Nigeria’s economic recession may be long and deep, says Peterside

Atedo Peterside, founder and chairman of Stanbic IBTC Bank Plc, says Nigeria’s economic recession may be long and deep.

Peterside, who doubles as the vice chairman of Nigerian Economic Summit Group (NESG), says the recession may be long and deep due to low investor confidence in Africa’s biggest economy.

“Nigeria’s economic recession may be long and deep because business confidence is low and investors are holding back,” he wrote on his Twitter account.

Peterside had warned at the 2016 Standard Bank West Africa investors’ conference in Lagos, that the foreign exchange policy at the time was taking its toll on the economy.

“In early September, 2015, the big unknown was the country’s economic policy direction and the likely composition of the president’s economic team,” he said.

“The team is now in place but the greatest policy uncertainty of all remains and that is an exchange rate policy regime that threatens the foundations of macroeconomic stability and appears to be unsustainable.”

The graduate of London School of Economics and Political Science said diversification could not happen without fresh capital, which is waning in the Nigerian economy.

“The much craved economic diversification can only take place meaningfully if new capital investment activity takes place to take maximum advantage of increased domestic competitiveness,” he said.

“Sadly, most investors here (local and foreign) are currently caught up in a frenzied pursuit of the cheapest available dollars and the difference between losing this game and winning it can be as high as a mind-boggling 50 per cent on new transactions.”

The International Monetary Fund (IMF) says Nigeria’s economy would shrink by 1.8 percent in 2016, but Udo Udoma, minister for budget and national planning, remains optimistic of a growth in excess of three percent.