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BUSINESS ROUNDUP: Dangers of lockdown extension; UN’s $3.4tn debt write-off proposal; See other stories that made our pick

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Nigeria retains position, scores lower in global competitiveness index

Hello, and welcome to Business Roundup this week. Here, we bring you highlights of events that happened during the week -from the capital market, mainstream business activities while not forgetting the tech/economy build up.

Here are the major Headlines:

  • CBN levies banks N1.4trn in move to shore up Naira
  • FAAC remits N120bn to Excess Revenue Account
  • UN agency proposes $3.4tn debt write-off for Nigeria, others
  • Extending lockdown further not sustainable –ACCI

Summary:

The Central Bank of Nigeria (CBN) has collected N1.4 trillion ($3.9 billion) from banks in the country with excess cash holdings as part of strategies to support the Naira, banking sources told Reuters on Friday.

The Nigerian currency has been reaching unprecedented low levels since March after the CBN adopted a new official rate, which factored in a 15% devaluation as a buffer against the effects of oil price slump prompted by COVID-19. This week, the Naira exchanged for as much as 420 to the dollar on the parallel market for the first time since February 2017, a figure 14% weaker than the official market rate. Read more

The Federation Account Allocation Committee (FAAC) has remitted the sum N119.55 billion to the Excess Revenue Account, a statement from the Office of the Accountant General of the Federation revealed Thursday.

Read also: BUSINESS ROUNDUP: $9.7bn debt relief from G-20; 34% growth in online transactions; See other stories that made our pick

The remittance came from the N780.926 billion, endorsed for distribution to the federal, state and local governments.According to the document signed by Henshaw Ogubike, Director Information, Press and Public Relations, the transfer was occasioned by the current crisis confronting the country and the highly volatile revenue profile in the immediate future. Read more

The United Nations Conference on Trade and Development (UNCTAD) is pushing for measures aimed at easing the debt burden of about $3.4 trillion on Nigeria and other developing countries undergoing economic crisis in the wake of the coronavirus outbreak.

UNCTAD admitted in a report released Thursday that developing countries were threatened by an imminent debt disaster given that the income of such countries had tumbled significantly. In the report named ‘From the great lockdown to the great meltdown: Developing country debt in the time of Covid-19,’ UNCTAD analysts foresaw that the $3.4 trillion repayment would comprise between $2 trillion and $2.3 trillion in high-income developing countries and between $666 billion and $1.06 trillion in middle and low-income countries. Read more

The Abuja Chamber of Commerce and Industry (ACCI) has warned the Nigerian government not to extend the current lockdown beyond 27th April, saying the decision is unsustainable.

The Nigerian government had on 2nd April declared a fortnight lockdown as a key measure in containing the spread of COVID-19, and further prolonged the movement restriction by another two weeks after the initial order expired. In a strategy paper released by the ACCI in Abuja Wednesday, the chamber recommended the designing and execution of an exit plan as a preliminary action to reopening the economy. Read more

On NSE ROUNDUP: Mixed sentiments as investors lose N168bn

Both positive and negative sentiments defined investors’ attitude to the market this week as gains and losses were recorded in the five trade sessions. The bourse posted losses on Monday, Tuesday and Thursday while Wednesday’s and Friday’s trades ended in the positive territory.

Week on week, the market shed N167.919 billion. All the key market performance indicators closed lower. A negative market breadth was recorded this week as 33 losers emerged against 25 gainers. The All Share Index (ASI) and the Market Capitalisation both contracted by 1.41% to 22,599.38 basis points and N11.778 trillion respectively.

Trade Volume of 1.195 billion shares worth N13.979 billion was recorded in 20,591 deals this week compared to the 1.495 billion shares valued at N12.894 billion posted in 20,982 deals last week. Read more

Thanks for joining the roundup this week. See you next week for another serving of Business Roundup. Don’t forget, for the latest news and updates from around the globe, keep reading Ripples Nigeria.

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