Election postponement : Expert forsees fiscal deficit, capital flight

Election By Chinyere Joel-Nwokeoma Lagos, Feb. 16, 2019 (NNN) A financial expert, Prof. Uche Uwaleke, on Saturday said that postponement of the general elections could trigger capital flight from the nation’s bourse and as well widen fiscal deficit. Uwaleke, Head of Banking and Finance Department, Nasarawa State University Keffi, told the News Agency of Nigeria […]




By Chinyere Joel-Nwokeoma

Lagos, Feb. 16, 2019 (NNN) A financial expert, Prof. Uche Uwaleke, on Saturday said that postponement of the general elections could trigger capital flight from the nation’s bourse and as well widen fiscal deficit.

Uwaleke, Head of Banking and Finance Department, Nasarawa State University Keffi, told the News Agency of Nigeria (NNN) in Lagos that opportunity cost of the polls postponement was enormous.

NNN reports that INEC, hours earlier, announced the shift of the Feb. 16 Presidential and National Assembly elections to Feb. 23.

The Governorship and State House of Assembly as well as FCT area council elections have also been shifted from March 2 to March 9.

INEC chairman, Prof. Mahmood Yakubu, at a press conference, attributed the postponement of all the scheduled elections to logistic and operational problems.

“With elections now rescheduled, you can be sure that this cost will spike.

“Where will this extra sum be sourced if not from money already earmarked for capital projects?

“So, the opportunity cost is quite high. This development could widen the fiscal deficit and I hope it doesn’t amount to additional borrowing by the government,” Uwaleke said.

He decried the huge risk INEC had thrown the country into, noting that any attempt to borrow externally would be at a higher cost.

Uwaleke said that the information-sensitive stock market would be at the receiving end, noting that the market would be bearish trend in the days ahead following this development.

“There is no doubt that this will have the effect of weakening investors’ sentiments and may even trigger further capital flight.

“I won’t be surprised if this first quarter of the year is characterised by lower capital importation and slower Gross Domestic Product growth.

“In the same vein, the Purchasing Managers Index reading for the month of February 2019 is bound to come in lower when compared to previous months.

“Overall, the postponement of the elections due to ‘logistic reasons’ was avoidable and does not bode well for the nation’s economy,” Uwaleke stated.

He said that postponement of the general elections by the INEC had monumental adverse economic impact, not only on the government, but also on firms and individuals.

Uwaleke noted that the cost was escalated by the fact that the announcement came on the very day the elections were to be held after a number of irreversible steps had been taken by various economic agents and actors.

“Many people had traveled far distances just to exercise their franchise before the INEC decision while many organisations, especially educational institutions, had to shut down temporarily for the period of the elections,” he added.

Uwaleke said that the associated costs of shifting the elections cannot be quantified, ranging from huge losses on individuals, businesses, companies, various political parties, airlines disruption as well as closure of land borders.

“This unfortunate development further confirms what is public knowledge that the huge cost of conducting elections in Nigeria is about the highest in the world, even surpassing that of India, the world’s largest democracy with a population six times bigger than Nigeria,” he said.

On the way forward, Uwaleke called for constitution amendment to provide for a single term of five or six years as against two terms of four years to save cost and national embarrassment.

“Going forward, in view of the huge cost of conducting elections in Nigeria and considering that elections were postponed in 2011 and again in 2015 and then now, it is now time we reconsider the frequency of elections in Nigeria by amending the constitution to provide for a single term of say five or six years as opposed to the two terms of four years,” he said. (NNN)


Edited by Oluwole Sogunle

Man seeks divorce of 13-month-old marriage over alleged deception Climate change plays a role in United States fires, climate expert says COVID-19: Nasarawa Govt. sets up committee on schools reopening  UN investigator on Belarus warns of another ‘iron curtain’ Edo 2020: Youth group tasks stakeholders on peaceful election Police foil robbery attack in Niger Accident claims 1 in Anambra – FRSC NAF distributes medical oxygen cylinders to FCT isolation centres 2 traders bag 8 months imprisonment each for stealing a chicken Third Mainland Bridge phase one rehabilitation almost complete – Controller CSOs canvass better deal for African wildlife in COVID-19 policies Labourer bags 2 years imprisonment for stealing 12kg gas cylinder, mug cups Police nab 3 over alleged armed robbery, fraud, car theft in Niger  Afghan president approves inclusion of mother’s name on ID cards Tensions in Polish governing majority as lawmakers defy ruling party Kwara records 5 new COVID-19 infections Insurance firm donates 500 reflective jackets, kiosks to FRSC NIHOTOUR DG seeks cooperation of stakeholders to ‘sanitise’ tourism, hospitality industry Premier League urges government to stick to Oct. 1 date for fans return How we got rights to broadcast Live German Bundesliga matches – OurTv Gov. Diri sues for understanding over Bayelsa, Rivers boundary dispute COVID-19: Nigeria must embrace e-learning now – Olanipekun   Osaka withdraws from French Open with ‘hamstring’ injury COVID-19: NCDC records 131 new cases, as total infections now 56,735 Tanzania seeks stronger trade, diplomatic relations with Nigeria Group welcomes Lanlehin to APC By-elections: Boot Party, ZLP did not submit nominations – INEC Rep. asks I-G to probe alleged killing of youth by SARS in Osun Woman clubbed stepson to death in Kano Ondo 2020: INEC re-opens registration link for NYSC members Gov. Sule inaugurates conflict management committee COVID-19: PTF mandates schools to conduct weekly assessments Lagos bye-elections: Most opposition parties in Lagos too lazy — AD chairman Court remands 30-yr-old man for allegedly raping minor in Osun How we boosted our patronage during COVID-19 — Ibom Resort GM Gov. Ortom condoles Unongo over wife’s death Tertiary institutions in Delta can reopen now till Oct. 2- Commissioner Weight, measures: FG won’t condone sharp practices by traders- Director Maritime Agencies synergise for safety of waterways, improved transportation Flooding: Kwara Assembly passes motion to maintain drainage systems   COVID-19: INEC to enforce physical distancing in Edo election APC Caretaker Committee has no plans for extension, says member Delta Govt reassures parents of Primary Six pupils’ safety during exams Constitution review: INEC wants NASS to approve recommendations on electoral reforms Infrastructure: Firm optimistic of Nigeria’s cement market Customs boss appoints 2 DCGs, 5 ACGs, moves 5 senior officers Institute urges LASG to pay allowances to enforcement officers on training Katsina gov’t. spent N3b on WAEC, NECO fees in 5 years, says Commissioner Local Content: Don’t scare investors, Ajumogobia tells NASS AIICO Insurance partners NGO to provide relief packages to indigents