07 April 2015, Lagos – The smooth conduct of the presidential and National Assembly elections will lead to the recovery of Nigeria’s economy, analysts at Meristem Securities Limited have said.
The analysts noted in the latest Meristem investment guide that the success of the election had sent a possible signal to investors, stressing that increased foreign direct investment and foreign portfolio investment would drive economic growth.
Reviewing the elections, they said, “The voice of Nigerians seemed to have resounded loud and clear in the recently concluded presidential elections, as the people united to select the next president of the country, in spite of the overwhelming power of incumbency usually wielded in African elections.
“Contrary to general expectations, the announcement of Gen. Muhammadu Buhari as the winner of the 2015 general elections was received with jubilations across most regions in the country, facilitated by the quick concession of defeat by the incumbent, President Goodluck Jonathan.”
They explained that given the significant international focus on the country, owing to Nigeria’s position as the largest economy and most populous country in Africa, coupled with the body language of foreign observers and stakeholders which, in their opinion, suggested a preference for Buhari’s candidacy, they expect a turnaround in the nation’s economic fortunes.
“This, we believe will be driven by increased inflow of foreign direct and portfolio investments into the country driven by improved perception of the country’s potentials by foreign governments, investors and rating agencies,” they added.
According to the analysts, after 16 years of sustained democracy, four elections and three presidents all from the People Democratic Party, Nigerians have set a new precedence for democracy and electoral processes in the country.
“We believe this feat was achieved due to the growing frustrations of citizens with regards to the state of the economy amidst security challenges, coupled with the rise of a formidable opposition party following the merger of key regional political parties (ACN, CPC and ANPP) in February 2013,” they explained.
However, they stressed that given the knackered condition of the economy (external debt of $26bn, devaluation, low-level global oil prices, currency volatility etc.), they did not envisage an immediate change in the economic state of the country.
“We nonetheless believe that the anti-corruption drive of the incoming government may help plug in leakages, reduce wastages and significantly cut back on cost of governance, thus freeing up funds for increased government spending and growth stimulating activities,” they said.