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Investors Cautiously Optimistic that Nigeria Will See Improvements Whoever Wins Poll

As Nigerian voters prepare to go to the polls on February 25, international investors are cautiously hopeful that whoever is elected as the next president of Africa’s largest economy will be more market-friendly than the current government. As of November, Nigeria was ranked 131 out of 190 economies on the World Bank’s Ease of Doing Business index. Problems that worry investors include multiple exchange rates, widespread insecurity, and low oil production due to massive crude theft. Another focus is soaring fuel subsidy costs that devour government revenues and drive up debt. Reform of the foreign exchange market is the number one concern for international equity investors, said Steve Pollicino of the US brokerage Auerbach Grayson, adding that uncertainty over how long it takes to get money out of Nigeria is a big deterrent. “No investor’s going to want to buy into a market where you can’t sell stock and get your money out,” he said. Foreign investors held 16 percent of shares on Nigeria’s stock exchange last year, down sharply from 58 percent in 2014, Nigerian Exchange Group data showed. Removing petrol subsidies, which cost $10bn in 2022, is also key but a “hard sell”, said Babatunde Ojo, emerging markets equities portfolio manager at Harding Loevner.