Weekly Nuggets

Saturday, August 15, 2020

Nigeria’s Unemployment Rate Jumps to 27.1%, Youths Hit Hardest

Nigeria’s unemployment rate jumped to 27.1 percent in the second quarter of 2020, making it the highest indication of joblessness in Africa’s most populous country in the past 10 years, according to data released by the National Bureau of Statistics.

The last time the agency released such figures two years earlier, the rate stood at 23.1 percent.

Among young people between 15 and 34 years, who make up more than half of the country’s 200 million population, the rate was higher at 34.9 percent, accompanied by underemployment of 28.2 percent.

Banks Set Lower Spending Limits on Payment Cards

Several Nigerian banks have imposed lower spending limits on payment cards used by their customers for foreign transactions, as an acute foreign currency shortage, occasioned by a dramatic drop in official foreign receipts, worsened.

The limits range from $100 at Guarantee Trust Bank to $500 at Stanbic IBTC as different banks responded to the situation as they deemed fit.

The Central Bank of Nigeria suspended its weekly sale of foreign exchange for imports and invisibles (such as school fees and medical bills) since March, trying to conserve the country’s foreign reserves as prospects of replenishment dimmed with the crash in the price of crude oil, Nigeria’s main export.

Nigerian Signs Africa Trade Insurance Treaty

Nigeria acceded to the treaty setting up the Africa Trade Insurance Agency, charged with providing cover for risks attending commerce by and among countries in the continent. The pact, first agreed in 2000, was signed by President Muhammadu Buhari on August 12.

Membership of the agency will provide another layer of confidence to trade transactions as African countries are poised for full implementation of the Africa Free Trade Agreement that seeks to end barriers to intra-continental commerce.

Backed by the African Development Bank, Nigeria has contributed $14.1 million to its capital, with an additional $138 million expected from shareholders.

Pension Commission Approves Transfer Window for Contributors

Nigeria’s Pension Commission said contributors will be provided an opportunity to switch their pension fund administrators before the end of this year, with simulated trials due to start in September.

Though the 2014 Pension Act provides for transfer of services by contributors among service providers if it’s “not more than once a year,” it hasn’t been implemented in practice since then.

“Pencom has been working to actualize the provisions,” Aisha Dahiru-Umar, the acting director-general of the commission, told reporters this week. A system for seamless transfer of accounts among administrators, already developed and put in place, will be tested in September for subsequent roll out, she said.