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Goodluck Jonathan vs Muhammadu Buhari (Photo
credit: Nigeriacurrent.com)
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Nigeria is suffering from
a plummeting currency, steep budget cuts, corruption scandals and diving oil
prices; yet all this is unlikely to decide a tight race for the presidency.
In many other
democracies, such turmoil would probably propel the incumbent from office. A
likely rise in inflation in Africa's biggest economy is unwelcome for President
Goodluck Jonathan, who is seeking re-election on Feb. 14 next year.
But many Nigerians appear
willing to give him the benefit of the doubt, while others will vote according
to regional, sectarian or ethnic loyalties in the most closely fought election
since the end of military rule in 1999.
Jonathan faces main
opposition contender, ex-military leader Muhammadu Buhari, with the naira
currency devalued 8 percent in the past month and a budget slashed by around 10
percent, both due to a near halving of world oil prices since June.
Yet any undecided voters
appear unlikely to be swayed by economic hardship whose immediate cause lies in
global markets.
"We are really
suffering from the high dollar, but you can't blame President Jonathan for
that. He can't control the dollar," said Daniel Ibere, whose sales of
electronic goods in Lagos's overcrowded Eko Idumota market dropped when he
raised prices.
Buhari is likely to
benefit from a perception that Nigeria was ill prepared for the energy price
shock because so much revenue from oil, its dominant export earner, has been
lost to corruption under Jonathan's administration. He is regarded as a rare
example of a graft fighter when president in 1983-85.
"CRYING AND
COMPLAINING"
When the central bank
devalued the naira last month to save foreign reserves, the impact was felt
instantly on the streets. Nigeria imports 80 percent of what it consumes.
"Everyone is crying
and complaining," said Ifeanyi Onuchukwu, a clothes wholesaler in the
capital Abuja. Onuchukwu tried to raise his prices 10 percent, but the traders
wouldn't buy his wares so he suffered losses.
Economist Bismarck Rewane
thinks inflation will hit double digits for the first time in two years by
January. "That's a difficult situation for Jonathan. You really don't need
this two months before an election," he said.
But a bigger headache
comes from allegations that billions of dollars of revenue have
"leaked" at the state oil firm, according to ex-central bank governor
Lamido Sanusi, among others. Jonathan removed Sanusi in February after he made
the allegations.
Critics argue this is one
reason why Nigeria failed to build up a savings cushion when oil prices were
high. Buhari's campaign has focused on the economy and alleged corruption.
"The lives of the
poor are bled dry while those of the powerful soak in excessive
abundance," he said on Thursday after winning the opposition ticket.
This, however, may not be
enough to sway an electorate divided along lines that for the most part have
little to do with policy.
Nigeria has been dogged
by regional rivalries since independence from Britain in 1960. It suffered a
catastrophic civil war in the late 1960s and even today, many Nigerians vote
for candidates from their own area or an allied ethnic group. Those who can
widen their geographical appeal gain a distinct advantage.
"Policy has never
been a great part of politics ... If you look at the last election, Buhari lost
because he didn't win as many votes outside his area as Jonathan did outside
his," said Anthony Goldman of Nigeria-focused PM Consulting.
He added that the
economic problems could cut either way, since "there's sometimes a 'better
the devil you know' factor" in times of crisis in Nigeria, a generally
conservative country.
COLOUR OF YOUR MONEY
The other factor is
money. Vast patronage is often needed to get communities to vote for a
candidate, so the incumbent who controls the oil wealth enjoys an advantage.
This time money is
running extremely low, and Nigeria's fiscal position always weakens around
election time.
However, a parliamentary
source said the funds needed to pay for campaigns on both sides had mostly
already been stockpiled before the oil price crash, so the impact may be
minimal.
While Nigeria faces a
more austere budget, its debt remains low, certainly when compared with the
developed world.
"Nigeria with its
low debt ratios and fairly liquid markets has more capacity than most to
increase borrowing ... to see it through a short-term price shock," says
Razia Khan, Standard Chartered's Head of Africa Research.
And since suitcases of
dollars are the preferred means of delivering patronage - carrying funds in
naira bills would require trucks - election spending is likely to increase the
supply of U.S. currency in the short term. That bodes well for the naira, which
has steadied in a week of electoral primaries.
"Huge dollar
spending by politicians on both the (ruling) PDP and (opposition) APC primaries
saw the Lagos bureau de change markets awash with dollars," Business Day
splashed on its front page on Friday. "This may have contributed
significantly to the appreciation of the naira."
By Tim Cocks and Julia Payne (editing by David Stamp)
Culled from Reuters/Wires
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