Business
Eurozone Economy Grows By 0.1% …As Germany Disappoints
The 16 countries that use the euro barely grew in the fourth quarter, as a modest recovery stalled amid turmoil in financially troubled members such as Greece and a disappointingly flat performance from Germany, the biggest euro economy.
The figures lagged well behind fourth-quarter growth in the United States and raised concerns that Europe could slip back into recession as government stimulus efforts expire and the continent struggles with a government debt crisis in some countries.
Eurozone gross domestic product grew by only 0.1 percent in the last three months of 2009 from the previous three-month period, EU statistics agency Eurostat said Friday.
Export powerhouse Germany turned in zero growth as consumption levels remained weak, reinforcing analysts’ thinking that sustained growth in Europe will have to wait until household spending picks up decisively.
The eurozone growth figure fell short of expectations for a 0.4 percent increase and stoked worries the eurozone may dip back into recession.
The euro took a further battering for the euro on currency markets. By late morning London time, the euro was trading at near nine-month lows $1.3535, a full cent lower than where it was when the German figures came out.
‘On Friday, data shows that the recovery in the euro area is a long way off from being self-sustained,” said Jorg Radeke, an economist at the Centre for Economic and Business Research.
The third quarter increase of 0.4 percent had encouraged hopes that the eurozone recoveiy wuulu be solid, especially as U.S. growth spiked sharply higher, it was up a quarterly 1.4 percent -during the period and China continues to grow strongly.
However, the recovery in the third quarter now appears likely to have been due to temporary factors like government spending boosts, a build-up in inventory levels and car scrappage schemes that pay people to trade in old cars, particularly in Germany.
A real concern in the markets now is that upcoming austerity programs in places like Greece, Spain, Portugal and Ireland will continue to depress activity in those countries and further undermine the overall eurozone recovery.
“Given the state of the public finances across many euro member states, fiscal tightening may be too early in many of those countries struggling to maintain growth,” said Radeke from the Centre for Business and Economic Research.
The Eurostat figures clearly showed that the countries most affected by the debt crisis are struggling.
Greece, which is in the midst of a debt crisis that made EU leaders to pledge support on Thursday, saw its output shrink by 0.8 percent. Portugal’s output was unchanged following two solid quarterly increases, and Spain’s economy contracted by a further 0.1 percent as it continues to suffer from its property market collapse and near 20 percent unemployment levels.
The third quarter recovery in Italy also proved to be short-lived as the eurozone’s third largest economy shrank by 0.2 percent during the period.
France, the eurozone’s second-largest economy, appears to have been the main reason behind the overall rise in the fourth quarter in the eurozone, as it posted a respectable 0.6 percent increase in output.
The fourth quarter figures cap a miserable economic year — for 2009 as a whole, the eurozone economy, which includes around 330 million people, contracted by a massive 4 percent.
Though most economists as well as the European Central Bank expect growth this year, it’s unlikely to be remarkable, especially as there are signs of underlying weakness in France — much of the growth there in the fourth quarter was due to car sales, which were boosted by the upcoming scaling back of the car scrappage scheme at the end of the year.
“An anaemic core and a deflating periphery point to weak eurozone GDP growth this year,” said Michael Taylor, an economist at Lombard Street Research.
As if further proof were needed that the euro area recovery is not going to plan, separate Eurostat figures showed that industrial production plunged 1.7 percent in December from the previous month.
The wider 27-country ED, which includes non-euro members such as Britain and Sweden as well as east European countries including Poland and Hungary, saw fourth quarter GDP rise by 0.1 percent, the same as the eurozone.
A trade research report has indicated that Nigeria and 12 other countries will be responsible for the driving of the global trade to the tune of $30 trillion by the year 2030.
The research, which was commissioned by Standard Chartered and prepared by PwC Singapore posited that Nigeria and 12 other countries would be responsible for driving global trade to $30tn by 2030.
According to the report sponsored by the Singaporean organisation, the global exports would be more than double from $17.4tn to $29.7tn over the next decade, while much of the growth would be driven by 13 markets.
It said Nigeria would be growing at an annual rate of 9.7 per cent, with about $112bn in exports by 2030, through key corridors such as India, Indonesia and Mainland China.
It also stated that Kenya, the second African nation on the list, would be growing by 7.6 per cent annually, with $10bn in exports by 2030 through key corridors namely, Pakistan, Uganda and the United States of America.
The list consists mostly of Asian countries with Mainland China contributing the most at $5.02tn by 2030 and growing at 7.1 per cent annually.
Other countries are Hong Kong ($939bn, 5.7 per cent), South Korea ($972bn, 7.1 per cent), and India ($564bn, 7.6 per cent).
Bangladesh, Singapore, United Arab Emirates, Indonesia, Malaysia, Vietnam, and Saudi Arabia also featured in the report.
The report is based on an analysis of historical trade data and projections until 2030, as well as insights from a survey of more than 500 C-suite and senior leaders in global companies.
