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Home Blog Page 4961

Nigeria’s Real GDP Recorded 3.54% Growth in Q2 2022

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After months of abysmal performance, the Nigerian economy is showing a comeback sign. Latest data released by the Nigerian Bureau of Statistics (NBS), shows a 3.54% Gross Domestic Product (GDP) growth.

The growth was recorded year-on-year in real terms in the second quarter of the year, indicating improvement compared to the 3.11% growth recorded in the same period the previous year.

Per the NBS, the aggregate real GDP recorded was N17.29 trillion in the Q2, 2022, indicating a marginal decline of -0.37 compared to N17.35 trillion recorded in Q1 2022.

Details of the data show Services leading other sectors, followed by the agricultural sector.

The services’ sector accounted for 57.35% of the GDP, followed by the agricultural sector with 23.24% contribution, about 1% increase compared to Q1 2022. Also, the industrial sector contributed 19.4%.

The significant increases which contributed to growth marks the seventh consecutive quarter of GDP growth, since the recession recorded in Q3 2020.

The oil sector dipped by 11.77% year-on-year in Q2 2022, compared to a contraction of 26.04% recorded in Q1 2022. The contraction in the sector’s GDP is following the decline in crude oil production capacity.

Nigeria recorded an average daily oil production of 1.43 million barrels per day (mbpd), lower than the daily average production of 1.61mbpd recorded in the same quarter of 2021 by 0.18 mbpd and lower than the first quarter 2022 production volume of 1.49 mbpd by 0.06mbpd.

The Oil sector contributed 6.33% to the total real GDP in Q2 2022, down from the figures recorded in the corresponding period of 2021 and the preceding quarter, where it contributed 7.42% and 6.63% respectively.

Non-oil sector

The non-oil sector grew by 4.77% in real terms during the reference quarter (Q2 2022). This rate was lower by 1.97% points compared to the rate recorded same quarter of 2021 and 1.31% points lower than the first quarter of 2022.

This sector was driven in the second quarter of 2022 mainly by Information and Communication (Telecommunication); Trade; Financial and Insurance (Financial Institutions); Transportation (Road Transport); Agriculture (Crop Production) and Manufacturing (Food, Beverage & Tobacco), accounting for positive GDP growth.

In real terms, the non-oil sector contributed 93.67% to the nation’s GDP in the second quarter of 2022, higher than the share recorded in the second quarter of 2021 which was 92.58% and higher than the first quarter of 2022 recorded as 93.37%.

Nigeria’s economy has been grappling with persistent headwinds buoyed mainly by shortfalls in oil revenue. This has resulted in inflation as forex scarcity took toll on the cost of goods and services, igniting concern that the country could relapse into another recession.

The GDP growth, though not high enough to erase the economic dips previously recorded, signifies progress that at least, always concern about another recession.

Judge Rejects Musk’s Further Demands for Twitter Data, Calling it “Absurdly Broad.”

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Elon Musk’s drama-filled bid to acquire Twitter keeps taking turns even as it has come under litigation.

On Thursday, a judge rejected Musk’s demands for more user details, describing it as “absurdly broad.” The demand is part of the entrepreneur’s efforts to ascertain the actual number of users on Twitter, an assurance he said he needs to close the $44 billion acquisition deal.

The Tesla CEO has maintained that Twitter is not being honest about the number of bots on its platform, even though the company has provided him with data it said would answer his questions about fake accounts.

Further push by Musk for additional data was rejected. Having described it as “absurdly broad,” Chancellor Kathaleen McCormick of Delaware’s Court of Chancery said many of Musk’s data demands amount to trillions of data points that “no one in their right mind has ever tried to undertake such an effort.”

According to the judge, Musk has had data and documents needed to pursue his case, with much provided by Twitter before he said he was calling off the deal in July, accusing Twitter of not being truthful.

“My overall impression is that plaintiff has agreed to produce a tremendous amount of information to defendants, and that the information plaintiff has agreed to produce is sufficiently broad to satisfy most of plaintiff’s obligations,” wrote Chancellor Kathaleen McCormick of Delaware’s Court of Chancery.

In June, Twitter agreed to provide the full firehose of internal data to Musk, as part of its efforts to satisfy the world’s richest man’s demand for additional data on the number of spam accounts the platform holds.

However, court ordered Twitter to turn over data from 9,000 accounts sampled in a fourth-quarter audit, which was carried out to estimate the number of spam or bot users on its platform. McCormick gave the social media company two weeks to produce the data, although it argued that the data is lost and recreating will be difficult.

“We look forward to reviewing the data Twitter has been hiding for many months,” said Musk’s attorney, Alex Spiro, in an emailed statement to Reuters.

Musk was enthusiastic about purchasing Twitter, making a swift $44 billion acquisition bid for the microblogging app in April. However, the SpaceX CEO made a U-turn in what is believed to be a ploy to secure a cheaper deal.

