Feature/OPED
Multilateral Collaboration Still Crucial For Tackling Africa’s Conflicts
By Professor Maurice Okoli
Burkina Faso, Mali and Niger have adopted an incredible approach towards tackling chronic conflicts and related security threats from various extremist groups like Boko Haram, al-Qaida, and Islamic State-affiliated groups by creating a formidable military alliance in the semi-arid Sahel region in West Africa.
As these West African States are entangled in fierce ethnic-Islamic conflicts that have adversely impacted their sustainable development and economic progress, the trio-military force reflects more proactive and dynamic coordination in resolving their security hurdles. It would also enhance practical possibilities of combating terrorism and extremism in the interests of strengthening peace and security in the Sahel-Sahara region and other parts of West Africa.
Historically the three were closely under French political control and have extended economic and security ties since colonial times. This geographically landlocked Burkina Faso has had several military coup d’états, the latest took place in Jan. 2022. Mali (May 24, 2021) and Niger (July 26, 2023) witnessed similar political trends, and both are now under military administration and share startling critical accusations of corruption and malfunctioning of state governance against previous governments. But the finger-end points to France for gross under-development and large-scale exploitation.
These former French colonies have, for the past years, suffered from growing political deficiencies and frequent Islamic attacks. But the key reason, the underlying cause, those tribes are rebelling is due to deep-seated abject poverty across the region. Staging military takeovers was the trio’s dynamic struggle to wage a collective war against their governments and France’s influence and hegemony. For instance, France, the United States and other European nations have poured hundreds of millions of dollars into shoring up Niger’s army and the coup has been seen as a major setback. Overall security environment poses uncertain challenges and devises strategies to tackle these emerging threats in the region.
Existing Sanctions
Since last year, Burkina Faso, Mali and Niger have been under regional and continental sanctions. The 15-member West African regional bloc has imposed stringent sanctions, finding a peaceful solution to the deepening crisis, but yielded little tangible results with no clarity on the next steps.
The African Union (AU), the continental organization which primarily coordinates the political and economic as well as the socio-cultural activities, observes the new trends as military rule spreads or re-appears in the West African region. That however, the Chairperson of the African Union Commission, Moussa Faki Mahamat, strongly condemned such actions and further moved to impose its sanctions as well on the military-ridden states. Their AU memberships, since then, have accordingly been suspended too.
Quite recently, on 28 November 2023, the United Nations Secretary-General António Guterres and the African Union Commission Chairperson Moussa Faki Mahamat convened their seventh African Union-United Nations Annual Conference in New York. In a joint communiqué issued at the end of the meeting, both reviewed progress in the implementation of the UN-AU Joint Framework for Enhanced Partnership in Peace and Security and the AU-UN Framework for the Implementation of Agenda 2063.
In particular, António Guterres and Moussa Mahamat again condemned the resurgence of unconstitutional changes of government in Africa and stressed the need for a timely and peaceful return to constitutional order in Burkina Faso, Gabon, Guinea, Mali, Niger and Sudan which are undergoing complex political transitions to sustain peace, development and human rights in the long term. There must be extensive political awareness among the people in the Sahel region to focus on democracy, development, security and stability. It also called for the release of President Bazoum and other arrested government officials.
Nevertheless, the Economic Community of West African States (ECOWAS) and the Intergovernmental Authority for Development (IGAD) were tasked to enhance their joint efforts to promote inclusive political transitions in those countries in support of the efforts of the respective transitional authorities and regional bodies. The meeting called for continued efforts towards the timely completion of all ongoing political transitions through peaceful, inclusive, transparent and credible elections.
Against this backdrop, they expressed concern over the challenges African countries continue to face towards the achievement of the AU Agenda 2063. Burkina Faso, Guinea, Mali and Niger, nevertheless have displayed defiance to the sanctions and, crafting a number of approaches and making their efforts toward addressing security and development-oriented issues combined with some kind of good governance.
Revisiting the Past
Within the context of the changing political situation, Russia is rapidly penetrating the Sahel. Moreover, to Russia’s expectations, these Sahelian States have in place provisional governments, which include civil society representatives. “We believe that a military approach to settling the crisis in Niger risks leading to a protracted standoff in the African country and a sharp destabilization of the situation in the Sahara-Sahelian region as a whole,” according to the statement posted to the Foreign Affairs Ministry’s website.
South African Institute of International Affairs reports established the fact that Russia seeks to build on Soviet-era ties, steadily widening its influence, and noticeably deploy the rhetoric of anti-colonialism in Africa. Russia is engaged in an asymmetric influence campaign in Africa. Borrowing from its Syria playbook, Moscow has followed a pattern of parachuting to prop up politically isolated leaders facing crises, often with abundant natural resources. Russia is fighting neo-colonialism from the West, especially in relations with the former colonies. According to the report, Russia sees France as a threat to its interests in Francophone West Africa, the Maghreb and the Sahel. The SAIIA is South Africa’s premier non-government research institute on international issues. (SAIIA, Nov. 2021 Report).
