RESEARCH DEPARTMENT

CENTRAL BANK OF NIGERIA
Volume 4, Issue 1
Volume 4, Issue 1
Volume 4, Issue 1
Volume 4, Issue 1
March 2009
March 2009
March 2009
March 2009
ECONOMIC REPORT FOR
THE FIRST QUARTER OF

CENTRAL BANK OF NIGERIA

QUARTERLY ECONOMIC REPORT


EDITORIAL BOARD

Editor-In-Chief
C.N.O. Mordi

Managing Editor
B. S. Adebusuyi

Editor
S. N. Ibeabuchi

Assistant Editor
S. A. Olih

Associate Editor
U. Kama

The Central Bank of Nigeria Quarterly Economic Report is designed for the dissemination of financial and economic information on the Nigerian economy on current
basis. The Report analyses developments in the financial, fiscal, real and external sectors
of the economy, as well as international economic issues of interest. The Report is directed at a wide spectrum of readers including economists and financial analysts in government and the private sector, as well as general readers.

Subscription to the Quarterly Economic Report is available without charge to institutions, corporations, embassies and development agencies. Individuals, on written request, can obtain any particular issue without a charge. Please direct all inquiries on the
publication to the Director of Research, Central Bank of Nigeria, P.M.B. 187, Garki,
Abuja, Nigeria.


i


TABLE OF CONTENTS


EDITORIAL BOARD ...


...

i

TABLE OF CONTENTS ...


...

1.0
SUMMARY


...


...

2.0
FINANCIAL SECTOR DEVELOPMENTS
...

2.1
Monetary and Credit Developments ...

2.2
Currency-in-Circulation and Deposits at the CBN
...

2.3
Interest Rate Developments
...
...

...

2.4
Money Market Developments
...
...

...

2.5
Deposit Money Banks’ Activities

...

2.6
Discount Houses’ Activities
...
...

...

2.7
Capital Market Developments


3.0
FISCAL OPERATIONS
...

...

3.1
Federation Account Operations
...

...

3.2
The Fiscal Operations of the three tiers of Government
...

3.2.1
The Federal Government
...

...

3.2.2
Statutory Allocations to State Governments
...

3.2.3
Statutory Allocations to Local Government Councils

3.3
Domestic Debt


...
...

4.0
DOMESTIC ECONOMIC CONDITIONS
...

4.1
Agricultural Sector

...


...

4.2
Industrial Production

...


...

4.3
Petroleum Sector

...

... 9
4.4
Consumer Prices
...


...

5.0
EXTERNAL SECTOR DEVELOPMENTS
...

5.1
Foreign Exchange Flows ...


...

5.2
Non-Oil Export Proceeds by Exporters ...

5.3
Sectoral Utilisation of Foreign Exchange

...

5.4
Foreign Exchange Market Developments

...

6.0
OTHER INTERNATIONAL ECONOMIC
DEVELOPMENTS

...

...


F I G U R E S
1.
Aggregate Money Supply in Nigeria


...

2.
Aggregate Domestic Credit to the Economy

...

3.
Selected Bank Interest Rates


...

4. Treasury Bills’ Holdings
...

5.
Volume and Value of Traded Securities


...

6.
Market Capitalization and Value Index


...

7.
Components of Federally Collected Revenue

...

8.
Trends in Oil and Non-Oil Share of GDP


...

9.
Index of Industrial Production


...

10.
Trends in Crude Oil Price


...

11.
Quarterly Consumer Price Indices in Nigeria

...

12.
Inflation Rate in Nigeria


...

13.
Foreign Exchange Flows through the CBN

...

14.
Sectoral Utilisation of Foreign Exchange


...

15.
Average Exchange Rate Movements


...

WDAS-BDC Exchange Rate Premium


...

17.
Demand for and Supply of Foreign Exchange

...

18. Selected Macroeconomic Indicators Tables

...

iii


the preceding quarter.

The major agricultural activities in the review quarter included harvesting of late maturing grains and pre-planting
operations for dry season farming.
1.0 Summary

Provisional data from the National Bureau of Statistics
(NBS) indicated that overall Gross Domestic Product
(GDP) at 1990 constant basic prices grew by 6.4 per cent
in 2008. Staff estimate for GDP growth in the first quarter
of 2009 was put at 6.3 per cent, compared with 5.7 per cent
in the corresponding quarter of 2008. The projected growth
was driven mainly by the non-oil sector, particularly agriculture which constituted 35.8 per cent of total GDP and
contributed 2.2 percentage points to the growth in real
GDP in the quarter. Broad money (M2) and narrow money
(M1) contracted by 1.9 and 3.9 per cent, respectively, relative to the preceding quarter. The decline in M2 was attributed largely to the fall in foreign assets (net) of the banking
system.

Available data indicated a general increase in banks’ deposit and lending rates in the first quarter, 2009. The
spread between the weighted average term deposit and
maximum lending rates widened from 8.13 percentage
points in the preceding quarter to 9.97 percentage points.
The margin between the average savings deposit and maximum lending rates, also, widened from 16.62 to 19.33 percentage points during the period. The weighted average
inter-bank call rate rose to 15.79 per cent from 14.01 per
cent in the preceding quarter, reflecting the liquidity condition in the inter-bank funds market.

The value of money market assets outstanding rose by 5.5
per cent over the level in the preceding quarter to
=N=2,996.8 billion in March 2009. The increase was attributed largely to the rise in outstanding FGN bonds and
Bankers’ Acceptances (BAs). Activities on the Nigerian
Stock Exchange were bearish as all the major market indicators trended downward.

Total federally-collected revenue in the first quarter, 2009
stood at =N=1,183.72 billion, representing a decline of
10.8 and 31.9 per cent from the proportionate budget estimate and the preceding quarter’s level. At =N=842.26 billion, oil receipts constituted 71.2 per cent of the total revenue representing an increase of 8.2 per cent over the
budget estimate, but a decline of 39.5 per cent from the
level in the preceding quarter. The fall in oil receipts relative to the budget estimate was attributed to the decline in
crude oil and gas sales as well as petroleum profit tax and
royalties. Non-oil receipts, at =N=341.46 billion or 28.9
per cent of the total, was lower than the receipts in the preceding quarter and the budget estimate by 1.6 and 37.7 per
cent, respectively. The decline in non-oil receipts relative to
the preceding quarter was attributed to the fall in independent revenue of the Federal Government, Customs and Excise Duties, Companies Income Tax (CIT), Customs Special
levies and Value-Added-Tax. Federal Government retained
revenue for the first quarter, 2009 was =N=747.37 billion,
while total expenditure was =N=747.86 billion. Thus, the
fiscal operations of the Federal Government resulted in an
estimated overall deficit of =N=0.49 billion, compared with
the budgeted deficit of =N=140.80 billion and =N=55.86 in
Nigeria’s crude oil production, including condensates and
natural gas liquids, was estimated at 1.68 million barrels
per day (mbd) or 151.20 million barrels for the quarter.
Crude oil export was estimated at 1.23 mbd or 110.70 million barrels for the quarter, while deliveries to the refineries for domestic consumption remained at 0.445 mbd or
40.05 million barrels. The average price of Nigeria’s reference crude, the Bonny Light (370 API), estimated at
US$46.15 per barrel, fell by 23.0 per cent from the level in
the preceding quarter. The end-period inflation rate for the
first quarter, 2009, on a year-on-year basis, was 14.4 per
cent, compared with 15.1 and 7.8 per cent recorded at the
end of the preceding quarter and the corresponding quarter
2008, respectively. Inflation rate on a twelve-month moving
average basis for the first quarter, was 13.1 per cent, compared with 11.6 and 5.8 per cent recorded in the preceding
quarter and the corresponding quarter, 2008, respectively.

