Good People, no matter what you do, I encourage you to update your personal and professional playbooks. Those playbooks must be comprehensive. The next 12 months would be extremely challenging in our world. Many negative factors are converging at the same time, and now is the time to do scenario mapping.
If you run a business, conserve cash because I expect lending and equity funding to dry up. If you are a paid worker, reduce expenses and put more money in the piggybank (have a dorm account for any money that is not needed within 3 months in Nigeria) because recession is breeding in most parts of Africa. Data from more than 60 companies I am associated with do provide a clear signal: consumer spending in Africa has weakened drastically.
Here are some issues to watch:
- Russia Gas: Russia can withdraw from Ukraine and the next day cut-off gas supplies to the whole of Europe. If that happens, some EU countries will struggle. Countries like Germany and Hungary will be devastated and the implications may result in a global recession.
- US Economy: As the US central bank works to tame inflation, by increasing interest rates, easy money will go. Expect global funds to pause on investments in some emerging economies. As that happens, high interest rates will mean borrowing for nations like Nigeria will be more expensive.
- Political Risk: In all you do, have a model that Nigeria could experience turmoil. We were lucky in 2015 (Jonathan) and 2019 (both candidates are from the North); 2023 looks increasingly volatile.
- Naira Devaluation: I do not expect any official move before the election. But fighting to protect the Naira is largely non-existent. So, the paralysis in the black market will continue. N670/$ by May 2023 is a possibility.
- Global Hunger: from rising supply chain costs (fuel cost, Ukraine war, etc) to inability of farmers to go to farms due to insecurity, food security will become more challenging in Nigeria.
Tekedia Mini-MBA will add a course in our June 6 edition to provide guidance to our learners. We did a similar thing during Covid-19 and many found it very helpful.
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Comment 1: Fuel (gasoline, petrol, whatever you want to call it) is hitting $2.10/litre here in Canada – that’s almost $CDN 8/ US gallon – never before have we seen those prices, and it might go even higher, and because everything is transported by consuming fuel everything is rising in price.
Political risk is unstable everywhere it seems. From Nigeria, to Philippines, to Sri Lanka, to almost everywhere political turmoil (no pun intended) is brewing.
The potential devaluation of the Naira would be relatively good news (or at least provide a stabilizing factor) if the oil production was at its peak output, but suck is not the case.
So heed the Prof’s words and put money aside in a safe place – not in the bank. Have cash money available to yourself and family. At times of uncertainty the adage “cash is king” is very important…..it’s strange times we live, have your wits about you.