Musk has said he wants to test that audit’s accuracy because he believes the company fraudulently misrepresented that only 5% of its accounts were spam. He wants McCormick to rule he can walk away from the deal. The deal was agreed at the price of $54.20 per share, below Twitter share price at the time.

Twitter said the spam-based controversy, which has lingered for months, is hurting the company. It has sued Musk to force him to close the deal. Musk on the other hand wants the court to rule that he can walk away from the deal without having to pay the $1 billion breakup feed enshrined in the agreement.

Musk’ attempt to have the trial pushed further into the future was denied by the court. A five-day trial has been scheduled for Oct. 17.

His argument has been that Twitter lied when it said in regulatory filing that spam accounts for only about 5% of the platform’s users.

“Mr. Musk is terminating the Merger Agreement because Twitter is in material breach of multiple provisions of that Agreement, appears to have made false and misleading representations upon which Mr. Musk relied when entering into the Merger Agreement, and is likely to suffer a Company Material Adverse Effect,” Musk’s lawyers wrote in a letter to Twitter’s Chief Legal Officer Vijaya Gadde.

But Twitter on Wednesday, described Musk’s argument as “legally irrelevant.” The company said it has described the spam count in regulatory filings as an estimate, not a representation, adding that the real level of spam could be higher.

Where the Opportunities Are Right Now in Nigeria

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Question: where do we have the most opportunity in Nigeria in the near future?

Response: ICT and broad technology sector.  ICT contributed just 1% to Nigeria’s GDP in 2001. Today, the number is 18.4%. What that means is that about 17% has been “eaten” by ICT in other sectors. As ICT grows, so are the opportunities in that domain. Read more here

  • Event: Tekedia Capital Open
  • Topic: The Abundance Is Here
  • Date: Saturday, Aug 27, 2022
  • Time: 4pm – 5pm WAT
  • Zoom link (free and open) here

Interestingly, I will have a presentation titled “Abundance Is Here” as part of Tekedia Capital OPEN as we begin a new investment cycle next month. It begins at 4pm WAT today and it is free. The Zoom link is here

The sector’s growth has been reported to be largely driven by activities in the telecommunications sub-sector which contributed 9.49% to the nation’s GDP. Its contribution to nominal GDP for the second quarter of 2021 stopped at 12.12% which was lower than the rate of 12.22% recorded in the same quarter of 2021, but higher than the 10.55% it contributed in the preceding quarter.

In nominal terms, in the second quarter of 2022, the sector growth was recorded at 14.11% year-on-year, 14.18% points increase from the rate of -0.07% recorded in the same quarter of 2021, and 6.43% points lower than the rate recorded in the preceding quarter.

The quarter-on-quarter growth rate recorded in the second quarter of 2022 was 14.13%. The ICT sector in the period under review, recorded a growth rate of 6.55% in real terms, year-on-year. From the rate recorded in the corresponding period of 2021, there was an increase of 0.99% points.

https://www.tekedia.com/youre-invited-to-tekedia-capital-open-the-abundance-is-here-aug-27-at-4pm-wat-free/

 

H2 2022- ICT Sector Contributes 18.44% To Nigeria’s GDP

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The ICT sector has no doubt contributed immensely to the sustainability of the Nigerian economy. The sector contributed 17.92 percent in the last quarter of 2020, and also in the first quarter of 2021, and has so far continued on an impressive trajectory.

Recently, the sector contributed 18.44% to Nigeria’s real Gross Domestic Product (GDP) in the second quarter of 2022, surpassing the contribution of the previous year. The sector is composed of four activities, which are; Telecommunications and Information Services, Publishing; Motion and Picture, Sound Recording and Music Production; and Broadcasting.

The sector’s growth has been reported to be largely driven by activities in the telecommunications sub-sector which contributed 9.49% to the nation’s GDP. Its contribution to nominal GDP for the second quarter of 2021 stopped at 12.12% which was lower than the rate of 12.22% recorded in the same quarter of 2021, but higher than the 10.55% it contributed in the preceding quarter.

In nominal terms, in the second quarter of 2022, the sector growth was recorded at 14.11% year-on-year, 14.18% points increase from the rate of -0.07% recorded in the same quarter of 2021, and 6.43% points lower than the rate recorded in the preceding quarter.

The quarter-on-quarter growth rate recorded in the second quarter of 2022 was 14.13%. The ICT sector in the period under review, recorded a growth rate of 6.55% in real terms, year-on-year. From the rate recorded in the corresponding period of 2021, there was an increase of 0.99% points.

Nigeria’s Minister of communications and Digital Economy, Prof. Isa Pantami, while speaking at the 2022 International Telecommunication Union’s World Telecommunications Development Conference (ITU-WTDC) in Kigali, Rwanda earlier this year, disclosed that Nigeria’s ICT industry has recorded incredible growth, leading to socio-economic development not just in the country but also across Africa.

