Edition:
United States

Libby George

UK judge to allow firm to try to seize $9 billion in Nigerian assets in gas dispute

Aug 16 2019

LAGOS A judge in London said on Friday he would grant a firm called Process and Industrial Developments Ltd (P&ID) the right to seek to seize some $9 billion in assets from the Nigerian government over an aborted gas project.

Nigeria's new oil czar wants to open books, turn into fuel exporter

Aug 08 2019

ABUJA Nigeria's state oil company plans to partner with a private refinery under construction on the shores of Lagos to turn the oil-producing country into a fuel supplier for the region, the new boss said in an interview with Reuters. | Video

INTERVIEW-New oil boss wants to open books, turn Nigeria into fuel exporter

Aug 07 2019

ABUJA, Aug 7 Nigeria's state oil company plans to partner with the huge private refinery under construction on the shores of Lagos to turn the oil-producing nation into a fuel supplier for the region, the new head said in an interview with Reuters.

On cusp of pan-African trade deal, giant Nigeria clings to protection

Aug 06 2019

LAGOS Adeleke Adeleye stands in front of a bank of whirring printers spinning out dozens of envelopes a minute in Nigeria's commercial capital of Lagos. | Video

On cusp of pan-African trade deal, giant Nigeria clings to protection

Aug 06 2019

* Nigeria signed Africa free trade deal in July * Many businesses there fear a flood of cheap goods * Analysts say Nigerian protectionism could undermine pact By Libby George and Alexis Akwagyiram LAGOS, Aug 6 Adeleke Adeleye stands in front of a bank of whirring printers spinning out dozens of envelopes a minute in Nigeria's commercial capital of Lagos. His stationery company, FAE Ltd, is thriving and will move into a larger factory nearby by the end of next year. But he sees trouble on the horizon in the form of a new African free trade agreement aiming to unlock a market of 1.3 billion consumers - but which many in Nigeria, the continent's largest economy, view as a threat. "It's definitely not a level playing field," he says. Africa is forging ahead with the African Continental Free Trade Area (AfCFTA) - a project to create a $3.4 trillion economic bloc - even as world powers such as the United States and Britain back away from multilateral trade pacts. Its champions - South Africa and Kenya among them - say the deal will provide a shot in the arm to trade between African nations, which accounted for just 17% of exports in 2017, and give their companies access to millions of new customers. But Nigeria is worried it could be flooded with cheap goods from more competitive neighbours, undermining its efforts to revive local manufacturing and expand farming to reduce dependence on crude oil exports. It was one of the last of 54 nations to back the agreement, only signing on last month. Just Eritrea, which did not participate in the negotiations, has not approved the deal. Now that Nigeria is in, however, some trade experts fear its long history of economic protectionism and tepid support for the AfCFTA will undermine the bloc. "If Nigeria, after signing, decides not to implement, there will be a problem. There are so many administrative ways in which Nigeria can frustrate this agreement," said Bismarck Rewane, CEO of Lagos-based consultancy Financial Derivatives Company (FDC). GIANT UNDERDOG? The size of Nigeria's economy - a gross domestic product of nearly $400 billion and a population of some 190 million - belies major weaknesses. Reliance on crude oil sales for around 90% of foreign exchange earnings led to neglect of other sectors. Once thriving automobile, textile and agricultural industries atrophied. While nations including Ethiopia and Kenya are investing heavily in railways, highways and power projects with a view to becoming manufacturing hubs, Nigeria's infrastructure remains antiquated. With a population less than a third its size, South Africa, the continent's second largest economy, produces roughly 10 times more electricity than Nigeria. South African brands, including supermarkets and telecommunication firms, are already conquering Africa. Nigeria garnered just 23 points out of 100 in the World Bank's "trading across borders" scoring due to its jam-packed ports and pot-holed roads, which add significant costs and delays to trade. Kenya, by comparison, scored 68. President Muhammadu Buhari's government is working to catch up. But those efforts in many cases run counter to the spirit of free trade the AfCFTA embodies. Nigeria has placed import controls on a broad range of items, from rice, cocoa and tomatoes to furniture and footwear. Total duties - tariffs, fees and other taxes - on some imports can top 70%. The central bank has also restricted access to foreign exchange for imports of more than 40 items it says Nigeria should produce itself. PROHIBITED IMPORTS EFFECTIVE BAN ON CENBANK (25 in total) TARIFFS AT OR FOREX FOR IMPORTS ABOVE 70%* (more than 40 in total) CANE SUGAR WHEAT FLOUR RICE BAGGED CEMENT SUGAR POULTRY SPAGHETTI NOODLES TOBACCO VEGETABLE OIL/PALM PRODUCTS OIL BIRDS EGGS CARS AND SUVs TEXTILES ALL TYPE OF SALT CEMENT FOOTWEAR FERTILIZER YACHTS/MOTORBOA FURNITURE TS SOAP AND DETERGENT ALCOHOL TABLEWARE COCOA BUTTER, RICE TOMATOES POWDER AND CAKES TOMATO PASTE TOMATO PASTE MILK (at 50%) * Tariff plus levy SOURCING: Nigerian Customs Service, Nigerian Central Bank, U.S. International Trade Administration Some of these policies have backfired. A cap on gasoline prices requires heavy subsidies on refined petroleum imports, and the artificially low prices mean 10% to 20% of Nigerian fuel is smuggled to neighbouring Benin, according to estimates by the Major Oil Marketers Association of Nigeria (MOMAN). Import controls on rice, imposed even as local farmers fail to meet demand, have kept prices artificially high and led to smuggling from Benin into Nigeria. Still, the measures are largely supported in Nigeria, particularly among manufacturers such as Adeleye, who says fellow stationers have benefited from a ban on imports made from a type of paper that would compete with their products. He fears joining the African free trade area could sweep away such advantages. "They have to stay in place," he said. "SOMETHING'S GOT TO GIVE" Having now signed onto the AfCFTA, Nigeria's presidency said last month it will set up a committee of government agencies and private sector groups to chart the way forward. But it made clear that requesting carve-outs for specific economic sectors would be a part of the process. "We viewed this as both an opportunity and a threat," Buhari told a group of business leaders in July. Analysts worry Nigeria's attempts to reconcile its strategy of ring-fencing domestic industries with its membership in a free trade zone could pose a major obstacle to implementing the agreement. "Something has to give," said John Ashbourne, senior emerging markets economist at London-based consultancy Capital Economics. "Will other African countries allow in Nigerian goods if the (central bank) is actively trying to discourage trade going the other way?" Nigeria's protectionism has scuppered similar multinational initiatives in the past. Five years after negotiations wrapped up for an economic partnership between the European Union and 16 West African nations, Nigeria's failure to sign the deal has effectively blocked it for the entire region. Its adherence to the West African bloc ECOWAS' common external tariff regime has also been patchy. Any attempts by Nigeria to slow-pedal implementation of the new African free trade deal until it is satisfied it can compete with its neighbours could be similarly undermining. Overhauling Nigeria's infrastructure could take decades. FDC estimates its power and transportation networks alone need 4.57 trillion naira ($15 billion) annually, an amount equivalent to 6.7% of GDP. However, the consultancy said Nigeria's total infrastructure spending was just over 2 trillion naira over the past two years. At his factory, surrounded by stacks of brown and white envelopes, Adeleye said Nigeria wasn't prepared for the challenges the AfCFTA would present. But he said the country had made a commitment. "We signed," he said, smiling. "We have to be ready. There is no going back." ($1 = 306.8500 naira) (Additional reporting by Felix Onuah in Abuja Editing by Joe Bavier, Alexandra Zavis and Andrew Heavens)

