Time for Scenario Mapping – Huge Nigeria, Global Dislocations Coming

Time for Scenario Mapping – Huge Nigeria, Global Dislocations Coming

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:

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  • 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.

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2 thoughts on “Time for Scenario Mapping – Huge Nigeria, Global Dislocations Coming

  1. With all the warnings coming from all quarters, just like during COVID-19, I expect course correction on Russia-Ukraine crisis. The western world will find a reason to avert this impending doom. The reaction will be swift. Everything will return to normal within a month.

    The intention has been to perturb the dependence of Europe on Russia oil. If Europe thought America was gas lighting when Trump raised the issue of the risk associated with it and threat to NATO, making a case for NATO allies to bring up their game, that case was validated when Putin invaded and continued to invade Ukraine.

    The above means that the new world order has been installed. It is aimed at reducing, if not eliminating completely, the dependence of NATO allies on Russia oil and hence reducing Russia’s control over these nations.

    So many nations and programs vulnerable to Russia have been shuffled. New space industries have received contracts to cover whatever Russia was doing for America in the space program. Several gas projects involving various West African countries for piping oil from Nigeria through Moroco to Europe have been in the works for over 5yrs now. They are being activated now as if it was caused by Russia’s invasion of Ukraine. Given that I saw those projects in the works 4yrs ago, I can state that the plan preceded Russia’s invasion of Ukraine.

    In conclusion, there will be a short term perturbation (which may have already happened). After that, the new world order will be installed. Russia will get a short term boost in their economy, to give their ppl the impression everything went their way (in this Ukraine crisis). Then 2-3 years from now, Russia economy will start seeing that this was planned years before now. At that point, Russians will remove Putin on their own because the countries they relied on for business would have survived and found alternatives but then know that Russia would always be a threat to be mindful of. Russians will remove Putin to appease western powers. This is what led to the fall of USSR. It will happen again.

    Reply
    1. Interesting trend it is…

      The new world power game plan is very robust and unflinching.

      Whichever way the trend goes, it’s always better to be on safe side, tidy up your credits, build cash reserves as much as you can, one wold think this is a no brainer yet it requires deep thoughts and swift strategic steps & action…

      Reply

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