#1KADIPA KADUNA INVESTMENT PROMOTION AGENCY KADUNA INVESTMENT PROMOTION AGENCY QUARTERLY INVESTMENT REPORT 2ND QUARTER 2022 (APRIL-JUNE)#2Introduction The Kaduna State Government has recognized the urgent need to attract private sector investments to the State in order to help create new jobs, improve living standards and transform the overall economy of the State into a modern and productive Knowledge-based economy. This necessitated the creation of the Kaduna Investment Promotion Agency (KADIPA), a One-Stop Investment Centre for businesses and investments. As part of our duties, we initiate, promote, facilitate & coordinate investments through PPP's, privatisation and commercialization in the State by coordinating all the activities of MDAs in the business environment. KADIPA also promotes the State in the National and International market place to attract domestic and foreign direct investment with a view to exploiting the vast economic potentials in the State. This is the second edition of our quarterly Investment Report published to the general public for the sake accountability and transparency. The public will be able to keep up with the agency's progress against its yearly Key Performance Indicators (KPI) going forward. The Economy of the World and Africa: Russia-Ukraine Conflict and its impact on Africa's Economy The Russia-Ukraine conflict began as the global economy was gradually recovering from the negative effects of the COVID-19 pandemic and as pent-up demand amid persistent gridlock in global value chains stoked a surge in commodity prices, fueling strong inflationary pressures. Russia's invasion of Ukraine and the associated sanctions on Russia have imposed costs and volatility on the global economy, transmitted through three main channels: energy and nonenergy commodity prices I. ii. supply-chain disruptions iii. financial markets These have direct and indirect implications for African economies.#3Both Russia and Ukraine are key players in the global agrifood market and account for more than 25 percent of the world's trade in wheat, more than half the global trade in sunflower oil, and 30 percent of global barley exports. This dominance poses a major challenge for Africa. In 2020, wheat and maize accounted for 41.6 percent (or $3.5 billion) of Russia's $8.5 billion merchandise exports to Africa. In the case of Ukraine, wheat, maize, and vegetable fats and oils accounted for 58 percent ($3.8 billion) of exports to Africa. The surge in prices of food, energy, and other commodities will, however, create winners and losers across Africa. Energyexporting countries stand to gain from higher than predicted prices, provided these countries have excess production capacity to respond to the positive price shock and shore up export earnings. For energy and net food-importing countries, higher energy and other commodity prices coupled with prolonged gridlock in global supply chains could exacerbate inflationary pressures. Given that most African countries are net energy importers - as they export crude oil and import refined petroleum products due to lack of domestic refining capacity the overall economic impacts are on the downside. Indeed, while net oil and other commodity exporting countries could benefit from higher prices, the impact on net energy and commodity importing peers is likely to offset these gains, resulting in higher inflation and constrained economic activity, this could slow economic recovery from the impacts of the COVID-19 pandemic. Net crude oilexporting countries with fuel subsidy regimes could experience fiscal shocks due to the higher price of imported refined petroleum products. Beyond energy and commodity prices, both Russia and Ukraine are significant sources of raw materials such as platinum group elements, nickel, and neon gas, which are critical components for manufacturing parts used in the automotive industry, consumer electronics, and renewable energy devices. For Morocco and South Africa, vehicle production and exports are likely to be constrained by the ongoing global shortages in vital car parts such as semiconductor chips and catalytic converters, while the supply of chip reliant consumer electronic goods might experience some delays and elevated prices. Key messages Africa's GDP grew by an estimated 6.9 percent in 2021—a strong recovery from the pandemic-induced contraction of 1.6 percent in 2020. Growth was highest in North Africa (11.7 percent) and East Africa (4.8 percent). Macroeconomic fundamentals have generally improved, but considerable challenges remain in the medium term, due largely to the persistence of the pandemic effect and volatility induced by the impact of the Russia-Ukraine conflict. Africa's low vaccination rates are constraining faster economic recovery and increasing the health impact of COVID-19.