Analysts warn that President Donald Trump’s economic policies, including a strong dollar and increased oil production, could destabilize Nigeria’s currency and foreign investments. Trump’s plans to ramp up U.S. energy production and lower oil prices may reduce Nigeria’s oil revenues, which are critical for foreign exchange inflows. Additionally, potential changes in U.S. immigration policies could impact remittances from Nigerians abroad, further straining the economy.
Experts believe Trump’s presidency could strengthen the dollar by boosting investment and employment in the U.S., leading to higher interest rates that may reverse portfolio flows from Nigeria. If investors shift funds back to the U.S., the naira may weaken due to reduced foreign capital inflows. Furthermore, increased U.S. energy production and influence over OPEC could drive down global oil prices, cutting Nigeria’s earnings from crude exports.
Despite these concerns, some market watchers remain optimistic, citing improved oil production and security measures that could counterbalance external risks. New government initiatives, such as enhanced transparency in the oil sector and investment in security, may support economic stability. Meanwhile, the global push for de-dollarization, particularly among BRICS nations, could reshape international trade and reduce dependency on the U.S. dollar in the long term.
Source: BUSINESS DAY