The unexpected postponement of the 2019 general election by the Independent National Electoral Commission (INEC), on Saturday, following hiccups in the distribution of sensitive materials and other logistics, has taken a huge toll on the economy of the country, with the extent of the massive losses in revenues to the country, businesses and individuals said to be not yet known.
Indications emerged on Saturday that the botched polls, which led to a total shutdown of macro and micro economic activities across the country, apart from leading to a huge loss in revenue to the nation and businesses, would also affect the credit rating of the country as well as result in more losses in the coming days.
Nigeria has lost $1.5billion–LCCI
For instance, the Lagos Chamber of Commerce and Industries (LCCI), on Saturday, reckoned that the country’s economy has lost about $1.5bn to the postponement.
Speaking to exclusively to Sunday Tribune, the Director-General of the LCCI, Muda Yusuf, said that the nation’s maritime sector also suffered horrendous loss due to the election postponement.
According to him, “the postponement of the elections has caused very serious disruptions to the nation’s economy and businesses. Many investors have lost a lot of money, and the loss to the economy due to the postponement cannot be less than 1.5bn US Dollars.
“Talking about the maritime sector of the economy, which is a very critical sector, what has happened would have cost not just those who are directly involved in the sector billions of money, but also importers and businesses who normally get their raw materials through the ports.
“Due to the election, which led to early closure of work at the ports, many businesses would have suffered delays in their efforts to clear their cargoes, which could lead also to delay in getting raw materials to factories.
“And don’t forget that a lot of importers borrow money for importation businesses. As long as delays like this happen, interests accrue on borrowed funds.
“So there is the interest cost, delay in production processes, delays in business cycles, because once there is disruption along the business chain, it affects the entire scope of business. It affects how businesses are able to turn around their capital.
“There are also implications for jobs; so many of the workers in the ports earn their income daily. For every hour that there is no business, the workers don’t get paid. The loss is quite horrendous on the maritime sector side and the economy as a whole.”
Nigeria will lose billions of naira, say NACCIMA, economists, traders
Meanwhile, the Vice-President of the National Association of Chamber of Commerce, Industry, Mines and Agriculture (NACCIMA), Mr Tony Ejinkeonye, on Saturday, maintained that Nigeria will lose billions of naira due to the postponement of the February 16 presidential and National Assembly elections.
Ejinkeonye, who is also the Director, Business Development for Africa, Esilknet Africa Network Ltd., told News Agency of Nigeria (NAN) in Abuja that the postponement would affect the economy adversely.
“It is quite unfortunate that the election was postponed. Economically, billions of naira have been lost and will be lost in the coming weeks. Industries, businesses including airlines were affected by the movement restriction.
“We also expect the same thing happening in the coming weeks. Most important effect is the perception of the international financial community. Situations like this will create panic with massive withdrawal and stoppage of funds inflow to Nigeria. I dread the effects in the stock market on Monday,” he said.
Ejinkeonye, who said that it would be difficult to determine the actual figure of the loss but that it would be in billions of naira, however, noted that the real cost would be the loss of investor confidence.
He, however, advised Nigerians not to be discouraged, urging them to still go and exercise their franchise next Saturday.
In the same vein, president of the National Association of Nigerian Traders (NANTs), Mr Ken Ukaoha, said the country will lose more than N140 billion due to the postponement.
Ukaoha noted that the postponement would affect the economy adversely in terms of money that the government, political parties and ordinary Nigerians had already expended on logistics and others.
He described the election postponement as appalling and unfortunate, noting that it could make the nation become a laughing stock among comity of nations.
“The loss is monumental; if you look at the economic consequences, essentially if you look at trading; Nigeria depends so much on daily turning of funds through distribution and redistribution of goods and commodity.
“I am telling you that with this calculation I have just done here, we are losing nothing less than 140 billion naira, because we all got this information so late.
“If you go round now you will see that the shops are close, so we are losing chunks of money just for this incident.
“We are not talking about the manufacturers and the industrialists because they have all sent their workers away to go and perform their civic duty.
“Farmers did not go to their farms because they want to exercise their franchise. If you do the computation your guess is as good as mine in terms of what the nation is losing, we should learn.”
He said: “The truth is that it appeared that the nation has refused to get things right, the implication is that if care is not taken the country will become a laughing stock in the minds of comity of nations
“You could remembered that Ghana had elections which had no encumbrances, no itches attached hereto, Cote D’ Ivoire has, Liberia just had these are countries that should be learning from us.
“If you take a look at what happened in 2015 and what we ran into now I think we should be matured and man enough to learn because this thing will continue to follow us in every election.”