#4FIGURE 1.1 Real GDP growth, 2019-23 Percent 日 Africa World Europe 12 6 2019 2020 2021 jestimated) 2022 (projected) 2023 (projected) Source: African Development Bank Statistics and World Economic Outlook, April 2022 FIGURE 1.4 Global commodity price indices, January 2020 - March 2022 Index (2016=100) 350 300 250 Meta 200 150 100-- FIGURE 1.2 Purchasing Managers' Index values for four of the big six economics in Africa, 2017-march 2022 Purchasing Managers" index 65 45 35 Egypt Kony Nigeria South Ahoa 25 2017 2018 2019 2020 2021 Source: Haver Analytics and IHS Markit Mr. 2022 FIGURE 1.5 Real GDP per capita growth, by region 2019-23 Percent 10 Energy Food Agricultural raw materials 0 Europe Asia World Africa 50 -10 Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec. Jan. Feb Mar Apr May June July Aug Sep Oct Nov. Dec. Jan. Feb. Mar 2020 2021 2019 2000 2022 2021 jestimated 2022 projected 2023 (projected) Source: Staff calculations based on the world economic outlook database andd the World Bank Commodity database. Source: African Development Bank Statistics and World Economic Outlook, April 2022 and united Nations Population Division estimates.#5Nigeria Economic Outlook Recent macroeconomic and financial developments Nigeria's economy grew by 3.6% in 2021 from a 1.8% contraction in 2020, underpinned on the supply side by 4.4% expansion in the non- oil sector against 8.3% contraction in the oil sector; non-oil growth was driven by agriculture (2.1%) and services (5.6%). On the demand side, public and private consumption were contributors to GDP growth. Per capita income grew by 1.0% in 2021. The fiscal deficit narrowed to 4.8% of GDP in 2021 from 5.4% in 2020, due to a modest uptick in revenues, and was financed by borrowing. Public debt stood at $95.8 billion in 2021, or about 22.5% of GDP. Annual average inflation stood at 17.0% in 2021 against 13.2% the previous year and above the central bank's 6-9% target. Inflation was fueled by food price rises at the start of the year and exchange rate pass- through. The central bank kept the policy rate unchanged at 11.5% in 2021 to support economic recovery. The current account deficit narrowed to 2.9% of GDP in 2021 from 4% the preceding year, supported by recovery in oil receipts. Improved oil exports and disbursement of the SDR allocation of $3.4 billion (0.8% of GDP), pending decision on its use, helped to boost gross reserves to $40.1 billion in 2021. The ratio of NPLs to gross loans was 4.9% in December 2021 (regulatory requirement 5%), while the capitaladequacy ratio was 14.5% (regulatory benchmark 10%). Poverty and unemployment remained high, broadly unchanged from 40% and 33.3%, respectively, in 2020. Outlook and risks Growth will decelerate, averaging 3.2% during 2022-23, due to persistent low oil production and rising insecurity. Inflation is projected to remain elevated at 16.9% in 2022 and to stay above pre-pandemic levels in 2023, fueled mainly by rising food, diesel, and gas prices and persistent supply disruptions amplified by the Russia- Ukraine conflict. Capital inflows are projected to recovery, while oil exports are projected to increase slightly. The benefit of a forecast positive oil price shock on exports may, however, be partly offset by a weak output effect due to lower oil production, stoked by infrastructure deficiencies and rising insecurity. The projected marginal current account surplus of 0.1% of GDP in 2022 could turn into deficit of 0.2% in 2023. Improved revenue collection will help narrow the fiscal deficit to an average of 4.5% of GDP. Public debt targeted to reach 40% of GDP by 2024 on fresh borrowing. The headwinds to the outlook may be exacerbated by rising insecurity and policy uncertainty underpinned by reversal of initially planned removal of subsidies on premium motor spirit a year before the 2023 elections. 4 2 Real GDP growth (%) 2 3.0 -2 Real GDP per capita growth (%) CPI inflation (%) Budget balance (% of GDP) 20 20 2 0.5 15 -2 13.2 13.1 10 0 -4 -4.4 -1.8 -6 -2 2020 2021 2022 2023 2020 2021 2022 2023 5 0 Current account (% of GDP) 0.2 -2 -4 -4.6 -4 -5.4 -4.0 -6 -6 2020 2021 2022 2023 2020 2021 2022 2023 2020 2021 2022 2023 Source: Data are as of April 2022 and are from domestic authorites; figures for 2021 are estimates and figures for 2022 and 2023 are projections by the African Economic Outlook team.