Investor Presentaiton
Nigeria - Macro
- Macro Economic Environment
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Nigeria transitioned to a new government in the
second quarter after holding its 7th election cycle in March
DANGOTE
CEMENT
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Economic Growth
Nigeria's economy grew by 2.51% in the second
quarter of 2023, faster than the 2.31% growth in Q1.
The growth was underpinned by developments in
the non-oil sector, which grew by 3.58%. In
contrast, the oil sector contracted by 13.43%.
The IMF forecast economic growth of 2.9% in 2023,
slower than the 3.3% growth in 2022.
Major downside to this outlook is tighter monetary
stance due to accelerating inflation
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Interest Rate
The CBN hiked MPR eight-consecutive times over
the last 12 months to 18.75%, in a sustained move
to control accelerating inflation.
One-year T-bills closed at 12.98%, higher than
8.49% in 2022, highlighting the upward trend in
the yield curve in the period.
The CBN resumed OMO sales in August after
seven months of halting issuance of the short-
term instrument.
Exchange Rate
In the second quarter, Nigeria floated the naira,
allowing for market determined rates of the domestic
currency.
The naira weakened from N461.1/$1 at the end of
2022 to N769.3/$ at the end of September 2023
(65% devaluation).
■ External reserve stood at $33.2 billion as at end of
September, down 10.4% from $37.1 billion as at year
end 2022.
■ Total debt stock jumped to N87.4 trillion in H1 23,
inclusive of N22.7 trillion advances from the CBN.
Politics
Big steps taken by President Tinubu to attract
investors:
- Fuel subsidy removal
-
FX market reform
Peaceful transition of power after a keenly contested
general election
The President nominated Yemi Cardoso, as the new
CBN Governor.
Inflation
Headline inflation rate accelerated to 26.72% YoY in
September 2023, on the back of disruption in food
supply and increases in import costs.
■ Food inflation quickened to 30.64% whilst core
inflation rose to 21.8% in September.
■ Total trade stood at N24.8 trillion in H1 23, down
13% YoY. Both imports and exports were down
18.7% and 6.9% to N11.3 trillion and N13.5 trillion,
respectively.
Oil Production
Nigeria's oil production averaged 1.2mb/d in
Q2-23, down 14.7% and 19.2% YoY and QoQ,
respectively.
■ Meanwhile, Brent Crude oil price averaged
$81.9/b YTD to September, down by 20%
YoY.
Source: IMF, CBN, OPEC, NBS
Investor Presentation
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