MAN lament disruption to economy, losses
The Manufacturers Association of Nigeria (MAN), on Saturday, said the postponement of elections INEC has disrupted the economy, causing colossal losses.
Director-General of MAN, Mr Segun Ajayi-Kadir, said the general election impacted on industrial activity as most factories shut down their operations till Monday.
“All Nigerians were full of expectations and looking forward to the election and were surprised by the news of its postponement.
“We know that many businesses closed early yesterday to allow people move around and travel to cast their votes in their respective locations,” he said.
He, however, urged Nigerians to keep faith and perform their civic responsibilities next week.
He said irrespective of the inconvenience and disruption to industrial activities, energy and resources exerted, having a credible and smooth election was worth the sacrifice.
Economists lament monumental cost of election postponement
Responding to the last minute postponement of the election, a professor of Capital Market and another professor of Economics lamented the monumental economic losses caused by the development.
Also responding, the Chief Economist for Africa and Middle East, Standard Chartered Bank, Razia Khan, in an email conversation with Sunday Tribune, said the postponement meant some interruptions to normal economic activities, but that so long as they “are not long lasting and credible elections are eventually held,” the effect might be limited.
Khan, however, said that “if the postponement is just one week, and things proceed smoothly with the holding of a credible election this week, then the economic impact of the delay should be fairly limited. The more important factor is that everything is in place for a credible poll.”
Economics professor, Badayi Sani, of Bayero University, Kano, told Sunday Tribune in an interview on Saturday that the postponement has added at least N28.6 billion to the budget of INEC for the 2019 election.
On his own part, Professor of Capital Market, Nasarawa State University, Keffi, Uche Uwaleke, said the associated costs of the postponement could not be quantified.
According to Sani, “it is likely that the cost of the cost of the election will be raised to about one fifth of the initial cost. Lots of resources deployed already; postponement means those spending now in terms of transportation and logistics, accommodation and rent, expenses on personnel have now gone to waste.
“Businesses were distorted. Adjustments had been made both at the corporate and individual levels. Many offices closed early because of the elections, many who would have opened for business on Saturday told their staff not to come to office.
“Universities also made their resumption plans based on the election timetable after ASUU called off their strike.
“There are costs associated with national and international election monitors in terms of travel expenses and hotel accommodation. Some of them have to go back to their countries and stations and return again if they are still interested in monitoring the elections.
“Many individuals travelled home from abroad to participate in the voting, others traveled from their stations to where they registered to vote.
“Although there are some inherent gains for certain businesses in the hospitality industry like hotels, which will make more money.
“However, the losses are much more than the little gains associated with the postponement”, he stated.
Uwaleke noted that the postponement of the general election by the INEC has monumental adverse economic impact not only on the government but also on firms and individuals.
“This cost is escalated by the fact that the announcement came on the very day the elections were to be held after a number of irreversible steps had been taken by various economic agents and actors.
“Many people had traveled far distances just to exercise their franchise before the INEC decision while many organisations especially educational institutions had to shut down temporarily for the period of the elections.
“The associated costs of doing so cannot be quantified. Just how do you measure the huge losses on the part of individuals from cancelled wedding, burial and other ceremonies already scheduled for Feb 23 and March 9, the new dates picked for the elections?
“How about production plans by business firms already made with the original elections dates in mind that will now be shattered?”
Uwaleke who is also Chair of Banking and Finance Department of the university also spoke of disruptions in domestic and international flight arrangements.
“Because the announcement wasn’t made early enough, business activities will be very low on Feb 16.
“A number of markets and businesses will be shut for most part of the day.
“The reopening of land borders eventually will be after the closure announced earlier had taken its toll on the economic activities of border communities.
“The cost to the political parties and election observers can better be imagined.”
Uwaleke expressed fears that some of the parties may not have the resources to foot the extra bill given that their agents had already been mobilised while international election observers, some of whom may have to return before March 9 due to unanticipated hotel and other bills may not return for the exercise.
“This unfortunate development further confirms what is public knowledge that the huge cost of conducting elections in Nigeria is about the highest in the world, even surpassing that of India, the world’s largest democracy with a population six times bigger than Nigeria.
“Recall that the sum of N189 billion was approved for INEC for the 2019 election. This amount is more than the capital components of education and health budgets put together.
“If you consider the total sum of N242 billion approved for INEC and five other agencies for the conduct of the 2019 general polls, it is money that could have gone a long way in fixing critical infrastructure in this country.
“With elections now rescheduled, you can be sure that this cost will spike. Where will this extra sum be sourced if not from money already earmarked for capital projects?
“So the opportunity cost is quite high. This development could widen the fiscal deficit and I hope it doesn’t amount to additional borrowing by the government.
