Business
Foreign Capital Imports in Nigeria drop by 78%
The National Bureau of Statistics of Nigeria, or NBS, has reported at the start of September that the value of Nigeria’s capital imports fell to $1.29 billion. This means that there is an active decline of 77.88 percent in the value. This is especially troublesome considering the fact that during the first quarter of 2020 the capital import used to be $5.85 billion.
This means that cumulatively, on a year-to-year basis, the drop amounted to a whopping 78.60 percent from what it used to be in the second financial quarter of 2019 ($6.05 billion).
It is no secret that this large decline is largely attributed to the ongoing novel coronavirus pandemic which is currently plaguing the world. Nigeria is not the only country that has been affected by the global problem. Almost every other country in the world is having financial problems with global economies like the US and UK shrinking by 20%. In Nigeria during the period between April and June the Foreign Direct Investment, or FDI, calculated in equities and other capital, has fallen by 30.65 percent on a quarterly and by 33.41 percent on yearly basis. The current number is sitting at $148.59 million. According to NDS, the FDI accounts for almost 12 percent of the total capital that has been imported in the second quarter of 2020. One of the leading causes is portfolio investment (equities, bonds, foreign exchange market, etc). These investments accumulate to 29.76 percent of the total inflow of foreign money. This unit has fallen by an incredible 91.06 percent just between the first and second quarters of 2020 to $385.32 million.
Major capital investment contributor is classified under “other investment” and comprises trade credits, currency deposits, loans, etc. The statistics show that these types of investments account for as much as 58.77 percent of total imported capital or $761.03 million. The decline here is also quite visible as there is a drop of 42.81 percent on quarter to quarter and 48.60 percent on yearly basis.
According to the report made by the NDS, during these times of crisis, Great Britain has become a major capital investor of Nigeria in the second quarter where the inflow of money shows $428.83 million. This is 33.12 percent of the total capital inflow in the second quarter of 2020.
The largest capital importing state is still considered to be Lagos with $1.13 billion or 87.30 percent of the total capital inflow in Q2 of 2020 closely followed by the states of Abuja and Ogun in second and third positions. However, the difference of capital investment here is quite troubling since Abuja has only $145.30 million and the Ogur state is netting $11 million which are 11.20 percent and 0.85 percent of the capital importing total.
The foreign exchange market (Forex, FX) in Nigeria is starting to boom though. Due to the novel coronavirus which has left a huge number of residents unemployed and others locked up in their own homes the number of people who started researching additional ways to generate income has increased by a significant amount. Forex has proved to be a useful instrument in this battle against unemployment. The educational material is freely available online, so it isn’t far from reality that anyone with a decent computer, smartphone, or even a tablet could go through some materials over the internet.
Choosing a proper, licensed broker is also quite an endeavor. However, it is made easier due to the efforts of regulatory bodies that work hard on licensing these firms which afterward have the ability to offer reliable services. If you’re a trader, you can read online forex reviews here to choose your desired broker, test the waters with a demo account, invest, and start trading currency pairs. It is a unique opportunity for people living in developing countries that do not have enough finances to manage the Coronavirus pandemic. This has been successfully done by countries like South Africa, which has introduced its own regulatory body – Financial Services Conduct Authority (FSCA) – that managed to put the country on the global playfield with the South African rand now becoming the 18th most traded currency on Forex globally.
The reason FX is profitable now is because of the Nigerian naira pushing the limits. The currency has become stronger during the last couple of months (everything is comparable) but this can be largely attributed to the fact that the decrease in imports leaves more focus on exports which directly translates to the strengthening of the local currency. However, the margin at which it strengthened leaves something to desire more. Unfortunately, the Nigerian naira has been devaluing for a very long time now and unless something changes in the inner politics of the nation it is not going to improve. The devaluation happens due to the oil prices jumping around constantly. Nigeria is extremely dependent on the crude price. This has gone to the extent where there are multiple exchange rate policies for naira. Currently, it is sitting around N381 which is a 21 point increase from what it used to be prior to the lockdown.
Business
Wigwe’s Luxury Yacht Goes For N8.74 Billion After Legal Proceedings
The daughter of late Nigerian banking executive, Herbert Wigwe has sold her father’s luxury yacht for $6.5 million which is the equivalent of N8.74 Billion following legal proceedings involving her, Otutochi Wigwe, and the company holding the vessel, Grosvenor Marine Ventures Limited.
This was contained in an online report obtained by The Tide Source in Port Harcourt recently.
The Source further clarified that $6. 5 Million dollars or N8.74 Billion was the asking price as at March this year but was unable to prove, if the said amount was exactly what the vessel went for.
The yacht, known as Chitochi, is a 2016 Custom Line 108 superyacht measuring approximately 33 metres (108 feet) in length. The transaction was handled by international yacht brokerage firm IYC, with its sales and charter consultant, Mark Elliott, overseeing the sale.
The disposal of the high-value vessel followed legal steps taken to address the corporate status of Grosvenor Marine Ventures Ltd., the company through which the yacht was held.
Otutochi Wigwe reportedly approached a court in the British Virgin Islands (BVI) to secure the restoration of the company to the corporate register, a move that enabled the necessary legal steps towards the sale of the vessel.
