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Nigeria’s inflation rate hits 28.20% in November, highest in 18 years

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The largest economy in Africa saw a worsening cost-of-living crisis in November when Nigeria’s annual inflation increased to 28.20% for the eleventh consecutive month, the highest level in eighteen years.

The last time Nigerians experienced this level of inflation was in August 2005, thus increasing pressure on the central bank to address the rise.

According to the data from the National Bureau of Statistics, consumer inflation rose to 28.20% in November from 27.33% in October. The October figure was a 0.61 percentage point increase from the 26.72% that was recorded in September.

Earlier in the week, the World Bank warned Nigeria’s central bank needed to control inflation by tightening monetary policy, building market confidence around free foreign exchange pricing, and phasing out so-called “ways and means” advances to the government.

According to the statistics bureau, increases in the prices of food and non-alcoholic drinks were the main cause of annual inflation in November. The majority of Nigeria’s inflation is attributed to food inflation, which increased to 32.84% in November from 31.52% in October.

To control inflation, Olayemi Cardoso, the newly appointed governor of the central bank, has promised to gradually phase out the institution’s fiscal intervention programmes. After resuming its Open Market Operations (OMO) to aid in containing money supply, Cardoso stated that the central bank intended to tighten policy over the following two quarters to control inflation.

During its most recent monetary policy meeting in July, the central bank decided against the more anticipated 25 basis point hike, stating that a moderate increase would be preferable to stabilise inflation expectations while still promoting investment.

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Nigeria offers oil majors faster exit if …

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Oil-rich West African country, Nigeria, has offered major oil companies, such as Exxon Mobil and Shell, that planned to leave the country’s onshore oil an offer for quicker exit approval on the ground that they take responsibility for spills rather than wait for authorities to apportion blame.

The regulator tt a meeting with the companies in Abuja, Nigerian Upstream Petroleum Regulatory Commission (NUPRC) chief Gbenga Komolafe offered a short-term option with faster approval if the companies commit to cleaning up spills and compensating communities.

To concentrate on deepwater drilling, Exxon, Shell, TotalEnergies, and Eni have all attempted to withdraw from Nigeria’s oil-rich Niger Delta in recent years, claiming security issues including theft and sabotage. Regulatory obstacles have, however, caused their exits to be postponed.

“We have the undertaking here. The consent here though fixed for June, could be much shorter,” he said.

“If you agree to take that option, you sign the undertaking knowing that there are obligations to be fulfilled,” Komolafe said.

The second long-term alternative might push back the final approval until August by requiring NURPC to identify and assign all liabilities first. In order to safeguard the environment, local populations, and the long-term viability of the assets, NURPC is attempting to strike a compromise between expediting the exit for oil majors.

According to them, the corporations are considering their alternatives and will reply shortly. Meanwhile, some observers say the accelerated option could cost oil majors millions of dollars for cleanups and reparations.

“The risk with option 1 is the transferor will continue to take responsibility for the asset until the process is completed while option 2 puts them at the mercy of the regulator since they waived their right to deemed approval,” said Ayodele Oni, energy lawyer at Lagos-based Bloomfield law firm.

Following the majors’ withdrawal, 26 onshore blocks with a combined estimated reserve of 13.76 billion barrels of oil, 2.70 billion barrels of condensate, and roughly 90,717 billion cubic feet of gas are up for grabs, according to NUPRC.

“We aim to ensure that the companies that take over these blocks have the necessary financial resources and possess the technical expertise required to responsibly manage the blocks throughout their lifecycle under good asset stewardship practices,” Komolafe said.

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Nigeria’s Security Exchange chief to meet foreign, local crypto exchanges, others over crypto regulation

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On Monday, local and international cryptocurrency exchanges will meet with Dr. Emomotimi Agama, the recently appointed Director General of the Securities and Exchange Commission, to deliberate and reach a consensus regarding the current state of cryptocurrency in Nigeria.

The Nigerian Blockchain Industry Coordinating Committee called the meeting to discuss pertinent issues and outline a forward-thinking plan for cryptocurrency regulations.

The meeting is open to all operators of digital asset exchanges, wallet providers, other virtual asset service providers (VASPs), and pertinent industry associations and bodies in order to address pertinent issues and map out a progressive path for cryptocurrency regulations in Nigeria.

The associations include the Blockchain Nigeria User Group (BNUG), the Cryptographic Development Initiative in Nigeria (CDIN), the Digital Currency Consortium (DCC) and the Stakeholders in Blockchain Technology Association of Nigeria (SiBAN).

Uwakwe expressed hope that the meeting could spark the right kind of change that would favour all crypto stakeholders in Nigeria and internationally.

“Everyone’s presence and insights are invaluable as we collectively navigate the regulatory terrain and strive toward fostering an environment conducive to innovation and growth within the blockchain and cryptocurrency sector,” he said.

Nigeria has since initiated investigations into the use of cryptocurrencies in the nation and taken actions that run counter to its December 2023 decision to lift a ban on them.

The Central Bank of Nigeria blocked local cryptocurrency users’ access to the websites of numerous cryptocurrency exchanges, including Binance, OctaFX, and others in February.

Additionally, the SEC of Nigeria suggested changing the regulations governing platforms that provide cryptocurrency services. It suggested raising the registration fee for cryptocurrency exchanges from N30 million ($18,620) to N150 million ($93,000).

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