According to the report, global trade will be reshaped by five key trends: the wider adoption of sustainable and fair-trade practices, a push for more inclusive participation, greater risk diversification, more digitisation and a rebalancing towards high-growth emerging markets.
It said almost 90 per cent of the corporate leaders surveyed agreed that these trends would be shaping the future of trade and would be forming part of their five to 10-year cross-border expansion strategies.
The research also found a significant trend towards the adoption of sustainable trade practices in response to climate concerns and a rising wave of conscious consumerism.
It said while almost 90 per cent of corporate leaders acknowledged the need to implement these practices across their supply chains, only 34 per cent ranked it as a ‘top three’ priority for execution over the next five to 10 years.
By: Corlins Walter
The currency in circulation in the country rose by N129bn to N2.97tn in October from N2.84tn in September, according to the figures from the Central Bank of Nigeria (CBN).
The currency in circulation had fallen to N2.78tn in August from N2.81tn in July.
It stood at N2.74tn in June, N2.79tn in May, N2.79tn in April, N2.8tn in March, N2.78tn in February and N2.83tn in January.
The CBN said, “The currency in circulation increased by N465.47bn or 19.06 per cent to N2.91tn in 2020, compared with N2.44tn in 2019.
“In 2020, there were higher withdrawals by DMBs than deposits, due to the panic need to hold cash to deal with the emergencies and reduced banking hours due to restrictions to curb spread of the pandemic”.
The apex bank said to maintain public confidence and ensure integrity of circulated notes in the economy, it developed and unveiled a clean note policy and banknote fitness guidelines in 2018.
The guidelines outlined details of quarterly and yearly activities towards the achievement of this objective.
According to the CBN, the clean note policy encapsulates diverse currency management activities to preserve the integrity and maintain the quality of banknotes in circulation.
The policy provides that every newly printed and existing banknotes should conform to predefined standards before circulation and re-circulation in the economy.
Currency in circulation is defined as currency outside the vaults of the central bank – that is, all legal tender currency in the hands of the general public and in the vaults of the deposit money banks.
The CBN said it employed the “accounting/statistical/withdrawals and deposits approach” to compute the currency in circulation in the country.
It said this approach involved tracking the movements in currency in circulation on a transaction-by-transaction basis.
According to the CBN, for every withdrawal made by a DMB at one of CBN’s branches, an increase in CIC is recorded; and for every deposit made by a DMB at one of CBN’s branches, a decrease in CIC is recorded.
The transactions are all recorded in the CBN’s CIC account, and the balance on the account at any point in time represented the country’s currency in circulation.
Barely four weeks after its launch in October, the eNaira app of the Central Bank of Nigeria (CBN) has witnessed about 600,000 downloads.
The CBN Governor, Godwin Emefiele, who disclosed this in a statement at the weekend, said, “In less than four weeks since its launch, almost 600,000 downloads of the e-Naira application have taken place.
“Efforts are ongoing to encourage faster adoption of the e-Naira by Nigerians who do not have smart phones.
“The support of the financial industry will be critical in the ongoing deployment of the e-Naira and efforts are ongoing to encourage continued partnership between the CBN and stakeholders in the financial industry”.
The CBN governor also said that building a robust payment system that would provide cheap, efficient, and faster means of conducting payments for most Nigerians have always been the focus of the apex bank.
According to him, the growing pace of digitization globally makes it essential that they leverage on digital channels in fulfilling this objective.
Emefiele disclosed that total transaction volumes using digital channels were more than doubled between 2018 and 2020, as volumes rose from 1.3 billion to over 3.3 billion financial transactions in 2020.
He added that digital payment channels also helped to support continued conduct of business activities during the lockdown.
The CBN boss noted that the robust payment system has continued to evolve towards meeting the needs of households and businesses in Nigeria. This, according to him, reflects the confidence people have in the payment system.
He said that between 2015 and September 2021, about US$900 million has been invested in firms being run by Nigerian founders.
“Notwithstanding these gains, close to 36 per cent of adult Nigerians do not have access to financial services.
“Improving access to finance for individuals and businesses through digital channels can help to improve financial inclusion, lower the cost of transactions, and increase the flow of credit to households and businesses,’’ Emefiele added.
-
Business5 days ago‘Renewable Energy, Pathway To Revamp Economy’
-
News5 days agoAgriculture Reduces Nigeria’s Dependence On Oil Sector, FG Admits
-
Sports5 days ago2021/2022 NPFL Season Starts, Dec 17
-
Politics2 days ago
Shehu Explains Buhari’s Controversial Tweet On Biafra
-
Sports5 days agoUS-Based Okorie Plans Maiden South-East Sports Festival
-
Business5 days agoEFCC Blames Frauds In Banking Sector On Insiders
-
Sports5 days agoCAFCC: Enyimba Storms Tunisia With Depleted Squad
-
Business5 days agoSEC Frowns At Resurgence Of Ponzi Schemes