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ECONOMIC NEWS
President Yar’adua will today, inaugurate the Vision 2020 Business Support Group (BSG), a group that will accelerate activities meant to actualize the country’s plan of being among the World’s top 20 economies by the year 2020. It is mandated to source funds from the private sector to complement the effort of the government towards the actualization of the Vision 20-2020. BSG is a private sector initiative with members drawn from prominent players of the organized private sector in the country.
At the end of the Federal Account Allocation Committee, the three tiers of government shared N285.58bn as allocation for January as against N435.40bn shared from December’s allocation, showing a shortfall of N149.82bn. A break down showed: the Federal Government got N121.32bn, the State governments N80.29bn while the local governments received N60.33bn. The nine littoral states got N23.64bn, being 13% derivation fund to their allocation.
Oil giant, Royal Dutch Shell has declared force majeure on shipments from its main Nigerian terminal because of increased attacks by militants on key facilities. The Anglo-Dutch oilgiant has been a regular target of attacks over the past three years, forcing it to shut down some facilities and several times defer contractual obligations to clients. Unrest in the Niger Delta has reduced Nigeria’s oil output by more than a quarter, putting pressure on crucial export earnings.
LOCAL MARKET NEWS
OBB and Overnight rates closed last week at 9.75% and 20.5% respectively. Stop rate at the 91-days Primary Auction dropped from 2.34% to 1.898% while 182-days rate also dropped from 2.85% to 2.588%.
INTERNATIONAL MARKET NEWS
Update on Global Economic Crisis The Group of Seven (G7) Finance Ministers said at the post meeting communiqué in Rome that the stabilization of the global economy and financial markets was the highest priority. The group reaffirmed their commitment to support growth and employment and strengthen the financial sector with full range of policy tools. The Group promised to ensure that protectionist measures, which risks exacerbating the downturn are avoided. G7 meetings are attended by finance ministers and central bankers from 7 industrialized nations – Canada, Italy, France, Germany, Japan, the UK, and the US.
Japan’s economy, the world’s second largest, is deteriorating at its worst pace since the oil crisis of the 1970s, due to rapidly shrinking exports and weak spending at home in the wake of the global financial crisis. The country’s real gross domestic product shrank at an annual rate of 12.7% in the 4th Quarter of 2008 after contracting in the two previous quarters. This is Japan’s worst quarterly drop since its GDP contracted at an annual pace of 13.1% in the first three months of 1974, amid a global oil shortage.
Commodity Market
Crude oil (WTI) price rose to close at $37.51 a barrel on Friday 13th February, 2008 after falling to 4.5 years low of $33.55 a barrel.