There was a lot of anxiety when INEC moved the elections about two weeks ago apparently because of looming insecurity. People wanted to move out of the country because they thought there’d be violence.
But in an ironic twist, moving the elections has brought some relief and people are going about the normal lives again. Those who initially thought the postponement was a bad idea also now see the good side of it, given reports that millions of people hadn’t received their permanent cards yet.
However, the postponement is having a bad impact on the economy.
Investors are especially hesitating to make long term investments. The development is also putting enormous pressure on the exchange rate of the naira. The exchange rate of the naira fell to as low as N206 to the dollar at the interbank and now trades for about N230 to the dollar at the black market, such that bureaux de change had to to shut down briefly last week.
International airlines have also raised fares as some Nigerians continue to intensify efforts to travel out of the country until the situation stabilises.
Consider what that would do to the exceedingly jittery naira or to the highly volatile stock exchange. The Nigerian Stock market on the other hand lost over $2 billion in the week after the election postponement was announced with stocks losing for 5 straight days. It has however, clawed back on another 7 day gaining streak even as fear of market volatility remains.
Consider the implications in a country that people, especially in the West, think is in a state of war. Think about how a foreign investor will react now that elections have been shifted and the next thing is uncertain.
The National Assembly has been distracted too, because they have not passed the budget. Governors aren’t also exempted from this situation. Some have left their work since November last year to work with presidential candidates, and this is wasting state resources. It is not anything new when one hears that state governments still haven’t paid its workers for months. The CBN is also temporising pending the passage of the elongated time for elections. This makes it difficult for businesses to make strategic economic decisions as one cannot predict the movement of the naira to the dollar for the next day. What does this portend for Nigeria? It’s quite simple to forecast an economy slowly creeping into recession. Stagnation is coming.
The truth is that INEC failed to consider the economic interests of millions of ordinary Nigerians who would be at the receiving end of the financial hard times. Moving the polls should not have been am option for a shaky economy like Nigeria. Definitely, the economy would need months to recover even after the elections have come, and gone.