Foreign exchange inflow and outflow through the Central
Bank of Nigeria (CBN) amounted to US$5.72 billion and
US$11.26 billion, respectively, resulting in a net outflow of
US$5.53 billion during the quarter. Foreign exchange sales
by the CBN to the authorized dealers amounted to US$7.57
billion in the review quarter. The weighted average exchange rate of the Naira vis-à-vis the US dollar, depreciated by 17.0 per cent to =N=146.86 per dollar at the
RDAS. In the bureaux de change segment of the market, the
naira also depreciated from =N=125.25 per dollar to
=N=160.37 per dollar. Non-oil export earnings by Nigerian
exporters amounted to US$258.98 million, indicating an
increase of 2.0 per cent over the level in the preceding
quarter. The development was attributed largely to the increase in the prices of all the commodities traded at the
international commodities market during the period.

Other major international economic developments of relevance to the domestic economy during the quarter included:
the 2009 Annual Meeting of the World Economic Forum
held in Davos-Klosters, Switzerland from January 28 –
February 1, 2009 (see January 2009 Report). The bilateral
meeting held between the Federal Government of Nigeria
and the United Arab Emirates (UAE) in Abuja on January
15, 2009 (see January 2009 Report). the meeting between
the Heads of the Multilateral Development Banks (MDBs)
and the International Monetary Fund (IMF) held in Tunis,
Tunisia, on February 12, 2009 at the invitation of the African Development Bank (see February 2009 Report). The
12th Assembly of the African Heads of State and Government met on February 3, 2009 in Addis Ababa, Ethiopia
(see February 2009 Report).

In another development, the International Monetary Fund
(IMF) convened a conference in Dar es Salaam, Tanzania
from March 10 – 11, 2009. The meeting was a fall out of the
severe challenges faced by African economies and the risk
that the achievements of the past decade in poverty reduction might be reversed.


Also, the 6th Session of Nigeria-U.S TIFA Council meeting
was held in Washington D.C., U.S.A from 30 - 31 March,
2009. The council meeting covered trade and investment
issues of concern to Nigeria and U.S.

The G-20 Finance Ministers and Central Bank Governors,
met on March 14, 2009 to prepare for the Leaders’ London Summit. They agreed on further action to restore
global growth and support lending, and reforms to
strengthen the global financial system.

2.0 FINANCIAL SECTOR DEVELOPMENTS

2.1 Monetary and Credit Developments
Provisional data indicated contraction in monetary aggregates in the first quarter of 2009. Broad money supply
(M2) and narrow money (M1) fell by 1.9 and 3.9 per cent
to =N=8,997.8 billion and =N=4,666.7 billion, respectively, as against the increase of 2.3 and 7.4 per cent in
December 2008. The decline in M2 was attributed to the
5.2 per cent fall in foreign assets (net), reinforced by the
2.6 per cent contraction in credit to the domestic economy
(net) (fig. 1 and table 1).

At =N=4,820.8 billion, aggregate banking system credit
(net) to the domestic economy declined by 2.6 per cent in
the first quarter of 2009, in contrast to the increase of
16.7 per cent in the preceding quarter. The development
reflected wholly the 9.6 per cent fall in claims on the Federal Government.

Banking system’s credit (net) to the Federal Government
declined by 9.6 per cent to negative =N=3,405.6 billion,
as against the increase of 3.8 per cent in the preceding
quarter. The fall was attributed to the decline in CBN and
DMBs’ holding of Federal Government securities.

Banking system’s credit to the private sector rose by 2.1
per cent to =N=8,226.4 billion, compared with the increase of 7.8 per cent in the preceding quarter. The rise
reflected largely the 1.5 per cent increase in bank’s claims
on the sector (fig 2).

At =N=8,105.3 billion, foreign assets (net) of the banking
system fell by 5.2 per cent, in contrast to the increase of
0.3 per cent in the preceding quarter. The development
was attributed largely to the 4.3 per cent decline in the
CBN’s holdings.

Quasi money increased by 0.5 per cent to =N=4,331.1
billion, in contrast to the decline of 2.9 per cent in the
preceding quarter. The development was attributed to
the rise in all the components namely, time, savings
and foreign currency deposits of the deposit money
banks (DMBs).

Other assets (net) of the banking system, also, rose by
9.4 per cent to =N=3,928.4 billion, in contrast to the
fall of 13.9 per cent in the preceding quarter. The increase reflected largely the decline in unclassified
liabilities of the both the CBN and DMBs during the
quarter.
2.2 Currency-in-circulation and Deposits at
the CBN

At =N=1,037.8 billion, currency in circulation rose by
1.3 per cent in March, 2009 over the level in December, 2008. The rise was attributed largely to the increase of 11.7 per cent in vault cash during the period.
M ajor monetary aggregates fell, while
banks’ deposit and lending rates increased in the first
quarter of 2009. The value of money market assets increased, following largely the rise in outstanding FGN
bonds and Nigerian Treasury Bills (NTBs). Transactions
on the Nigerian Stock Exchange (NSE) were bearish as
the major market indicators trended downward.
3rd Qtr

4th Qtr

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

1st Qtr

QCP

QCG

QAC

CCP
58.6
90.8


CCG

CAC


Per cent
Figure 2: Aggregate Domestic Credit to the Economy (Quarterly and
Cummulative Growth Rate)

Total deposits at the CBN amounted to =N=5,686.2
billion, indicating a decline of 3.2 per cent from the
level in the preceding quarter. The development was
attributed largely to the fall in Federal Government
deposits. The shares of the Federal Government, banks
and “others” in total deposits at the CBN were 89.0, 6.1
and 4.9 per cent, respectively, compared with the
shares of 88.0, 6.7 and 5.3 per cent, in December 2008.

2.3
Interest Rate Developments

Available data indicated a general increase in banks’
deposit and lending rates in the first quarter of 2009.
With the exception of the average savings and 7-day
deposit rates, which declined by 0.26 and 0.09 percentage points to 2.91 and 6.97 per cent, respectively, all
other rates on deposits of various maturities rose from a
range of 12.10 – 12.76 per cent in the preceding quarter
to 12.85 – 13.58 per cent. Similarly, the average prime
and maximum lending rates rose by 2.31 and 2.45 percentage points to 18.34 and 22.24 per cent, respectively. Consequently, the spread between the weighted
average term deposit and maximum lending rates widened from 8.13 percentage points in the preceding
quarter to 9.97 percentage points. The margin between
the average savings deposit and maximum lending
rates, also, widened from 16.62 percentage points in the
preceding quarter to 19.33 percentage points.

At the inter-bank call segment, the weighted average
rate, which was 14.01 per cent in the preceding quarter,
rose to 15.79 per cent, reflecting the liquidity squeeze
in the inter-bank funds market. The weighted average
rate for the Open Buy Back (OBB), however, fell to
7.89 per cent from 9.31 per cent in the preceding quarter. With regards to the Nigerian Inter-bank Offer Rate
(NIBOR), the 7-day and 30-day tenors, rose respectively to 16.14 and 17.30 per cent from 14.90 and 16.49
per cent in the preceding quarter. With inflation rate at
14.4 per cent at end-March, all deposit rates were negative in real terms.

