Economy

What Awaits Nigeria’s Economy in Buhari’s 2nd Term

Published

7 years ago

01/03/2019

By Modupe Gbadeyanka

The presidential election in Nigeria may have come and gone, but the effect will be with the Africa’s largest economy for the next four years.

Last Saturday, Nigerians went to the polls to re-elect President Muhammadu Buhari for another four years.

In his first four years in office, which will officially end on May 29, 2019, the nation suffered its first recession in many years.

During the period, a lot of investors rushed to pull out their funds from the country and the stock market suffered for it.

Also, the President had to spend a chunk of his time in office treating himself at a hospital in London, creating the impression that he was not fully fit to govern the country.

As the country prepare for another four years of President Buhari, analysts at United Capital Research have given their views on the economic outlook in his second term in office.

“The outlook for the economy over the next four years is positive but modest as President Buhari’s victory signals policy stability,” the firm said.

It was stated that the administration will clearly continue to invest in infrastructure, sustain its welfare scheme, reinforce the drive to substitute imports for local production, and retain its intervention programs across the Agric, Power and the SMEs space, by building on its Economic Recovery and Growth Plan (ERGP).

“We expect the budget to remain large, broadly financed by borrowings. However, the role of the private sector may be limited by the absence of far-reaching liberal policies.

“This may keep investment low and output growth soft. Accordingly, we expect GDP growth to sustain a gradual uptick over the next four years, rising from 2.0% to 3.5% or more over the period.

“Inflation rate is likely to ease 10%/9%, though minimum wage implementation and power tariff adjustment may weigh on prices.

“Thus, interest rate may to revert to its long term 12% over the period. In the rest of the report, we highlight our views of the medium term economic outlook for Nigeria,” it said.

The firm further said beyond elections, the medium to long term outlook for the Nigerian economy depends on the position of government on the implementation of far-reaching economic reforms to fix the structural challenges in the economy.

“If not urgently addressed, structural constraints such as; the enormous infrastructural deficit, poor electricity supply, sharp rising population growth, dependence on oil export and oil revenue for budget funding, and the problem of the viability of sub-national governments, are bound to mar economic progress.

“Notably, system inefficiencies continue to undermine the ability of the federal government to diversify its revenue base, enhance social justice, allocate resources efficiently and drive economic diversification. If the stance of the current administration over the last four years is anything to go by, we do not envisage a significant drive for bold reforms.

“However, we expect investment in infrastructures such as rail project, road, and similar social amenities to continue in a bid to bridge the infrastructural gap.

“Again, the drive to diversify government revenue via improving the efficiency of tax authorities such as the FIRS, Customs and Ports Authorities, and support the SMEs boost job creation through intervention in the Agric sector will continue.

“Finally, efforts to ease doing business in Nigeria, via the initiatives of the Presidential Enabling Business Environment Council (PEBEC), by reviewing the bureaucracies and red tapes within the civil service and other government agencies, should be more obvious going forward,” the report said.

In its report, United Capital Research further during the period, it expects the present Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, if retained by the President for another term in office, to sustain its current fixed/multiple forex regime.

On monetary policy, it said aggressive liquidity mop-up via persistent OMO issuances may be retained considering that FX rate will broadly drive policy actions.

On the government’s anti-corruption war, the company said efforts to stamp-out corruption will be sustained and the EFCC will continue to clamp down on looters and individuals with allegations of misappropriation of public funds.

Over the last three to four years, the implementation of TSA, whistleblower’s policy and the efficiency unit of the Ministry of Finance, by the administration has supported significant improvement in independent revenue and recoveries.

“While this will remain appealing to the poor masses, it may rein in discretionary spending by the elite, ultimately limiting the growth rate of aggregate spending in the economy, especially on activities in the services sector,” it said.

On security and social political environment, it said a major aspect of the socio-political environment that seems to have benefited a lot from President Buhari’s first 4-year is the war against insurgency.

If the voting pattern from the region is anything to go by, the massive re-election of the President by voters in Borno and Yobe (the most affected States) suggests that the perceived containment of Boko Haram activities by the Buhari government is paying off.

“Hence, we imagine that another four years in office is positive for relative peace and security in the North Eastern region of the country,” it stated.

Economy

Tinubu Presents N58.47trn Budget for 2026 to National Assembly

Published

4 hours ago

19/12/2025

Adedapo Adesanya

By Adedapo Adesanya

President Bola Tinubu on Friday presented a budget proposal of N58.47 trillion for the 2026 fiscal year titled Budget of Consolidation, Renewed Resilience and Shared Prosperity to a joint session of the National Assembly, with capital recurrent (non‑debt) expenditure standing at 15.25 trillion, and the capital expenditure at N26.08 trillion, while the crude oil benchmark was pegged at $64.85 per barrel.

Business Post reports that the Brent crude grade currently trades around $60 per barrel. It is also expected to trade at that level or lower next year over worries about oil glut.

