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Cryptocurrencies should be regulated, not prohibited, Osinbajo tells CBN

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Nigeria’s vice president Yemi Osinbajo Friday called for the regulation of cryptocurrencies in the country, as against the prohibition of digital currencies.

“There is a role for regulation here,” Osinbajo said at the Bankers Committee Vanguard in Lagos State.

“And it is in the place of both our monetary authorities and SEC to provide a robust regulatory regime that addresses these serious concerns without killing the goose that might lay the golden eggs.

“So it should be thoughtful and knowledge-based regulation, not prohibition,” he added.

The vice president is reacting to the recent clampdown on cryptocurrencies by the Central Bank of Nigeria.

CBN ordered commercial banks and other financial institutions to close down accounts associated with cryptocurrencies.

The apex later clarified that the order was not a new order, but a reminder of a directive published in 2017.

This restriction made some Nigerians looked for a way to circumnavigate the restrictions set by financial institutions, hence, taking advantage of the digital currencies for their transactions.

Nigeria has since become the world’s second-largest Bitcoin market after the United States, Quartz Africa said in a December report.

Although, Osinbajo said he “fully appreciate the strong position of the CBN, SEC, and some of the anti-corruption agencies on the possible abuses of cryptocurrencies and their other well-articulated concerns, but I believe that their position should be the subject of further reflection.”

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He said regulatory bodies must “act with knowledge and not fear” as the digital currencies disruption will only make “room for efficiency and progress.”

“The point I am making is that some of the exciting developments we see call for prudence and care in adopting them, but we must act with knowledge and not fear,” he said.

In response, banks quickly cut ties with cryptocurrency companies, such as the Binance exchange and social payments app Bundle, which in turn stopped accepting deposits.

Since July 2020, Nigerian banks have reduced the amount customers can spend abroad using debit cards as Nigeria’s economy continued to face dollar shortages due to the sharp fall in oil prices. As of now, banks limit customers to withdraw less than $100.

 

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Dangote: Cement price from Factories is between N2,450 and N2,510 per Bag, VAT inclusive

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  …says Nigeria price is in line with or lower than prices across the West African coast 

Management of Dangote Cement Plc has clarified that the price of a bag of cement from its factories and plants across Nigeria (as at 12th April, 2021) is N2,450 in Obajana and Gboko, and N2,510 in Ibese inclusive of VAT.

The clarification was made in view of recent insinuations that the company sells cement in Nigeria at significantly higher prices relative to other countries, particularly Ghana and Zambia.

Dangote’s Group Executive Director, Strategy, Portfolio Development & Capital Projects, Devakumar Edwin revealed that, while a bag of Cement sells for an equivalent of $5.

1, including VAT in Nigeria, it sells for $7.2 in Ghana and $5.95 in Zambia ex-factory, inclusive of all taxes. He said that though the company has direct control over its ex-factory prices, it cannot control the ultimate price of cement when it gets to the market. He advised that it is important to distinguish Dangote’s ex-factory prices from prices at which retailers sell cement in the market.

He, therefore, frowned at intentional misinformation or demarketing, allegedly sponsored by some individuals, that Dangote sells its cement at higher prices in Nigeria relative to other African countries at the expense of Nigerians. He described the allegation as false, misleading, and unfounded, while giving the media persons present at the press conference copies of invoices from Nigeria and some other African countries (Cameroun, Ghana, Sierra Leone, Zambia), and urging them to conduct independent investigations on the price of cement across the West African coast.

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Edwin further explained that while Dangote cement has 60% share of the market, other companies have the remaining 40%. DCP has no control over neither the prices charged by other cement manufacturers nor the prices charged by retailers in the markets.

He further explained that “Demand for cement has risen globally as a fallout of the COVID crisis. Nigeria is no exception as a combination of monetary policy changes and low returns from the capital market has resulted in a significant increase in construction activity. To ensure that we meet local demand, we had to suspend exports from our recently commissioned export terminals, thereby foregoing dollar earnings. We also had to reactivate our 4.5m ton capacity Gboko Plant which was closed 4 years ago and run it at a higher cost all in a bid to guarantee that we meet demand and keep the price of Cement within control in the country.”