2.4
Money Market Developments

Provisional data indicated that the value of money market assets outstanding as at March 2009 was
=N=2,996.8 billion, representing an increase of 5.5 per
cent over the level at end-December 2008. The increase
was attributed largely to the 8.8 and 21.8 per cent increase in outstanding FGN bonds and Nigerian Treasury Bills (NTBs), respectively.
Analysis of the money market during the first quarter
showed a slow down in the level of activities at the
secondary market. The liquidity squeeze which had
confronted the banking system in the last quarter of
2008 persisted in the review quarter.
Consequently, the Bank continued to inject fund into
the system through the expanded discount window and
the standing lending facility to enable deposit money
banks and discount houses even their positions.
Total NTBs that matured in the review quarter was
=N=431.54 billion, compared with =N=783.26 billion
in the fourth quarter of 2008. Total injections through
the government fiscal policy actions and CRR computations fell to =N=902.60 billion from =N=1342.81
billion in the preceding quarter. There was no injection
of funds through the purchase of government securities,
as the rates were unattractive.
Nigerian Treasury Bills of 91- 182- and 364-day tenors were offered forth-nightly, while the 364-day tenor
was offered monthly. The total amount offered and
allotted in the first quarter of 2009 were =N=256.58
billion and =N=235.57 billion, respectively while total
subscription stood at N608.75 billion. In the fourth
quarter of 2008, total subscription and allotment were
=N=780.21 billion and =N=256.36 billion, respectively.
2nd
Qtr

3rd
Qtr

4th
Qtr

1st
Qtr

2nd
Qtr

3rd
Qtr

3rd
Qtr

4th
Qtr

1st
Qtr

Avg. Term Deposits

Prime
16.92 16.46 16.9 16.05 15.86 15.97 15.97 16.03 18.34
Inter-bank
8.00
8.13
8.25 10.21 10.4 12.83 12.83 14.01 15.79
Maximum
18.74 18.27 18.24 18.17 17.9
18.1
18.1 19.79 22.24

Per cent
Figure 3: Selected Bank Interest Rates (Per cent
Average)

The surge in subscription at the primary market auctions for NTBs was attributable to investors’ flight to
safety from the stock segment of the capital market to
the government securities (FGN Bonds), coupled with
the need to maintain their portfolio holding of bills in
order to meet regulatory guidelines.
The issue rates for the 91- and 182-day NTBs ranged
from 1.898 to 5.100 per cent and 2.55 to 6.00 per cent,
respectively in the review period, compared with a
range of 5.00 to 9.00 per cent and 5.20 to 9.30 per
cent, in the fourth quarter of 2008. The issue rates for
the 364-day tenored instrument ranged from 4.75 to
5.98 per cent, compared with the range of 7.65 and
9.30 per cent in the fourth quarter of 2008. Analysis of
the issues showed investors’ preference for longer
tenored bills due mainly to the higher returns as well
as the need to hedge against interest rate volatility.
Monthly auctions of FGN Bonds continued as 3-, 5-
and 20-year tranches were issued in January and subsequently reopened in February and March 2009, in
line with the restructuring of the domestic debt profile
to longer tenors. A total of =N=160.00 billion, made
up of =N=60.00 billion 3-year Bond, =N=60.00 billion
5- year Bond, and =N=40.00 billion 20-year Bond
were floated and allotted, and the total subscription
was =N=277.51 billion during the first quarter of 2009.
The coupon rates ranged from 9.92 to 10.95 per cent
for the 3-year Bond, 11.40 to 12.00 per cent for the 5year Bond and 13.21 to 13.45 per cent for the 20-year
bond. In the last quarter of 2008, FGN Bonds of 3-, 5-,
10– and 20- years were issued with total issue and allotment of =N=90.00 billion apiece, while the total
subscription was =N=269.17 billion. The coupon rates
were 10.00 per cent for 3-year Bond, 10.50 per cent for
5-year Bond and 15.00 per cent for 20-year Bond.
Trading at the secondary market (O-T-C) for FGN
Bonds also remained very active in the review period.
The Monetary Policy Rate (MPR) remained at 9.75 per
cent in the review quarter. Due to the liquidity unease
that pervaded the banking system in the review quarter, the volume of lending by the Bank remained high
as deposit money banks and discount houses accessed
the facility on a daily basis. However, the total lending
facility granted to deposit money banks and discount
houses declined to =N= 7,891.38 billion, from the
=N=9,366.30 billion in the fourth quarter, 2008. The
development was attributed to the market players’
preference for the Expanded Discount Window Facility, which accommodates variety of instruments and
affords them longer tenor.


The maximum spread on the 90-day and 360-day
tenor at the Expanded Discount Window was
pegged at 195 and 500 basis points above the prevailing MPR, in March, 2009. Meanwhile, the eligible financial instruments used as collateral at the
discount window included Bankers’ Acceptances
(BAs), Guaranteed Commercial Papers (CPs) and
Promissory Notes, among others. Thus, the total
amount injected through the medium as at March
2009 stood at =N=1,110.06 billion, compared with
=N= 879.10 billion at end-December 2008.
2.5
Deposit Money Banks’ Activities

Available data indicated that total assets/liabilities
of the DMBs amounted to =N=15,542.6 billion,
representing a decline of 2.4 per cent from the level
in the preceding quarter. The development was attributed largely to the 7.7 per cent decline in unclassified assets, reinforced by the 9.8 per cent fall in
foreign assets.

Funds, which were sourced mainly from unclassified liabilities and increased foreign assets were
used mainly for the settlement of unclassified liabilities.

At =N=9,165.4 billion, credit to the domestic economy declined by 0.6 per cent from the level in the
preceding quarter. The development was attributed
largely to the 12.1 per cent decline in claims on the
Federal Government.

Central Bank’s credit to the DMBs rose by 1.9 per
cent to =N=134.7 billion in the review quarter, reflecting the increase in CBN’s overdrafts to the
DMBs.

Total specified liquid assets of the DMBs stood at
=N=3,123.1 billion, representing 35.6 per cent of
their total current liabilities. At that level, the liquidity ratio rose by 3.0 percentage points over the preceding quarter’s level, but was 4.4 percentage points
below the stipulated minimum ratio of 40.0 per cent.
The loans-to-deposit ratio fell by 1.4 percentage
points to 86.6 per cent from the level in the preceding quarter, and was 6.6 percentage points above the
prescribed minimum target of 80.0 per cent.

2.6
Discount Houses’ Activities

Total assets/liabilities of the discount houses stood
at =N=375.8 billion in the first quarter, 2009 indicating a decline of 9.9 and 14.2 per cent from the levels
in the preceding quarter and corresponding period of
2008, respectively. The fall in assets was as a result
of the 46.5 and 21.2 per cent decline in claims on the
Federal Government and banks, respectively, during
the quarter.

Correspondingly, the fall in total liabilities was attributed to the 48.0 and 13.1 per cent decline in
money-at-call and borrowings during the period,
respectively. Discount houses’ investments in Federal Government securities of less than 91 days maturity declined by 42.2 per cent to =N=26.3 billion,
representing 8.5 per cent of their total deposit liabilities. At this level, discount houses’ investments fell
by 4.3 per cent from the level in the preceding quarter. This level of investment was 51.5 percentage
points below the prescribed minimum level of 60.0
per cent for fiscal 2009.

