How Buhari’s return could mar Nigeria’s economic gains


By Odunewu Segun

While President Muhammadu Buhari’s return to the country has been cheered by his supporters after over 100 days on medical vacation, his absence hasn’t been negative as the stock market rallied to gain over 40%.

Now that he is back, investors will be assessing the impact of his return and if there could be positives for the economy.

In his absence, the surge in the Nigerian stock market has been largely attributed to the introduction of the investor/exporter exchange rate window.

President Buhari’s opinion about the handling of the exchange rate is well-known. He has often voiced out his preference for a fixed exchange rate regime, believing that frequent depreciation of the naira has not strengthened the exchange rate.

However, the economic crisis of the last two years has taught us many lessons, one of which is that you cannot control your exchange rate policy and expect to control the inflow of forex from investors.

Now that the CBN Governor has given foreign investors what they want expectations are now beginning to shift towards a unification of the several exchange rate bands that we have in the country.

Buhari could obviously be an enabler or a disrupting element depending on how is expectation is managed. Any suggestion or rhetoric that gives an impression that he doesn’t support the current FX policies could throw the market into turmoil.

ALSO SEE: Read what Atiku said about Buhari return

Also the NNPC is expected to conduct new oil licensing rounds sometimes this year following the expiration of some of the oil mining licenses issued by the previous Jonathan administration. Reports suggest about 11 oil blocs licenses expired in 2016 and are yet to be renewed. The President could expedite the renewal of these licenses especially as portions of the PIB has now been signed into law.

Also, about N2 trillion was earmarked as capital expenditure for 2016, experts argued that achieving this would be a tall order considering the revenue shortfall currently being experienced by the government. However, with Buhari around, it is hoped that he can provide the leadership required to ensure priority projects are treated as such.

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