“It also raises country risk for Nigeria. Any attempt to borrow externally will be at a higher cost.
“The information-sensitive stock market will be at the receiving end as I expect a bearish trend in the days ahead following this development.
“There is no doubt that this will have the effect of weakening investors’ sentiments and may even trigger further capital flight.
“I won’t be surprised if this first quarter of the year is characterised by lower capital importation and slower GDP growth.
“In the same vein, the Purchasing Managers Index reading for the month of February 2019 is bound to come in lower when compared to previous months.
“Overall, the postponement of the elections due to ‘logistic reasons’ was avoidable and does not bode well for the nation’s economy.
“Going forward, in view of the huge cost of conducting elections in Nigeria and considering that elections were postponed in 2011 and again in 2015 and then now, isn’t it time we reconsidered the frequency of elections in Nigeria by amending the constitution to provide for a single term of say five or six years as opposed to the two terms of four years? This is my take.”
Postponement’ll affect credit rating, portfolio investments, says economist
An economist, Mr Chijioke Ekechukwu, has said that postponement of the elections will affect credit rating and already threatened portfolio investments in the country.
Ekechukwu, who said this in an interview with the NAN in Abuja, on Saturday, noted that the investments would likely flow out in large value.
According to him, beginning from February 16, the stock market will go bearish due to the postponement.
“What will the international observers who already had their return tickets for Monday or Tuesday do after the failed election?
“They will indeed fly back and not come back as they didn’t budget for any extra cost and extra stay.
Ekechukwu expressed worry that Nigerians would be made to bear the losses.
He said that the postponement had worsened the already negative image that bedevilled the country for some time, saying it was the biggest embarrassment Nigeria had faced both locally and internationally.
Traders lament revenue loss in Rivers
Residents of Oyigbo in Oyigbo Local Government Area of Rivers State have lamented the postponement of the elections, stating that it affected their businesses negatively.
According to NAN, Mr Peter Paul, a trader, said the postponement should have been announced earlier for Nigerians to re-strategise for their private activities.
“For instance, if it was postponed a day or two days to the Election Day, I would have been in the market as early as 6 a.m., clean my shop and shade my wares before buyers troop the market.
“But waking up and hearing the postponement weakened me,” Paul said.
Mr Johnson Oke, another trader, said he had planned to travel to Onitsha in Anambra to buy “goods” to restock his store next week Saturday but that the change in the date of the election had affected the business schedules.
Oke, a dealer in plumbing materials, appealed to the Federal Government to always consider the masses before making abrupt decisions.
In her contribution, Mrs Alice Nwankwo, a housewife, said the development “shattered” the day’s socio-economic programmes.
Postponement, a national embarrassment—Kano traders
A cross section of traders in Kano, the Kano State capital, while responding to the news of election postponement on Saturday, described the development as a national embarrassment.
Most of traders, who ply their trades at the popular Abubakar Rimi market, Kano, told Sunday Tribune that the postponement was a slap on the face for INEC and the Federal Government, because it dented country’s image in the eyes of foreign nations.
One of the traders, Alhaji Habibu Abubakar, who deals in palm oil and groundnut oil, said the postponement made him lose millions of Naira, which he could have realised from sales.
Another trader, Hajiya Auwa Mohammed, who sells food at Yankwa market, said she lost a huge amount of money that she could have made from her customers, most of whom she said used to be villagers and visitors coming to trade in Kano.
In his response, Malam Dogo Mohammed, told Sunday Tribune that he heard about the postponement around 9 a.m. on Saturday.
“I live at Gebasawa village about 25 kilometres to Kano city; it was not easy for me to get transport from there to Kano, as many transporters were not aware of the cancellation of election. Now, I am in the market but there are no customers. On a normal day, I would have slaughtered no fewer than 500 chickens at N100 per one.”
Ibadan residents lament, count losses
Residents of Ibadan, the Oyo State capital, on Saturday, joined other Nigerians to lament the abrupt postponement of the presidential and National Assembly elections by INEC, counting their losses as a result of the development.
When Sunday Tribune visited major business hubs around the city, including the popular Gbagi Market, Iwo Road, Challenge and Molete in the early hours of the day, the streets were deserted, with scanty business activities going on.
Many shops, markets, including Palms Mall (Shoprite) in Ibadan stayed locked while roads were deserted for the many hours on Saturday in spite of the postponement of the elections.
A NAN correspondent who visited major roads such as Mokola, Ring Road, Elebu-Akala Express road sighted only few vehicles.
The Challenge Lagos-Ibadan transport park was not busy as usual, as the park was deserted.
