The Tougher Days Ahead For Nigerians, By James Olaosebikan
POLITICS DIGEST – I hate being the carrier of bad news but I want to put this info out there for you all and I hope you take some practical measures to safeguard yourself, your investments and your standard of living in the months ahead.
Nigeria is solely dependent on oil as foreign exchange earners. All other sources of income account for only 5%. 80% of our budgetary revenues come from oil and other ancillary products.
Crude Oil is technically free now because the price of crude oil is less than the cost of production. Countries are basically begging other nations to move and store these products because prices have fallen to its lowest in modern civilization.
What that means is NIGERIA and other African countries who are wholly dependent on oil are not making money. Budget is based on $60 per barrel and that’s unrealistic as prices have been falling all year.
Therefore, the value of Nigerian currency will take a tumble in the coming weeks and months and it’s no longer a good way to store wealth. Nigeria is set to take a $3.4 Trillion loan from IMF this week as a result of dried up sources of revenue.
These are things you should do immediately:
1) PRAY PRAY PRAY! God is able to do the unthinkable. But you must take some actions in addition to prayers.
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2) If you have Naira saved somewhere, change everything to $, £ or €. Naira is changing for 450 now to $1. By the end of May, it will be near or above 600! By the end of the year, Naira will be worthless and you can sell some as needed to make money. But the value of your savings will continue to depreciate in the coming weeks and months.
3) Food prices will double in the next few weeks and months. If you can afford it, buy as much non perishable foodstuffs and keep in a safe, dry place. You will save a lot of money-rice, beans, yam flour, vegetable and other kinds of cooking oil etc
4) Invest in Agriculture if that’s feasible. This will not only provide food for your household, you will make a lot of money in the months ahead as a result of improved rices of farm produce.
5) Your money in the stock markets and in shares will evaporate. If you are willing to accept your current losses, sell off. It’s hard to sell even now but stocks prices will fall below those occasioned by the economic meltdown of few years ago.
6) You can also use your money to buy sellable assets like fridges, freezers, electronics etc that you can re-sell later. That’s a tough one because most people will not have disposable income to buy new things in coming months. Food will be the priority.
7) If you can leave NIGERIA/Africa for other countries, it’s a good time to do it. CANADA has a permanent residency program going on if you are a professional.
Please feel free to share. I am not making predictions based on any revelations but purely based on economic parameters, effects of the current pandemic on global economy and the prices of crude oil in international market.
God bless you all and take care of yourself and each other.