Total borrowing by the discount houses was
=N=209.0 billion, while their capital and reserves
amounted to =N=34.0 billion, representing an increase of 1.1 and 41.6 per cent over the levels in the
preceding quarter and the corresponding period of
2008, respectively. Thus, resulting in a gearing ratio
of 6.1:1, compared with the stipulated maximum
target of 50:1 for fiscal 2009.

2.7
Capital Market Developments

Available data indicated that activities on the Nigerian Stock Exchange (NSE) in the first quarter of
2009 were bearish as all the major market indicators
trended downward. The volume and value of traded
securities declined by 19.7 and 29.1 per cent to 19.0
billion shares and =N=106.9 billion, respectively,
compared with 23.7 billion shares and =N=150.8
billion in the fourth quarter of 2008. Relative to the
68.6 billion shares and =N=990.4 billion in the corresponding period of 2008, total turnover volume and
value fell by 72.3 and 89.2 per cent, respectively, in
the review quarter. The banking sub-sector was the
most active on the Exchange with traded volume of
10.4 billion shares valued at =N=72.7 billion exchanged in 234,393 deals. There were no transactions
on the Federal Government and industrial loans/
preference stocks.

Transactions on the over-the-counter (OTC) bond
segment of the market indicated that a turnover of
4.2 billion units worth =N=4.3 trillion was recorded
in the review quarter, in contrast to a total of 3.7 billion units valued at =N=3.6 trillion exchanged during
the preceding quarter. The most active bond measured by turnover volume was the 3rd FGN Bond 2011
Series 13 with traded volume of 167.8 billion units
valued at =N=193.8 billion in 1,579 deals.
In the new issues market, a total of 4.4 billion ordinary
shares in favour of HIS (Nigeria) Plc; 4.6 billion shares
of =N=0.0015 each at =N=6.00 per share in favour of
Pinnacle Point Group Plc; 4.0 billion units of Irredeemable Non-Cumulative Convertible Preference shares of
=N=0.50 each at =N=9.50 per share in favour of Finbank Plc; and =N=50.0 billion Lagos State Fixed Bond
(Series 1) were admitted into the daily official list during the review quarter. Thus, the number of listed State
Government bonds increased to six (6). Also, there
were (8) supplementary listings during the same period.
Universal Trust Bank Plc was, however, delisted from
the Daily Official List, following the successful takeover of the bank by Union Bank of Nigeria Plc through
the Purchase & Assumption (P&A) model of bank
resolution option. In another development, the name of
PlatinumHabib Bank Plc was changed to Bank PHB
Plc as advised by the Board of Directors in the review
quarter.
The NSE All-Share Index, which opened at 31,450.78,
closed at 19,851.89, representing a decline of 36.9 per
cent from the level in the preceding quarter. The total
market value of the 302 listed securities declined by 4.0
per cent to =N=7.2 trillion from the preceding quarter’s
level. The fall in market capitalization was attributed to
the price losses recorded by the highly capitalized
stocks. The 214 listed equities accounted for =N=4.5
trillion or 62.6 per cent of the total market capitalization.

Figure 5: Volume and value of traded securities

1st
Qtr
'07
2nd
Qtr
'07
3rd
Qtr
'07
4th
Qtr
'07
1st
Qtr

2nd
Qtr
'08
3rd
Qtr
'08
4th
Qtr
'08
1st
Qtr

No.

N'billion
Volume of traded securities
Value of securities
Figure 6 : M arket cap it alizat ion and value ind ex

1st
Qtr

2nd
Qtr

3rd
Qtr

4th
Qtr

1st
Qtr

2nd
Qtr

3rd
Qtr

4th
Qtr

1st
Qtr

2nd
Qtr

3rd
Qtr

4th
Qtr

1st
Qtr


Mkt capitalization
Value index


3.0
FISCAL OPERATIONS

3.1
Federation Account Operations

Available data showed that total federally-collected
revenue during the first quarter of 2008 stood at
=N=1,183.72 billion, representing a decline of 10.8 and
31.9 per cent from the proportionate budget estimate
and receipts in the preceding quarter, respectively. At
=N=842.26 billion, oil receipts, which constituted 71.2
per cent of the total, was higher than the proportionate
budget estimate by 8.2 per cent, but lower than the receipts in the preceding quarter by 39.5 per cent. The
fall in oil receipts relative to the preceding quarter was
attributed to the decline in receipts from crude oil and
gas sales as well as petroleum profit tax and royalties.

Non-oil receipts, at =N=341.46 billion or 28.8 per cent
of the total, was lower than the budget estimate and
receipts in the preceding quarter by 37.7 and 1.6 per
cent, respectively. The development was attributed
largely to the fall in Federal Government Independent
Revenue, Customs and Excise Duties, Value-Added
tax (VAT), Customs special levies and Companies Income Tax (CIT) (fig 7). As a percentage of GDP, oil
revenue was 12.5 per cent, while non-oil revenue stood
at 5.1 per cent in the first quarter of 2009. The decline
in revenue relative to the level in the preceding quarter
was due to the fall in oil and non-oil receipts during the
review quarter.

Of the total federally-collected revenue during the review quarter, the sum of =N=770.54 billion was transferred to the Federation Account for distribution among
the three tiers of government and the 13.0 per cent derivation fund. The Federal Government received
=N=363.79 billion, while the state and local governments received =N=184.52 billion and =N=142.26
billion, respectively. The balance of =N=79.97 billion
went to the 13.0 per cent derivation fund for distribution by the oil producing states. To bridge the shortfall
in revenue for the period, the sum of =N=310.65 billion was augmented and shared as follows: Federal
Government (=N=142.38 billion), state governments
(=N=72.22 billion), local governments (=N=55.68 billion) and oil producing states (=N=40.38 billion).

3.2
The Fiscal Operations of the Three
Tiers of Government

3.2.1
The Federal Government

At =N=747.37 billion, the Federal Government retained revenue for the first quarter, 2009 was higher
than the proportionate budget estimate by 24.5 per
cent, but lower than the receipts in the preceding quarter by 18.3 per cent.

At =N=747.86 billion, total expenditure for the review
period rose by 0.9 per cent over the proportionate
budget estimate but declined by 23.0 per cent from the
level in the preceding quarter. The increase in total
expenditure for the review period relative to the budget
estimate was attributed largely to the rise in current
expenditure during the quarter. A breakdown of total
expenditure showed that the recurrent component accounted for 67.8 per cent, the capital component accounted for 25.8 per cent, while statutory transfers accounted for the balance of 6.4 per cent. As a percentage
of GDP, recurrent expenditure was 7.5 per cent, while
capital expenditure and transfers stood at 2.9 and 0.7
per cent, respectively.

The fiscal operations of the Federal Government in the
first quarter, 2009 resulted in an estimated overall deficit of =N=0.49 billion, compared with the respective
deficits of =N=140.80 billion in the preceding quarter
and the budgeted sum of =N=55.86 billion.

3.2.2 Statutory Allocations to State Governments

During the first quarter, 2009 total receipts, including
the 13 per cent Derivation Fund and share of VAT by
the state governments from the Federation Account
stood at =N=352.14 billion, representing a decline of
22.8 and 14.6 per cent from the levels in the preceding
quarter and the corresponding period of 2008, respectively.

