FG appoints new team to head SEC, markets are indifferent
As foreign investors dump Nigerian stocks and the naira seems to be in a free fall, the FGN has made some changes to the leadership of the Securities and Exchange Commission (SEC). The FGN nominated a new leadership team for SEC led by Lamido Yuguda. Reginald C Karausa, Ibrahim D Boyi, and Obi Joseph were nominated as new executive commissioners of the SEC. Nigeria’s stock market has been wobbling and it is expected that a firm hand at the capital market regulatory board will help stem the tide. Given the uncertainties in the financial market, the stability in the corporate governance will boost investor’s confidence in the bourse.
FEC cuts 2020 Budget to N10.523 trillion – Can Nigeria dodge the recession bullet
The Federal Executive Council (FEC) reviewed downwards the 2020 budget by N71.5 billion (0.67%) to N10.523trillion. Other adjustments to the budget include a 38.67% cut in revenue to N5.158trillion which resulted in a widening of the fiscal deficit to N5.365trillion. It also maintained an exchange rate of N360/$.
In addition, the bearish trend in oil prices necessitated a third review of the oil benchmark price. Even with Brent currently trading at $34.81pb above the new benchmark of $25pb, the risks of a further fall in oil prices prevent a premature celebration. The risk of poor implementation is now higher for the 2020 budget due to the uncertainties surrounding the global economy and oil markets.
The Poverty and Hunger Virus that predates Covid
According to the NBS, 40.1% of Nigerians live below a national poverty line of N137, 430 ($305) per annum. This simply means that 82.9million Nigerians survive on less than $1per day. More disturbing is the fact that the income distribution shows that poverty in rural areas (52.1%) is nearly three times that of urban centres (18%). Whilst the attention of global policy makers is currently on an unseen virus, Nigerian policy makers must not neglect the glaring virus (poverty) that has been around long before Covid and is sure to remain in a post-pandemic Nigeria.
In this edition of the FDC Monthly publication, the FDC Think-Tank analyzes these issues and their implications on businesses and the economy at large.
Enjoy your read!