Feature/OPED
Socioeconomic Challenges and Options Before the Federal Government
By Jerome-Mario Utomi
Aside from the time-honoured belief that the poverty of any country is felt by the quality and quantity of food to its citizens, it is important to state abinitio that this piece was principally inspired by two separate but related promptings.
First is the study report which among other observations states that over the past century in the United States of America (USA), there exists a shift in the locations and occupations of urban consumers.
It explained that in 1900, about 40% of the total population was employed on the farm, and 60% lived in rural areas. Today, the respective figures are only about 1% and 20%. Over the past half-century, the number of farms has fallen by a factor of three.
As a result, the ratio of urban eaters to rural farmers has markedly risen, giving the food consumer a more prominent role in shaping the food and farming system. The changing dynamic has also played a role in public calls to reform federal policy to focus more on the consumer implications of the food supply chain.
The second is the argument by Frances Stewart that the development-security nexus has become central to the development and peace-building enterprises.
He considers three types of connections between security and development, both nationally and globally: (a) security as an objective, (b) security as an instrument and (c) development as an instrument.
Given these connections, he argued that security policies may become part of development policy because in so far as they enhance security, they will contribute to development.
Conversely, development policies may become part of security policy because enhanced development increases security. Stewart finds that ‘societal progress requires reduced insecurity’ and that more inclusive and egalitarian development is likely to enhance security.’
From this spiralling awareness, the question may be asked; as a nation, what do make out of the above given heightened insecurity in the country which has resulted in incessant killings of farmers majorly in the North central part of the country and Nigeria as a whole and pathetically rendered us a country in dire need of peace and social cohesion among her various socio-political groups?
How do we arrest the situation given the fact that all its signs portend grave danger to the nation and are laced with the capacity to ‘engineer food insecurity in the country?
How do we as a nation tackle the fact that the number of farms has fallen caused by a factor attributable to insecurity? What plan is in place to manage the nagging reality that the ratio of urban eaters to rural farmers has markedly risen as a result of farmers that fled their farms/villages in order to secure their lives? Is the federal government mindful of the worrying awareness that by 2050, global consumption of food and energy is expected to double as the world’s population and incomes grow, while climate change is expected to have an adverse effect on both crop yields and the number of arable acres? What are our security and development objectives? What are the instruments targeted at achieving these objectives?
Exacerbating the situation is the belief in some quarters that since independence, the country has demonstrated that “there is no development plan (Fiscal policies, socioeconomic plans and poverty alleviations programmes) which has achieved its core objectives. There is always a disturbing laxity in marching plan targets with practical and unfailing consistency. The result is that the country remains one of the most politically and economically disarticulated countries in the world”.
Accordingly, as we prod over these concerns, it will be relevant to the present discourse to add that for any programme/action to be typified as development-based/focused, development practitioners believe that such programme progress should entail an all-encompassing improvement, a process that builds on itself and involve both individuals and social change.
Requires growth and structural change, with some measures of distributive equity, modernization in social and cultural attitudes, a degree of political transformation and stability, an improvement in health and education so that population growth stabilizes, and an increase in urban living and employment.
In the same vein, it is public knowledge that throughout the early decades, Nigeria paid little attention to what constitutes sustainable development.
Such conversation, however, gained global prominence via the United Nations introduction, adoption and pursuit of the Millennium Development Goals, MDGs, which lasted between the years 2000 and 2015. And was among other intentions aimed at eradicating extreme poverty and hunger as well as achieve universal primary education, promote gender equality, reduce child mortality, improve maternal health among others.
Without going into specific concepts or approaches contained in the performance index of the programme, it is evident that Nigeria and the majority of the countries performed below average. And, it was this reality and other related concerns that conjoined to bring about 2030 sustainable agenda- a United Nation initiative and successor programme to the Millennium Development Goals (MDGs)- with a collection of 17 global goals formulated among other aims to promote and cater for people, peace, planet, and poverty.
And has at its centre; partnership and collaboration, ecosystem thinking, co-creation and alignment of various intervention efforts by the public and private sectors and civil society.