“Sanctions have already been announced against Niger, and its membership in the organization is likely to be suspended. Thus, a belt of states in political isolation and bordering on each other is forming in the Sahara-Sahelian region: Guinea – Mali – Burkina Faso – Niger. Russia is interested in expanding relations with Niger, as well as with all other African States, and thus could help to normalize the situation there,” Vsevolod Sviridov, Expert at the HSE University Center for African Studies, told Russia’s Financial Izvestia.
Russia’s Economic Interest
In pursuit of development, the five Sahel states need peace. An analysis of geopolitical factors underscores glaring facts that Russia is getting stronger with its military influence on a bilateral basis, bartering equipment in exchange for access to natural resources. Mali has an agreement with Russia to build a gold refinery while Burkina Faso also wanted energy power. A four-year memorandum guarantees the West African country’s largest gold refinery. Russia’s state nuclear energy company Rosatom signed a deal with Mali in October 2023 to explore minerals and produce nuclear energy. It unreservedly offered a high-level promise to build a 200- to 300-megawatt solar power plant by mid-2025.
Economic Performance
International Monetary Fund (IMF) and the World Bank research reports show that Sahelian states’ economy may face relative stagnation due to unstable conditions including persistent protests in the region. Burkina Faso, Chad, Mali and Niger have been severely affected by the rise in militancy, affecting overall economic performance. Agriculture represents 32% of its gross domestic product and occupies 80% of the working population in Burkina Faso. A large part of the economic activity of the country is funded by international aid, despite having gold ores in abundance. Burkina Faso is the fourth-largest gold producer in Africa, after South Africa, Mali and Ghana.
The December 2023 report by the World Bank, for example, indicated that the poverty rate across the Sahelian region is still deepening due to poor management and governance. The economic and social development could, to some extent, be sustained based on ensuring political stability in the subregion, supporting and intensifying local production, its openness to international trade and export diversification.
According to the UN’s Multidimensional Poverty Index (MPI) report of 2023, Niger is one of the poorest countries in the world. It faces challenges to development due to its landlocked position, even though it possesses some natural resources including uranium ore. Government finance is derived from revenue exports (mining, oil and agricultural exports) as well as various forms of taxes collected by the government. Reports, however, estimated improvement in its revenues after the exit of France. Niger was the main supplier of uranium to the EU, followed by Kazakhstan and Russia.
Across the Sahel, the estimated aggregate population of 120 million is predominantly young, with 49.2% generally under 25 years old. The conflicts have only deepened poverty and food insecurity, and the challenges increasingly gaining ground in those countries. Future growth may be sustained by the exploitation of various untapped resources. Uranium prices have recovered somewhat over the last few years. But much also depends largely on state control, and good governance, by prioritizing economic sectors in the region.
Latest Developments
Niger has scrapped two key security agreements with the European Union that were intended to help fight violence in the Sahel region. It completely withdrew from EU Military Partnership Mission that was launched in February in Niger. It has also revoked approval for the EU Civilian Capacity-Building Mission, which was established in 2012 to help the country’s security forces fight militants and other threats. Most of Niger’s foreign economic and security allies have sanctioned the country, including France, which had 1,500 troops operating in Niger. All of them have been asked to leave.
In June 2022, Mali also abruptly withdrew from the G5-Sahel group and its Joint Force. The Joint Force was created in 2017 by the “G5” Heads of State—Burkina Faso, Chad, Mali, Mauritania and Niger—to counter-terrorism in the region. Reports pointed to the anti-French sentiments and under-equipped local armies to quickly step up their game against Islamist rebels in the volatile Sahelian region. By the end of 2022, France reduced and moved its troops. That ended the so-called “Operation Barkhane” which was a military mission marked by a tactic of permanent occupation of the Sahel countries by French troops. The French government, however, apparently would try to reorganize its strategy in Africa. From some indications, it appears the focus of action turns to the Gulf of Guinea.
At the AU Extraordinary Summit from May 25 to 28, 2022, held in Equatorial Guinea, Moussa Faki Mahamat, Chairperson of the African Union Commission, highlighted the factors contributing to the lack of development including good governance, the growing tendency of usurping power by the military and the significance of forging collective solidarity as a basis for resolving continental and regional problems. Both Senegalese president Macky Sall (then the AU Chairperson) and Moussa Mahamat, issued statements urging the interim military governments to return to constitutional regimes as early as possible, reassuring that the solutions to continental problems and overcoming the existing challenges depend on strong mobilization of African leaders and the effective coordination provided by the African Union. Regrettably, all these have not yet become a thing of the past.