He said: “Over the past 15 months, our production costs have gone up significantly. About 50% of our costs are linked to USD so the cost of critical components like: gas, gypsum, bags, and spare parts; has increased significantly due to devaluation of the Naira and VAT increase. Despite this, DCP has not increased ex-factory prices since December 2019 till date while prices of most other building materials have gone up significantly. We have only adjusted our transport rates to account for higher costs of diesel, spare parts, tyres, and truck replacement. Still, we charge our customers only N300 – 350 per bag for deliveries within a 1,200km radius. We have been responsible enough not to even attempt to cash in on the recent rise in demand to increase prices so far” he said.

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Cement cheaper in Nigeria than Ghana, Zambia, others ― Dangote Cement

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The management of Dangote Cement Plc has clarified that the price of a bag of cement from its factories and plants across Nigeria (as at 12th April, 2021) is N2,450 in Obajana and Gboko, and N2,510 in Ibese inclusive of VAT.

The Company in a statement stated that the clarification was made in view of recent insinuations that the company sells cement in Nigeria at significantly higher prices relative to other countries, particularly Ghana and Zambia.

Dangote’s Group Executive Director, Strategy, Portfolio Development & Capital Projects, Devakumar Edwin according to the statement revealed that, while a bag of Cement sells for an equivalent of $5.1, including VAT in Nigeria, it sells for $7.2 in Ghana and $5.95 in Zambia ex-factory, inclusive of all taxes.

He said that though the Company has direct control over its ex-factory prices, it cannot control the ultimate price of cement when it gets to the market.

He advised that it is important to distinguish Dangote’s ex-factory prices from prices at which retailers sell cement in the market.

He, therefore, frowned at what he described as intentional misinformation or demarketing, allegedly sponsored by some individuals, that Dangote sells its cement at higher prices in Nigeria relative to other African countries at the expense of Nigerians.

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He described the allegation as false, misleading, and unfounded, while giving the media persons present at the press conference copies of invoices from Nigeria and some other African countries (Cameroun, Ghana, Sierra Leone, Zambia), and urging them to conduct independent investigations on the price of cement across the West African(W/A) coast.

Edwin further explained that while Dangote cement has 60% share of the market, other companies have the remaining 40%.

He further explained that “Demand for cement has risen globally as a fallout of the COVID crisis. Nigeria is no exception as a combination of monetary policy changes and low returns from the capital market has resulted in a significant increase in construction activity.“To ensure that we meet local demand, we had to suspend exports from our recently commissioned export terminals, thereby foregoing dollar earnings.

“We also had to reactivate our 4.5m ton capacity Gboko Plant which was closed 4 years ago and run it at a higher cost all in a bid to guarantee that we meet demand and keep the price of Cement within control in the country.”

 

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Pension assets dropped by N 51.30bn in February – PENCOM

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The total value of pension assets in the country dropped by N51.30 billion in February, the National Pension Commission (PENCOM) has said.

In a figure obtained by Ripples Nigeria from the commission on Sunday, the pension assets dropped from N12.299 trillion in January to N12.247 trillion in February.

The figure was N12.306 trillion in December last year.

However, PENCOM blamed the development on the depreciation in the prices of Fixed Income Securities (FISs).

Fixed-income securities provide investors a return in the form of fixed periodic payments and the eventual return of principal at maturity.

The regulator pointed out that the trading portfolios of the Approved Existing Schemes (AES), Retirement Savings Account (RSA) Funds II & IV and Closed Pension Fund Administrators (CPFA) fluctuated based on the supply and demand of the underlying securities.

It said: “The values of the bonds in the trading portfolios fluctuate based on the supply and demand of the underlying securities as well as the outlook of the financial market.”

Analysis of the fund showed that the bulk of PENCOM’s investment continued to be invested in the Federal Government’s securities.

Despite the decline, the regulator revealed that there was an increase in the number of registered contributors from 9.237 million in January to 9.265 at the end of February.

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