Though some traders of the usually busy Gbagi Market had seized the opportunity of the postponement to open shops in other to engage in some sales, most shops were locked up while businesses were subdued.
Speaking with Sunday Tribune, a curtain seller, Alhaji Adeniji Saheed, lamented over the postponement, condemning the INEC for taking such decisions at the last minute.
“I think they ought to have declared the postponement earlier, so that people would have been fully prepared for the business of the day. It is unfortunate that this is happening to us. It shows that they are just taking the masses for granted. I have to come to the market to make some sales, because I have a target. I just pray that I meet it, so that it will not affect my business. I have not sold anything so far, but I am hopeful,” he said.
Another trader, Abiola Akeem, who said he summoned courage to visit the market hoping that he could make some sales, said that hope had been shattered, because the sale was poor.
He told Sunday Tribune that he would have made over N150,000 before noon, but “it is painful that I have recorded loss, because it is not certain I would make any sale today, as I have not made any sale so far,’ he added.
International passengers stranded at Lagos airport
As Nigerians continue to count their losses following the postponement of the general election, airlines operating in the country are not left out.
From investigations carried out by Sunday Tribune, many airlines including foreign and domestic carriers were forced to either cancel their flights while few could only operate one or two flights.
Many passengers, particularly the outbound ones, who did not get clear commitment from the foreign airlines they were billed to travel with became stranded at the Murtala Muhammed International airport.
Among those affected according to information gathered were the passengers billed to travel on Ethiopian Airlines with 1.00pm flight but could not achieve their aim as the airline officials in Lagos were not on ground to attend to the passengers who were on ground at the airport to catch their flights.
According to some of the affected passengers, all efforts made to get the airline officials to talk to them failed, as the entire airline counter and office at the Lagos airport were deserted.
Independent information gathered, however, attributed the cancellation of the Ethiopian airline flight to the closure of the borders for the presidential election, which was eventually shifted by a week.
The African carrier like other foreign airlines were said to have cancelled their flights outright or rescheduled them for the safety of their crew and the passengers who may have been caught up in the restriction of movement order.
The same scenario played out on the domestic scene where virtually all the domestic airlines were forced to cancel their flights.
Many of the domestic airlines who spoke to Sunday Tribune were counting the losses incurred through the cancellations.
Largely hit on the domestic scene was Air Peace, the largest domestic airline in the country as the airline said it could not operate any of its daily 90 flights within Nigeria and out of Nigeria due to the presidential election.
Dana Air also cancelled ten flight operations into various parts of the country except the three flights it operated on a special arrangements to help airlift some Lagos/Portharcourt bound passengers who were earlier stranded in Abuja.
Speaking to the Sunday Tribune, the spokesperson for Dana Air, Kingsley Ezenwa, who confirmed the cancellation of ten flights by the airline described the decision to to what he called a hard stance they had to take for national interest.
Ezenwa who said the cancellation of ten flights made the airline to lose millions of Naira however lamented how the airline will again be made to forfeit more millions of Naira in view of the fresh postponement of the election by one week.
The 1999 Constitution in Section 157(1) states that the Chairman and members of the Commission may only be removed by the President acting on an address supported by two-thirds majority of the Senate that the person be removed for inability to discharge the functions of the office (whether arising from infirmity of Mind or body or any other cause) or for misconduct
“We are warning that any attempt to sack or suspend the INEC Chairman will only lead to electoral and constitutional crisis. The nation is still grappling with the illegality and unconstitutionality of the removal of the Chief Justice of Nigeria and the President wants to go down this ignoble path again,” CUPP stated.
If the President has ears, let him hear.
At Iwo Road, another ever-busy area of Ibadan, it was not business as usual, with only skeletal businesses going on while the motorists in the axis were trying to return to business though without the usual bustling.
Traders, business centres, supermarkets, as well as inter-state and local transporters at the Orita, Challenge, Idi Odo and Molete areas, had also made the attempt to return to business following the postponement, though observation around 1.30p.m. showed that they could not regain the lost momentum.
The manager of a major supermarket, Crown Chemist, lamented over low patronage despite the cancellation of the elections, noting that without doubt, the development would affect the sales of the day.
An okada rider, who spoke Sunday Tribune said that with the botched poll, it was clear that he had lost his usual proceeds for the day, noting however, that the reason he came out was to recover from his spending for the preparation of the election. “Ordinarily, I would have not come out today, but I need to recover from my spending for the preparation of the elections. I had given money to my wife to get enough food stuff for the family, so that we will not lack anything during and after the election. But now, you can see what we are going through. There are many okada riders but there are no passengers.
Mr Adigun Kazeem, a trader, told Sunday Tribune that after learning of the postponement, he had to open shop because his business would suffer.