United Nation’s Approach
The United Nations (UN) Under-Secretary-General for Peace Operations, Jean-Pierre Lacroix, has argued that the peacekeeping and terrorism fight faces greater challenges than ever and that it requires multinational mechanisms and approaches. It also requires member-states to adopt a collective capacity to support political and peace processes. Conflict is more complex and multi-layered.
According to Jean-Pierre Lacroix, peacekeepers are facing terrorists, criminals, armed groups and their allies, who have access to powerful modern weapons and a vested interest in perpetuating the chaos in which they thrive. Further complicating this situation is the fact that most peacekeeping operations – particularly our large, so-called multidimensional missions in Africa – have long been affected by a discrepancy between their capacities and what is demanded of them by the Security Council and host countries. Financial resources are often inadequate for their mandated tasks.
What’s at Stake
Niger and Burkina Faso exited the anti-Islamist force this early December 2023, withdrawing from an international force known as the G5 that was set up to fight Islamists in the Sahel region. Now Burkina Faso, Mali and Niger – run by military rulers following coups who have formed their mutual defence pact. Their so-called Alliance of Sahel States (AES) was signed back in September. United Nations Secretary-General António Guterres has often spoken against such inter-state collaboration.
But Chad and Mauritania are still part of the G5 force which is meant to be made up of about 5,000 soldiers. A statement from the military-led governments of Burkina Faso and Niger was critical of the G5 force for failing to make the Sahel region safer. It also suggested the anti-jihadist force undermined the two African nations’ desire for greater “independence and dignity” – and was serving foreign interests instead. They almost certainly meant France, whose power has dramatically deteriorated.
Usually referred to as the G5 Sahel, these countries – Burkina Faso, Chad, Mali, Mauritania and Niger – are engulfed with various socio-economic problems primarily due to the system of governance and poor policies toward sustainable development. In addition, rights abuse and cultural practices to a considerable extent affect the current state of development.
The big question is what impact this would have on the Islamist militant groups that have been growing in numerical strength, scope of operations and degree of force across the Sahel region. Russia is back in prominence on the world stage. As it flexes its muscles and tentacles to gain influence, the stature of the EU/US continues seemingly fading away. And former French colonies are simply turning to Russia for military support, bartering their natural resources for further much-anticipated collaborative partnerships. Russia has already agreed to develop nuclear power plants in Mali, while in Burkina Faso, it plans to construct an oil refinery.
For fear and concerns about the new rise of all kinds of terrorism and frequent attacks, the Sahel-5 are all turning to Russia for military assistance to fight growing terrorism, and efforts to strengthen political dialogue and promote some kind of partnerships relating to trade and the economy in the region. At the same time, with renewed and full-fledged interest to uproot French domination, Russia has ultimately begun making inroads into the entire Sahel region, an elongated landlocked territory located between North Africa (Maghreb) and West Africa, that stretches from the Atlantic Ocean to the Red Sea.
Unique Lessons from Southern Africa
At least the majority of African leaders have to consider a complete overhaul of their security system across Africa. The Security Committees of the African Union and that of the Economic Community of West African States have to learn a few lessons and methodological approaches in dealing with indiscriminate threats of terrorism, militant groups, Islamic State-linked insurgencies and other related issues in Mozambique.
The worsening security situation at that time was a major setback for Mozambique but has been controlled by the involvement of regional troops from Rwanda and the Southern African Development Community Military Mission (SAMIM). Rwanda offered 1,000 in July 2021. South Africa has the largest contingent of approximately 1,500 troops. External countries are enormously helping to stabilize the situation in Mozambique. Its former colonizers Portugal and the United States both sent special forces to train local troops. Mozambique’s approach towards fighting growing threats of terrorism and conflict resolution offers explicit valuable lessons for the G5 Sahel which are Burkina Faso, Chad, Mali, Mauritania and Niger.
At the panel discussions during the mid-December U.S.-Africa Summit in Washington, Mozambican President Filipe Nyusi was very outspoken and shared valuable experiences with the audience about the use of well-constituted regional military force for enforcing peace and security in Mozambique. He told the panellists that there has been “remarkable progress” as businesses have restarted and displaced people began returning to Cabo Delgado, northern Mozambique. His argument simply was on the necessity of adopting ‘African solutions to African problems’ on peace and security issues across Africa, and this should be seriously considered as the most suitable, comprehensive approach under the current emerging geopolitical situation.
Joint regional forces within the context of multilateralism still have, to a large degree, significance in tackling conflicts in Africa. The Joint Forces of the Southern African Development Community are keeping peace in northern Mozambique. The rules, standards and policies, provision of assistance as well as the legal instruments and practices are based on the protocols of building and security stipulated by the African Union. It falls within the framework of peace and security requirements of the African Union. And has an appreciable commendation from the United Nations Security Council.
