Following the United Kingdom (UK’s) surprise vote to leave the European Union (EU), the Chartered Institute of Bankers of Nigeria (CIBN) and other financial experts in Nigeria have said that the decision to leave the European Union (EU) could have negative consequences on Nigerian economy considering its strong economic ties with Britain, as a member of the British Commonwealth.
Top rated experts, who spoke at the Chartered Institute of Bankers of Nigeria Centre for Financial Studies (CIBNCFS), a subsidiary of the CIBN over the weekend noted that Brexit will no doubt create anxiety for Nigeria’s policy makers.
One of the experts, Dr Biodun Adedipe, Chief Consultant, Adedipe Associate Limited, said that the bilateral trade between Nigeria and the UK, currently valued at six billion pounds and projected to reach about 20 billion pounds by 2020 could be affected.
He said a decelerating British economy could impact a drop in investment, trade, and also remittances from the Nigerian diaspora who sent home over 20 billion dollars in 2015.
Adedipe further noted that the shrinking of UK economy could affect the source of Federal Government of Nigeria’s foreign earning with the recent data from the National Bureau of Statistics showing that the UK was Nigeria’s largest source of foreign investment in 2015.
He also mentioned that with oil prices falling today, there are fears that Brexit’s ripple effects may halt what has been a march towards higher prices for the commodity in recent weeks.
“It is, however, not certain that Nigeria’s hopes of getting more from its oil revenues have been put to bed by this,” he added.
Mr Femi Awoyemi, Chief Executive Officer, Proshare Nigeria Limited, however, said that Nigerians who own property in the UK are going to find that their rental income will be lower in naira terms.
But the representative of the deputy CBN Governor, Mr Moses Tule, Director Monetary Policy Department, said that there is nothing to be worried about.
He said that Brexit will not lead to global economic crisis and that Nigerian investors should not be afraid. Tule noted that financial institutions are more regulated now, banks more capitalised and the system more equipped to deal with the situation.