Further breakdown showed that at =N=54.43 billion,
receipts from the VAT Pool Account declined by 13.6
per cent from the level in the preceding quarter, while
receipts from the Federation Account stood at
=N=297.71 billion. On monthly basis, the sum of
=N=157.9 billion, =N=103.9 billion and =N=90.3 billion were allocated to the 36 state governments in January, February and March 2009, respectively.

Figur e 7 : Compone nt s of Fe de r a l ly Coll e c t e d
Re v e nue ( =N= Bi l li on)

OI L
NON OI L


3.2.3 Statutory Allocations to Local Government Councils


Total receipts by the local governments from the Federation and VAT Pool Accounts during the first quarter, 2009 stood at =N=196.78 billion. This was lower
than the level in the preceding quarter by 23.0 per cent,
but higher than the corresponding quarter of 2008 by
1.8 per cent. Of this amount, allocation from the Federation Account was =N=174.78 billion or 83.9 per
cent of the total.

VAT Pool Account accounted for =N=38.54 billion,
representing a decline of 6.2 per cent from the level in
the preceding quarter. On monthly basis, the sums of
=N=84.39 billion, =N=60.33 billion and =N=52.06
billion were allocated to the 774 local governments in
January, February and March 2009, respectively.

3.3
Domestic Debt

The domestic debt stock of the Federal Government
outstanding at the end of the first quarter, 2009 was
estimated at =N=2,579.07 billion, representing an increase of 28.7 per cent over the level at the end of the
fourth quarter, 2008. As a percentage of GDP, total
domestic debt was 9.6 per cent. The increase in total
domestic debt was attributed largely to the issuance of
additional FGN Bonds during the quarter.

4.0
DOMESTIC ECONOMIC CONDITIONS


4.1
Agricultural Sector

The weather situation during the first quarter of 2009
was mixed. The first two months witnessed the prevalence of dry harmattan but in March, there was rainfall
in the coastal areas and the Federal Capital Territory.
Agricultural activities in the southern states centered on
harvesting of tree crops and the clearing of land for the
cropping season, while farmers in the northern states
were engaged in the preparation of irrigated land for
cultivation. In the livestock sub-sector, farmers restocked broilers and layers to replenish the sales of the
festive season in late 2008.

During the review quarter, a total of =N=738.78 million was guaranteed to 4,601 farmers under the Agricultural Credit Guarantee Scheme (ACGS). This
amount represented a decline of 74.5 per cent from the
level in the preceding quarter but an increase of 34.1
per cent over the level in the corresponding quarter of
2008. A sub-sectoral analysis of the loans guaranteed
indicated that the food crop sub-sector had the largest
share of =N=367.90 million or 47.8 per cent to 3,659
beneficiaries, while the livestock sub-sector received
=N=234.00 million or 31.7 per cent to 486 beneficiaries. Also, 337 beneficiaries in the fisheries sub-sector
obtained =N=107.3 million or 14.5 per cent. In the cash
crops sub-sector, 39 beneficiaries got =N=18.60 million or 2.5 per cent, while 80 beneficiaries in ‘others’
had =N=11.0 million or 1.5 per cent. Further analysis
showed that all the 23 states benefited from the
scheme during the quarter, the highest and lowest sums
of =N=85.00 million (11.5 per cent) and =N=1.30 million (0.2 per cent) went to Oyo and Akwa Ibom States,
respectively.

The retail prices of most staples recorded increases in
the first quarter of 2009. Thirteen of the fourteen commodities monitored recorded price increases, which
ranged from 1.7 per cent for white garri to 25.0 per cent
for palm oil over their levels in the preceding quarter,
while millet recorded a price decline of 4.4 per cent.
The rise in the price of most commodities was attributed to the subsisting food situation in the country.

1st
Qtr

2nd
Qtr

3rd
Qtr

4th
Qtr

1st
Qtr

2nd
Qtr

3rd
Qtr

4th
Qtr

1st
Qtr

GDP Growth

Oil Share of GDP

Non-Oil Share of GDP

Per cent
Figure 8: Trends in Oil and Non-Oil Share of
GDP ( in Per cent)
A ggregate output growth in the economy
measured by the gross domestic product (GDP) was
estimated at 6.3 per cent in the first quarter, 2009,
compared with 5.8 per cent in the corresponding quarter of 2008. The projected growth was driven mainly by
the non-oil sector particularly agriculture which constituted 35.8 per cent of total GDP and contributed 2.2
percentage points to the growth in real GDP in the
quarter. The major agricultural activities in the first
quarter, 2009 were harvesting of late maturing grains
and pre-planting operations for dry season farming.
Crude oil production was estimated at 1.89 million
barrels per day (mbd) or 173.88 million barrels for the
quarter. The end-period inflation rate for the first quarter, 2009 on a year-on-year basis, was 15.1 per cent,
compared with 13.0 per cent in the preceding quarter.
The inflation rate on a 12-month moving average basis
was 11.6 per cent, compared with the preceding quarter’s level of 9.2 per cent.


4.2
Industrial Production

Industrial activities during the first quarter, 2009 declined relative to the preceding quarter. At 115.9
(1990=100), the estimated index of industrial production fell by 1.1 and 2.6 per cent from the levels attained
in the preceding quarter and the corresponding period
of 2008, respectively. The fall reflected the poor performance in manufacturing activities, mining output
and electricity generation.

The estimated index of manufacturing production, at
89.9 (1990=100), declined by 1.9 and 0.9 per cent from
the levels in the preceding quarter and corresponding
period of 2008, respectively. The estimated capacity
utilization also fell by 1.6 percentage points during the
review quarter. The development was attributed to the
fall in manufacturing production arising from weak
demand and influx of imported goods.

At 127.6 (1990=100), the index of mining production
declined by 1.1 and 2.5 per cent from the levels in the
preceding quarter and the corresponding period of
2008, respectively. The decline was attributed to the
fall in crude oil and gas production, resulting from the
crisis in the Niger Delta region.

At 2,305.9 MW/h, estimated average electricity generation fell by 13.6 per cent from the level attained in
the preceding quarter. The decline reflected the fall in
water levels at the reservoirs, which power the hydro
power plants in the country as well as the reduction in
gas supply to thermal stations.

At 1,955.5 MW/h, estimated average electricity consumption declined by 13.9 per cent from the level in
the preceding quarter. Of the total, residential consumption accounted for 51.3 per cent, commercial &
street lighting accounted for 26.2 per cent, while industrial consumption accounted for 22.5 per cent. The fall
in electricity consumption was attributed to low power
generation and supply during the review quarter.


4.3 Petroleum Sector

Nigeria’s crude oil production, including condensates
and natural gas liquids was estimated at 1.68 million
barrels per day (mbd) or 151.20 million barrels (mbd)
during the first quarter, 2009, compared with 1.87 mbd
or 168.3 mbd in the preceding quarter. This represented
a decline of 10.2 per cent. Crude oil export was estimated at 1.23 mbd or 110.70 million barrels in the review quarter, compared with 1.42 mbd or 127.8 million
barrels in the preceding quarter. Deliveries to the refineries for domestic consumption remained at 0.445 mbd
or 40.05 million barrels in the review quarter.

At an estimated average of US$46.15 per barrel, the
price of Nigeria’s reference crude, the Bonny Light
(37o API), fell by 23.0 per cent from the level in the
preceding quarter. The average prices of other competing crudes namely, the West Texas Intermediate, the
U.K Brent and the Forcados also fell by 33.2, 24.4 and
22.9 per cent to US$40.86, US$43.69 and US$46.69
per barrel, respectively. The average price of OPEC’s
basket of eleven crude streams also, fell by US$19.1
dollars to US$42.5 from the level in the preceding
quarter. The decline in price was attributed to the fall in
global demand for crude following the continued deterioration in the world economy.