“We welcome collective action from SADC in committing to bringing sustainable peace to the region. We urge our leaders to consider the lessons learnt from other similar conflicts in Africa. In the Sahel, Somalia, and the Niger Delta offer stark contemporary reminders that a purely militaristic solution (devoid of measures to address the causes of the insurgency) increases the likelihood of its intractability. It is also unlikely to pave the way towards achieving sustainable peace,” the official statement from SADC.
The complexity and challenges in navigating this regional security partnership could be diverse, it depends also on political culture and mechanism of pragmatic approach. There have been various assessments and interpretations, but the security initiative to create the joint southern force underscores the multiplex dynamics to better play at home-grown solutions. The SADC initiative portrays a distinctive blueprint for purely African-headed peacekeeping success stories in the region, precisely for Mozambique and this could be replicated in West Africa.
With the changes sweeping across the world, it is glaringly well-known that a number of external countries are using Africa to achieve geopolitical goals, sowing seeds of confrontation which threaten African unity. Prime Minister Abiy Ahmed, the Federal Democratic Republic of Ethiopia (FDRE), during the 36th Ordinary Session of the African Union (AU) held in Addis Ababa, interestingly used the phrase – “African solutions to African problems” – seven times in his speech delivered on February 2023. He strongly suggested that for the existing conflicts and disputes on the continent, it is necessary to mobilize collective efforts to resolve them and “must be confined to this continent and quarantined from the contamination of non-African interference.”
Final Security Breathe
As the security situation stands, the best option is to consider new approaches, taking into cognizance local factors, to regulate tensions and to prioritize development and economic sovereignty in the Sahel. And of course, many experts have suggested that addressing the Sahel crisis requires collective efforts and cooperation from all parties involved that can bring positive change in the region. Ultimately, it must be through tailored collective efforts and, most importantly, within the African context taking local conditions into account. As shown by Mozambique, carefully evaluating the tangible advantages combined with results, underscores the degree of consideration given to foreign involvement in conflicts without bartering natural resources. Sometimes the geopolitical factors are intertwined, though. In any case, to separate facts from fiction, Mozambique’s exemplary case is undoubtedly marked by significant successes.
In the context of – “African solutions to African problems” – the SADC’s regional force was earlier constituted in April 2021, agreed to deploy a regional force (3,000 troops) in Cabo Delgado, located in northern Mozambique and to fight threats of terrorism in neighbouring Southern African countries. What is referred to as Islamic attacks and insurgency caused havoc and devastation in Cabo Delgado province of Mozambique. The insurgency began in 2017 and left an unimaginable negative effect on settlements of the civilian population, and business and industry operations. The situation now is under control and seen as a distinctive example for the rest of Africa. With relative regional peace, Southern Africa looks now toward the direction of attaining its economic sovereignty. Besides that, SADC counted on funding from the United States and European Union (EU) and the United Nations.
Professor Maurice Okoli is a fellow at the Institute for African Studies and the Institute of World Economy and International Relations, Russian Academy of Sciences. He is also a fellow at the North-Eastern Federal University of Russia. He is an expert at the Roscongress Foundation and the Valdai Discussion Club. As an academic researcher and economist with a keen interest in current geopolitical changes and the emerging world order, Maurice Okoli frequently contributes articles for publication in reputable media portals on different aspects of the interconnection between developing and developed countries, particularly in Asia, Africa and Europe. With comments and suggestions, he can be reached via email: [email protected].
By Barr. Adefila Kamal
Football in Nigeria has never been just a sport. It is emotion, argument, nationalism, and sometimes heartbreak wrapped into ninety minutes. That passion is a gift, but it often comes with a tendency to shout down progress before it has the chance to grow. In the middle of this noise sits the Nigeria Football Federation under the leadership of Ibrahim Musa Gusau, a man who has chosen steady hands over loud speeches, structure over drama, and long-term rebuilding over chasing instant applause.
When Gusau took office in 2022, he understood one thing clearly: the only way to fix Nigerian football is to repair its foundations. He said it openly during the 2025 NNL monthly awards ceremony — you cannot build an edifice from the rooftop. And true to that conviction, his tenure has taken shape quietly through structural investments that don’t trend on social media but matter where the future of the game is built. The construction of a players’ hostel and modern training pitches at the Moshood Abiola Stadium is one of the clearest signs of this shift. Nigeria has gone decades without basic infrastructure for its national teams, especially youth and age-grade squads. Gusau’s administration broke that pattern by delivering the first dedicated national-team hostel in our history, a project that signals an understanding that success is not luck — it is preparation.
The same thread runs through grassroots football. The maiden edition of the FCT FA Women’s Inter-Area Councils Football Tournament emerged under this administration, giving young female players a structured platform instead of the token attention they usually receive. These initiatives are not flashy. They do not dominate headlines. But they form the bedrock of any footballing nation that wants to be taken seriously.
