Business

IMF to grant concessionary loans at zero interest rate to member countries

Published

9 years ago

October 6, 2016

—-conditionalities are too tough to handle — Nigeria official
Managing Director International Monetary Fund, Ms Christine Lagarde yesterday said that the board of the multilateral institution has approved a zero interest loan facility for concessionary loans for member countries facing financial challenges.
She said “That is really important for low-income countries to be able to actually absorb the shocks without necessarily going to the international markets or relying on bilateral lending capacity of close to a trillion dollars by extending access to bilateral borrowing agreements. The new agreements that are being signed this week will run at least through the end of 2019, and will continue to serve as a third line of defence.
“As you know the first line of defence is quota, second line is New arrangements to borrow, and the third line of defence will be those bilateral loans. We have so far received pledges of $344 billion from 26 members. We look forward to others joining this effort. We will provide more detail shortly, and there will be some signing sessions organised in the course of the next two days Lagarde said.
This ordinarily would be cheering news for Nigeria but the facility is bugged with conditionality that top government sources say Nigeria will not be willing to subject its citizens to at this time.
A top government sources said in Washington that the IMF will be pressing for further devaluation of the Naira and fuel price hike which the government may not be willing to accept as a result of the social implication of further devaluation and and another hike in fuel prices.
Lagarde at a press briefing yesterday said “the outlook for advanced economies remain subdued and the outlook for developing economies provide some guarded optimism with great diversities within the various economies. Prospects for low income economies may be more challenging with varied outlook. We see growth as too low, too long and benefiting few.
“We believe that there is more policies that meets the eyes. By exploiting synergies in policies we can overcome these challenges. We also believe that each country has something to offer. My hope us that at the end of these meetings, each finance minister, each Governor of central bank will go back home thinking of what to fuel growth. For example, when monetary policy has been over stretched, fiscal policy can step up.
“This will also put in place the structural reforms that are much needed, which have been sorted out in some countries, but which are still lacking in other places. So, what does it mean for the IMF? It means that if we want to improve the inequality issue, we must have a strong international safety net. In this context, I am pleased to reveal that our board recently approved the extention of zero interest rate on all concessional facilities from 2016 to 2018, and thereafter, if there is need for extension.”
IMF had earlier said “we find ourselves in a low-growth, low-rate, era characterized by increased political and policy uncertainty. This is creating many challenges for banks, policymakers, and corporates, in all parts of the world. Failure to adapt to this new era could undermine the health of financial institutions and add to the pressures of financial and economic stagnation.
” Short term risks have declined. Six months ago we worried about Brexit and possible global repercussions. The shock of Brexit was well absorbed by markets, helped by central bank contingency plans, and monetary policy easing by the Bank of England. The impact appears more local than global. We were worried about high levels of corporate debt in emerging markets and rising risk of default. As some of the worst-hit emerging markets showed signs of recovery, and against the backdrop of further monetary easing, emerging market assets have rebounded strongly. The passing of these near term risks has led to a fall in volatility and a rise in equity prices in advanced economies.
” But medium term risks are building, because we’re entering a new era of challenges. Low, uneven, and unequal growth is opening the door to more populist and inward looking policies, leading to a loss of political cohesion and a rise in policy uncertainty in some countries. This could increase volatility and undermine growth.
” A striking outcome of this weak economic environment and heavy reliance on unconventional monetary policies is that markets expect negative policy rates in the euro area and Japan to last through the end of this decade. The weak outlook has pushed hopes for normalizing monetary policies well into the future. As a result, almost 40 percent of advanced economy government bonds carry negative yields. This is unprecedented! Financial stability now depends on how well financial institutions adapt to this new era.
” Since the crisis, enhanced regulation and oversight have strengthened banks’ capital and liquidity positions, making them safer. However, this new era of low growth and low rates threatens to undermine these hard won gains. Markets have serious concerns about the ability of many banks to remain viable and healthy. Equity valuations are well below the book values of many banks as the focus of investors has shifted from the level of capital to the business models that banks need to maintain that capital through profits. This is the fundamental reason why some banks have come under pressure this year.
” The question that we raise in this report is whether an economic recovery is sufficient to restore sustainable profitability. Or, are the problems more deep rooted and structural? To answer this question, we conducted a detailed bottom up analysis of some 280 banks, covering about 70 percent of U.S. and the EU banking systems. We found that a cyclical recovery helps, but is not enough. In this exercise, a large majority of U.S. banking system returns to healthy levels of profitability. But, some weaknesses remain.
“Despite signs of recovery and resilience in some economies, global growth continues to disappoint, with the expected pick-up driven primarily by emerging markets. This persistent underperformance has exposed complex underlying trends in many countries—including the difficulty for some groups to adjust to rapid changes in the global economy. Policymakers should act and use a balanced mix of all policy levers to revive demand and raise productivity, and ensure the gains from technology and globalization—which have led to unprecedented global welfare gains in recent decades—are shared more broadly. A retreat from globalization and multilateralism is a serious risk at a time when international cooperation and coordination are as critical as ever. The Fund can assist by helping policymakers in their efforts by providing advice, developing capacity, and lending to countries in need, while continuing to advocate for multilateral solutions that work for all”.

