I attended an economic outlook session with top economists and top CEOs a few years ago, and learnings that I came out of that summit with have left me changed forever. I thought to share some of the perspectives.
The session looked at Nigeria’s economic direction for 2017. The summary: 2017 was going to be tougher than 2016. True to their predictions, 2017 was a tough year; tougher than any year I had ever know in my 45 years of leaving in this world. But you know the twist to this story, 2017 was yet another significant year for me. It was the year, I bought a house and moved home from a rented apartment to a house I owned; without a mortgage but years of savings, careful planning and of course God’s favour.
Then 2018 came along, the economy recovered but inflation continued in 2019 and may continue to do so even into the foreseeable future. Inflation, I am told will continue to be high (hovering around 20%) and Naira to dollar will remain in the 360s. With money scarce many more businesses will fold up, leading to job losses and more poverty.
With inflation and high exchange rate, many banks will not be able to give loans especially to SMEs and when they do give loans, the interest rate will be too high to afford. With continued high inflation those with paid salaries are now actually earning less, that is if they will be lucky to keep their jobs. Research shows that all sectors of the economy (not just oil) are falling. The signs are still there: over 300 foreign companies have left the shores of this country between 2015 and 2018; almost all foreign airlines now fuel in Ghana; many people now smuggle crops and raw materials out to earn dollars; 50% of vacant houses in Ikoyi and VI don’t have buyers etc.
The experts’ advice:
- Cash is still going to be King and whoever has it or has access to it should preserve it. This is what a Cooperative Platform attempts to achieve.
- Spend less than you earn; SAVE for the rainy day.
- Cut down on avoidable merriment.
- Expect the worst Christmas in 20 years.
- Look for dollar or pounds-earning businesses if you can.
I need not say more than this but chose to be wise with your income, save as much as you can, be positive and put your absolute trust in God.