#612.00 10.00 8.00 6.00 4.00 2.00 Kaduna State Economic outlook and Performance GDP GROWTH (%) GDP GROWTH (%) 2017 2018 (2.00) GDP GROWTH (%) 2019 2020 SECTOR CONTRIBUTION TO GDP (MILLION NAIRA) 1,800,000.00 1,600,000.00 1,400,000.00 1,200,000.00 1,000,000.00 800,000.00 600,000.00 400,000.00 200,000.00 60.00 50.00 40.00 30.00 20.00 10.00 SECTOR CONTRIBUTION TO GDP (%) 2017 2018 2019 2020 Agriculture Industry Services Combined Urban and Rural CPI inflation of food and all items 600 500 400 300 200 100 0 Jun-21 Jul-21 2017 2018 2019 2020 Aug-21 Sep-21 Oct-21 Nov-21 Dec-21 Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 -Food -All Items -Agriculture -Industry Services#7% do % Combined Urban and Rural CPI inflation Food (%) Food 2.37 17.75 MONTHON MONTH YEAR ON YEAR Food Combined Urban and Rural CPI inflation All items (%) All items 2.61 17.83 MONTHON MONTH YEAR ON YEAR All Items **Source- Kaduna Bureau of Statistics and National Bureau of Statistics#83.0 2022 SET TARGETS (KPIs) $ 1977 * New KPIs and Goals for the Year 2022 Actualize $500 million worth of Investments in kaduna State's Investment Portfolio Track the creation of 50,000 Jobs Track the generation of $10 million in revenue for the State Government Remain No. 1 subnational in the Ease of Doing Business Ranking KADIPA KADUNA INVESTMENT PROMOTION AGENCY#9☐ ■ 4.0 Investment Portfolio As at 1st Quarter 2022, the State's total Investment Portfolio was $4.2 billion. 2nd Quarter Investments increased by $148.7 million where $112.7 million were announced investments and $36 million worth of investments were actualized, thus increasing the Investment Portfolio to $4.35 billion representing a 3.6% growth for the quarter. The slowdown in growth rate is attributable to the global economic slowdown. Actualized 19% Announced 81% Actualized $36,024,096.00 Announced $112,733,157.00 Total $148,757,253.00#10ACTUALIZED INVESTMENTS ACROSS LGA ACTUALIZED INVESTMENTS ACROSS SECTORS Kubau $1.2m Igabi $5.9m Retail & Tourism $4.8m Chikun $28.9m Agro-Allied $31.2m#114.0 Performance Review Targets Vs Achievements INVESTMENT PORTFOLIO Achievement 2022 2Q 7% ($36m) JOBS TO BE CREATED Achievement 2022 2Q 6% ($570K) IGR Achievement 2022 1Q 4% ($366K) Achievement 2022 2Q 2% (680 JOBS) Achievement 2022 1Q 20% (10,150 JOBS) Achievement 2022 1Q 48% ($241.3m) Target Remaining for 2022 45% ($222.7m) Target Remaining for 2022 90% ($9.06m) Target Remaining for 2022 78% (39,170 JOBS) Note: The lackluster performance in jobs created this quarter is as result of the number of investments. actualized which as well is attributed to the general global economy slowdown. Source: Investment Intelligence Department, Kaduna Investment Promotion Agency KADIPA#12S/N Annexures Actualized Greenfield Investments Investment Worth ($) No Expected Jobs to be created Company/Investor Project Description Sector LGA 1 KANGIMIKACHIA ILLAJ FARMING AGRICULTURE $361,445.78 210 2 TAK AGRO LTD. (CHEMICAL AND FERTILIZER PROCUCTION AGRO-ALLIED CHIKUN FERTILIZER COMPANY) $28,915,662.65 150 3 MHA Agriculture Application for agricultural farmland Agro-allied 4 Umsy Request for farmland; to build 3 units (300 tons Agro-allied kubau igabi $1,204,819.28 $722,891.57 70 70 each) grains storage facility, finished products warehouse, car/trucks park, a mosque and cleaning plant for sesame seed and ginger processing. 150 5 Kaballi Intergrated Ltd Hotels and Restaurants Retail & Tourism Igabi $4,819,277.11 100 TOTAL $36,024,096.38 680#13Announced Greenfield Investments Company/Investor Danfalalu industries Project Description DAIRY AND BEEF PRODUCTION Sector AGRO-ALLIED Quarter Investment Worth $39,518.07 2nd Terrific Engineering CONCRETE MANUFACTURING MANUFACTURING INDUSTRY $1,325,301.20 2nd OBAX GAS HUB OIL AND GAS $740,324.20 2nd YUFA NIG LTD RICE MILLING AND PROCESSING MANUFACTURING INDUSTRY $533,734.94 2nd JAFCO FARMING AGRICULTURE $1,204,814.30 2nd TAIRENE INTERGRATED SERVICES BREAD AND WATER MANUFACTURING INDUSTRY $300,216.86 PRODUCTION FACTORY 2nd GOLDEN QUANTITIES HOUSING ESTATE REAL ESTATE $5,060,240.96 ASSOC. LTD 2nd ISIYAKA BROTHERS NIG LTD ROOFING SHEET FABRICATION AND MANUFACTURING MANUFACTURING INDUSTRY $1,204,814.00 2nd FODIOS.G AND SOND LTD NAIL MANUFACTURING MANUFACTURING INDUSTRY $2,324,192.80 2nd Dornier Aviation Training school Transport 2nd $100,000,000.00#14THANK YOU