Citigroup See Nigeria as Potential Investment Opportunity Amid Naira Collapse to US Dollar

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Nigeria, among other African countries, stands out as a potential recipient of increased foreign investment due to a significant decline in its currency this year, as indicated by Citigroup Inc. George Asante, Citi’s head of markets for Sub-Saharan Africa, emphasized that nations experiencing notable FX adjustments are well-positioned from an investment standpoint. Nigeria’s naira has seen the most substantial depreciation against the dollar this year, dropping over 40%, driven by measures to address fiscal challenges, including the elimination of fuel subsidies and a revamp of the criticized exchange-rate system. Nigerian President Bola Tinubu aims to revitalize the economy by redirecting funds saved from subsidies into health services, education, and job opportunities. The central bank’s overhaul of exchange-rate policies in June has also contributed to the naira’s devaluation. The removal of subsidies is regarded as a crucial reform, and efforts to consolidate exchange rates are expected to enhance liquidity, according to Asante. He believes these changes will significantly stimulate investment inflows into the Nigerian market. Additionally, the prospects for eurobond issuance by African nations are discussed, with Ivory Coast and Senegal noted as attractive options due to their sustained economic growth, fiscal responsibility, and favorable debt service costs. As the coronavirus pandemic’s impact lessens, African countries, including Nigeria, are seeking infrastructure financing, particularly for energy, food-related projects, and long-term investments in critical sectors like transportation and healthcare. The shift in funding sources is highlighted, with reduced Chinese financing and an uptick in Western financing observed. Among African nations, Nigeria remains one of the countries with financial flexibility to pursue infrastructure funding.

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Godwin Okafor
Godwin Okaforhttps://naija247news.com
Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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