Gusau’s leadership has also focused on lifting the domestic leagues out of years of decline. The NFF has revamped professional and semi-professional competitions, working to create consistent scheduling, fair officiating, and marketable competition structures. The growing number of global broadcasting partnerships — something unheard of in the old NPFL era — has brought more eyes, more credibility and more opportunities for clubs and players. Monthly awards for players, coaches and referees have introduced a culture of performance and merit, something our domestic game has needed for years. These are reforms that reshape the culture of football far beyond one season.
Internationally, Nigeria regained a powerful seat at the table when Gusau was elected President of the West African Football Union (WAFU B). This is not a ceremonial achievement. In football politics, influence determines opportunities, hosting rights, development grants, international appointments and the respect with which nations are treated. For too long, Nigeria’s voice in the region was inconsistent. Gusau’s emergence changes that, and it places Nigeria in a position where its administrative competence cannot be dismissed.
His administration has also made it clear that women’s football, youth development and academy systems are no longer side projects. There is a renewed intention to repair the broken pathways that once produced global stars with almost predictable frequency. If Nigeria is going to remain a powerhouse, development must become a machine, not an afterthought.
Still, for many observers, none of this seems to matter because the yardstick is always a single match, a single tournament or a single disappointing moment. Public criticism often grows louder than the facts. Fans want instant results, and when they don’t come, the instinct is to blame whoever is in office at the moment. But this approach has repeatedly sabotaged Nigerian football. Constant leadership changes wipe out institutional memory and scatter reform efforts before they mature. No nation becomes great by resetting its football house every time tempers flare.
Gusau’s leadership is unfolding at a time when FIFA and CAF are tightening their expectations for professionalism, financial transparency and infrastructure. Nigeria cannot afford scandals, disarray or combative politics. We need the kind of administrative consistency that global football bodies can trust — and this is exactly the lane Gusau has chosen. He has not been perfect; no administrator is. But he has been consistent, measured and focused. In an ecosystem that often rewards noise, this is rare.
For progress to hold, Nigeria must shift from the culture of outrage to a culture of constructive contribution. The media, civil society, ex-players, club owners, fan groups — everyone has a role. The truth is that Nigerian football’s biggest enemy has never been the NFF president, whoever he might be at the time. The real enemies are impatience, instability and emotional decision-making. They derail strategy. They kill reforms. They weaken institutions. And they turn football — our greatest cultural asset — into a battlefield of blame.
Gusau’s effort to reposition the NFF is a reminder that real development is rarely glamorous. It is slow, disciplined and often misunderstood. But it is the only route that leads to the future we claim to want: a football system built on structure, modern governance, infrastructure, youth development and global influence. Nigeria will flourish when we start protecting our institutions instead of tearing them down after every misstep.
If we truly want Nigerian football to rise, we must recognise genuine work when we see it. We must support continuity when it is clearly producing a roadmap. And we must resist the temptation to substitute outrage for analysis. Ibrahim Musa Gusau’s tenure is not defined by noise. It is defined by groundwork — the kind that elevates nations long after the shouting stops.
Barr. Adefila Kamal is a legal practitioner and development specialist. He serves as the National President of the Civil Society Network for Good Governance (CSNGG), with a long-standing commitment to transparency, institutional reform and sports governance in Nigeria
By Taiwo Olatunji, CFA
Nigeria’s infrastructure ambition is not constrained by vision, but by the financing architecture. The public sector balance sheet, which has been the primary source of financing, has become very tight, while financing from the private sector is available and increasing, with a focus on long-term, naira-denominated assets. Hence, the challenge lies in effectively connecting this capital to bankable projects at scale and with discipline. Project bonds, created, structured and distributed by investment banks, are the instruments required to bridge the country’s infrastructure needs.
The scale of the need is clear. Nigeria’s Revised NIIMP (2020–2043) estimates ~US$2.3 trillion, about US$100bn, a year is required annually for the next 30 years to lift infrastructure to 70% of GDP. Africa’s pensions, insurers and sovereign funds already hold over US$1.1 trillion that can be mobilised for this purpose, but they require new and innovative approaches to enhance their participation in addressing this challenge.
What is broken with the status quo?
Nigeria continues to finance inherently long-dated assets through the issuance of local currency public bonds, Sukuk and Eurobonds. This approach creates a heavy burden on the government’s balance sheet while sometimes causing refinancing risk and FX exposures, where naira cash flows service dollar liabilities. It has also led to the slow conversion of the pipeline of identified projects because many infrastructure projects have not been prepared, appraised and structured to attract the private sector.
Why project bonds and where they sit in the stack
Project bonds are debt securities issued by project SPVs and serviced from project cash flows, typically secured by concessions, offtake agreements, or availability payments. Unlike typical bonds (corporate or government), which are backed by the sponsor’s balance sheets, project bonds are backed by the cash flow generated by the financed project. They often have longer duration, are tradeable, aligned with the long operating life of infrastructure projects and best suited for pension and insurance investors.