Business

FG earned N2.78trn from Company Income Tax in second quarter 2025—NBS

Published

1 week ago

November 28, 2025

Business News Report

National Bureau of Statistics has said that Nigeria’s Company Income Tax rose sharply in the second quarter of 2025, hitting N2.78 trillion.

The figure represents a significant 40.27 per cent increase compared to the N1.98 trillion recorded in the first quarter of the year, reflecting both improved tax compliance and stronger corporate performance across key economic sectors.

The NBS report said that domestic company income tax payments accounted for the bulk of the revenue, contributing N2.31 trillion, while offshore collections stood at N469.36 billion during the period under review.

According to the NBS, the financial and insurance sector recorded the highest quarter-on-quarter growth, rising by an astonishing 772.29 per cent, driven by improved profitability among banks, fintechs, and insurance firms following robust half-year earnings.

This, according to NBS, was followed by wholesale and retail trade, as well as motor vehicle repair activities, which grew by 538.38%.

Activities of households as employers also surged by 526.79%, although their overall contribution to total company income tax remained negligible.

On the flip side, some sectors experienced sharp declines in company income tax remittances.

Activities of extraterritorial organizations and bodies dropped by –45.01%, while education, public administration, defence, and compulsory social security recorded declines of –26.61% and –18.17% respectively.

The contraction in these sectors, particularly education and public administration, highlights persistent structural and fiscal challenges confronting government-funded institutions.

In terms of contribution to total tax revenue, financial and insurance activities led with a dominant 44.13%, reflecting the sector’s continuing expansion and strong capital flows.

Manufacturing followed with 15.57%, bolstered by increased production output and improved supply chain activity.

Mining and quarrying ranked third, contributing 9.18%, supported by higher commodity prices and renewed interest in solid mineral development.

At the bottom of the contribution chart were activities of households as employers, which accounted for just 0.01%, as well as activities of extraterritorial organizations and bodies, and water supply, sewerage, waste management, and remediation services, each contributing 0.04%. Despite economic headwinds, year-on-year company income tax collection still rose by 12.66% when compared to Q2 2024, underscoring moderate but steady improvement in government revenue mobilisation.

Company income tax collection in the same period of 2024 rose by 150.83 per cent N2.47 trillion. In the first three months of the year, company income tax collection stood at N984.61 billion. According to the report, local payments in the period under review amounted to N1.35 trillion, while foreign CIT payments contributed N1.12 trillion. On a quarter-on-quarter basis, the agriculture, forestry, and fishing sectors exhibited the highest growth rate at 474.50%, followed by financial and insurance activities at 429.76%, and manufacturing at 414.15%.

Business

Lagos govt promises MSMEs continued visibility, market access

Published

3 weeks ago

November 16, 2025

Business News Report

Lagos State government has reaffirmed its unwavering commitment to supporting micro, small, and medium enterprises (MSMEs) across the state through visibility, capacity building, and market access. Commissioner for Commerce, Cooperatives, Trade, and Investment, Folashade Ambrose-Medebem, made the pledge on Sunday at the closing ceremony of the 2025 Lagos International Trade Fair (LITF). The 38th edition of the event, organised by the Lagos Chamber of Commerce and Industry (LCCI), had its theme as “Connecting Business, Creating Value.”

Ms Ambrose-Medebem said every entrepreneur, regardless of scale, deserves an enabling environment to thrive and contribute meaningfully to the state’s economic prosperity. She said the state, through strategic investments in infrastructure, institutional reforms, and continuous engagement with the private sector, was building a Lagos that worked for business. The commissioner added that the state would continue to foster innovation, competitiveness, and sustainability.

“As a government, we remain steadfast in our commitment to making Lagos the preferred destination for commerce and enterprise. This fair has once again demonstrated the power of connection: connection between producers and consumers, investors and innovators, the government and the private sector, and local entrepreneurs and global brands. Every handshake, every conversation, every business card exchanged here is a building block toward the future we are creating, a future of prosperity that leaves no one behind,” she said.

