Nigeria Counts Cost of Last-Minute Vote Delay by INEC

Nigerian stocks fell the most this month and bond yields rose after Africa’s biggest oil producer delayed last weekend’s presidential and parliamentary election at the last minute.

The one-week postponement, just a few hours before voting was scheduled to start on Saturday morning, rattled investors and led to accusations from President Muhammadu Buhari’s party and the opposition, led by Atiku Abubakar, of skulduggery against one another.

Nigeria’s main equities index dropped 1.6 percent on Monday in Lagos, the commercial capital. A gauge of banking stocks dipped 3.2 percent, the most since Jan. 9. Nigerian Breweries Plc contributed the most to the stock market’s fall as it weakened 10 percent, the largest loss in four years. The subsidiary of Heineken NV announced a decline in full-year revenue and profit on Friday.

Yields on the government’s $1.5 billion Eurobond maturing in November 2027 rose 9 basis points to 7.21 percent. Nigerian assets had rallied since the end of January on the expectation of a smooth election.

“It’s sent a very negative signal,” Ayodeji Ebo, managing director at Afrinvest Securities in Lagos, said by phone. “Some investors are trying to reduce their positions.”

Nigerian stocks fall after last-minute vote delay

The Independent National Electoral Commission’s delay marked the third consecutive time that Nigeria has postponed a nationwide vote. A week before the 2015 ballot, it was moved back by more than a month. Buhari went on to win and become the first opposition candidate to take power in Africa’s most populous country.

As well as pushing back the presidential and parliamentary vote to Feb. 23, INEC delayed governorship elections for a week until March 9.

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The chairman of Buhari’s All Progressives Congress, Adams Oshiomhole, said INEC had colluded with Abubakar’s People’s Democratic Party over the delay.

The election body “is working with anti-democratic forces,” Oshiomhole told reporters in Abuja, the capital. “INEC’s leadership knew they were going to postpone and shared this information with the PDP not to waste their money, while telling us everything was well.”

An INEC spokesman, Rotimi Oyekanmi, said no party had been informed in advance.

Former general Buhari, 76, said at the same press conference that he didn’t know about the deferral before he woke up on Saturday morning and that INEC had to explain its “incompetence.”

Anticipating possible violence and attempts to rig the vote, Buhari said the military and police should “be ruthless.”

Logistical Problems

Abubakar, a 72-year-old businessman and ex-vice president, said there was a plot by the government to rig the election by stifling voter turnout in areas where he needs big majorities to win. House of Representatives Speaker Yakubu Dogara, a PDP member, said Buhari’s statements indicated Nigeria’s democracy “has become the victim of a full-blown dictatorship.”

INEC’s chairman, Mahmood Yakubu, blamed logistical problems and said there was no political interference. Yakubu said INEC struggled to prepare elections involving around 90 political parties, 23,300 candidates and 84 million registered voters, while some commission offices in the east were burned in what he called acts of “sabotage.”

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Election officials and members of the national youth corps were left stranded across the country. Many Nigerians had traveled to their hometowns to vote and won’t be able to afford trips for a second weekend running.

“I can’t stay here till next Saturday just to vote and I can’t return here again next week just to vote,” said Onyeka Ikoro, a 45-year-old electronics dealer who traveled from Lagos to his hometown of Ohafia in Abia state. “Atiku and Obi will lose my vote. It doesn’t make me happy but what can I do?,” he said in reference to Abubakar and his running mate, Peter Obi.

Nigerian assets may recover later in the week if investors think the delay won’t be repeated or lead to violence, according to Aderonke Akinsola, an analyst at Chapel Hill Denham, an investment bank in Lagos.

“The personal costs will be high,” Andrew Alli, former chief executive officer of Lagos-based Africa Finance Corp., said in an emailed response to questions. “But as long as it doesn’t portend some major election dispute after the voting, I don’t think the ultimate effect will be that major.”

(An earlier version of this story corrected company name in the last paragraph to Africa Finance Corp.)

— With assistance by Tope Alake, Elisha Bala-Gbogbo, and Ruth Olurounbi

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