Certainly, Nigeria is plagued with development challenges such as widespread poverty, insecurity, corruption, the gross injustice and ethnic politics-and in dire need of attention from interventionist organizations (private and civil society organizations) as demanded by the agenda.
But, instead of the government’s passionate plea for sustainable partnership and productive collaboration receiving targeted positive responses from private organizations and Civil Society Organizations (CSOs), such request often always elicits from critical minds and corporate organizations nothing but jigsaw:
If it has been said that government has no business in business, what business does the private sector have in helping the government to do its business of providing quality governance to the populace which is the instrumentality of participatory democracy and the election of leaders conferred on them? The reason for this state of affairs is not to be unconnected with transparency challenges on the part of the government.
To the private and civil society organizations, such a response option offers a more considerably reduced risk as no organization may be disposed to investing in an environment that is devoid of transparency and accountability.
Aside from the transparency and accountability challenge, with the constant killing, wanton destruction of property and palpable insecurity in the states, farmers have abandoned their farms to save their lives.
The effect is that food production and supplies in the country are openly threatened and may totally cut off months ahead.
The implication of this scenario if allowed is that the country is exposed to a harsher food crisis. It also sends a gory signal/message that what is to come in terms of escalation in the prices of food and agricultural produce and supplies promises to be scary.
Bearing this in mind, the question again, may be asked; what is the way forward? What are the best ways that the President Muhammadu Buhari led federal government can save Nigeria and Nigerians from this impending food crisis? What proactive steps and options are available before the federal government?
If the federal government wants to progress and development for the nation, there is no reason why everything that will lead to success must not be done. And such effort must first and fundamentally focus on developing socioeconomic policies that are not only people-focused but equipped with a clear definition of our problem as a nation, the goals to be achieved, and the means chosen to address the problems/and to achieve the goals.
As an incentive, such policies/programmes must focus on protecting the lives and property of Nigerians, job creation, development of strong institutions as well as infrastructural development.
By Jerome-Mario Utomi is the Programme Coordinator (Media and Public Policy), Social and Economic Justice Advocacy (SEJA), Lagos. He could be reached via je*********@***oo.com/08032725374.
Feature/OPED
What Does Nigeria’s $51bn Reserves Milestone Mean if Most New Foreign Money Can Leave Quickly?
Nigeria’s foreign reserves have climbed to about $51 billion, a decade-plus high, according to the Central Bank of Nigeria (CBN). EBC Financial Group (EBC) notes that this reflects stronger investor confidence, but the second half may show whether it holds, as the build rests on three cyclical drivers: oil earnings, short-term foreign money and a narrowing official-to-street naira gap.
Reserves rose from about $32 billion in April 2024, during a dollar shortage, to about $51 billion now, near the CBN’s target. Much came from two cyclical sources, strong oil earnings and money chasing high-yielding naira assets, so EBC expects the pace to slow or reverse. Fitch Ratings, a major international credit rating agency, expects a marginal decline to about $47 billion by the end of 2026, citing higher spending and external pressures.
David Precious, Senior Market Analyst at EBC Financial Group, said, “Nigeria’s reserve build is real but may not be durable yet, because nearly all of the new money is the kind that can leave quickly. Of the $10.37 billion that came in over the first quarter, the overwhelming majority was short-term portfolio funds rather than long-term investment, so a shift in oil prices, global interest rates or confidence in the naira might pull a large part of it straight back out.”
Most New Money Can Still Leave Quickly
The composition of the foreign inflows explains the caution over how long the build can last. The country attracted $10.37 billion in foreign investment in the first quarter of 2026, up 83.83 per cent year-on-year, according to the National Bureau of Statistics (NBS). Of that, $9.86 billion or 95.09 per cent, was portfolio money, largely short-term naira debt such as Treasury bills that investors can sell at the next auction, while foreign direct investment, the long-term kind that builds factories and jobs, was $135.08 million, or 1.30 per cent. Put simply, of each dollar coming in, about 95 cents can leave quickly, and barely one cent stays.
