Sekondi Accra

The new leader of the Independent National Electoral Commission (INEC), Attahiru Jega has the challenge of ensuring that the 2011 elections are more credible than those of 2007. The greatest obstacle he faces ahead of the 2011 elections is finalizing a new voter's register started in October 2010. Despite the INEC's insufficient budget of $569 million dollars and the postponement of the polls until April 2011 (rather than January as previously planned), the logistics are formidable. The registration of around 70 million voters occurs at the state level, where elections are won and lost in Nigeria. Another challenge will be to ensure that the new INEC manages to follow through on their plans of internal re-organisation. It must also make sure that officials indicted by judicial tribunals during the last elections are forbidden to participate as officers in the April 16, 2011 elections. If the most important achievement of the late president Umaru Musa Yar'Adua's years was the ceasefire in the Niger Delta, then the re-election of President Goodluck Jonathan is fortuitous because he is thought to be the man best able to keep the peace in the oil-producing region. However, the Nigerian government's strategy for dealing with Boko Haram, a controversial Nigerian terrorist Islamist group that seeks the imposition of Shariah law in the northern states of Nigeria, is based on its experience with militants in the Niger Delta which means those tactics may not work because Haram has a different set of grievances.

The reform of the oil sector and the improvement on the failing electric power situation have been painstakingly incremental. These issues in conjunction with the overall quality of governance of the People's Democratic Party (PDP) were the subject of lively debates among the primary presidential candidates, which included General Muhammadu Buhari, Wole Soyinka and Nuhu Ribadu leading up to the elections. A free and competitive election could help build on the cumulative democratic gains made since Nigeria was freed from military rule in 1999. Even though many politicians were dishonest and greedy, coups would no longer be tolerated. The issues regarding religious and social discontent, especially in the Delta, the Middle Belt and the northeast (where there has been an increase of islamic extremism), can be inflamed on a moment's notice, but it would not be in the military's interest to exacerbate these kinds of differences.

The Nigerian economy has rebounded since peace returned to the oil-producing region and the government's bailout of several threatened banks in 2009. The real GDP rate, which decreased to below 5% in 2009, is forecast by the International Monetary Fund (IMF) at above 7% in 2010 and 2011. Petroleum production has been rising steadily, attaining an average of 2.2 million barrels per day (bpd) in October 2010, far above Nigeria's quota of 1.67 million barrels per day (bpd) authorized by the Organization of Petroleum Exporting Countries (OPEC). Several billion-dollar offshore developments should increase national production capacity beyond 3 million (bpd) in 2012, despite oil companies doubts that the Petroleum Industry Bill, which would impose stricter terms for international companies, will halt further expansion.

Economic management may be vulnerable during the lead-up to the election and in its aftermath. Economists are particularly concerned that there could be a reduction in essential capital expenditure which fuels investment and job creation, and that capital budgets have not be completely liquidated. Additional plans have been presaged under the stewardship of of finance minister Olusegun Aganga, a former Goldman Sachs executive. He unveiled the sale of a $500 million dollar Eurobond in September 2010, to be managed by Barclays Capital and Lagos based FNB Capital, partly to serve as a benchmark so that local companies can price their bonds accordingly. The government will use the funds to develop infrastructure and reduce dependence on petroleum exports. Aganga has also resolved to ensure that the modalities of a sovereign wealth fund are established before the elections.

Central bank governor Sanusi Lamido Sanusi has strongly defended his 2009 bank reforms against the criticisms of his predecessor, Chukwuma Soludo. He noted that as a result of weak regulation and supervision, the banking system had lost 66% of its capital through margin lending and exposure to fuel imports, and that reforms to the financial system were critical and long overdue. He has also supported the unlocking of $2.6 billion dollars to increase investments in electricity generation, noting that funds of this magnitude should be borrowed locally to avoid exchange rate risks. With the support of World Bank credit, the country was able to maintain confidence in its financial markets, although its sovereign rating descended to B-. Credit to the real sector increased following the July 2009 crisis as eight banks were recapitalized. The financial sector is still working towards adopting international financial reporting standards. The incarceration of former Oceanic Bank CEO Cecilia Ibru in October 2010 and the surrender of assets woth $1.2 billion bollars was one of the most important signals of cultural change.


Official Data


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