Nigeria’s Economic Uncertainties: Coping Guidelines for Business Survival

Abstract

Nigeria, like many economies, is ravelled by the fallout of the Russia-Ukraine war, which worsened the enduring impact of the COVID-19  pandemic and the existing structural challenges facing the economy. The macroeconomic instability experienced in Nigeria over time  cannot be dissociated from the country's massive dependence on crude oil, which remains the largest source of fiscal revenues and  export earnings. The unstable macroeconomic space – in terms of high inflation, exchange rate volatility, constricted fiscal space, weak  external reserves, and balance of payments problems – and deepening instability on the social and political landscapes – have proved the  extent of Nigeria’s vulnerability to shocks. A more recent ranking showed that Nigeria was among the bottom half of African  countries classified as less resilient to shocks by the African Development Bank (AfDB) in 20211. The burden of vulnerability is borne by  the people at the bottom of the income pyramid, which could aggravate the insecurity problem. Consequently, Nigeria’s unstable  macroeconomic space has worsened the business environment, subdued investors’ confidence and weighed on the financial  performance of businesses in Nigeria. In this paper, the NESG highlighted four variants of business-related risks alongside the coping   guidelines Nigerian businesses could adopt.