Nigeria is in good hands as it attempts to reverse the damaging policies of the last eight years, according to analysts at US-based Citibank.
“In our meetings, we were continuously reminded that Nigeria has never had such a strong team between the Finance Minister, Wale Edun, the Central Bank Governor, Yemi Cardoso, and the President,” the Citibank analysts said in a note to institutional investors following a visit to Nigeria’s economic capital, Lagos and political capital, Abuja.
“The triumvirate have all worked together in the past, and all have orthodox/private sector backgrounds. That bodes well – reflected in support from the private sector, bilateral and multilaterals,” the analysts said.
Citibank said it came away from Nigeria with more optimism on the team in charge “despite the murmurings of slow reform momentum.
“Ten years of seriously heterodox policy has created deep distortions in the economy – no small feat to turn-over,” the Citibank analysts said.
President Tinubu, who was elected in May, started off his administration with a bang, after ending a wasteful petrol subsidy and kickstarting badly needed reforms in the foreign exchange market. The Financial Times in an editorial last week said Tinubu’s reform momentum was slowing.
Citibank however said the reform pace may be slower than anticipated after President Tinubu’s first aggressive moves on FX and the fuel subsidy, “but that is arguably needed considering the depth of various distortions and the risk of piling costs on the average Nigerian.”
The bank also said it considers Cardoso’s appointment the missing link in an economic team saddled with undoing 10 years of policy mistakes, an unenviable feat that could take 6 to 12 months.
If the administration can unwind the policy mistakes of the past over the next 6-12 months, Nigeria could-just-about-balance itself without market access, according to Citibank.