With its sights visibly set on financial system stability and mitigating macro-prudential risks, the Central Bank of Nigeria issued a directive restricting banks and discount houses with high non-performing loans and inadequate capital buffers from dividend payouts. The banking system remains fragile and measures to fortify it may likely affect short-term profitability.
Nigeria’s underinvestment in infrastructure has left it with a core stock of infrastructure of just 20%-25% of GDP compared to an average of 70% of GDP for more advanced middle-income countries of similar size. Bridging this gap will require investing an estimated $15bn annually for the next 15 years. Given the government’s limited access to international debt, revenue constraints and competing priorities, the major question is where will funding be sourced?
As the crypto-currency craze rages, the prospects of fiat-money ever being completely replaced by virtual currency remains a farfetched reality. However, the underlying technology on which crypto-currencies stand – blockchain – is already drastically revolutionizing the global banking and the business landscape.
In this edition of the FDC Bi-monthly publication, the FDC Think-Tank analyzes these issues and their implications on businesses and the economy at large.
Enjoy your read.