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Fasten your seatbelts for the year ahead (2025)

After an unexpected 4-day appreciation, the naira crashed to N1700/$ at the parallel market. It had earlier gained 8.97% to close at ₦1,535/$ at the official market and 6.60% to ₦1,620/$ at the parallel market. Traditionally, the naira appreciates in the forex market during the Christmas season. This is because of visiting friends and family from abroad, increasing the supply of dollars. In addition, the main crop of the cocoa harvest happens at this time of the year. The cocoa farmers this year have been flushed with dollars. The price of cocoa is at a record high of $10,649/MT. The sudden crash of the naira was mainly due to a correction of an oversold domestic currency.

Nigeria had issued a $2.2 billion Eurobond in December 2024, its first since 2022. The issuance, split into $700 million 6.5-year bonds with a 9.625% yield and $1.5 billion 10-year bonds yielding 10.375%, was oversubscribed with over $9 billion in global bids. Despite this success, the bonds were issued at a premium, reflecting investor concerns about Nigeria’s debt sustainability.

A stitch in time saves nine

Nigeria was once one of the world’s leading agricultural economies, with agricultural exports accounting for 60–80% of the country’s GDP. However, the discovery of oil in 1957 gradually deprioritized the agriculture sector and consequently slowed the implementation of agricultural mechanization. On the other hand, Ukraine has maintained its focus on agriculture and now has over 40 agricultural machinery manufacturers since its agricultural sector restructuring in 2000. This has positioned the country as one of the leading global producers and exporters of grains and oilseeds, with agricultural products being Ukraine’s main exports.

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