The First 100 Days

With a quote from me in The Economist

The Economist have a piece on Bola Tinubu’s first 100 days as President:

After hotly contested elections Bola Tinubu was inaugurated as Nigeria’s president just over 100 days ago. He was determined to hit the ground running, and for a while, it looked as if he had. As promised in his inaugural speech, he removed an unaffordable fuel subsidy and ended a system of multiple fixed exchange rates. He also suspended the central-bank governor, Godwin Emefiele, who had played a big part in Nigeria’s economic slide.

To say it’s been an interesting 100 days will be an understatement. That fine afternoon at Eagle Square on May 29 now seems like a lifetime ago. The reforms are now running into serious headwinds and are in danger of being reversed.

I have a small quote in the piece on the dangers facing the FX reforms in particular:

This lack of technical expertise is a shame, because Mr Tinubu’s policies are facing unexpected headwinds. In August, when the central bank published its first audited accounts since 2015, these revealed a huge hole in the country’s foreign reserves. More than 40% of the $34bn in foreign reserves the bank held at the end of 2022 were encumbered, either as collateral for loans from foreign banks or by being tied up in forward contracts. Nigeria officially claims to have enough foreign currency to cover almost eight months of imports, but, after subtracting these obligations, that falls to little more than four months, leaving it vulnerable to external shocks. “[The central bank] still does not have any firepower to anchor the market... and calm things down,” says Feyi Fawehinmi, a political commentator.

Read the whole thing if you can.