Globally, this type of instrument has been used to finance major projects such as toll roads, power plants, and social infrastructure. For example, in Latin America, transportation and energy projects have been financed through project bonds from local and international investors, through the 144A market, a U.S. framework that allows companies to access large institutional investors without going through a full public offering. Similarly, in India, rupee-denominated project bonds have benefited from partial credit guarantees provided by institutions like Crédit Agricole Corporate and Investment Bank, which help lower investment risk and attract more investors.
In practice, project bonds can be structured in two ways: (i) as a take-out instrument, refinancing bank or DFI construction loans once an asset has reached operational stability; or (ii) as a bond issued from day one for brownfield or late-stage greenfield projects where revenue visibility is high, often supported by credit enhancements such as guarantees.
In both cases, the instrument achieves the same outcome: aligning long-term, project cash flows with the long-term liabilities of domestic institutional investors.
The enabling ecosystem is already emerging
1. Nigeria is not starting from zero. Regulatory infrastructure is already in place. The Securities and Exchange Commission (SEC) has issued detailed rules governing Project Bonds and Infrastructure Funds, creating standardized issuance structures aligned with global best practice and familiar to institutional investors. The SEC is also mulling the inclusion of the proposed rules on Credit Enhancement Service Providers in the existing rules of the Commission.
2. Market benchmarks are already available. The sovereign yield curve, published by the Debt Management Office (DMO) through its regular monthly auctions, provides a transparent reference point for pricing. This curve serves as the base risk-free rate, against which project bond spreads can be calibrated to reflect construction, operating, and sector-specific risks.
3. The National Pension Commission (PenCom) has revised its Regulation on the investment of Pension Fund Assets, increasing the amount of the country’s N25.9 trillion pension assets to be allocated to infrastructure.
4. InfraCredit has established a robust local-currency guarantee framework, supporting an aggregate guaranteed portfolio of approximately ₦270 billion. The portfolio carries a weighted average tenor of ~8 years, with demonstrated capacity to extend maturities up to 20 years. (InfraCredit 2025)
Why merchant banks should lead
Merchant banks sit at the nexus of origination, structuring, underwriting, and distribution, and they need to work with projects sponsors, financiers and government to develop a pipeline of bankable infrastructure projects. A pipeline of bankable infrastructure projects is important to attract investors as they prefer to invest in an economy with a recognizable pipeline. A pipeline also suggests that a structured and well-thought-out approach was adopted, and the projects would have identified all the major risks and the proposed mitigants to address the identified risks.
This “banks-as-catalysts” model, an economic framework that states banks can play an active and creative role in promoting industrialization and economic development, particularly in emerging markets, can be adopted to structure and mobilise domestic private finance into Infrastructure projects.
Coronation Merchant Bank’s role and vision
At Coronation, we believe the identification, structuring and testing of bankable infrastructure projects are the constraints to mobilization of private capital into the infrastructure space. We bring an integrated platform across Financial Advisory, Capital Mobilization, Commercial Debt, Private Debt and Alternative Financing to identify, structure, underwrite and distribute infrastructure debt into domestic institutions. The Bank works with DFIs, guarantee providers and other banks to scale issuance. Our franchise has supported infrastructure debt issuances via the capital markets, likewise Nigerian corporates and the Government.
From Insight to Execution
If you are considering the issuance of a project bond or you want to discuss pipeline readiness, kindly contact [email protected] or call 020-01279760.
Taiwo Olatunji, CFA is the Group Head of Investment Banking at Coronation Merchant Bank
By Blaise Udunze
At the Annual Bankers’ Dinner, when the Governor of the Central Bank of Nigeria, Yemi Cardoso, recently stated that Nigeria had “turned a decisive corner,” his remark aimed to convey assurance that inflation was decelerating with headline inflation eased to 16.05percent and food inflation retreating to 13.12 percent, the exchange rate was stabilizing, and foreign reserves ($46.7 billion) had climbed to a seven-year peak. However, beneath this announcement, a grimmer and conflicting economic situation challenges households, businesses, and investors daily.
Stability is not announced; it is felt. For millions of Nigerians, however, what they are facing instead are increasing difficulties, declining abilities, diminished buying power, and susceptibilities that dispute any assertion of a steady macroeconomic path.
The 303rd MPC gathering was the most significant in recent times, revealing policies and statements that prompt more questions than clarifications. It highlighted an economy striving to appear stable, in theory, while the actual sector struggles to breathe.
This narrative explores why Cardoso’s assertion of “restored stability” is based on a delicate and partial foundation, and why Nigeria continues to be distant from attaining economic robustness.
Manufacturing: The Core of Genuine Stability Remains Struggling to Survive
A strong economy is characterized by growth in production, increased investment, and competitive industries. Nigeria lacks all of these elements.