The commissioner urged businesses to continue to connect, collaborate, and create value, saying, “In Lagos, we do not just trade goods; we trade ideas, build futures, and transform lives. “Together, let us continue to make Lagos not just a place of commerce, but a symbol of progress, innovation, and endless opportunity.” Gabriel Idahosa, president of LCCI, urged governments at all levels to continue addressing the issues of creating an enabling environment in the country.Mr Idahosa said focus should be on infrastructure, security, and implementing the right policies to address the key drivers of high inflation.

This, he said, was needed to fully harness the vast enterprising resources of domestic and foreign investors for the diversification of our economy and the welfare of our people. He pledged the commitment of the organised private sector to stand solidly behind the state in its quest to actualise its innovative initiatives on all fronts. NAN

Business

Jumia posts $17.7m pre-tax loss in Q3, down 1% in 12 Months

Published

3 weeks ago

November 12, 2025

Business News Report

Jumia Technologies AG posts a $17.7 million loss before income tax in the third quarter of 2025, down 1% year-on-year from $17.8 million in the third quarter of 2024. The road to profitability has remained long as ecommerce continues to face uncertainties, including widening competition with rivals in the same industry. The e-commerce company revenue came in at $45.6 million compared to $36.4 million in the third quarter of 2024, representing a 25% year-over-year surge in the period. The company reported gross merchandise value of $197.2 million compared to $162.9 million in the third quarter of 2024, up 21% year-over-year. Excluding South Africa and Tunisia, physical goods GMV grew 26% year-over-year, Jumia revealed in the unaudited financials.

Jumia said in its report that the GMV growth was driven by supply and strong marketing execution, partially offset by lower corporate sales in Egypt. Excluding corporate sales, GMV in reported currency grew 37% year-over-year. Nigeria’s momentum accelerated, with order growth up 30% and GMV up 43% year-over-year, Jumia said. The e-commerce giant’s operating loss reduced by 13% year-over-year to $17.4 million compared to $20.1 million in the third quarter of 2024. The company’s adjusted earnings before interest tax depreciation and amortisation loss dropped by 17% to $14.0 million compared to $17.0 million in the third quarter of 2024.

Jumia reported a loss before income tax of $17.7 million, a slight reduction of 1% compared to $17.8 million in the third quarter of 2024. Liquidity printed at $82.5 million, a decrease of $15.8 million in the third quarter of 2025, compared to an increase of $71.8 million in the third quarter of 2024, which included the net proceeds from the August 2024 At-the-Market (ATM) offering, and a decrease of $12.4 million in the second quarter of 2025.

Its net cash flow used in operating activities settled at $12.4 million compared to net cash flow used in operating activities of $26.8 million in the third quarter of 2024 and $12.7 million used in the second quarter of 2025. The result includes a positive working capital contribution of $0.4 million.

Jumia reported that customers’ orders grew 34% year-over-year, driven by strong execution, enhanced product assortment, and healthy consumer demand across key categories. It said quarterly active customers ordering physical goods grew by 23% year-over-year, highlighting continued engagement and customer loyalty. As of September 30, 2025, the Company’s liquidity position was $82.5 million, comprised of $81.5 million in cash and cash equivalents and $1.0 million in term deposits and other financial assets, it said in the report Jumia’s liquidity position decreased by $15.8 million in the third quarter of 2025, compared to an increase of $71.8 million in the third quarter of 2024, which included net proceeds from the August 2024 At-the-Market (ATM) offering, and a decrease of $12.4 million in the second quarter of 2025.

Net cash used in operating activities was $12.4 million in the third quarter of 2025, compared to a net cash used of $26.8 million in the third quarter of 2024 and $12.7 million used in the second quarter of 2025. The result includes a positive working capital contribution of $0.4 million in the third quarter of 2025, compared to a negative working capital contribution of $9.1 million in the third quarter of 2024, primarily reflecting improvements in operating performance.

In addition, the Company reported $1.4 million in capital expenditures in the third quarter of 2025, compared to $0.9 million in the third quarter of 2024, primarily reflecting investments in infrastructure and facility enhancements to support business growth. “This quarter marks a significant acceleration in customer demand and order growth, driven by strong execution across our markets and growing consumer trust in the Jumia brand. We believe Jumia has reached an inflection point as our compelling value proposition, and improved operational discipline position us for sustainable, profitable growth.

“We continue to strengthen our cost structure and sharpen operational discipline, reinforcing our path toward profitability. Our focus remains on execution and customer engagement as we build a more efficient business.
“We believe that we are on track to reach breakeven on a Loss before Income tax basis in Q4 2026 and achieve full-year profitability in 2027, positioning Jumia for long-term growth and value creation.”