Inflation introduces a level of uncertainty in economic conditions. Manufacturers will continue to find it challenging to make long-term business plans due to unpredictable cost fluctuations, demand shifts, and overall economic instability.
▪︎Reduction of Consumer Spending: High inflation often reduces consumers’ purchasing power. As prices rise, consumers are cutting back on discretionary spending, including manufactured goods. “
Business
Filling Stations Selling Petrol, Diesel Higher Driven By Global Crude Prices
The development is expected to raise transportation costs and household expenses, while increasing operating costs for businesses that depend on fuel for logistics, power generation and other activities.
The surge in international crude oil prices above $100 per barrel is pushing up petrol prices across Nigeria.
While the government-owned filling stations operated by NNPC Limited have raised their pump price to N1,375 per litre from N1,275, some independent marketers have increased their prices to N1,400 from about N1,360 per litre.
For instance, MRS filling stations have increased their petrol price to N1,400 per litre from N1,300, representing a N100, or 7.7 per cent, increase in Lagos and its environs.
The latest increases followed the rise in the gantry price of petrol by Dangote Petroleum Refinery to N1,350 per litre, reflecting the impact of higher crude oil prices and rising costs across the petroleum supply chains.
The development is expected to raise transportation costs and household expenses, while increasing operating costs for businesses that depend on fuel for logistics, power generation and other activities.
Business
Obi Sees Something Good in Tinubu’s “Naira Float Policy ‘
The policy was introduced by the Tinubu administration in June 2023 as part of wider foreign exchange reforms.
The presidential candidate of the National Democratic Congress (NDC) for the 2027 election, Peter Obi, has said he would retain President Bola Ahmed Tinubu’s naira float policy if elected president.
The policy was introduced by the Tinubu administration in June 2023 as part of wider foreign exchange reforms.
The Central Bank of Nigeria removed restrictions at the Investors and Exporters foreign exchange window, allowing the naira to trade more freely against the dollar and other major currencies
Obi made the disclosure in a public statement on air, emphasising that his administration would seek to strengthen the currency by prioritising productivity and increasing economic output rather than reversing the floating exchange-rate framework.
Asked to identify one policy of the Tinubu administration he would keep if elected, Obi said, “There’s one – the floating of the Naira. I’m not going to defend it. But I’m going to put productivity to make it more valuable to the people.”
His position means he would maintain the floating exchange-rate system while seeking to change the economic conditions that determine the strength and value of the naira.
Business
Dangote Refinery Buys 16m Barrels Of Nigerian Crude For October
The October supply is equivalent to about 520,000 barrels per day, representing most of the refinery’s 700,000 barrels-per-day processing capacity.
Dangote Refinery has bought at least 16 million barrels of Nigerian crude oil for delivery in October.
Reuters reported that the 16 million barrels comprise monthly crude allocations from the Nigerian National Petroleum Company and additional volumes purchased through a tender.
The October supply is equivalent to about 520,000 barrels per day, representing most of the refinery’s 700,000 barrels-per-day processing capacity.
The increased crude purchases highlight the refinery’s rising demand for feedstock as it expands operations and moves closer to operating at a larger share of its installed capacity.
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