The proceedings were central to resolving the corporate issues affecting the company and facilitating the transaction, underscoring the legal complexities that may arise when valuable assets are held through corporate entities in foreign jurisdictions.
The sale is also significant in the context of estate administration, as luxury yachts require substantial financial commitments to maintain, even when they are no longer actively used by their owners or beneficiaries.
Such vessels typically attract considerable expenses, including crew salaries, insurance premiums, berthing charges, routine servicing and other maintenance costs, making their continued ownership a major financial responsibility.
Beyond the recurring expenses, luxury yachts are depreciating assets that may lose value over time. Their disposal can therefore form part of a strategy to preserve estate value, reduce liabilities and convert an expensive asset into liquid funds.
Wigwe, who was the former Group Chief Executive Officer of Access Holdings, died on February 9, 2024, in a helicopter crash in California, United States, alongside his wife, Chizoba; their son, Chizi; and former Nigerian Exchange Group chairman, Abimbola Ogunbanjo.
His death was widely mourned across Nigeria’s banking and business communities, where he was recognised for his contributions to the financial services industry, entrepreneurship and philanthropy.
Wigwe’s passing left behind an estate whose administration involves the management of assets and other financial interests, a process that can require legal and financial decisions to protect the interests of the estate and its beneficiaries.
The sale of Chitochi highlights the challenges associated with managing high-value assets held through corporate structures, particularly where the relevant companies and legal proceedings fall under different jurisdictions.
The $6.5 million transaction brings the yacht’s ownership chapter to a close while illustrating how legal procedures, financial considerations and estate management can intersect in the administration of the assets of a prominent business figure.
‘’We determined to get all our equipments and machinery functioning as we progress. For now we’ve about 105 workers, comprising daily paid harvesters and regular staffs. But aside these 105 staffs we also employ daily slashers who for now are about 100.
“During peak periods, hopefully on or before January 2026 we hope to increase our work force for maximum production”, the firm’s management Stated.
King Onunwor
Business
Firm Mulls Crash Down On Vegetable Oil Price …Targets Revenue Boost, Job Creation
Ariwera Ibibo-Howells, Yenagoa
Business
Traders Decry Continuous Increase In Prices Of Foodstuffs
Some traders at the Rumuwoji Market popularly known as Mile 1 Market have decried the continuous increase in the prices of food stuffs and other items in the ember season.
This was made known by the traders when The Tide visited the market recently.
The traders revealed varying changes in the prices of foodstuffs, with some commodities recording higher increase than others .
A trader Mrs Charity Obinna, at the market, said the price of yam remained the same last week and this week compared to the prices from last month to this month, adding that only a difference of about N100 to N200 was seen.
Another trader, Chukwuebuka Livinus who deals on garri, reported that the prices of some food commodities had been changing frequently.
According to him, the price of a bag of garri increased from N45,000 last week to N58,000 this week, representing an increase of N13,000.
Livinus described the increase as scary and called on the government to do something about it, especially as we get closer to the festive period.
A trader that deals on vegetables, Mrs Joy reported that a significant increase in the prices of pepper rose from N20,000 last week to N40,000 this week.
Similarly, the price of a bag of melon (egusi) increased from N420,000 toN490,000 this week.
In a separate report, Mrs Charity Obinna said that foodstuffs were generally cheaper last month than this month, with price differences ranging from N150 to N200 for some items.
Meanwhile, Giff Okoro reported a decrease in the price of tomatoes. According to her, a quantity of tomatoes that cost N45,000 last month now sells for N25,000, indicating a reduction of N20,000.
Another trader, Usman Ibrahim said the cost of transporting goods from the communities to urban areas where they are sold is one of the major reasons for high cost of goods.
He said transport cost has doubled due to the cost of petroleum products in Nigeria, adding the whole cost is part of the goods because “entrepreneurs must cover their cost and make their gains .
Ibrahim called on the government to help farmers and traders even with little capitals to expand and sustain their business.
Another trader, Mrs Choice Promise a fish retailer said a cartoon which sold at #35,000 last week now sells at #50,000 .
Promise complained that there is no gain or profit because the price has drastically increase and most people cannot afford to buy fish again.
“Mr. President’s Renewed Hope Agenda recognizes that economic ambition requires dependable infrastructure,” Tegbe said.
He added that investments in electricity infrastructure would strengthen the foundations for business expansion, employment and economic growth.
The Kankia substations comprise two 60 MVA, 132/33 kilovolt (kV) facilities designed to strengthen the transmission network serving Katsina State and neighbouring areas.
Tegbe said the infrastructure would improve the network’s ability to distribute available electricity, supporting commercial activities and household welfare.
He also urged residents to protect the facilities against vandalism and other activities that could disrupt electricity infrastructure, asking them to report suspicious activities to TCN or security agencies.
Katsina State Governor, Dikko Umaru Radda, described the project as a significant investment in the state’s electricity infrastructure.
Radda stated that improved electricity supply could support industrial development, economic growth and public service delivery.
He further commended the President, the Federal Ministry of Power and TCN for completing the project.
It would be noted that the latest projects come amid a broader government’s drive to address bottlenecks in Nigeria’s electricity transmission network, which has constrained the amount of electricity that can be delivered to distribution companies and end users.
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