Google goes Nigerian with local accent, 'informal' transit routes

Jul 24 2019

LAGOS Commuters making their way through Nigeria can now hear travel advice in a local voice on Google Maps under new features aimed at attracting more users in Africa that were unveiled by the company on Wednesday.

Nigeria's state oil firm awards oil-for-fuel swap deals: sources

Jul 16 2019

LAGOS/LONDON Nigerian state oil firm NNPC issued award letters on Monday for highly sought-after contracts to exchange crude oil for imported fuel for one year, oil industry sources told Reuters.

Political void crimps Nigeria's stocks, rattles investors

Jul 04 2019

LONDON/LAGOS The failure of Nigeria's president to appoint a cabinet four months after winning a second term has stymied the country's stock market, prompted foreign investors to trim holdings and threatened growth prospects for Africa's largest economy.

Political void crimps Nigeria's stocks, rattles investors

Jul 04 2019

* MSCI Nigeria index down 15% in 2019, defying frontier rally

Nigerian court adjourns tax case between MTN and attorney general

Jun 26 2019

LAGOS A Nigerian judge on Wednesday adjourned until Oct. 29 a case to resolve a $2 billion tax dispute between South African telecoms company MTN Group and Nigeria's attorney general.

World News

Iran tanker heads to Greece, U.S. warns against helping vessel

An Iranian tanker at the center of an angry confrontation between Iran and Washington sailed for Greece on Monday after it was freed from detention off Gibraltar, as Washington called the release unfortunate and warned Greece and Mediterranean ports against helping the vessel.