BUSINESS ROUNDUP: Nigeria devalues the Naira; petrol pump price awaits further deliberations; See other stories that made our pick

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 Headlines:

• CBN devalues Naira to 380 per dollar
• New petrol pump price to be reviewed further in April —PPPRA
• Nigerian aviation sector could lose $434m revenue, 22,200 jobs to coronavirus – IATA
• Reps summon MTN, GLO, 9Mobile CEOs, others over alleged $30bn tax fraud

Summary:

The Central Bank of Nigeria (CBN)  has technically devalued the Naira exchange rate for the dollar on the Investors and Exporters’ (I&E) window to N380, a statement that became public on Friday, March 20, has stated.

The Naira came under increasing pressure in recent days, marked by sharp volatility in the Foreign Exchange (Forex) market, a development that compelled the apex bank to back down from its earlier stance that market fundamentals did not support Naira devaluation.

There was a weak demand for the Open Market Operations (OMO) instruments of the CBN on offer on Thursday, meaning that Foreign Portfolio Investors were uncertain about market situation, statistics from Bloomberg terminal reveals. Read more

Indications have emerged on Thursday, March 19, that the new petrol price of N125 per litre announced on Wednesday might be reconsidered in less than two weeks.The Petroleum Products Pricing Regulatory (PPPRA)which disclosed this stated that the new price would last temporarily till the end of March after which a new price would be adopted on 1st April.

Abdulkadir Saidu, Executive Secretary of the PPPRA, at a media briefing in Abuja remarked that there was huge probability that another price regime would take effect should there be a shift in the variables used in determining the price of petrol. In his statement, he confirmed that petroleum prices review would be conducted on a monthly basis onwards. Read more

The International Air Transport Association (IATA)has noted that the far-reaching economic impact of COVID-19 could cost the aviation industry as much as $434 million (around N159.278 billion) together with massive job cuts in the region of 22,000 in the nearest future. In patronage terms, the sector stands the chance of recording a shortfall of 2.2 million in passenger volumes, up from the 853,000 projected earlier in the light of the current development, it said on Thursday.

International travel traffic has come under increasing strain in the past few days with government’s embargo on flights to 13 coronavirus high-risk countries notably Italy, the UK, the US and Italy. West Africa-based carrier, Arik Air, had Wednesday announced suspension of flights from Nigeria to Ghana, Liberia and Senegal as its own intervention to contain spread. Read more

The House of Representatives Thursday, March 19, has issued a notice, inviting the Chief Executive Officers (CEOs) of some telecommunication firms in the country to appear before it in seven days or risk arrest.

Read also: BUSINESS ROUNDUP: External reserves drop by $2.43bn; Oil price falls to $32.55; See other stories that made our pick

Numbering 15, the telcos include MTN Nigeria, Airtel Nigeria, Glo Mobile Limited and 9Mobile. At the Thursday plenary, James Faleke, Chairman Committee on Finance, informed the House through a motion of urgent public importance that the telcos had dishonoured a litany of invitations in time past. Read more

On NSE ROUNDUP: Market capitalisation down by 2.35% on weak investors’ confidence

Negative sentiments are still rife across the Nigerian bourse, reflected in how shares are being dumped for sales in enormous volumes week after week.

The glut in the market has set most stocks on relentless loss for days on end, causing a year-to-date negative return of 17.30% to equity investors so far this year. Theoutlook is not in any way favourable on the grounds that the broad implications of COVID-19 may not only contract the economy further, but also sustain this ugly trend throughout 2020.

All the key market performance indicators closed lower this week. A negative market breadth was recorded as 35 losers emerged against 27 gainers. The All Share Index (ASI) and the Market Capitalisation simultaneously diminished by 2.35% with the former tumbling to 22,198.43 basis points and the latter to N11.568 trillion.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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