At the budget presentation today, Mr Tinubu said the expected total revenue for the year is N34.33 trillion, and the proposal is anchored on a crude oil production of 1.84 million barrels per day, and an exchange rate of N1,400 to the US Dollar.

In terms of sectoral allocation, defence and security took the lion’s share with N5.41 trillion, followed by infrastructure at N3.56 trillion, education received N3.52 trillion, while health received N2.48 trillion.

Addressing the lawmakers, the President described the budget proposal as not “just accounting lines”.

“They are a statement of national priorities,” the president told the gathering. “We remain firmly committed to fiscal sustainability, debt transparency, and value‑for‑money spending.”

The presentation came at a time of heightened insecurity in parts of the country, with mass abductions and other crimes making headlines.

Outlining his government’s plan to address the challenge, President Tinubu reminded the gathering that security “remains the foundation of development”.

He said some of the measures in place to tame insecurity include the modernisation of the Armed Forces, intelligence‑driven policing and joint operations, border security, and technology‑enabled surveillance and community‑based peacebuilding and conflict prevention.

“We will invest in security with clear accountability for outcomes—because security spending must deliver security results,” the president said.

“To secure our country, our priority will remain on increasing the fighting capability of our armed forces and other security agencies by boosting personnel and procuring cutting-edge platforms and other hardware,” he added.

Economy

PenCom Extends Deadline for Pension Recapitalisation to June 2027

Published

12 hours ago

19/12/2025

Aduragbemi Omiyale

By Aduragbemi Omiyale

The deadline for the recapitalisation of the Nigerian pension industry has been extended by six months to June 2027 from December 2026.

This extension was approved by the National Pension Commission (PenCom), the agency, which regulates the sector in the country.

Addressing newsmen on Thursday in Lagos, the Director-General of PenCom, Ms Omolola Oloworaran, explained that the shift in deadline was to give operators more time to boost the capital base, dismissing speculations that the exercise had been suspended.

“The recapitalisation has not been suspended. We have communicated the requirements to the Pension Fund Administrators (PFAs), and we expect every operator to be compliant by June 2027. Anyone who is not compliant by then will lose their licence,” Ms Oloworaran told journalists.

She added that, “From a regulatory standpoint, our major challenge is ensuring compliance. We are working with ICPC, labour and the TUC to ensure employers remit pension contributions for their employees.”

The DG noted that engagements with industry operators indicated broad acceptance of the policy, with many PFAs already taking steps to raise additional capital or explore mergers and acquisitions.

“You may see some mergers and acquisitions in the industry, but what is clear is that the recapitalisation exercise is on track and the industry agrees with us,” she stated.

PenCom wants the PFAs to increase their capital base and has created three categories, with the first consists operators with Assets Under Management of N500 billion and above. They are expected to have a minimum capital of N20 billion and one per cent of AUM above N500 billion.

The second category has PFAs with AUM below N500 billion, which must have at least N20 billion as capital base.

The last segment comprises special-purpose PFAs such as NPF Pensions Limited, whose minimum capital was pegged at N30 billion, and the Nigerian University Pension Management Company Limited, whose minimum capital was fixed at N20 billion.

Economy

Three Securities Sink NASD Exchange by 0.68%

Published

13 hours ago

19/12/2025

Adedapo Adesanya

By Adedapo Adesanya

Three securities weakened the NASD Over-the-Counter (OTC) Securities Exchange by 0.68 per cent on Thursday, December 18.

According to data, Central Securities Clearing System (CSCS) Plc led the losers’ group after it slipped by N2.87 to N36.78 per share from N39.65 per share, Golden Capital Plc depreciated by 77 Kobo to end at N6.98 per unit versus the previous day’s N7.77 per unit, and FrieslandCampina Wamco Nigeria Plc dropped 19 Kobo to sell at N60.00 per share versus Wednesday’s closing price of N60.19 per share.

At the close of business, the market capitalisation lost N16.81 billion to finish at N2.147 billion compared with the preceding session’s N2.164 trillion, and the NASD Unlisted Security Index (NSI) declined by 24.76 points to 3,589.88 points from 3,614.64 points.

Yesterday, the volume of securities bought and sold increased by 49.3 per cent to 30.5 million units from 20.4 million units, the value of securities surged by 211.8 per cent to N225.1 million from N72.2 million, and the number of deals jumped by 33.3 per cent to 28 deals from 21 deals.

Infrastructure Credit Guarantee Company (InfraCredit) Plc remained the most traded stock by value with a year-to-date sale of 5.8 billion units valued at N16.4 billion, followed by Okitipupa Plc with 178.9 million units transacted for N9.5 billion, and MRS Oil Plc with 36.1 million units worth N4.9 billion.

Similarly, InfraCredit Plc ended as the most traded stock by volume on a year-to-date basis with 5.8 billion units traded for N16.4 billion, trailed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.7 million, and Impresit Bakolori Plc with 536.9 million units exchanged for N524.9 million.