The Lagos Chamber of Commerce and Industry (LCCI) says Nigerian businesses may likely face greater challenges in the new year, urging them to prepare for “more stress.”

In a statement on Monday, Chinyere Almona, LCCI’s director-general, said businesses are likely to face higher interest rates when the next Central Bank of Nigeria (CBN) Monetary Policy Committee (MPC) meeting holds.

“The persistent rise in the inflation rate, reaching a 28-year record high of 34.60 in November, continues to fuel a tense business environment as elevated prices constrain various business operations,” Almona said.

“The Lagos Chamber of Commerce and Industry (LCCI) is particularly concerned because, with the persistent and unabated rise in inflation, businesses should prepare for more stress from the burden of higher interest rates as we enter the new year.”

“With the raging inflation rate, the unsuccessful attempt of the Central Bank to reduce the currency in circulation, and approaching a high-spending festive period, we are set to contend with even higher interest rates as the expected outcome from the next decisions by the CBN Monetary Policy Committee (MPC).”

Almona explained that a high inflation rate has significant implications, including reduced consumer spending.

She said it negatively impacts the economy by reducing disposable income, increasing business costs, and discouraging investments, ultimately threatening economic growth.

‘FOREIGN DIRECT INVESTMENT IN NIGERIA DROPPED TO $103.82M IN Q3 2024’

According to the statement, foreign direct investments (FDIs) in Nigeria dropped to $103.82 million in Q3 2024, making the country less attractive to investors.

Almona said interest rates have had limited success in curbing inflation, but reforms aimed at boosting production have shown some promise.

She expressed hope that the reforms would eventually have a stronger impact on key indicators such as inflation, interest rates, and exchange rates.

The director-general said a coordinated effort is required to drive oil production to earn more forex, which is needed to defend the naira in the short term.

“The new investments recently entering the oil fields can be well supported with a sound regulatory environment to sustain and attract more,” she said.

“A disappointing negative record of our capital importation at $1.25bn during the third quarter of 2024 compared with $2.60bn recorded in the preceding second quarter of the year points to an unattractive environment for investors.”

“Foreign Direct Investment, the most critical investment that shows long-term investor confidence, accounted for only $103.82m, or 8.29 percent.”

Almona added that the fight against terrorism and crime must be sustained to ensure the safety of farmlands.

She noted that the rising costs of food, energy, housing, transportation, and services are driving inflation, worsening economic conditions, and reducing both purchasing power and business profitability.

However, Almona stated that the LCCI believes ongoing reforms have the potential to deliver significant benefits, enabling the economy to return to a growth path and achieve positive outcomes for critical economic indicators, provided they are sustained.

The Central Bank of Nigeria (CBN) has introduced a daily withdrawal limit of N100,000 per customer for point-of-sale (PoS) terminals.

In a circular sent to all deposit money banks (DMBs), microfinance banks, mobile money operators, and super-agents, titled ‘Cash-out limits for agent banking transactions,’ CBN stated that the restriction aligns with the apex bank’s ongoing efforts to promote a cash-less economy.

The circular explained that these measures aim to address identified challenges, combat fraud, and establish uniform operational standards across the industry.

“In view of the above, ALL principals of agents are to comply with the following directives immediately:

i. Issuers shall set a cash withdrawal limit (cash-out) per customer (regardless of channel) to N500,000.00 per week,” the circular reads.

“ii. Ensure that all agent banking terminals are set to a daily maximum transaction cash-out limit of N100,000.00 per customer.

“iii. Ensure that each agent’s daily cumulative cash-out limit shall not exceed N1,200,000.00.

“iv. Ensure that agent banking services are clearly demarcated from merchant activities and that agents apply the approved Agent Code 6010 for agent banking activities.

“v. Ensure that agency banking activities are consummated exclusively through agent float accounts maintained with the principals.

“vi. Monitor accounts associated with the agents’ BVN(S) with a view to identifying agent banking activities which may be conducted outside the designated float account(s).

“vii. Ensure that all agent terminals are connected to a PTSA.

“viii. Ensure that all daily transactions per agent, including withdrawals, limits of transactions and balances in the float accounts of each agent, are sent electronically to NIBSS as a report to the CBN. The template of this report will be sent to principals.”

