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Experts Warn Nigeria Over Imminent Global Recession

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Economic and financial experts have warned that Nigeria could face serious economic consequences if the global economy contracts into a recession, as predicted by the World Bank.
President of the World Bank Group, David Malpass told a United States business event recently that it was difficult to “see how we could avoid a recession.”
His comments are the latest warning over the rising risk that the world economy may be set to contract with the protraction of the ongoing Russia-Ukraine war.
“As we look at the global GDP… it’s hard right now to see how we avoid a recession.
“The idea of energy prices doubling is enough to trigger a recession by itself,” he said.
Last month, the World Bank cut its global economic growth forecast for this year by almost a full percentage point, to 3.2 per cent.
Malpass also said that many European countries were still too dependent on Russia for oil and gas.
That’s even as Western nations push ahead with plans to reduce their dependence on Russian energy.
He also told a virtual event organised by the US Chamber of Commerce that moves by Russia to cut gas supplies could cause a “substantial slowdown” in the region.
He said higher energy prices were already weighing on Germany, which is the biggest economy in Europe and the fourth largest in the world.
Developing countries are also being affected by shortages of fertiliser, food and energy, Mr Malpass said.
Also speaking in an interview with newsmen, the Chief Executive Officer, Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, said a global recession would have a catastrophic effect on Nigeria’s economy.
Yusuf said Nigeria was already dealing with challenging economic problems which would be further compounded by a contraction of the global economy.
“The impact of a global recession will obviously be very adverse. That means that the challenges that we are facing currently will get even worse because already, we are dealing with a lot of issues around inflation.
“We are dealing with a lot of problems around foreign exchange and macroeconomic issues generally, which are things that are driven by external factors.

“So, if you have a global recession, then we may see some effects on some of these things that may make those variables much more difficult.

“We have so many issues which are internal to us. So, when you combine those internal issues with these external variables or factors, you can imagine the impact it will have not just on the economy but on the lives of the citizens, on investments and so many other things. It’s not going to be palatable at all”, he said.

According to him, the war between Russia and Ukraine will continue to have far reaching consequences due to interests from foreign countries that have caused a ripple effect across the global economic space.

On the other hand, a professor of Economics at the Olabisi Onabanjo University, Prof Sheriffdeen Tella, said a global recession, particularly one driven by the energy crisis resulting from the Russia-Ukraine war, would spotlight Nigeria’s continuous inability to meet its global crude oil supply quota, as pegged by the Organisation of the Petroleum Exporting Countries.

He noted that a global recession, if prolonged over an extended period of time, could have serious consequences on the Nigerian economy.

“Actually, it is supposed to have a positive impact, but it didn’t have because we have no oil to sell. We are not producing to meet demand. What is meant by the global recession is that most of Europe depend on gas and oil from Russia. Since it is not forthcoming, the cost of things there has risen.

“So, consumers are likely going to demand less. When that happens, it also has many effects on developing countries. It is what we call the contingent effect.

“When you have a global recession. It affects consumption in those countries” he said.

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Firms Want Solar Integration In Renewable Energy

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Non-renewable energy firms, such as Chint Global, have proposed solar integration to solve energy challenges in Nigeria.
In an interview with The Tide’s source at the “Power & Water Nigeria Exhibition and Conference, 2022” in Lagos, the Country Manager of Chint Global for Nigeria,  Michael Chen, said Nigeria had been a major target for solar power distribution.
“Egypt has about 100 million people, but Nigeria has 200 million people. However, the power generation capacity of Egypt is about 60 gigawatts while Nigeria has 13 gb watts.
“So, the capacity of power generation in Egypt is about five times that of Nigeria. Nigeria has a 200 million population, and one of the biggest GDPs in Africa.
“This will make Nigeria a bigger market for electrical equipment. This is a good opportunity for marketing and a means to contribute to Nigeria with our professional equipment and services to make this country a better place,” he said.
Chen noted that Chint Global, which is into the four industry chains of power generation, storage, transmission, distribution, and utilisation, had contributed solar power to crucial parts of the country.
“As a priority in Nigeria, our 132 kV transformer is working in TC and grid power systems. From Lagos to Ibadan, all the people are using the Chint distribution”, he said.
In his part, the Director of Solar Centric Technologies and Vice President, Renewable Energy Association of Nigeria, Adetunji Iromini, stressed the urgency of solar power integration in Nigeria, stated that at “although we have pushed for some intervention programmes to fast track integration, the government is yet to come to the table.”
He also talked on the escalating costs of products like diesel, saying the government now knew that it needed to onboard distributed renewable energy into solving Nigeria’s energy problem.
“So RIAN as a body is at the forefront of engaging with the government on strategies to solve the power problems in the country,” he said.
Meanwhile, the Chief Com