The Manufacturers Association of Nigeria (MAN) expressed this clearly in its response to the MPC’s choice to keep the Monetary Policy Rate at 27 percent. MAN stated that elevated interest rates are now” hindering production, deterring investment, and weakening competitiveness.
Producers are presently taking loans at rates between 30-37 percent, an environment that renders growth unfeasible and survival challenging. MAN’s Director-General, Segun Ajayi-Kadir, emphasized that although stable exchange rates matter, no genuine industry can endure borrowing expenses to those charged by loan sharks.
The CBN’s choice to maintain elevated interest rates is based on drawing foreign portfolio investors (FPIs) to support the naira’s stability. However, FPIs are well-known for being short-term, speculative, and reactive to disturbances. They do not signify long-term stability. Do they represent genuine economic development?
Genuine stability demands assurance, in manufacturing beyond financial tightening. Manufacturers are expressing, clearly and persistently, that no progress has been made.
Oil Output and Revenue: The Engine Behind Nigeria’s Stability Is Misfiring
Nigeria’s oil sector, which is the backbone of its fiscal stability, is underperforming. The 2025 budget presumed:
- $75 per barrel oil price
- 2.06 million barrels per day production
Both objectives have fallen apart. Brent crude lingers near $62.56 under the benchmark. Contrary to the usual explanations, experts attribute the decline not mainly to external shocks but to poor reservoir management, outdated models, weak oversight, and delayed technical decisions.
Engineer Charles Deigh, a regarded expert in reservoir engineering, clearly expressed that Nigeria is experiencing production losses due to inadequate well monitoring, obsolete reservoir models, and technical choices lacking fundamental engineering precision. These shortcomings result directly in decreased revenue. By September 2025:
– Nigeria had accumulated N62.15 trillion from oil revenue
– instead of the N84.67 trillion budgeted.
– In September, the Federal Inland Revenue Service reported a startling 49.60 percent deficit in revenue from oil taxes.
A nation falling short of its main revenue goals by 50 percent cannot assert stability. Instead, it will take loans. Nigeria has taken loans.
A Stability Built on Debt, Not Productivity
Nigeria is now Africa’s largest borrower, and the world’s third-biggest borrower from the World Bank’s IDA, with $18.5 billion in commitments. By mid-2025, the total public debt amounts to N152.4 trillion, marking a 348.6 percent rise since 2023.
From July to October 2025, the government secured contracts for: $24.79 billion, €4 billion, ¥15 billion, N757 billion, and $500 million Sukuk loans. Nevertheless, in spite of these acquisitions, infrastructure continues to be manufacturing remains limited, and social welfare is still insufficient.
Uche Uwaleke, a finance and capital markets professor, cautions that Nigeria’s debt service ratio is “detrimental to growth.” Currently, the government spends one out of every four naira it earns on servicing debts. Taking on debt is not harmful in itself, provided it finances projects that pay for themselves. In Nigeria, it supports subsistence. A country funding today, through the labour of the future, cannot assert restored stability.
The Naira: A Currency Supported by Fragile Pillars
The CBN contends that elevated interest rates and enhanced market confidence have contributed to the naira’s stabilisation. However, this steadiness is based on grounds that cannot endure even the slightest global disturbance. The pillars of a stable currency are:
– Rising domestic production
– Expanding exports
– Reliable energy supply
– Strong security
– A thriving manufacturing base
None of these is Nigeria’s current reality. What Nigeria actually receives is capital from portfolio investors, and past events (2014, 2018, 2020, 2022) have demonstrated how rapidly these funds disappear.
Unemployment: “Stable” Figures Mask a Rising Youth Crisis
The CBN touts a reported unemployment rate of 4.3 percent. However, the International Labour Organisation (ILO), along with economists, cautions that the approach conceals more serious issues in the labour market.
Youth joblessness has increased to 6.5 percent, and the Nigerian Economic Summit Group cautions that Nigeria needs to generate 27 million formal employment opportunities by 2030 or else confront a disastrous labour crisis. The employment crisis is a ticking time bomb. A country cannot maintain stability when its youth are inactive, disheartened, and financially marginalized.
FDI Continues to Lag Despite CBN’s Positive Outlook
During the 2025 Nigerian Economic Summit, NESG Chairman, Niyi Yusuf stated that Nigeria’s efforts to attract direct investment (FDI) continue to be sluggish despite the implementation of reforms. FDI genuinely reflects investor trust, not portfolio inflows. FDI signifies enduring dedication, manufacturing plants, employment, and generating value. Nigeria does not have any of this as of now. An economy unable to draw long-term investments lacks stability.
139 Million Nigerians in Poverty: What Stability?
The recent development report from the World Bank estimates that 139 million Nigerians are living in poverty, and more than half of the population faces daily struggles. This is not stability. It is a humanitarian and economic crisis.
