by Thomas Wash

(N.B. Due to the President’s Day holiday, the next report will be published February 25.)

On February 16, 2019, Nigeria will hold its sixth presidential election since it ended military rule in 1999. President Muhammadu Buhari, who has been rumored to be in bad health after disappearing from public view for weeks at a time, is facing a serious challenge from the former vice president, Atiku Abubakar. Although there are several other challengers, their chances of winning are slim.

In a country where presidents typically serve two terms, Buhari appears vulnerable to being removed from office after his first. In a word, his first term can be described as turbulent. The economy fell into recession, there were bouts of fuel scarcity and his health troubles sparked rumors that he had been replaced by a Senegalese body double.[1] In 2016, even his wife registered her discontent with his performance by insinuating that she may not support him in his re-election bid. Recent actions by Buhari and his government suggest he has not taken his declining popularity in stride. As a result, there is growing concern that the election could become violent.

Even though the last election saw a relatively peaceful transition of power, historically, elections in Nigeria have been violent. Thus, this election has garnered international attention as it could possibly lead to broader conflict within the region. While we are concerned with the humanitarian aspects of this event, the primary focus of this report will be on how the election could impact financial and commodity markets. We will examine the overall political situation in Nigeria, the issues surrounding recent elections and the potential for unrest following the vote. As always, we will conclude with potential market ramifications.

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[1] https://www.wsj.com/articles/on-the-issue-of-whether-ive-been-cloned-an-election-gets-weird-1544459732