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Fake Products Controversy: SON’s DG Lied – Customs

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Nigeria Customs Service (NCS) has described the allegation against it by the Director General of Standard Organisation of Nigeria (SON), as a fabrication.
Reacting to the allegation that customs was responsible for the influx of fake and substandard products into Nigerian markets, the Public Relations Officer of the NCS, Deputy Comptroller Timi Bomodi, said it was diversionary tactics.
In a press statement issued on Friday, Mr Bomodi said the statement by the SON DG, Mallam Farouk Salim, was a lie.
Bomodi stated that there is an existing open channel of communication between officials of SON and Customs Area Commands should the need arise for clarifications or interventions and that its officials usually partake in examinations.
“We want to state that the allegations are untrue. The Nigeria Customs Service is fully cognizant that strategic cooperation among security and regulatory agencies lies at the heart of national security, and willfully works in tandem with other security and regulatory agencies, including SON, to achieve national goals.
“Under the Nigeria Integrated Customs Information System (NICIS II), SON and other regulatory agencies of government are linked directly and frequently make inputs in reference to items of significance to their operations.
“At no time has NCS refused to oblige them with any request. Indeed the Nigeria Customs Service even without intervention from SON on its own directs suspicious items bordering on brand and intellectual property rights infringements to them.
“SON has access to our systems, are informed and fully participates in examinations and even go as far as collecting product samples, where necessary, during examinations for their investigations.
“Even the field inspection process chart on the SON official website shows the involvement of SON at the ports and borders during examinations.
“Therefore, this statement ascribed to the DG creates a totally false narrative and is viewed as an attempt to portray the NCS in a negative light.
“It is questionable, raises serious concerns and calls for scrutiny by discerning members of the public. It is also self-condemning, regrettable and exposes SON as being incapable of living up to its mandate.
“If after issuing certificates, participating in examinations, taking samples for further investigations and authorizing release to the NCS, substandard goods find their way into the open market the DG SON should look inwards.
“While success is said to breed opposition, the success of the NCS is not achieved by tarnishing the image of another agency just to look good or score cheap points. Our nation at this time needs every security and regulatory agency to trust and work as a team for our socio-economic wellbeing.
“We urge the DG SON and his agency not to be self-seeking, leave the path of rivalry and collaborate towards achieving national interest”, Bomodi said
While fielding questions from journalists in Lagos, the SON DG was asked how fake and substandard products find their way into Nigerian markets despite his men partaking in joint cargo examinations with the customs.

By: Nkpemenyie Mcdominic, Lagos

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Nigeria Loses N500.6bn Over Crude Oil Sale

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Findings from various oil and gas and statistical reports have indicated that Nigeria lost about N500.6 billion from the sale of crude oil between January and May, 2022.
The Tide’s source gathered that the crash in revenue was due to the slump in the country’s oil production, which slided by 11.63 million barrels during the period under review.
The source stated that data obtained from different reports of the Organisation of Petroleum Exporting Countries (OPEC) showed that Nigeria produced 1.399 million barrels of crude oil daily in January, which translates to 43.369 million barrels in the entire month.
Production, however, slumped to 1.024 million barrels per day in May, according to crude oil production figures, based on direct communication, indicating a total production of 31.744 million barrels in May 2022, according to OPEC’s reports.
The difference between January and May figures implies that Nigeria’s oil production crashed by 11.63 million barrels within the five-month period.
Data from Statistica, a globally renowned statistical firm, on the monetary value of the lost oil volumes, also showed that Nigeria had been losing billions of naira monthly due to the persistent plunge in its oil production.
Also, industry figures obtained from Statistica showed that in January, February, March, April and May 2022, the average prices of Brent, the global benchmark for crude, were $86.51/barrel, $97.13/barrel, $117.25/barrel, $104.58/barrel and $113.34/barrel respectively.
This gives an overall average of $103.76/barrel for crude oil during the five-month period.
With an overall average of $103.76/barrel and 11.63 million barrels of crude lost between January and May, it implies that Nigeria’s oil revenue crashed by $1.21bn (N500.6bn at the official exchange rate of N415/$) during the period under review.
The source further revealed an indication that Nigeria’s oil production kept moving southwards since January, 2022.
This is  according to figures from OPEC reports, which showed that while the country produced 1.399 million barrels per day in January, production crashed to 1.258 million barrels per day in February.
The oil production plunge continued in March, as it dropped 1.238 million barrels per day and further went down to 1.219 million barrels per day in April, with the worst plunge being recorded in May, as the country’s oil production slumped to 1.024 million barrels per day, based on crude oil production figures obtained through direct communication by OPEC.

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