Global Oil prices looked tired, exhausted and ready for an early summer break during the second quarter of 2019 as global growth fears overshadowed supply disruptions and ongoing OPEC supply cuts. At the time of writing, Oil prices remain shaky and vulnerable despite OPEC+ latest decision to extend production cuts until March 2020.
The crucial question is whether Oil prices will ever recover and trade back towards the $70+ levels. That depends less on geopolitical tensions in the Middle East and more on whether the US and China can reach a trade deal, settling disputes over tariffs and opening the door to continued global growth.
In this case, it’s likely that Oil prices will be injected with a renewed sense of confidence on the back of boosted global growth expectations and demand for Oil. But what if the current circumstances persist and the US-China trade disputes continue throughout the second half of 2019?
Taking each scenario one-by-one, starting with the upside for Oil prices, Nigeria’s economy could benefit considerably if a US-China trade deal is reached and global growth expectations become brighter. The manufacturing sectors in the US and China are the Oil-gobbling engines which drive demand for international Oil suppliers.
China is the world’s top crude Oil consumer, importing more than 50 per cent of its consumption, part of which comes from Nigeria. In the fourth quarter of 2018, Nigeria exported ₦23.5 billion worth of crude Oil to China and remains a major trading partner to the Asian giant. It’s likely that if China’s economy roars back to life, Nigeria’s growth would see more long-term support, benefiting foreign exchange reserves and the naira.
Although unlikely, if a trade deal were to be announced early in the quarter, it’s possible the nation’s 2019 budget would also see ample support from increased Oil revenues from China. This argument doesn’t apply to the US which has considerably reduced its crude Oil imports from Nigeria as it heads towards energy independence, relying instead on domestic production to meet its own needs.
If you take the negative outlook on Oil, it’s more likely the rise in Oil prices is a temporary result of supply shortage fears and the prevalent trend in Q3 will be downward pressure from concerns over a global recession. In this unfavorable scenario, the world’s two largest economies do not reach a trade deal in the third quarter and aggregate demand for Oil continues falling as it tracks economic weaknesses in China and the US.
As demand for Oil is whittled away, Nigeria’s foreign exchange reserves may be negatively impacted, along with the Naira, the 2019 budget, and most importantly GDP growth.
In terms of the national budget sheet, expenses like the petrol subsidy may take the limelight as they drag on revenues, overshadowing growth and threatening fiscal stability.
There’s another factor we haven’t talked about so far but it’s significant in terms of Oil market economics. Oil sales are denominated in US Dollars. Recently, the currency has weakened against its rivals, meaning that Oil is more affordable and possibly giving traders an incentive to snap up contracts at current levels before they rise further.
If the Dollar bears have their way and the currency keeps declining, Oil price benchmarks could see further support in the third quarter. The impact of a weaker USD might not be as strong as a US-China trade deal, but it could feed positively into Nigeria’s Oil revenues and go some way to counter possible losses from ongoing global recession fears.
To sum up, Nigeria’s foreign exchange reserves, currency, growth, and budget will face headwinds should trade disputes persist.
However, provided the USD keeps weakening, there’s scope for support from higher Oil prices based on bargain hunting. There’s always the possibility that the US and China could decide on a trade deal, if this happens sooner than later, Nigeria’s economy would benefit accordingly.
The views expressed in this piece are the author’s own and do not necessarily reflect News Central TV’s editorial stance.
Research Analyst at FXTM
Flooding can happen anywhere
Over the past few years, mother nature has changed its ways, because we changed ours. Homes and businesses have been affected by a combination of factors like increased rainfall and the resulting overflow from rivers, especially in coastal areas.
Even for those residents in flood-susceptible areas or riverine communities, marshy lowlands, the method and character of angry cloudburst during a flood, is problematic and fraught with imponderables that are difficult to predict.
At least 25,000 people have died annually since the 80s in Africa from flood with 11 million more affected.
Last year, floods in East Africa provoked massive flooding, landslides, and overflow of several dams across Rwanda, Kenya, Somalia, Burundi, Ethiopia and Uganda. In recent times, Tanzania has spent over US$2 billion annually to manage flood. Landslides from flood took tolls in West Pokot, Kenya where 54 people died.
In Cunene Province of South Angola, Heavy rains submerged homes and damaged properties worth billions.
Mozambique lost assets and properties to 2013 floods estimated to cost over a tenth of its GDP to the tune of US$500m.
Nigeria experienced one of its worst floods in a century in 2012 – properties worth about US$10 billion were destroyed. Borno State in North-Eastern Nigeria had its worst flood in 7 years displacing over 20,000 people.
In 2019, flash floods happened in Tunisia and Algeria as well.
How ready is your community?
Homes may flood from prolonged rain over a long period of time. Internal issues like sewage leak, plumbing failure or extreme weather conditions, water-control structures like dams or levees may fall apart with devastating consequences.
