As the global economy wriggles through uncertainties worsened by the protracted Russia-Ukraine war with its spillover effects seen in accelerating global inflation, aggressive tightening of monetary policies, worsening debt positions, the decline in capital importation and other adverse implications, the sharp slowdown in global growth raises the risk of a prolonged recession in emerging markets, and subSaharan Africa economies like Nigeria seem at greatest risk given their precarious fiscal conditions.
Apart from higher food and energy prices, rising interest rates, currency crises from dollar shortages, and capital outflows affecting emerging markets from Pakistan to Egypt to Ghana, Nigeria additionally faces rising insecurity, unpredictable FX exchange rates, shrinking earnings and profitability of corporate entities, as well as political uncertainties ahead of the 2023 general elections, according to analysts at Cowry Asset Management Limited, an investment banking firm.