Nigeria’s Economic Crisis Deepens as
Thank you for reading this post, don't forget to subscribe!Nigeria’s economic challenges are intensifying as the country’s sovereign-risk premium surged to an eight-month high, with its dollar bonds becoming some of the worst-performing assets among emerging markets, according to Bloomberg.
The economic strain comes as Nigerians take to the streets in protest against government policies that have driven inflation to a nearly three-decade high. The discontent is widespread, fueled by rising costs of living that have pushed 40% of the population into extreme poverty. Tragically, the protests have already claimed at least 13 lives on the first day alone.
Data from JPMorgan Chase & Co. shows that Nigeria’s sovereign-risk premium jumped 16 basis points to 640 basis points, the highest level since November. CitiGroup Inc. strategists Alexander Rozhetskin and Luis Costa attribute the decline in Nigeria’s economic stability to political unrest and a difficult environment for reform.
Over the past two months, Nigeria’s sovereign bonds have underperformed, especially in recent weeks as concerns over the cost-of-living protests grow. The protests, which began on August 1, call for better governance and urgent relief from the skyrocketing living expenses.
The government’s response to the demonstrations has been severe, with reports of fatalities and injuries due to a crackdown on peaceful protesters. Additionally, there are concerns that the protests have been infiltrated by suspected sponsored groups, further complicating the situation.