Food inflation continues to stay structurally high. The cost of a food basket has risen five times since 2019. Low-income families currently allocate much, as 70 percent of their earnings to food. A government cannot claim stability when its citizens go hungry.
A Fragile, Failing Power Sector
The power sector, another cornerstone of economic stability, is failing. Over 90 million Nigerians are without access to electricity, which is one of the highest figures globally. Even homes linked to the grid get 6.6 hours of electricity daily. Companies allocate funds to generators rather than to technology, innovation, or growth. Nigeria has now emerged as the biggest importer of solar panels in Africa, not due to environmental goals but because the national power grid is unreliable.
A country cannot achieve stability if it is unable to supply electricity to its residences, industrial plants, or medical centers.
Insecurity: The Silent Pillar Undermining All Economic Policy
Banditry, terrorism, abduction, and militant attacks persist in agriculture, manufacturing, logistics, and investment. Nigeria forfeits $15 billion each year due to insecurity and resources that might have fueled industrial development.
Food price increases are mainly caused by instability, and farmers are unable to cultivate, gather, or deliver their products. Nevertheless, the MPC approaches inflation predominantly as an issue of policy. In a country where insecurity fundamentally hinders the economy tightening policy cannot ensure stability.
Inflation Figures Under Suspicion
Questions have also emerged regarding the reliability of inflation data. Dr. Tilewa Adebajo, an economist, affirmed that the CBN might not entirely rely on the NBS inflation figures, highlighting increasing apprehension. A sharp decrease to 16 percent inflation clashes with market conditions.
Families are facing the food costs in two decades. Costs, for transport, housing rent, education fees, and necessary items keep increasing. Food prices cannot decline when farmers are abandoning their farmlands and fleeing for safety. If inflation figures are manipulated or partial, the stability story based on them becomes deceptive. There is, quite frankly, a significant disconnect between governance and the lived experience of ordinary Nigerians.
Foreign Reserves: A Story of Headlines vs Reality
Even Nigeria’s celebrated foreign reserves require scrutiny. The CBN reported $46.7 billion in reserves. However, a closer examination shows:
– Net usable reserves are only $23.11 billion
– The remainder is connected to commitments, swaps, and debts
Gross reserves make the news. Net reserves protect the currency. The difference is too large to assert that the naira is stable.
Nigeria’s Economic Contradiction: Stability at the Top, Volatility at the Bottom
In reality, Nigeria is caught between official proclamations of stability and lived experiences of volatility. The disparity between the CBN’s account and the actual experiences of Nigerians highlights a reality:
– Macroeconomic changes have failed to convert into improvements in human well-being.
– Nigeria might appear stable officially. Its citizens are experiencing instability in truth.
– Taking on debt is increasing
– Poverty is worsening
– Manufacturing is contracting
– Jobs are scarce
– Authority is breaking down
– Feelings of insecurity are growing stronger
– Inflation is undermining dignity
– Companies are struggling to breathe
– Capital is escaping
– Misery, among humans, is expanding
A strong economy is one where advancement is experienced, not announced.
What Genuine Stability Demands
To move from paper stability to real stability, Nigeria must:
- Support domestic production. Cut interest rates for manufacturers, reduce borrowing costs, and provide targeted credit.
- Fix oil production technically. Revamp reservoir engineering, implement surveillance. Allocate resources to adequate technical oversight.
- Prioritize security. Secure farmlands, highways, and industrial corridors.
- Reform the power sector. Invest in grid reliability, renewable integration, and private-sector-led transmission.
- Attract real FDI. Streamline rules, enhance the framework, and maintain consistent policy guidance.
- Anchor debt on productive projects. Take loans exclusively for infrastructure projects that produce income.
- Prioritize reforms in welfare. Adopt crisis-responsive, domestically funded safety nets.
- Improve transparency. Ensure inflation, employment, and reserve data reflect reality.
Stability Is Not Given; It Has to Be Achieved
The CBN Governor’s statement of “renewed stability” is hopeful. It remains unproven. The inconsistencies are glaring, the statistics too. The real-world experiences are too harsh. Nigerians require outcomes, not slogans. Stability is gauged not through statements on policy but by whether:
– Manufacturing plants are creating (factories operate at full capacity),
– Food is affordable,
– Young people have jobs
– The naira is strong without artificial props,
– Electricity is reliable,
– Security is assured,
– Poverty rates are decreasing.
Unless these conditions are met, Nigeria is not experiencing a period of restored stability. Instead, it is going through a phase of recovery, one that will collapse if the actual economy keeps worsening while decision-makers prematurely applaud their successes. The CBN must rethink its approach. Nigeria needs productive stability, not statistical stability.
Blaise, a journalist and PR professional, writes from Lagos, can be reached via: [email protected]
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