A new report released this week revealed that at the end of the 2018 fiscal year, Nigeria would have spent a whopping 6 trillion Naira (more than $16 billion) on its defense in 11 years. The report says almost half (48.30 percent) of this money spent on national security was spent between 2012 and 2014, at the height of the Boko Haram insurgency in Nigeria’s North-East region.
Nigeria’s president Muhammadu Buhari would have also spent 30 percent of this 11-year defense budget by the end of the fiscal year in 2018, having only resumed office in 2015. And despite his claims in late 2015 that Boko Haram had been “technically defeated,” Buhari has continued to spend millions of dollars on a war that is turning states in North-Eastern Nigeria into failed states. Also, Nigeria’s military personnel is becoming spread thin across the country, as it tries to protect citizens and goods from ethnic clashes, secession agitations, and a terrorist insurgency. With these battles on all fronts, resources are also becoming scarce.
Nigeria’s National Assembly is considering Buhari’s February request to withdraw $1 billion (N362 billion) from Nigeria’s Excess Crude Account to buy weapons for security purposes. If his request is granted, Nigeria’s defense budget in 11 years will reach N6.5 trillion. For a country where almost 50 percent of its population lives in extreme poverty, amongst other reasons, N6.5 trillion is a steep price to pay to be safe.
Below is the Ventures Africa Weekly Economic Index, for the week ending 27th of July 2018. This economic index gives you a glimpse into other recent activities in Nigeria’s economy as well as changes and prices that could affect the naira:
Nigerian Stock Exchange
Data released by the Nigerian Stock Exchange (NSE), as of 27th July 2018, showed that the All-Share Index appreciated by 0.09 percent from the previous week ending 20th July 2018. Market capitalization at the close of trading during the week under review was N13.272 trillion, a 0.09 percent increase from N13.260 trillion recorded the previous week. The All Share-Index for the week under review closed at 36,636.97.
Top five price gainers and decliners in the week under review:
Top five price gainers
Cement Co. of North Plc.
Continental Reinsurance Plc.
FBN Holdings Plc.
Caverton Offshore Support Grp Plc.
Top five price decliners
Rak. Unity Pet. Comp. Plc.
UACN Property Development Co. Limited.
Secure Electronic Technology Plc.
Royal Exchange Plc.
Lafarge Africa Plc.
How did the Naira fare?
The value of the Naira against the dollar depreciated in the week under review. The Naira depreciated from N360/$ recorded on the 20th of July, 2018, to N361/$ on the 27th of July, 2018.
How did the price of oil fare?
Brent Oil prices began the week at below $74 per barrel, but by the end of the week on the 27th of July, it had risen slightly to $74.58 per barrel.