In his words;

Nigeria has utilized ICT as a driver of socio-economic development not just for herself, but also for the benefit of the sub-region and continent, given its role as a founding member and strategic sponsor of the West Africa Telecommunications Regulators Assembly (WATRA).

“As a country, we have grown from the second generation (2G) to 3G, 4G and now the 5G is about to come on board after conducting a globally-acclaimed transparent auction and awards of two 5G licenses. Also, the country has implemented vigorous financial inclusion initiatives riding on robust digital infrastructure.

“Many achievements of Nigeria in the area of ICT development have been possible through the successful launch and implementation of policies that foster use of ICTs across all sectors to enhance a digital economy.”

The impressive contributions of information and communication technology (ICT) to Nigeria’s GDP, is gradually transforming the country from a traditional economy, into one of Africa’s leading digital economies.

Due to exponential growth of the sector, it has made Nigeria one of Africa’s largest ICT markets in terms of its share of telecom subscribers and internet users. The ICT sector has no doubt continued to remain a critical driver of non-oil growth and a significant contributor to Nigeria’s GDP.

The sector has also been an enabler for digitalization and the development of other key sectors such as Agriculture, Education, Manufacturing, and Healthcare.

The federal government continued played an active role in prioritizing the expansion of the ICT sector in the country through dedicated policies, infrastructure development, and investment promotion, which effectively helped to boost the sector’s contribution to Nigeria’s GDP from less than 1% in 2001 to 18.4% in 2022.

As the digital stage is upon us, given the role the ICT is playing by facilitating businesses, transforming the Educational sector, and the likes, the sector will no doubt continue to remain a priority in the years ahead.

MTN Kicks Off 5G Rollout Amidst the Challenge of Unaffordable Devices

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On Friday, MTN Nigeria Communications Plc unveiled an open 5G pilot, announcing its plan to roll out 5G services in seven Nigerian cities – Lagos, Abuja, Port Harcourt, Ibadan, Kano, Owerri, and Maiduguri soon.

The Nigerian Communication Commission (NCC), had in December 2021, announced MTN and Mafab as the two successful winners of the 3.5 gigahertz (GHz) spectrum auction for the deployment of Fifth Generation technology. The telecom regulator thus set August 24, 2022 as timeline for the licensees to begin the rollout.

However, only MTN has commenced its rollout. This is because Mafab experienced delay in its issuance of Unified Access Service Licence and Numbering plan by the NCC. The telco was granted a five-month extension to roll out 5G services.

MTN said the redeployed 5-Generation infrastructure will be tested in anticipation of its launch by allowing customers with 5G-enabled devices to connect and try out the service where there is coverage.

The Chief Marketing Officer, MTN Nigeria, Adia Sowho, said during the pilot test that “Every major technological evolution redefines what is possible – changing the way we live and the way we connect.

“MTN Nigeria has been at the forefront of every leap in telecommunications: from GSM to 2G, 3G, and 4G. 5G has the potential to change everything. It will allow us to connect, create, collaborate, and compete in ways we’ve not even begun to imagine.”

She added on Friday, during a chat on Arise TV’s Global Business Report, that 5G technology has come with a lot of benefits that Nigerians can’t afford to miss out on.

“By the end of this year, we will cover 80-90 per cent of the population from MTN NIGERIA. These things take time but a lot is required in educating the users to understand why technology is being deployed, how it is useful and what benefits it offers.

“At the end of 2021, there were only 85 countries in the world that had launched 5G. For Nigeria to be at the forefront of the launch of such a revolutionary technology is amazing and could not have been done without the government’s support,” she said.

However, the affordability of 5G devices may hinder the service adoption in Nigeria, even though there has been significant increase in the number of 5G devices available globally since 2020.

According to ‘Ericsson Mobility Report, more than 615 million units of 5G devices were shipped in 2021, more than double the number shipped in 2020. The report added that over 650 5G smartphone models have now been launched,  accounting for 50% of all 5G devices by form factor.

However, their costs have come very high for most Nigerians earning below $50 dollars monthly.

In an interview with Punch last month, Vice President, Global Telecommunications Industry, IBM, Craig Wilson, pointed at the affordability of 5G devices as the biggest threat to successful rollout of 5G services in Africa.

He said that although some device manufacturers have committed to bringing costs down to around $150, the cost of a 5G device currently runs around $350, making them unaffordable for many.

“Still, many industry analysts believe that 5G devices need to be at about $50 to support mass adoption across Africa. The high cost of 5G phones is a major impediment, and it impacts the launch the fifth generation network on a commercial scale when there are not enough mobile devices capable of receiving it.

“We can see the effects on 5G rollout when we compare Africa to other continents. Globally, the rollout of 5G has been in process since 2019. Yet deployment across Africa has been much slower, with only 6 African countries having launched the network,” he said.