February Elections Could Prove Deadly for Nigeria’s Economy

All hopes of Nigerians towards better days following the outcome of the February elections may be hinging on a lie should the government continue on the current trajectory heading into the election, according to a financial expert, Idakolo Gbolade.

A retroactive look at Nigeria’s business sector in 2022 reveals a mix of too nasty and not too good, analysts believe, as the industry would likely stagnate with the impending elections and change of administration scheduled in February 2023.

Inflation, a high unemployment rate, poverty, insecurity, an unfavorable foreign exchange regime, the Naira’s depreciation against other currencies, high energy costs, sluggish GDP growth, fuel scarcity, flooding, the oil theft conundrum, high-interest rates, soaring public debt, and the Naira redesign policy with its attendant implications are just a few of the problems the nation’s business sector faced in 2022.

According to NBS data from September, the economic woes of Nigerians in 2022 worsened due to a 33% jobless rate. Because of the widespread instability throughout Nigeria, including the North East, West, South East, and overall, there have been job losses, company closures, and a decline in customer support.

However, the CBN’s system for managing foreign exchange, flooding, a lack of fuel, high energy prices, high interest rates, and Naira depreciation all contributed to the misery of the majority of Nigerians as a result of the difficult economic climate.

Nigeria’s currency crisis has persisted, with prices on the official international market and the black market differing significantly (Black market). For instance, the official exchange rate for the naira against the dollar in January was N415/1$, whereas the black market rate was N567/1$.

The situation is worse now; the black rate is N737/1$ while the official rate is 448.8/1$. Businesses and Nigerians that rely on foreign exchange for their transactions are still impacted by the issue.

Zainab Ahmed, the nation’s minister of finance, budget, and planning, added that the Economic Sustainability Plan, the National Economic Development Plan (2021-2025), and other plans had been undertaken by the Nigerian government to weather the storm.

However, according to a remark from Mr. Idakolo Gbolade, a finance expert who spoke with the Daily Post, if the government continues on its current course, the country’s economic problems won’t get any better, particularly in light of the February elections and shift of power.

“Some of the major setbacks in the economy in 2022 were inability of the government to quickly tame the theft of crude oil that led to major loss of revenue and loss of our position as the number one crude producer for a large part of the year; continued insecurity in the country affected investors’ confidence;

“CBN policies did little to tame the consistent rise in inflation; due to lack of political will, corruption increased among government officials and private sector players in the year; despite claims that the Nigerian government was subsidizing petroleum products, the pump price continued to increase during the year.

“Looking at 2023, not much will change because it is an election year, and the outgoing government will pay little attention to the economy, while the incoming government will need time to settle down.

“If the CBN continues in its policy trajectory in 2023, we might not see inflation receding or poverty reducing,” Gbolade stated.