4.4
Consumer Prices

Available data showed that the all-items composite
Consumer Price Index (CPI) for the end of the first
quarter, 2009 was 196.2 (May 2003=100), representing
an increase of 1.9 and 14.3 per cent over the levels in
the preceding quarter and the corresponding period of
2008, respectively. The development was attributed to
the increase in the prices of some staple food items,
beverages, household goods, newsprints and stationeries and miscellaneous services.

Qt3.

Qt4.

Qt1.

Qt2.

Qt3.

Qt4.

Qt1.

Manuf.

Mining

Electricity

All
Sectors

Indices
Figure 9: Index of Industrial Production (1990=100)


The urban all-items CPI at the end of the first quarter,
2009 was 215.8 (May 2003=100), indicating an increase
of 1.2 and 9.9 per cent over the levels in the preceding
quarter and the corresponding quarter of 2008, respectively. Similarly, the rural all-items CPI for the quarter,
at 183.7 (May 2003=100), represented an increase of 2.2
and 16.7 per cent over the levels in the preceding quarter
and the corresponding period of 2008, respectively.

The end-period inflation rate for the first quarter of
2009, on a year-on-year basis, was 14.4 per cent, compared with 15.1 and 7.8 per cent in the preceding quarter
and the corresponding quarter of 2008, respectively.

The inflation rate on a twelve-month moving average
basis for the first quarter, 2009 was 13.1 per cent, compared with 11.6 and 5.8 per cent recorded in December
2008 and the corresponding period of 2008, respectively.

5.0
EXTERNAL SECTOR DEVELOPMENTS


5.1
Foreign Exchange Flows

Foreign exchange inflow and outflow through the CBN
in the first quarter of 2009 amounted to US$5.72 billion
and US$11.26 billion, respectively, representing a net
outflow of US$5.54 billion. Relative to the respective
levels of US$10.78 billion and US$18.93 billion in the
preceding quarter, inflow and outflow fell by 46.9 and
40.6 per cent. The decline in inflow was attributed to
the 56.9 per cent fall in oil receipts, while the rise in
outflow was attributed largely to the 39.5 per cent increase in RDAS utilization during the review quarter.

Available data on aggregate foreign exchange flows
through the economy indicated that total inflow
amounted to US$19.12 billion, representing a decline
of 19.8 and 34.1 per cent from the levels in the preceding quarter and the corresponding period of 2008. Oil
sector receipts, which accounted for 22.2 per cent of the
total, stood at US$4.25 billion, compared with the respective levels of US$9.87 billion and US$10.69 billion
in the preceding quarter and corresponding period of
2008. Non-oil public sector inflows, which accounted
for 7.7 per cent of the total, rose by 62.6 per cent, while
autonomous inflow, which accounted for 70.1 per cent
increased by 2.5 per cent.

At US$11.45 billion, aggregate foreign exchange outflow from the economy declined by 40.0 per cent from
the level in the preceding quarter but increased by
114.0 per cent over the level in the corresponding period of 2008. The fall in outflow relative to the preceding quarter was attributed largely to the respective declines in RDAS utilization and other official payments
during the review quarter.

June.

Sept.

Dec. 07March.

June.

Sept.

Dec. 08March.

Composite 164.3

Urban

Rural


Number
Fig. 11: Quarterly Consumer Price Indices in
Nigeria (2003=100)
T he Retail Dutch Auction System (RDAS) was
re-introduced on January 15, 2009 to facilitate the stability of the value of the naira, following the increased
demand for foreign exchange induced by the global financial crisis, which if left unchecked could lead to
faster depletion of the external reserve.


5.2 Non-Oil Export Proceeds by Exporters

Total non-oil export earnings by Nigeria’s exporters
increased by 2.0 per cent to US$258.98 million over
the level in the preceding quarter. A breakdown of the
proceeds in the review quarter showed that the proceeds of industrial, food products, manufactured products, transport, agricultural, and minerals stood at
US$92.67 million, US$1.57 million, US$51.32 million,
US$0.00 million, US$59.97 million and US$53.45 million, respectively.

The shares of industrial, food products, manufactured
products, transport, agricultural, and minerals subsectors in non-oil export proceeds were 35.8, 0.6, 19.8,
0.0, 23.2 and 20.6 per cent, respectively, in the review
quarter. The development was attributed largely to the
increase in the prices of the goods traded at the international market.

5.3 Sectoral Utilisation of Foreign Exchange


The invisibles sector accounted for the bulk (26.2 per
cent) of total foreign exchange disbursed in the first
quarter of 2009, followed by the industrial sector (23.7
per cent). Other beneficiary sectors, in a descending
order of importance, included: minerals & oil (18.6 per
cent), manufactured products (16.8 per cent), food (9.2
per cent), transport (4.8 per cent) and agricultural products (0.7 per cent) (Fig.12).
5.4 Foreign Exchange Market Developments

Foreign exchange demand by the authorized dealers
stood at US$11.45 billion, indicating a decline of 32.0
per cent from the level in the preceding quarter. Relative to the level in the corresponding period of 2008,
demand rose by 238.1 per cent. Consequently, a total
amount of US$7.57 billion was sold by the CBN during
the period, indicating a fall of 22.0 per cent from the
level in the preceding quarter.


Under the RDAS, the weighted average exchange rate
of the Naira vis-à-vis the US dollar depreciated by 17.0
per cent to =N=146.86 per dollar from =N=121.92 per
dollar in the preceding quarter.

It also showed a depreciation of 19.8 per cent from the
level in the corresponding period of 2008. In the bureaux-de-change segment of the market, the naira
traded at an average of =N=160.37 per dollar, compared with =N=125.25 and =N=118.81 per dollar in the
preceding quarter and the corresponding quarter of
2008, respectively. Consequently, the premium between the official and the bureaux-de-change rates widened from 2.7 per cent in the preceding quarter to 9.2
per cent (fig. 16).

2nd
Qtr

3rd
Qtr

4th
Qtr

1st
Qtr

2nd
Qtr

3rd
Qtr

4th
Qtr

1st
Qtr

2nd
Qtr

3rd
Qtr

4th
Qtr

1st
Qtr

Average RDAS 128. 128. 128. 128. 127. 126. 120. 118 117. 117. 121. 146.
Average BDC
142. 130. 130 129. 128. 127. 123. 119. 118. 119. 125. 160.

Rate (=N=/$)
Period
Figure 15: Average Exchange Rate Movements
Fig. 14 : Sect oral U t ilisat ion of Fo reig n Exchange
( Percent age of Tot al)

per cent
4th Qtr 2008


1st Qtr 2009

1st Qtr 2008

Industr i al
Agr i cul tu
r al
Food
M anuf act
ur es
T r anspor
t
Invi si bl es
M i n. & Oi l
Figure 16: WDAS-BDC Exchange Rate Premium
(Quarterly)

'4th Qtr-06
'1st Qtr-07
2nd Qtr-'07
3rd Qtr-07
4th Qtr-07
1st Qtr 08
2nd Qtr 08
3rd Qtr 08
4th Qtr 08
1st Qtr 09
Premium


6.0 OTHER INTERNATIONAL
ECONOMIC DEVELOPMENTS

World crude oil output in the first quarter, 2009 was
estimated at 84.06 million barrels per day (mbd), while
demand was estimated at 85.10 mbd, compared with
85.30 and 85.50 mbd supplied and demanded in the
preceding quarter, respectively. The marginal decline in
demand was due to the continued deterioration of economic activities in the world economy.

