Investors bullish on Nigeria

ABUJA – Only a major derailment of Nigeria’s upcoming political transition can slow a growing tide of private investment into Nigeria’s non-oil economy, fund managers and bankers said yesterday.

Encouraged by high oil income, economic reform and a range of candidates all eager to bring more money to the private sector, Nigerian markets have been booming. “Things would have to go horribly wrong, like large scale violence, cancellation of elections, or the Niger Delta blowing up, for people to start pulling out,” said Jonathan Chew, head of Imara Asset Management, which has about US$15 million in Nigerian equities.Nigerians go to the polls on Saturday to elect state governors and legislators, followed by presidential polls a week later.The elections are pivotal because they should lead to the first transition from one elected leader to another since independence in 1960.Preparations for the polls in Africa’s most populous nation have been upset by sporadic political violence, confusion over the candidates and deteriorating security in the oilfields of the Niger Delta.But investors say this situation is quite normal for Nigeria, which has lived through civil war and repeated military coups over the last 40 years, and elections do seem to be going ahead.Two candidates have emerged as front-runners: state governor Umaru Yar’Adua for the ruling People’s Democratic Party and former army ruler Muhammadu Buhari for the opposition All Nigeria People’s Party.President Olusegun Obasanjo, who must step down in May, launched a series of economic reforms in 2003 which reined in public spending, won US$18 billion of debt relief, and prompted credit rating agencies to award Nigeria a BB- rating.Nampa-Reuters”Things would have to go horribly wrong, like large scale violence, cancellation of elections, or the Niger Delta blowing up, for people to start pulling out,” said Jonathan Chew, head of Imara Asset Management, which has about US$15 million in Nigerian equities.Nigerians go to the polls on Saturday to elect state governors and legislators, followed by presidential polls a week later.The elections are pivotal because they should lead to the first transition from one elected leader to another since independence in 1960.Preparations for the polls in Africa’s most populous nation have been upset by sporadic political violence, confusion over the candidates and deteriorating security in the oilfields of the Niger Delta.But investors say this situation is quite normal for Nigeria, which has lived through civil war and repeated military coups over the last 40 years, and elections do seem to be going ahead.Two candidates have emerged as front-runners: state governor Umaru Yar’Adua for the ruling People’s Democratic Party and former army ruler Muhammadu Buhari for the opposition All Nigeria People’s Party.President Olusegun Obasanjo, who must step down in May, launched a series of economic reforms in 2003 which reined in public spending, won US$18 billion of debt relief, and prompted credit rating agencies to award Nigeria a BB- rating.Nampa-Reuters