That money supports reserves while it stays. Dollars brought in to buy naira assets add to market supply, letting the CBN hold more reserves and steady the naira. It leaves when conditions change. Nigeria earns most of its export dollars from oil and gas, so lower oil prices mean fewer dollars, and as a member of the Organisation of the Petroleum Exporting Countries (OPEC), it cannot simply produce more, output capped by quota and reduced by theft and ageing fields. Higher global interest rates draw money toward safer returns abroad, and a weakening naira prompts investors to sell early. When oil fell in 2016 and 2020, foreign investors withdrew and could not convert naira to dollars as supply dried up, leaving the CBN to clear more than $7 billion in trapped obligations into 2024.
The Oil Boost is No Longer Certain
Oil looked like a dependable source of the dollars behind the reserves only months ago. Earlier in 2026, concern over disruption around the Strait of Hormuz lifted crude prices, and stronger receipts flowed in, with crude oil export earnings of $8.11 billion in the first quarter in the CBN’s balance-of-payments data. That support is now easing. The tension has subsided, and Brent traded near $72 on June 29, down about 24 per cent over the month, back to pre-conflict levels. With the price boost gone and output constrained, reserves are more exposed, leaning on non-oil earnings and investor patience rather than oil.
The Naira Still Trades at Two Prices
The naira has traded at two prices, an official rate and a higher parallel-market rate, and closing that gap into one trusted price is what many investors might watch most. Before committing funds, they may want assurance they can convert naira to dollars at a fair rate when they exit, and a wide gap revives the fear of being trapped that lingers from earlier shortages. The gap has narrowed to roughly N20 to N30, with the CBN’s official rate near N1,380 per dollar on June 26 against parallel-market quotes around N1,400. The International Monetary Fund (IMF) 2026 Article IV review urged Nigeria to depend less on this fast-moving portfolio money and to keep phasing out its multiple exchange-rate practices. The CBN’s Foreign Exchange Manual, in force from 1 June, is intended to make the market clearer, though such rules build confidence only once investors can freely trade dollars at the posted rate.
What could Make the Build Durable
A few signs that may show the build turning durable include a smaller gap between the official and street naira rates, more long-term foreign investment, and steadier oil earnings. A gap that stays small, now roughly N20 to N30, may mean investors trust the official rate and no longer need the street market. A clear rise in foreign direct investment, only $135 million last quarter against $9.86 billion of short-term money, might mean lasting capital is replacing funds that can leave at the next auction. Oil earnings that hold up, rather than sliding from the low $70s, should help keep reserves steady, since oil and gas bring in most of Nigeria’s export dollars.
“Reserves built on money chasing high yields can fall as fast as they rose, as they did after the last two oil shocks, when investors left, and the CBN spent years clearing a foreign-exchange backlog,” Precious added. “What holds through a downturn is slower money, direct investment, steady oil and non-oil export earnings and one credible naira rate, and that is the shift Nigeria has yet to make.”
By Olajumoke Bello
Across Nigeria, small and medium enterprises remain the backbone of economic activity. They drive trade, create jobs, and sustain millions of livelihoods. Yet, despite their importance, many SMEs continue to operate below their full potential due to persistent structural challenges.
Access to finance remains one of the most cited constraints. However, the issue today goes beyond the availability of capital. Many businesses struggle with financial readiness, weak documentation, and limited understanding of what lenders require. This often leads to missed opportunities, even when funding options exist.
At the same time, SMEs face gaps in market access and visibility. Business owners operate in highly localised environments, with limited exposure to broader networks that can unlock partnerships, new markets, and growth opportunities. This isolation can constrain scalability and reduce long-term competitiveness.
Equally important is the capability gap. Many entrepreneurs grow through resilience and experience but lack structured knowledge on critical areas such as financial management, export readiness, and digital adoption. Without this, even well-capitalised businesses can struggle to sustain growth.
These challenges point to a clear need for a more practical and integrated approach to SME support. It is no longer sufficient to offer standalone solutions. SMEs require ecosystems that combine knowledge, access, and direct engagement in ways that reflect how they actually operate.
A key shift is the move from centralised interventions to localised engagement. SMEs are deeply influenced by their immediate environments, whether markets, industrial clusters, or trade corridors. Solutions must therefore be brought closer to where these businesses function, allowing for more relevant support and stronger relationships.