Other major international economic developments of
relevance to the domestic economy during the quarter
included: the 2009 Annual Meeting of the World Economic Forum held in Davos-Klosters, Switzerland from
January 28 – February 1, 2009. The purpose of the
meeting was to give support to governments and governance institutions, particularly the G20; develop recommendations on how the structures and strategies of
international cooperation should be strengthened to
confront the contemporary global challenges; and improve on the ethical value base for business, as a constructive social actor (see January 2009 Report).

An update of the World Economic Outlook (WEO)
released by the International Monetary Fund (IMF) on
January 29, 2009 showed that global growth in 2009 is
expected to fall to 0.5 per cent when measured in terms
of purchasing power parity and to turn negative when
measured in terms of market exchange rates. This represented a downward revision of about 1.8 percentage
points from the November 2008 WEO Update (see
January 2009 Report).

The Federal Government of Nigeria and the United
Arab Emirates (UAE) held bilateral meeting in Abuja
on January 15, 2009. The major highlight of the meeting was the signing of a $16.0 billion investment agreement where the United Arab Emirates was to improve
basic infrastructural facilities in the country. The agreement covers areas such as dams, electricity, agriculture,
mineral resources and the development of the Federal
Capital Territory (FCT), among others (see January
2009 Report).

Others are the meeting of the Heads of the Multilateral
Development Banks (MDBs) and the International
Monetary Fund (IMF) held in Tunis, Tunisia, on February 12, 2009 at the invitation of the African Development Bank. The purpose of the meeting was to discuss
recent developments in the global financial and economic crisis and the response of each institution as well
as the way forward (see February 2009 Report).


The Board of Directors of the African Development
Bank Group (AfDB), on February 18, 2009 approved a
US$100 million Line of Credit (LoC) to support Nigeria’s Intercontinental Bank Plc in financing small and
medium-sized enterprises (SMEs). The LoC will be
used for medium- to long-term financing for SMEs in
manufacturing, services, and natural-resource projects
across Nigeria. The projects are intended to ultimately
enhance the productive capacity and growth in the
country (see February 2009 Report).

The 12th Assembly of the African Heads of State and
Government met on February 3, 2009 in Addis Ababa,
Ethiopia. The purpose of the meeting was to discuss the
global financial crisis so as to speak with one voice in
the world economic arena (see February 2009 Report).

The World Bank and the United States Congressional
Caucus for Dialogue on the World Bank urged rich
countries to resist the temptation to slash foreign aid in
the face of current global financial and economic crisis,
the worst since the Great Depression. The dialogue
spearheaded by the Caucus was intended to help
deepen understanding and build a global collaboration
between the efforts of the U.S. Congress with other
partners such as the World Bank in tackling diseases,
food insecurity and other crises (see February 2009
Report).

In another development, the International Monetary
Fund (IMF) convened a conference in Dar es Salaam,
Tanzania from March 10 – 11, 2009. The meeting was
conceived to discuss the severe challenges faced by
African economies and the risk that the achievements
of the past decade in poverty reduction might be reversed.

African Ministers and Governors underlined six building blocks of stronger partnership between Africa and
the IMF as enhancing IMF surveillance over the policies of all its members, in a spirit of evenhandedness;
expanding the IMF’s financing facilities and their accessibility to low-income countries; consolidating the
debt relief process by adjusting the IMF’s debt sustainability framework to accommodate Africa’s new financing needs and opportunities; accelerating reforms
of IMF governance to enhance Africa’s voice and representation at all levels of the institution; enhancing the
policy dialogue between the IMF and its African members, including through technical assistance, to ensure
that African countries’ policies benefit from the IMF’s
experience and expertise; and reinforcing the IMF’s
catalytic role to leverage public and private financing
for Africa’s critical infrastructure needs.

The African Governors and Ministers’ Joint Declaration:

♦ reaffirmed that facing the global economic crisis
requires stronger partnerships and called for development partners to increase their efforts to support
Africa, including through aid, trade, and technical
assistance.
♦ noted the need to ensure that Africa’s financing
needs are addressed and called on Africa’s development partners to step up their support to assist Africa in these difficult times and ensure continued
progress toward the achievement of the Millennium
Development Goals.
♦ supported the IMF Managing Director’s call to double the IMF’s concessional resources and raise African countries’ access to IMF financing urgently.
They welcomed the forthcoming review of the
IMF’s financing facilities for low-income countries,
stating that these facilities need to be sufficiently
responsive and flexible to meet the diverse needs of
African countries, including during the global
downturn.
♦ welcomed the decision by the IMF to open two new
Regional Technical Assistance Centers in Africa, in
addition to expanding the existing three, which will
provide enhanced assistance to Africa, while
strengthening its timeliness and ownership.
♦ reaffirmed African countries’ commitment to the
implementation of sound economic policies and the
establishment of strong institutions that are consistent with their long-term development goals.

The IMF and its African members expressed their commitment to a new and enhanced partnership. They
agreed to:

♦ work together towards the shared goals of making
IMF financing more timely and responsive,

making its technical assistance more effective,
and enhancing dialogue on the policy challenges
and opportunities facing Africa.

♦ Build on the first steps that were taken in 2008 to
increase the voice and representation of African
members of the IMF, with the aim of agreeing rapidly on further steps in this direction to ensure that
the diversity of the IMF’s membership is fully reflected in its governance structures.
♦ Review the implementation of the joint commitments between the IMF and its African members
every six months in the context of the African Consultative Group.


Also, the 6th Session of Nigeria-U.S TIFA Council meeting was held in Washington D.C., U.S.A from 30 - 31
March, 2009. The council meeting covered trade and
investment issues of concern to Nigeria and U.S.

The major highlights of the meeting were as follows:
♦ Nigeria and U.S delegations expressed the desire for
a successful conclusion of the Doha Round of multilateral trade talks.
♦ The U.S requested Nigeria to further reduce the
tariff rates and import prohibitions imposed on some
products which are of interest to U.S. Responding, the
Nigerian team informed the U.S that it cannot unilaterally reduce tariffs because of its regional commitment to
ECOWAS Common External Tariff (CET).
♦ U.S promised to assist Nigeria to train sanitary and
phyto-sanitary specialists in order to improve quality of
Nigeria’s products to enhance market access.
♦ Nigeria solicited for funds to assist small and medium enterprises to participate in bilateral trade.
♦ Nigeria advocated for capacity building to enhance
packaging and labeling of export products to U.S.
♦ The Federal Government’s initiatives to end corruption in the economy were highlighted.
♦ U.S entrepreneurs were invited to take part in the
energy sector development given the policy of public
private partnership.
♦ Financial sector reforms in the banking sector and
the emergence of strong banks to foster trade and investment were made known to U.S investors.
♦ Both parties (U.S and Nigeria) agreed to revisit issues concerning intellectual property, bilateral investment treaty and avoidance of double taxation.

The G-20 Finance Ministers and Central Bank Governors, met on March 14, 2009 to prepare for the Leaders’
London Summit. They agreed on further action to restore global growth and support lending, and reforms to
strengthen the global financial system.

