- SBM Intelligence has declared that Nigeria’s economy is in a “warning” state.
- The ACIRI is a timely tool that indicates a country’s vulnerability to political instability.
- Nigeria’s macro risk indicator ranking in the “Economy” category was 60%, indicating a lack of economic stability in the nation.
Based on its 60% ranking in the “Economy” macro risk indicator, SBM Intelligence, a prominent research and risk consulting firm in Nigeria, has declared that Nigeria’s economy is in a “warning” state.
In its Africa Country Instability Risk Index (ACIRI), which evaluates the risks to political stability in 47 African nations, the research firm disclosed this.
Nigeria’s economy
The novel framework utilized in the report to evaluate the risk of coups d’état is one of its most important aspects. The ACIRI is a timely tool that indicates a country’s vulnerability to political instability, especially since 2023 has been the year that the bite of longstanding state fragility has become apparent, whether in the form of African government takeovers or the resurgence of hostilities in the Middle East.
Utilizing indices like ethnic tensions, past coups, dominant ethnic groups, economic concentration, aging leaders, and the type of economy (mono-, bi-, or multi-product), the ACIRI framework creates a stability ranking for each nation, which is then further subdivided into the categories of “Red Watch, Warning, Critical, Vulnerable, Stable, and Safe.”
The four groups of macro risk indicators—economics, geopolitics, history, and leadership and governance—each have a score of 100%. An elevated score denotes heightened political risk for businesses.
Specifically, Nigeria’s macro risk indicator ranking in the “Economy” category was 60%, indicating a lack of economic stability in the nation. The “Economy” category comprises sub-indicators such as GDP growth, government maturity, food security, product/sector dominance, poverty rate, debt sustainability, and currency volatility.
