A Week in Nigeria: 4 April
Highlights from Reuters coverage of Nigeria over the last seven days
In this week’s round-up: President Buhari announces measures to combat coronavirus outbreak, Lagos and Abuja begin two-week lockdown, and stocks hit eight-year low.
- Nigeria’s two main cities — sub-Saharan Africa’s biggest city Lagos and the capital, Abuja — began a two-week lockdown on Monday night as part of an attempt to stop the spread of the coronavirus. The usually bustling streets of Lagos, a city of around 20 million people, were uncharacteristically quiet as the shutdown was largely observed. The terms of the shutdown, announced by President Muhammadu Buhari on Sunday night, initially created confusion. While the president said food retailers and health facilities could remain open, he did not say whether people could leave their homes to buy necessities or seek care. However, the conditions of the lockdown were outlined by the government later in the week. Buhari’s announcement of measures, made in a televised speech, marked his first major address to the nation since Nigeria’s first confirmed coronavirus case was announced in late February. The 77-year-old president, whose chief of staff has tested positive for the highly infectious disease, said the “containment period” would be used to identify, trace and isolate all individuals that have come into contact with confirmed cases. “We will ensure the treatment of confirmed cases while restricting further spread to other states,” he said.
- African finance ministers want International Monetary Fund, World Bank and EU support for bilateral, multilateral and commercial debt relief amid the coronavirus crisis, the UN Economic Commission for Africa (UNECA) said. Africa is facing a perfect storm of an impending global economic downturn, plummeting oil and commodity prices and weaker currencies which threaten to imperil its coronavirus response. Co-chaired by South African Finance Minister Tito Mboweni and Ken Ofori-Atta of Ghana, the ministers met via video conference on Tuesday. Many wore medical masks, said the UNECA, which hosted the meeting. “The call for debt relief … should be for all of Africa and should be undertaken in a coordinated and collaborative way,” UNECA said in a statement. In an initial meeting organised by UNECA last month, ministers called for a $100 billion stimulus package, including a suspension of debt service payments. Following Tuesday’s meeting, they said the continent’s development partners should consider debt relief and interest rate forbearance over a two to three-year period for all African low-income and medium-income countries. They also called for the creation of a special purpose vehicle to “deal with all sovereign debt obligations” though no further details were given as to what shape it would take.
- Nigeria’s petroleum regulator ordered oil and gas companies to reduce their offshore workforce and move to 28-day staff rotations as part of measures to curb the spread of the disease. The restrictions came after the Nigerian Ports Authority (NPA) said that six workers on board an offshore rig support vessel tested positive for coronavirus late last week. Health experts are concerned about the potential for a widespread outbreak in Africa’s most populous country, which has about 200 million inhabitants. Nigeria has 97 confirmed coronavirus cases and one death from the virus. The country is keen to protect oil production, which provides 90% of much-needed foreign exchange. A coronavirus case on an offshore rig could spread quickly among workers and have a potentially devastating impact on production. Sarki Auwalu, director of the Department of Petroleum Resources, said that only staff on essential duties would be allowed to travel to offshore or remote locations. Industry sources said that a number of oil companies had already shifted from 14-day rotations to 28 days. Some are also implementing a 14-day quarantine for workers before they leave for rigs.
- We reported a number of stories related to banks. Ratings agency Fitch said Nigerian banks’ credit profiles face severe risks from the oil price slump and operating environment disruption due to the pandemic. It said asset quality deterioration linked to high exposures to the oil and gas sector posed the biggest threat to ratings. We also reported that Fidelity Bank cut its profit target for the year, citing the impact of the coronavirus pandemic, but added it had set aside money for a Eurobond coupon payment due in two weeks. The mid-tier bank now expects to see a 15% drop in profit this year to 25.8 billion naira, compared with its 2019 profit of 30.4 billion naira, Chief Operations and Information Officer Gbolahan Joshua told Reuters by phone. Meanwhile, it emerged that Nigerian banks are limiting the amount individuals can withdraw with their debit cards while abroad in an effort to ease foreign currency settlement risk. The central bank is battling to conserve dollar reserves that are down 16% from a year ago after the coronavirus outbreak triggered a sharp fall in the price of oil, Nigeria’s main export. The oil price plunge has also prompted foreign investors to shed Nigerian assets. And the central bank said will suspend cheque clearing temporarily.
- Meanwhile, Nigerian stocks fell 2.4% to hit a new eight-year low after its biggest listed firm Dangote Cement declined and a lockdown of the country’s two main cities to stop the spread of coronavirus entered second day. The all share index dropped to 20,789 points, a level last seen in April 2012 as Dangote Cement shed 9.95% to 116.80 naira each.
- The ministry of power said it will postpone planned electricity tariff increases by at least three months as citizens struggle with coronavirus lockdown. The first price increase since 2015, which was scheduled to take effect on Wednesday, will take place only when distribution companies “improve quality of supply, meter consumers and agree with consumers on rates,” according to a statement issued by the Ministry of Power. “This is in relation to the #COVID19 pandemic and current economic reality of the Country,” Power Minister Sale Mamman said on Twitter. Nigeria’s state-controlled power tariffs are too low to allow distribution companies to recoup costs and pay generating companies — leaving the sector with ballooning debts. Reuters has previously reported on the extent of the sector’s debts and their role in holding back a creaking system that does not generate enough power for the nation’s 200 million citizens.
- A Nigerian doctor who came out of retirement to help Britain’s National Health Service (NHS) cope with the coronavirus outbreak has died of the disease. Alfa Saadu, 68, who immigrated to Britain from Nigeria and had a long and successful career in NHS hospitals across London, died on Tuesday after suffering from the COVID-19 disease for two weeks, his son said. “My dad was a living legend, worked for the NHS for nearly 40 years saving people’s lives here and in Africa. Up until he got sick, he was still working part-time saving people,” the doctor’s son said in a post on social media.
- Finally, we reported on Lagosians turning to rabbits for solace during the lockdown. Nigeria has recorded more than 200 cases of the novel coronavirus, most of which have been in Lagos. The lockdown has had a silver lining for Akinjo Joshua, manager of online store Hopsville Farm, who has seen sales rocket as Nigerians seek comfort and companionship from cute, furry pets. “People want to stay with something they can reckon with,” Joshua said. “The rabbit being an intelligent animal fits in this space.” His shop has up to 20 species of rabbit and they sell for 10,000 naira ($28) to 30,000 naira ($83). Though Joshua halted deliveries earlier this week, he made more than 100 sales in the previous month — well above typical sales of up to 20. Animal rights group PETA warned prospective rabbit owners that they are complex creatures with special needs. “PETA hopes Lagos doesn’t see a rise in the number of abandoned bunnies once lockdown is over, as we often see after Easter,” it said.