Communities must pursue building approaches to withstand flood and erect structures above flood levels. In building homes and facilities, barriers should be created to prevent the ingress of floodwater into homes with high points using hard-wearing bricks or concrete or sandbags.
Encouraging tree planting across wetlands could create a wooded bulwark to break the speed of floods, check river overflow and arrest deforestation.
Farming or agrarian communities prone to flood may, with the assistance of local authorities, build flood storage reservoirs to hold back floodwater, collect excess rain and runoffs. Such reservoirs may be channelled to farms for irrigation purposes.
The role of Diaspora Nigerians in national economic development
In the USA, Nigerians are the most educated ethnic group with the highest percentage of Bachelors’ degree holders
Emigration or immigration is what happens from time to time. This is when a person decides to leave their country to live permanently in another country for reasons that are not far-fetched. Some could be for economic reasons, wanting a better life or simply running away from conflicts which can be outright war or religious.
It is a fact that millions of Nigerians emigrate to other parts of the world. These migrants and their descendants make up the Nigerian Diaspora. This population range between 5 million and 15 million according to figures from official quarters.
Nigerians can be found in the United Kingdom with Peckham referred to as little Lagos, the USA, Ireland, especially in Dublin, South Africa, India, Malaysia etc. It is even a serious joke that there’s hardly any place on the planet you cannot find a Nigerian and till now I see that as a problem.
These migrants, as observed, are at a high cost to the development of Nigeria, especially when it borders on professionals like doctors, scientists, lecturers which the country is in dire need of. Unfortunately, some of Nigeria’s brightest professionals constitute the class of people leaving the country on a daily basis for other countries that provide better facilities and services for their people.
In the USA, Nigerians are the most educated ethnic group with the highest percentage of Bachelors’ degree holders and have an average honourable income of $94,000 (2010 US census). We cannot also ignore the fact that Nigerians in the Diaspora also contribute largely to the economy with $12bn remitted by them in 2012 (World Bank), which is positive to our economy.
There is, therefore, a need to put in place structures and policies that will encourage some of those that have emigrated to return and use their acquired expertise to help in the development of the country.
But to have those in the Diaspora come back, especially the professionals, facilities must be provided in our hospitals, universities, government institutions and we must also apply meritocracy in appointments. Aside from that, there should be improvement in the remuneration of specialised functions while we beef up security nationwide.
The Nigerian in Diaspora Organisation is a body recognised by the Federal Government as an umbrella body of Nigerian citizens in the Diaspora with a vision to harness the skills and expertise of Nigerians with the view to providing them for the development of the country.
The Nigerian government has to take advantage of this body in making some appointments in government agencies and institutions. The appointment of Ngozi Okonjo-Iweala, a former Director of the World Bank, is one that easily comes to mind. Her impact as Minister of Finance and coordinating minister of the economy under the Jonathan administration cannot be underestimated. The structures she put in place to check “ghost” workers as well as the Treasury Single Account have, in no small measure, minimised corruption.
Also, the impact of Dr. Akin Adesina, a former agricultural economist at the Rockefeller Foundation, who became the Minister of Agriculture, was also positive, as he returned to use his expertise to develop the country.
Another well-known case is the success of Singapore linked to Lee Kuan Yew. Lee studied Law in Fitzwilliam College in Cambridge, UK. In 1950, he was admitted to the English Bar but instead of practising there, he returned to Singapore and became the first Prime Minister from 1959 to 1990. He transformed Singapore from one of the poorest countries in the world in the 60’s to one of the most advanced today. He built a country based on the rule of law with an efficient government structure and continuously fights against corruption and insecurity.
Unfortunately, we cannot say this of Nigeria, reasons being the structures, policies, establishments are not in place to attract and facilitate integration.
We can identify Nigerians and award scholarships to them in specific institutions with the clause of returning home to help in the country development in various fields. However, the government on the other part must ensure adequate facilities are in place for their return.
The ease of doing business has significantly improved and there is a need to legalise the whistle-blower policy as part of our anti-corruption drive.
Competence and honesty must be introduced in making appointments to critical government positions. All these will ensure we appoint the best Nigerians both home and abroad, leading to good governance and increased investors’ confidence in our economy.
We have no other country but Nigeria; we have the human and abundant natural resources to make the country an economic power. But we must enthrone meritocracy and honesty as our way of life and shun ethnicity and religious animosity. The journey has just begun and we must all join hands in making this country great, again.
The views expressed in this piece are the author’s own and do not reflect News Central’s editorial stance.
Period poverty: The fault in our blood
In Kenya alone, almost 50 per cent of school-going girls do not have access to sanitary products
A family of 8 has just been admitted in Mafalala health centre, Mozambique. They all woke up to what seemed like food poisoning. It was not merely food poisoning. It was the eldest daughter, who inadvertently introduced microbes and bacterial toxins into the food due to poor hygiene – poor hygiene from period poverty.
In a nutshell, ‘Period poverty’ refers to lacking access to sanitary products, menstrual hygiene education, decent toilets, hand washing facilities, and, or, waste management due to financial constraints.
