NewAfricanWoman Issue 35 - Flipbook - Page 34
Spotlight on Nigeria
Nigeria
Reloaded
WHAT IS IN STORE FOR AFRICA’S GIANT IN 2016?
After an election year wracked by political tensions, economic uncertainty
and a hard-fighting terrorist group, what should Nigerians and Nigeria-watchers
be looking out for in 2016? Tolu Ogunlesi sums it all up.
A
t the beginning of 2015 Boko
Haram occupied an area in
the northeastern corner of
Nigeria estimated to be the
size of Swaziland. From that
stronghold, it kept Africa’s
largest economy cowering in
fear, overrunning towns and
cities at will, kidnapping girls and women in large
numbers, massacring the men. On top of that was
the falling oil price, after four years of record highs.
But all of that paled beside the approaching
elections, touted as the most unpredictable in
Nigeria’s history. With opinion polls suggesting
a tight race, and the possibility of a defeat for the
ruling People’s Democratic Party, which had held
power for the previous 16 years, tensions spiked,
and worst-case scenarios dominated conversations
at home and abroad.
The fears of a meltdown mercifully turned out
to be exaggerated. Incumbent President Goodluck
Jonathan conceded defeat to his main challenger,
Mohammadu Buhari, setting the stage for the firstever transfer of power from one political party to
another, and a new government.
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Economy
With Iran unleashing its substantial oil reserves
onto the global market, and a troubling economic
slowdown in China, oil prices are likely to remain
depressed for a long time to come. It is currently
hovering around US$30 per barrel, a 10-year low.
For a country that depends on oil for three-quarters
of government revenues, and 90% of foreign exchange earnings, this is bloodbath territory. Nigeria’s 2016 budget is based on a $38 assumption.
Foreign investors are hovering, hawk-like, in anticipation of a devaluation of the naira. The Central
Bank, having allowed the currency slide by about
20% between November 2014 and February 2015,
doesn’t seem keen for a repeat, even though the
gap between the official price and the black market
price continues to widen. President Buhari appears
unconvinced that devaluation is the way to go, and
analysts believe the Central Bank is taking its cue
from him. In a country so heavily dependent on
imports, and on the greenback, governments tend
to be sensitive about the relative value of the naira.
But with oil prices down 70% and foreign reserves at a 12-year low, there’s not much of a choice.
Unwilling to devalue, and unable to boost the sup-