Adedapo Adesanya
By Adedapo Adesanya
Thinktank group, the Nigerian Economic Summit Group (NESG), has urged the federal government to take necessary steps to take advantage of the Russia-Ukraine war to avoid economic risks.
This is contained in a report titled Implications of Russia-Ukraine War: Risks and Opportunities for Nigeria.
The NESG urged the government to take certain key action points to mitigate the impact of the crisis on the Nigerian economy including the significant legislation and treaties signed by the country.
“Implementing the Petroleum Industry Act (PIA) in a holistic manner is key to attracting huge investments into Nigeria’s oil and gas sector.
“Leveraging the benefits of the African Continental Free Trade Area agreement (AfCFTA) and ensuring effective border control,” the group stated.
Apart from the PIA and AfCFTA, the group noted some other steps that the country can use, including removing the constraints to agricultural productivity to improve food security and supporting value chain development to ensure that primary products are processed locally before they are exported.
“Removing capital controls and encouraging the inflow of stable investments, such as Foreign Direct Investment,” it said.
According to the NESG, the key transmission channels of the crisis to the global economy and Nigeria include the trade channels, financial channels, and commodity price channels.
Others are the technology transfer channel, foreign policy channel and migration channel.
“The tensions have triggered global supply chain disruptions, largely affecting countries exposed to trade with the warring nations.
“Uncertainties will make investors seek safe havens, and this could prompt capital outflows from emerging markets, including Nigeria.
“Constraints to supply due to the geopolitical tension have pushed up global commodity prices. This will generally fuel global inflation,” it said.
The group said that the crisis would also hinder further procurement of expertise and equipment from Russia.
“Nigeria’s alliance with Russia could suffer a setback due to fears that she might face sanctions from the West like those on Russia,” it said.
It said that the war had also affected millions of migrants in Ukraine, including about 4000 Nigerians who are currently studying in Ukrainian universities.