While many may be lucky enough to probably take this for granted, one in ten girls miss school because they don’t have access to sanitary products. Some stay away because there aren’t safe, private toilets to use at school.
In Kenya alone, almost 50 per cent of school-going girls do not have access to sanitary products.
WHO states that, each year, 600 million people (1 out of 10 persons around the world) become ill after consuming contaminated food. Among all these people, 420,000 die, including 125,000 children under the age of 5.
Women and girls’ health may be put at risk, as they are forced to use dirty rags which can cause infection. Risks can be greater if the women or girl has undergone female genital mutilation.
In Maradi, Zinder and other parts of Niger Republic, study carried out for menstruating women and girls between 15 and 45 show that they observe nutritional and religious restrictions.
With men and boys less concerned about the management of menstruation among women, there is low awareness on menstrual health management which is more prevalent among nomadic women (96%) compared to sedentary women (49%).
There are many other health risks linked with the current practices of many girls during their menstrual cycles, especially in the rural or poor neighbourhoods.
Most times, girls are unaware of the availability of sanitary pads. They often resort to using pieces of mattress, chicken feathers, dry leaves, and newspapers to meet their needs and to attend school during their periods. The outcome is mostly offensive, repulsive and discomforting to the girls yet fertile for disease-causing organisms.
Some girls would employ plastic bowls because conveniences are far-flung from their residences; some dig holes at home and sit on them intermittently for the period of their menstruation!
UNICEF’s investigation found 54% of Kenyan girls reported challenges with accessing menstrual hygiene products. The research also highlighted that one in ten adolescent girls admitted to having transactional sex for pads in Kenya’s Kibera slums.
In villages where sanitary pads are not available and girls do not have transport – many times unable to afford a bus fare – these taboo issues become so repeated they get nearly normalised.
With most of these women constantly handling dishes or domestic necessities of the family, the likelihood of introducing disease-causing organisms to water, fruits, vegetables or food is high.
Before pads became commonplace, women historically placed in all sorts during menses. Tampons were prevalent at a point, but leaving a tampon in for too long could lead to infections and sometimes cause life-threatening toxic shock syndrome (TSS).
TSS is typically caused by an overgrowth of bacteria called Staphylococcus aureus. Menstrual hygiene is so vital that it should be part of the primary school curriculum across Africa. Boys, too, should know about it.
A team of wonderful women called the Numwa Mothers Sewing group sew inexpensive sanitary pads for schools in Zimbabwe. Canada and Australia recently ended tampon tax. Sanitary products in India have become 100% tax-free, while Scotland now offers free sanitary products to low-income families.
For keeping more Tanzanian girls in school with her enlightenment and investment in Menstrual Hygiene, entrepreneur Lucy Odiwa won the World Bank’s first SDGs and Her competition in 2018.
Options available to the girl child are; frequently changed tampons, sanitary pads and menstrual cups. Menstrual cups are usually sterilised and reusable. They will no longer have to miss days in the week every month, while classes are on.
Little girls who are yet to start earning livelihood do not have to pay for a natural process which they have little or no control over. We must do better by pushing for progressive policies to end period poverty in Africa. We can do better.
The views expressed in this piece are the author’s own and do not reflect News Central’s editorial stance.
Ghana Signs 5-Year Deal With Afro Nation
Super Falcons goalkeeper moves to France
2022 FIFA World Cup draw throws up interesting pairings
UK to Invest £1.3 Billion in Kenya
Sudan plans airline revival
Locust Invasion Spreads Across Six Counties in Kenya
We beheaded 10 Christians in Nigeria to avenge Baghdadi’s death – Islamic State
At least 20 soldiers feared dead in ISWAP attack on Monguno, northeast Nigeria
Bomb kills 30 in Nigeria’s northeastern Borno state
Boko Haram attacks Nigeria’s top army commander in insurgency-prone northeast
Will Uber and others replace Lagos’ yellow cabs?
Vimbai Chats with Mmamoloko Kubayi-Ngubane on SA Tourism
Abi Owolawi Chats with Vumile Msweli on Human Resources
#NCExclusive with Rotimi Akinoso of “Power”
2019 Southern Sun Ikoyi Golf Tournament Press Briefing
Entertainment1 week ago
Voting Opens for Ugandan HiPipo Music Awards
News1 week ago
Military chiefs sacked by Niger over attack that killed 89 soldiers
Politics1 week ago
Weah’s critic arrested in Sierra Leone after request by Liberian government
Entertainment1 week ago
Simi and Adekunle Gold Celebrate Wedding Anniversary
Politics7 days ago
Isabel dos Santos considers running for Angola’s presidency
News1 week ago
Russia to train three young Nigerians on nuclear research for emerging African winners
Business1 week ago
Tanzania goes digital to woo Chinese tourists
Politics2 days ago
Boko Haram executes Nigerian Christian cleric, Lawan Andimi