US risk research firm signals investors Nigeria could see fiscal crisis, insecurity, lack of electricity, outsourcing of governance reign on
Global investors looking at Nigeria in this election year up to the near and medium terms, have been tacitly signaled to the ominous outcomes ahead, with the problems of fiscal crisis, insecurity, lack of electricity supply and the outsourcing of governance continuing. And as campaigning enters fever-pitch stages, Eurasia Group, a leading global political risk research and consulting firm, is canvassing that Nigerian electorates look beyond incumbent Mohammadu Buhari and main challenger, Atiku Abubakar, and consider a ‘third option’ during the forthcoming presidential election in February, dismissing the leadership and managerial credentials of the top two contenders for the office of president.
The United States based firm in a report, said allowing president Buhari, candidate of the All Progressives Congress (APC), continue in office would lead to the perpetuation of the country’s fiscal crisis, inertia in the energy sector, political instability, insecurity and outright outsourcing of government to power brokers who have their eyes on the next elections in 2023.
The report said President Buhari would be a lame duck from day one and should his health problem continues to worsen, his absence would impair governance, removing him from decision making and setting investors wondering if their investments are safe.
“A politically weak president, for health or other reasons, would open the floodgates for political infighting, increasing the chances that his ruling All Progressives Congress implodes. That would turn a policy slowdown into paralysis. The risk of attacks on oil infrastructure would also rise, because the absence of strong leadership in Abuja would make it harder to negotiate with the Niger Delta’s various militant groups,” the report said.
For Abubakar, the Peoples Democratic Party (PDP) candidate, his victory will lead to official corruption at the highest level of governance, infighting within his party over tenureof office, among others.
“Atiku’s policy priorities are unclear and untested: He had previously promised to deregulate the oil and gas sector but recently pledged to reduce gasoline prices by 50% from already below-market levels. That would swell subsidy costs and endanger long-term debt sustainability. He’s also unlikely to champion a tax reform that’s critical to Nigeria’s fiscal sustainability. Atiku would face significant infighting within his People’s Democratic Party as well, as leaders try to hold him to his promise to serve only one term (a pledge he’s likely to retract),” the group said.
This is not the first time that analysts have expressed disappointment in the policy plans of the two leading presidential candidates. An investment bank cum research institution, FBNQuest, in its economic outlook for the 4th quarter of 2018, said there was little on relevant policies on some of the issues facing the country such as fuel subsidy which will help address the problems facing the country.
While noting that PDP’s Atiku Abubakar has produced a plan with ambitious targets for FDI expansion and GDP growth, the report however said the reforms proposed to attain the target are not very different from the policies of the APC, which have failed to deliver growth in GDP per head during its tenure.
Commenting on President Mohammadu Buhari’s change agenda, the report said the change promised in 2015 has been modest, adding that critics can point to power and other shortages, as well as the grossly inadequate infrastructure.
“In our view, one main reason for such disappointment lies in the centralised system of government and its negative impact on decision-taking. It appears at times that almost all decisions and appointments have to be rubber-stamped at the presidency.
“There are many examples of important positions in public agencies and diplomatic posts left vacant for this reason. This institutional inertia has blunted the ability of the big-hitters in the executive to lead from the front. The change has been patchy yet is evident in some fields. Expansionary budgets through to 2018’s, which was finally signed off by the president in mid-June, have brought larger capital releases by the FGN. These budgets have enabled the FGN to deliver on some of its “social interventions” on job creation in the public sector. We would also single out the success of Kemi Adeosun, the recent federal finance minister, in cutting waste, improving cooperation between government agencies, strengthening revenue collection agencies and driving a coherent FGN debt strategy,” the report said.