The following were the highlights and decisions of the
meeting:
♦ They expressed commitment to fight all forms of
protectionism and maintain open trade and investment.
♦ They stated that their key priority was to restore
lending by tackling, where needed, problems in the
financial system through continued liquidity support, bank recapitalisation and dealing with impaired assets, through a common framework. They
reaffirmed their commitment to take all necessary
actions to ensure the soundness of systemically important institutions.

♦ They stressed their commitment to deliver the
scale of sustained effort necessary to restore
growth, and called on the International Monetary
Fund (IMF) to assess the actions taken and the
actions required.
♦ They reiterated their commitment to help emerging and developing economies to cope with the
reversal in international capital flows. They
agreed on the urgent need to increase IMF resources very substantially. This could include
further bilateral support, a significantly expanded and increased New Arrangements to
Borrow (NAB), and an accelerated quota review.
They welcomed the progress by the IMF and
World Bank in introducing new and enhanced
instruments, including the development of a new
high-access,
quick-disbursing
precautionary
facility.
♦ To further strengthen the global financial system
they welcomed the Financial Stability Forum’s
(FSF) expansion to all G20 members.


They made recommendations to the London Summit
to ensure that.
♦ All systemically important financial institutions,
markets and instruments are subject to an appropriate degree of regulation and oversight, and
that hedge funds or their managers are registered
and disclose appropriate information to assess
the risks they pose;
♦ Stronger regulation is reinforced by strengthened
macro-prudential oversight to prevent the buildup of systemic risk;
♦ Strengthened international cooperation to prevent and resolve crises, including through supervisory colleges, institutional reinforcement of the
FSF, and the launch of an IMF/FSF Early Warning Exercise.

They noted that in order to strengthen the effectiveness and legitimacy of the IFIs they must enhance
their governance and ensure they fully reflect
changes in the world economy. Emerging and developing economies, including the poorest, should have
greater voice and representation and the next review
of IMF quotas should be concluded by January 2011.
The heads of the IFIs should be appointed through
open, merit based selection processes.

Appendix 1: Selected Macroeconomic Indicators (GDP, Money & Credit, Money Market & Capital Market Indicators)

st Qtr 07

nd Qtr 07

rd Qtr 07

th Qtr 07

st Qtr 08

nd Qtr 08

rd Qtr 08

th Qtr 08

st Qtr 09
GROSS DOMESTIC PRODUCT (at 1990 Constant Basic Prices)
Growth Rate (%)

Oil share of GDP (%)

Non-Oil share of GDP (%)

GROSS DOMESTIC PRODUCT (at Current Basic Prices)
Growth Rate (%)

Oil share of GDP (%)

Non-Oil share of GDP (%)

MONEY & CREDIT

Narrow Money (M1) (%)


Broad Money (M2) (%)


Narrow Money ((M1) (%)


Broad Money (M2) (%)


Aggregate Credit (Net) (%)


Aggregate Credit (Net) (=N= ‘b)


Credit to Government (Net) (%)


Credit to Government (Net) (=N= ‘b)


By CBN


By DMB


Federal Government Deposits (=N= ‘b)


Credit to Private Sector (%)


Credit to Private Sector (=N= ‘b)


Private Sector Deposit (=N= ‘b)

Aggregate Credit (%)


Credit to Government (%)


Credit to Private Sector (%)


Base Money (=N= ‘b)

(Growth Rate, %)

Currency in Circulation (=N=’b)


Bank Reserves (=N=’b)

Money Supply (=N=‘b)

NTB SALES (=N=‘b)
NTB Sales at Primary Market


st Qtr 07

nd Qtr 07

rd Qtr 07
4th Qtr 07

st Qtr 08

nd Qtr 08

rd Qtr 08

th Qtr 08

st Qtr 09
NTB Sales at OMO (N’ B)

INTEREST RATES (%)
Inter-bank Call Rate (Weighted Average)

Minimum Rediscount Rate/Monetary Policy Rate

Treasury Bill Rate
Savings Deposit Rate

Deposit Rates (Consolidated)

Average Term Deposit Rate

7 Days

1 Month

3 Months

6 Months

12 Months

Over 12 Months

Prime Lending Rate

Maximum Lending Rate

Average Lending Rate
Real Interest Rate (Max. Lending Rate)

Real Interest rate (Ave. Deposit Rate)

CAPITAL MARKET
All Share Value Index
43,456.0
51,330.46
50,229.01

57,990.22

63,016.56

55,949.00

46,216.13

31,450.78

19,851.89
Market Capitalization (=N=’t)

Value of Shares Traded (=N=’b)

Volume of Shares Traded (‘b)

1 Percentage change over preceding Quarter
2 Percentage change over preceding December
* Commencement of MPR
GDP Figures are revised for 2007


Appendix 2: Selected Macroeconomic Indicators (Fiscal, External & Real Sectors Indicators)

1st Qtr 07

2nd Qtr 07

3rd Qtr 07

4th Qtr 07

1st Qtr 08

2nd Qtr 08

3rd Qtr 08

4th Qtr 08
1st Qtr 09
FISCAL OPERATIONS OF THE
FEDERAL GOVT
Federally Collected Revenue (=N=‘b)


Oil Revenue


Non-Oil Revenue


315.1
321.0

369.8
326.2
341.46
Retained Revenue (=N=‘b)


Total Expenditure (=N=‘b)


Recurrent


Capital Expenditure


Transfers

Surplus/Deficit (=N=‘b)

Ways and Means Advances (=N= ’b)

Statutory Limit (% of Budgeted Revenue)

FOREIGN EXCHANGE FLOWS Through the CBN
(US$’m)
Inflow

8,146.21

6,406.19


Outflow


(Debt Service)
676.71
109.17

129.43

111.15

110.4
118.44

130.9
105.36
93.06
Net Flow

FOREIGN EXCHANGE MARKET
Forex Sales at WDAS (US$’m)

Forex Demand at WDAS (US$’m)

Supply of Forex to BDC (US$’m)

Total Forex Supply (US$’m)

Average WDAS Exchange Rate

Average BDC Exchange Rate (=N=/$)

BDC Premium

Depreciation
BALANCE OF PAYMENTS (=N=’b)
Current Account (=N=’b)
876.06


Goods


Export


Import


Services (net)


Income (net)


1st Qtr 07
2nd Qtr 07
3rd Qtr 07
4th Qtr 07
1st Qtr 08
2nd Qtr 08
3rd Qtr 08
4th Qtr 08
1st Qtr 09
Current Transfers (net)


-


-
Capital and Financial Accounts


Capital Account (net)


Financial Accounts (net)


Direct Investment

Net Errors and Omissions

Overall Balance

EXTERNAL RESERVES (US$’b)

CRUDE OIL PRODUCTION (MBD)
Total World Supply


OPEC


Non-OPEC

CRUDE OIL PRICES (US$/Barrel)
Bonny Light

OPEC Basket

DOMESTIC PRICES
12 MMA Inflation Rate (%)

Y/Y Inflation Rate (%)

Core Inflation:12 MMA (%) 2

Core Inflation: Y/Y (%) 2

Food Inflation:12 MMA (%) 3

Food Inflation: Y/Y (%) 3

INDUSTRIAL PRODUCTION
Index of Industrial Production

Index of Manufacturing Production

Index of Mining Production

Average Electricity Generation (MW/h)

Average Electricity Consumption (MW/h)

1 Provisional
2 Core Inflation based on consumer price index (CPI) of All Items less Farm Produce
3 Inflation based on consumer price index (CPI) of food