America has been presented with two choices of candidates whose economic views are largely in disparity and expectedly, the policy positions of any of the president who will clinch the seat in the white house will have wide-ranging effects world over, including for Nigeria.
All issues may seem to have taken the back seat as all eyes are on the outcome of the US Elections.
America’s 45th president, Donald Trump has a date with history. For Trump and his supporters, his promises of 2016 have been kept and the campaign agenda to protect American values targeted at his predominantly white-American base have also been kept.
After four years in the saddle, voters have gone ahead to determine whether he deserves a second term. His tenure which has been very controversial and expectedly so from domestic disagreements on immigration and health to international dispute with nations whether historical friends or foes.
The Election is much more than who rules America for the next four years but the future of the next two generations of Americans.
As a Nigerian, I have repeatedly asked myself how the outcome of the American elections affects me as I don’t have a voting right in the elections. So whether Trump wins or Joe Biden does, just like it is commonly done here in Nigeria, we move.
I won’t be surprised if a lot of Nigerians have the same kind of disposition towards the US Elections of which we all await the announcement of the Electoral College.
But for personal enlightenment and education, I have adjusted that position and here’s the thing.
America has been presented with two choices of candidates whose economic views are largely in disparity and expectedly, the policy positions of any of the president who will clinch the seat in the white house will have wide-ranging effects world over, including for Nigeria.
In order to really grasp the implications clearly, we must look at what the win for any candidate portends in relation to the activities in Nigeria whether economically, politically, religiously or otherwise.
From the economic standpoint, let’s look at the facts
- US is the best economy in the world with GDP of over 2 trillion dollars and that is massive.
- In terms of crude import in the world, the US is the second largest importer of crude. In 2019, the US did about 1.32 billion dollars in terms of the total importation.
- US also has the largest stock exchange.
The US economy is connected to the Nigeria economy in at least for major ways; the Dollar exchange rate, the price of crude oil, the US Federal Reserve Rate and Bilateral relations with China.
In terms of the exchange rate, while the US Elections may not have a direct impact, it is important to note that most of our revenue is in dollar and if the dollar is affected, our revenue will also be affected.
The election outcome is definitely going to impact the global oil market which will ultimately affect oil price in Nigeria. One of the immediate impact is that, Trump for instance, is seen to be against Iran and because of certain sanctions as well, that has lowered oil supply.
It is expected that Biden will lift or relax some of the sanctions if he wins and ultimately that will mean oil prices becoming low as over 2 million barrels of crude would be made available in the market.
The implication of this for Nigeria is that it will see a block of oil coming into the market and that would probably necessitate oil price coming down a bit and that of course will affect the revenue Nigeria is earning from oil received.
Speculations already say that a Biden victory will see massive deficit spending, and a refocus on green policies and healthcare. The positive is that the trade climate in the US will be more open to imports and outsourcing from Nigeria.
Reports also says that under Biden, the dollar will be weaker, the crude oil price will stay up (dues to lower US Supply) and fed rates rise. Thus, emerging market security with higher yields is attractive.
A look also at the trade relations between Nigeria and the US is another pivotal aspect of this election. Though trade has generally been affected by Covid-19 and not necessarily who is president. The democratic party tends to be liberal and that will make us see some positive trade relations with the US but if the republican party wins, things are expected to be status quo of course.
The US immigration decision for Nigeria is another aspect in the elections. It is believed that because the democrats are more liberal, they would want to change some immigration policies not just for the benefit of Nigeria but for other countries.
In terms of bilateral relations with China, China is seen as a big opportunity for Nigeria.
Interestingly, both candidates are trying to clamp down on Chinese imports, which presents an opportunity for companies in China and America to offshore to Nigeria without Chinese import tariffs. Whichever, it is important to note that a win for any of the party will present positive and neutral benefit for Nigeria.
So by and large, everyone is anticipating the outcome of the elections as it will affect a number of activities in Nigeria.
Let’s not forget also that in all of these analysis, Covid-19 is still lingering and that has a factor to play as well.
