Category: Business

The volume of activities on the floor of the Nigerian Exchange on Thursday increased by 543.4% following huge investments in the shares of FBNHoldings, FCMB, AccessCorp Japaul Gold and others.

The volume of transactions rose by 4.596 billion, representing 543.14% as investors traded 5.443 billion shares valued at N95.005 billion in 9948 deals against 846.323 million shares worth N10.305 billion in 9815 deals.

Also, market capitalisation of listed equities also increased by N270 billion, indicating growth of 0.81 per cent to N33.770 trillion from N33.500 trillion reported the previous day.

The NGX All Share Index also appreciated by 496.31 basis points to 62019.88 points from 61523.57 reported on Wednesday.

An analysis of the investment showed that five listed companies recorded 10 per cent gain at the close of transactions on Thursday. Learn Africa, Union Bank of Nigeria, Conoil Plc, MRS and Eterna Plc gained 10 per cent each to close at N3.52 per share, N8.25, N102.30 per unit, N91.30 and N25.85 per share respectively.

On the contrary, Wapic Insurance topped losers chart, declining by 9.59 per cent to N0.66 per share, UPDC trailed with a loss of 9.24 per cent to N1.08 per unit, International Energy Insurance dipped by 9.09 per cent to close at N1.30 per unit, Chellaram down by 8.90 per cent to close at N1.33 per shares, HoneyWell Flour fell by 7.46 per cent to close at N3.35 per unit.

Transactions in the shares of FBNHoldings led market activity with 4.691 billion shares valued at N87.808 billion,, FCMB group followed with account of 126.766 million shares worth N744.090 million, AccessCorp traded 56.481 million shares cost N1.018 billion, Japaul Gold traded 55.246 million shares cost N55.775 million while Transnational Corporation of Nigeria exchanged 49.184 million shares valued at N185.758 million.

As reactions continue to trail the Executive Orders signed by President Bola Ahmed Tinubu on Thursday, a Don of Finance and the Capital Market at the Nasarawa State University, Prof. Uche Uwaleke, has said the President’s action would improve Nigeria’s business environment.

In an exclusive the NIGERIAN ANCHOR, also said it would moderate the country’s rising inflation.

Nigeria’s inflation figures currently stand at 22.41% with the World Bank’s Nigerian Development Update report projecting that the rates may hit 25% by the end of 2023.

Analysts have also said severally that the ease of doing business in Nigeria was stifling ventures, especially SMEs.

“The recently signed Executive Orders represent a welcome development as they will no doubt enhance the business environment and consequently improve the country’s ranking in the Ease of Doing Business.

“The suspension of the proposed import tax adjustment levy on certain vehicles and the Excise tax on telecommunications and other locally manufactured products will help to moderate the rising inflation and increase productivity.

“Also, the Finance Act Variation Order 2023 is equal in order to enable taxpayers to adjust to the new provisions in line with the National Tax Policy,” Uwaleke said.

The Don also called for the immediate rollout of palliatives to ease the pains being experienced by Nigerians since fuel subsidy was pronounced ‘gone’ by President Tinubu.

“Much as these developments will help moderate rising inflation, more measures with direct impact on the population need to be put in place in order to significantly ameliorate the adverse consequences of the fuel subsidy removal. These should include the immediate rollout of palliatives promised by the government,” he added.

President Bola Tinubu has suspended the 5 percent excise duty on telecommunication services as well as the excise duties escalation on locally manufactured products.

This is contained in four Executive Orders signed Thursday in Abuja.

The four EO is part of President Tinubu’s pledge to address unfriendly fiscal policy measures and multiplicity of taxes that hamper business growth.

According to the Special Adviser to the President on Special Duties, Communications and Strategy, Dele Alake at a press briefing at the State House further disclosed that President Tinubu also signed the Finance Act (Effective Date Variation) Order, 2023, which now defers the commencement date of the changes contained in the Act from May 23, 2023 to September 1, 2023.

According to the presidential spokesman, this is to ensure adherence to the 90 days’ minimum advance notice for tax changes as contained in the 2017 National Tax Policy.

President Tinubu also signed The Customs, Excise Tariff (Variation) Amendment Order, 2023, shifting the commencement date of the tax changes from March 27, 2023 to August 1, 2023 and also in line with the National Tax Policy.

Tinubu also ordered the suspension of the newly introduced Green Tax by way of Excise Tax on Single-Use Plastics, including plastic containers and bottles as well as the suspension of Import Tax Adjustment levy on certain vehicles.

Alake equally explained that the President issued these orders to ameliorate the negative impacts of the tax adjustments on businesses and chokehold on households across affected sectors.

He however reiterated the President’s commitment to reviewing complaints about multiple taxation, local and anti-business inhibitions.

He also noted that President Tinubu’s administration will, therefore, continue to give requisite stimulus by way of friendly policies to allow businesses to flourish in the country.

