Nigerian Business Outlook – Week in Review

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The Nigerian business outlook for the week is an analysis of the performances of the various sectors of the economy. Herein are the gains and the pains:

Budget Delay Hurting the Economy

The delay in signing the 2016 Appropriation Bill into law by President Muhammadu Buhari has worsened the economic crisis currently facing the nation.

Johnson Chukwuma, an economist said, “the economy grew at 2.11 percent during the fourth quarter of 2015. When the data for the first quarter of 2016 is out, everyone will realize that the delay in signing the budget has almost paralyzed economic activities.”

“Many economic sectors and activities are tied to the implementation of the budget. This is why you see that the failure of the government in signing the budget is having adverse effects on the economy,” he added.

The Stock Market

Union Bank of Nigeria is currently leveraging strategies that will reduce its cost to income ratio from 67 percent to 60 percent for the 2016 financial year.

The bank assured stakeholders that it would improve its business processes, branch network and channel optimization to sustain the growth of the bank.

Also, Dangote Sugar has recorded a group turnover of N101billion in 2015, a 7 percent increase over the turnover of N95 billion in 2014.

Similarly, Unilever Nigeria Plc results for the first quarter ending March 31, 2016 show a turnover and profit after tax of N16.78billion and N1.04 billion respectively.

Contrarily, Guinness Nigeria Plc has reported a dip of 83 percent in profit after tax for a period of nine months ending in March 31, 2016.

Guineas posted a revenue of N69.618 billion in 2016, down by 16 percent from the N84.75 billion earned in 2015.

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Financial News

The naira is expected not to rise or fall significantly at the parallel and official foreign exchange market as the economy slows and demand for foreign exchange eases after President Muhammadu Buhari’s delayed signing of the 2016 budget.

Forty-one customers of Diamond Bank Plc will be rewarded with N25 million and a brand new SUV in its DiamondXtra Season 8 South West regional draw in Ibadan this week.

In the same vein, Access Bank Plc has called on women in business to avail themselves of the opportunities in accessing bank loans to grow their businesses.

Equally, Sterling Bank Plc has shown her commitment to the growth of the Nigerian economy to champion the use of locally manufactured goods and services by initiating the “Made in Nigeria” week from today until Friday.

Scarcity of Aviation Fuel Hampers Flight Operations

Many flights were delayed and others cancelled this past weekend, following the inability of most airlines to receive the volume of aviation fuel they needed for scheduled flight operations.

Due to the paucity of the product, oil marketers resorted to rationing the product to airlines, sharing the product at the ramp from one aircraft to another.

Nigerians are hopeful that better days are ahead in the next quarter of the year but this depends largely on the ratification of the budget by President Muhammadu Buhari.

(With information from The Punch and This Day Newspaper)