Another important shift is from awareness to action. Business owners do not only need information; they need insights that they can apply immediately. This includes understanding how to structure their finances, how to access trade opportunities, and how to connect with the right partners to scale their operations.
There is also a growing need for continuity. Many SME-focused initiatives deliver strong initial impact but lack follow-through. For support to be effective, it must extend beyond one-off engagements into sustained relationships, with clear pathways for onboarding, advisory, and growth.
For financial institutions, this presents both responsibility and an opportunity. Supporting SMEs now requires moving beyond transactional banking to deeper partnership models. It requires understanding businesses at a granular level and co-creating solutions that evolve with their needs.
At Stanbic IBTC, this perspective continues to shape our approach to SME development. Our focus is on delivering practical support that translates into real business outcomes, helping enterprises grow, compete, and contribute more meaningfully to the economy.
As part of this commitment, we are extending our SME engagement to the regions through the Nigeria Business Summit Regional Tour. The tour will take structured, on-ground activations into key commercial hubs, where SMEs can access funding guidance, trade insights, advisory support, and direct engagement with financial experts.
The regional tour will take place across five strategic locations, bringing these solutions closer to business owners in Aba, Onitsha, Ibadan and Kano.
This approach reflects an important principle. When support moves closer to businesses and when solutions are delivered in ways that are practical and continuous, SMEs are better positioned to grow sustainably. In turn, this strengthens not only individual enterprises but the broader economy.
Olajumoke Bello is the Head of Enterprise Banking at Stanbic IBTC Bank
By Winston Osuchukwu
The average Nigerian borrower is widely considered high-risk – a claim repeated in credit committees, priced into retail loans, and largely treated as settled fact. Every credit market accepts that an individual loan may not be repaid; this is ordinary, priced risk. The high-risk claim, however, is applied to whole segments – the informal trader, the gig economy earner whose income is steady but split across several accounts, the remote worker paid by an overseas client into a fintech FX wallet. What the assessment establishes is not whether they are likely to repay, but how they fit into an arbitrary segment. Having spent years building decisioning systems for this market, my thesis is a specific one: “high-risk” does not mean “no credit” – it simply requires that the lender embrace alternative datasets to price the risk appropriately.
This is not a criticism of the institutions that built their frameworks around collateral and documentation; those were rational responses to the tools available at the time. When data is scarce, prudence means defaulting to the status quo. The limitation is not that this approach is wrong, but that it leaves a blind spot – excluding fundamentally sound borrowers whose economic lives simply are not captured on the bank’s ledger. A market trader who has moved consistent, growing volumes of cash through mobile money for three years is not, in any meaningful sense, unknowable. Their financial behaviour is observable and patterned; it simply occurs outside the traditional banking system, rendering it invisible to conventional underwriting.
This is the gap technology is now positioned to close – not by replacing institutional judgment, but by augmenting it. When AI-driven analysis is applied rigorously to the financial behaviour these borrowers generate, a far more complete picture of their repayment ability emerges – and a meaningful share presents a risk profile that compares favourably with segments the traditional system has long considered safe. The “high-risk” label, applied broadly to an entire category of borrower, was never a risk pricing tool so much as the limit of what the available tools could see.
For banks, this is the opportunity to extend capital with confidence beyond the borrowers who fit their stringent criteria. Nigerian banks are highly liquid; the constraint on credit growth has rarely been capital, but the ability to assess and price the borrowers who sit outside the traditional file. Close that gap, and the whole ecosystem strengthens: banks grow their loan books into segments they have long wanted to serve, and the real economy gets the capital it needs to expand.
This is precisely what we focus on at Mathesis Analytics: building AI-powered credit decisioning that gives lenders a fuller, more defensible picture of the individuals long excluded as high-risk when they were simply misjudged. The Nigerian credit gap has never been a non-lendable population problem, but one of incomplete visibility. By unifying varied data sources and partnering with the institutions that hold the capital and scale to move the market, we translate out-of-ecosystem behaviour into reliable, bank-grade risk scores. Closing this gap is one of the clearest, highest-leverage opportunities in Nigerian financial services today.
Winston Osuchukwu is the founder & CEO of Mathesis Analytics