CBN emphasized that, as outlined in the guidelines for the regulation of agent banking and agent banking relationships in Nigeria, principals would be held fully responsible and liable for all actions and omissions of their agents related to agent banking services.

The apex bank also cautioned that it would carry out oversight activities, including impromptu back-end configuration checks to ensure compliance.

CBN warned that violations of the directives in the circular will result in appropriate penalties, including monetary and/or administrative sanctions.

The Dangote refinery has exported Premium Motor Spirit (petrol) to Cameroon, Angola, Ghana, and South Africa in the past few weeks.

The Vice President of Oil and Gas at Dangote Industries Limited, Devakumar Edwin, revealed this while hosting a delegation from the Japanese Business Community in Nigeria, led by Japan’s Ambassador-designate to Nigeria, Suzuki Hideo.

In a statement on Sunday, the company’s spokesman, Anthony Chiejina, quoted Edwin as confirming that products from the refinery meet international standards and are already being exported globally.

“In recent weeks, we’ve exported petrol to Cameroon, Ghana, Angola, and South Africa, among others. Diesel has gone all over the world, and jet fuel is being heavily exported to European markets. Our products are already making their mark internationally,” Edwin said.

Edwin explained that the facility is the vision of Nigerian investor Aliko Dangote, designed and built by Nigerians, and intended to serve the global market.

He said it is a point of pride that a Nigerian company not only designed but also built the world’s largest single-train refinery complex.

According to him, Dangote Industries Limited acted as the Engineering, Procurement, and Construction contractor for the refinery, incorporating cutting-edge technologies from around the world to ensure the facility meets the highest standards.

Edwin assured the ambassador-designate and the delegation that the company is open to collaboration, always striving to maintain the best possible standards.

“Even now, we have a lot of Japanese equipment inside both the refinery and the fertiliser plant. There are significant opportunities for collaboration, as we always seek the latest technology in any business we engage in. For instance, our cement plant laboratory is managed by robots, and we always embrace advanced technology. With Japan’s focus on technological innovation, there is ample scope for cooperation and for supplying various types of technology,” he said.

Edwin also stated that the Dangote Petrochemical project will significantly boost investment in downstream industries, creating substantial value, generating employment, increasing tax revenues, reducing foreign exchange outflows, and contributing to Nigeria’s Gross Domestic Product.

He added that by leveraging Africa’s vast crude oil resources to produce refined products locally, the Dangote Group aims to create a virtuous cycle of industrial development, job creation, and economic prosperity.

He reiterated that the refinery’s petroleum products are in demand worldwide, as it expands its polypropylene section to reduce Nigeria’s reliance on imported polypropylene, a crucial material used in packaging, textiles, and the automotive manufacturing industries.

The statement disclosed that the Japanese delegation hailed the refinery and the petrochemicals complex, describing it as an astonishing masterpiece, showcasing Nigeria’s technological advancements on the global stage.

The Japanese delegation, which toured the facilities housing both the Dangote Petroleum Refinery and Petrochemicals as well as Dangote Fertilisers, commended the technology, noting that it reinforces Nigeria’s role as the gateway to Africa.

Managing Director of the Japan External Trade Organisation, Takashi Oku, was said to have remarked that while Nigeria remains the gateway to Africa, the refinery stands as a remarkable project that showcases the country’s technological progress.

Oku added that the facility, as the world’s largest single-train refinery, is a point of immense pride for Nigeria.

“We had heard about the excellence of the Dangote Refinery through the media but seeing it in person has left us truly amazed by its vastness and grandeur. It demonstrates that Nigeria’s population is not only growing but also advancing in technology. We are keen to collaborate with Nigerian companies, especially Dangote Refinery,” he said.

Emphasising that the refinery has bolstered Nigeria’s leading position in Africa, he further noted that the facility serves as an ideal introduction to the country for the global community.

The Managing Director of Itochu Nigeria Limited, Masahiro Tsuno, was said to have also praised the sheer size and automation of the Dangote refinery, calling it a miracle and one of the wonders of the world.

“I’ve seen many standalone refineries across the globe, including in Vietnam and the Middle East. However, the size of a refinery built by one single investor is probably a miracle in the world. And I’m just actually witnessing a miracle,” he said.

Tsuno indicated that his company would seek collaboration with the refinery across various sectors, including polypropylene and other petroleum products.