Financial intermediation – the process of matching savers with borrowers – is a primary function of the banking sector. Intermediation channels excess funds towards productive uses, spreading the risk across a bank’s entire depositor base so no single saver bears the losses in the event of a loan default. However, in Nigeria intermediation is...
In response to Nigeria’s 2016 recession, the government launched the Economic Recovery and Growth Plan (ERGP) in March 2017. The ERGP sets out broad targets ranging from macroeconomic stability to economic diversification and improving governance. It identifies five priority areas: stabilising the macroeconomic environment; achieving...
Nigeria has seen notable success in recent months on global debt markets. In February 2017 the government issued a 15-year, $1bn dollar-denominated eurobond at a yield of 7.9%, which was eight times oversubscribed. The following month it issued an additional $500m eurobond at a yield of 7.5%, testament to the continued appetite for debt in...
The past few years have been difficult for Africa’s largest economy, with a fall in oil prices from more than $100 per barrel in 2014 to roughly $50 per barrel at the start of 2017 having damaging consequences for Nigeria. The fall in revenues from the country’s largest export-earner led to a slowdown in investment throughout the economy, a...
With hydrocarbons accounting for 90% of Nigeria’s foreign exchange, sustained low oil prices in 2014 and 2015 reduced the availability of dollars and other major foreign currencies. This reverberated throughout the economy, given the need for dollars to buy imports for key staples ranging from rice to diesel fuels. As a result, Nigeria...
With Africa’s largest economy and its biggest population, Nigeria is the continent’s heavyweight. The country has been blessed with resource-rich lands, areas of great agricultural fertility and favourable demographics, but it has also had its fair share of challenges, ranging from poor infrastructure, secessionist movements, military coups and religious violence.
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