Nigeria Economy | |
Nigeria Economy | |
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Thursday, February 07, 2019
07:40 AM /FDC Ltd
There is a strong correlation between holding credible elections in
Africa and positive economic outcomes. This is part of the analysis discussed
at this month’s LBS Breakfast Club by the FDC Think Tank.
The timing of the findings is auspicious as it coincides with the
February 16 presidential election. Research shows that where credible and
transparent elections are held in a country, it is usually followed by positive
GDP growth, decline in inflation, a rise in Gross Fixed Investment and a bounce
in the stock market. This hypothesis is partially validated by the last
elections in Ghana, Senegal and Nigeria in 2015.
However, where elections are stolen or rigged and rancorous the reverse
is the case. Negative economic performance and violence usually follows as
noticed in Zimbabwe, DRC etc. and far away Venezuela.
Empirical evidence also seems to suggest that when the misery index in a
country increases in 3 consecutive quarters preceding an election, the incumbent
mostly suffers. In the last few days, economic indicators have shown some
strange trends- the naira appreciated to N360/$ before falling back to N361/$
and economists at FDC are forecasting a decline in inflation in January to
11.35%.
The NBS is set to release Q4 GDP numbers on February 12th.
Good economic news at this time is incumbent supportive whilst if the GDP
numbers are weak and inflation rises it could be helpful to the opponent.
However, no matter the electoral outcome, the need for an increase in growth
and investments in Nigeria has become an urgent necessity.
The attached slides are a synopsis of the state of the economy and the
post-election outlook as presented by Bismarck Rewane at the LBS Breakfast
Session.
Kindly download The LBS Executive Breakfast Session – Feb 2019
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