Nigeria’s Buhari will sustain protectionist course

Subject

Nigerian economic policy.

Significance

Predicting the policy direction of President Muhammadu Buhari’s second term appears complicated given inconsistencies in key appointments to his administration. His new cabinet is composed of political loyalists unlikely to oppose his protectionist agenda. Conversely, Buhari has revamped his economic team to include free marketeers and staunch critics of his economic record thus far. However, recent policy measures suggest that the latter will have limited effect on the president’s underlying agenda.

Impacts

• Plans to comply with OPEC production cuts will further worsen the outlook for foreign reserves and the naira.
• The slight acceleration of GDP growth to 2.3% this year may not be sustained into 2020 if protectionist policies persist.
• Improvements in the overall business environment ranking mask ongoing weakness in crucial indicators such as electricity supply.