The President assured Nigerians that there will not be further tax raise without robust and wide consultations undertaken within the context of a coherent fiscal policy framework.

Russia has increased its crude oil sales through Africa following sanctions from Western nations.

Russia’s refined product exports to Africa have skyrocketed since the invasion of Ukraine, increasing 14-fold in just over a year, following a diplomatic onslaught on the continent by Russian officials.

Prior to the war, Russia exported 33,000 b/d of refined products to Africa, much of it gasoline and by March 2023, that had soared to 420,000 b/d, illustrating the geopolitics at play, shipments to countries such as Nigeria, Tunisia, and Libya jumped sharply in February, when the European Union placed an embargo on Russian products.

The embargo followed independent decisions from many Western countries to halt imports of Russian oil.

These sanctions have forced Russia to redirect significant oil export volumes to alternative markets, including Africa. India, China, and Turkey are also becoming increasingly important export markets.

Experts say a new “scramble for Africa” has gathered pace since the invasion began early last year, with Russia, China, the US, Turkey, Gulf states, and former colonial powers Britain and France all vying for influence on the world’s fastest-growing continent.

Sergei Lavrov, Russia’s foreign minister, visited seven African countries in the space of a month last year in a bid to firm up ties with key countries and open up new markets for Russian oil products, independent Russia analyst Timur Kulakhmetov told S&P Global Commodity Insights.

Meanwhile, Russian mercenaries with the Wagner Group have provided security for African rulers in return for lucrative mining contracts, and Russian energy companies have eyed investments on the continent. At the United Nations General Assembly in March, 22 African countries refused to condemn Vladimir Putin’s full-scale invasion.

Perhaps the clearest evidence of strengthened ties is in Russian refined product exports since an EU embargo on imports of most Russian oil products came into force Feb. 5. A G7, EU, and Australia price cap of $100/b on Russian products that typically trade at a premium to crude including gasoline and gasoil was introduced at the same time.

This left Moscow “struggling to keep a foothold in the raw materials ladder, by seeking new markets for commodity exports,” Kulakhmetov said.

A lower price cap of $45/b on petroleum products traded at a discount to crude oil came into force on the same date.

Although Russian refined product flows dipped slightly after the February 2022 invasion, they reached a seven-year high of 1.9 million b/d in March 2023.

And while shipments to European countries, like France and Belgium, have cratered in recent months, shipments to African countries—particularly northerly ones—have skyrocketed, particularly after the EU embargo on product imports came into force.

Russia was “a key product supplier to the European market before sanctions, especially of diesel, fuel oil, and naphtha,” said Rebeka Foley, senior analyst of near-term oil markets, at S&P Global.

“But the market has re-balanced—in light of sanctions, more Russian diesel has been heading to Africa, Turkey, the Middle East, and Latin America.”

In the first quarter of 2022, Tunisia imported just 2,700 b/d of Russian products, but that rose to 66,300 b/d in Q1 of this year, according to S&P Global Commodities at Sea data, while Nigeria—Africa’s biggest oil producer and most populous nation—saw imports rise almost five-fold year on year to 57,400 b/d in Q1 2023.

Morocco, Libya, and Egypt have also recorded huge rises in Russian imports. “[Lavrov’s] flurry of diplomatic activity makes it abundantly clear. These steps are about Russia seeking alternative routes for their commodity exports,” Kulakhmetov added. “Therefore, North African states are playing a significant role for Russia in mitigating implications of oil and oil product ban.”

At the heart of the new flows is Litasco, the Geneva-based trading arm of Russian oil company Lukoil, which has been active in Africa for decades. Western-owned Vitol and Guvnor have also continued shipping Russian products. In addition, trading entities in the UAE, Hong Kong, and Singapore have sprung up in recent months.

The reorientation of product flows has been aided by falling imports into Africa of Dutch gasoline after regulators in the Netherlands imposed new rules on sulfur, benzene, and manganese content for fuel exports. In turn, some African countries—such as Morocco—have seen their own refined products exports increase, fueling accusations they have been re-exporting Russian products to Europe. “African recipients of Russian fossil fuels have blended them with other oil products and re-exported them to other states, primarily to Europe,” said Kulakhmetov.

Pre-war, Morocco did not export gasoline, gasoil, or naphtha, but in 2023 it supplied fairly large quantities to Europe. Morocco is reportedly the only African country to have supplied weapons to Ukraine. In June, the North African country shipped 61,400 b/d to Spain, according to the data.

The true numbers could be even higher amid surging dark ship-to-ship transfers.

An investigation by S&P Global Market Intelligence found a 225% increase globally in the shadowy practice of ships switching off their automatic identification systems, which track shipments of oil, since before Russia was sanctioned.

“Russia has managed to find new markets for its key refined product exports, and these new trade flows are structural changes to the market that are here to stay,” said Foley, although she cautioned, “Since the sanctions began, the marketplace has certainly become murkier and harder to track.”