- After two consecutive quarters of negative growth, the non-oil economy showed, in Q3 2016, a modest return to positive territory, at 0.03%. This was partly due to the continued good performance of agriculture and the solid minerals, two sectors prioritised by the Federal Government. Agriculture grew by 4.54% in the quarter under consideration of which growth in crop production at nearly 5% was at its highest since the first quarter of 2014. Growth in the solid mineral sector averaged about 7%.
- The Anchor Borrowers Programme (ABP) of the Central Bank of Nigeria (details below), combined with a new soil map designed to aid fertilizer application, substantially raised local production of grains in 2016 (yields improved from 2 tonnes per hectare to as much as 7 tonnes per hectare, in some States) and produced a model agricultural collaboration between Lagos and Kebbi States.
- The Fertilizer Intervention Project (which involves a partnership with the Government of Morocco, for the supply of phosphate) is on course to significantly raise local production, and bring the retail price of fertilizer down by about 30 percent. (Details in a future edition of the newsletter).
- The newly established Development Bank of Nigeria (DBN) is finally taking off, with initial funding of US$1.3bn (provided by the World Bank, German Development Bank, the African Development Bank and Agence Française de Development) to provide medium and long-term loans to MSMEs
- A new Social Housing Programme is kicking off in 2017. The ‘Family Homes Fund’ will take off with a 100 billion naira provision in the 2017 Budget. (The rest of the funding will come from the private sector)
- More than 800 billion naira has been released for capital expenditure in the 2016 budget, since implementation started in June 2016. This is the largest ever capital spend within a single budget year in the history of Nigeria. These monies have enabled the resumption of work on several stalled projects — road, rail and power projects — across the country
- All 4 components of the Social Investment Programme (SIP) have now taken off. The SIP is the largest and most ambitious social safety net programme in the history of Nigeria, with more than 1 million beneficiaries so far — 200,000 N-Power beneficiaries, 23,400 Government Enterprise and Empowerment (GEEP) Scheme beneficiaries, 1,000,000 Homegrown School Feeding Programme (HGSFP) beneficiaries, as well as ongoing Conditional Cash Transfer (CCT) payments across nine pilot states.
- Strategic Engagements with OPEC and in the Niger Delta have played an important part in raising our expected oil revenues. Already, Nigeria’s External Reserves have grown by more than $4 billion in the last three months.
- Collaboration with China, proceeding from President Buhari’s April 2016 visit, has unlocked billion of dollars in infrastructure funding. Construction will begin on the first product of that collaboration, a 150km/hour rail line between Lagos and Ibadan, in Q1 2017.
- The National Economic Recovery and Growth Plan (NERGP), the Federal Government’s medium-term Economic Plan, is due for launch in February 2017, and will chart a course for the Nigerian economy over the next four years (2017–2020).
- The almost 8-fold oversubscription of our recent Eurobond (orders in excess of US$7.8 billion compared to a pre-issuance target of US$1bn) demonstrates strong market appetite for Nigeria, and shows confidence by the international investment community in Nigeria’s economic reform agenda.
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