The Federal Government has said it is closely monitoring global developments following the escalating tensions involving Iran, the United States and Israel, noting that it may introduce policy adjustments to protect the Nigerian economy and citizens.
The Minister of Finance and Coordinating Minister of the
Economy, Wale Edun, disclosed this in a statement issued in Abuja on Tuesday.
The statement, signed by the Assistant Director of
Information and Public Relations at the Ministry of Finance, Mrs. Uloma Amadi,
did not specify the policy measures under consideration but said the government
was reviewing options to mitigate potential economic shocks.
According to the statement, the Federal Government remains
committed to safeguarding Nigeria’s economic stability amid rising geopolitical
tensions in the Middle East.
“The Federal Government of Nigeria is closely monitoring
escalating geopolitical tensions in the Middle East involving the United
States, Israel and Iran, and remains committed to safeguarding Nigeria’s
economic stability,” the statement said.
It added that the Economic Management Team (EMT) is
coordinating closely across fiscal, monetary and energy policy institutions to
review policy options aimed at shielding households and businesses from
external shocks.
Edun emphasised that careful policy calibration would guide
the government’s response to ensure that recent progress in macroeconomic
stability, revenue mobilisation and economic growth is not undermined by
external developments.
He also assured that the government would continue to
monitor the situation and adjust policies where necessary to minimise
disruptions, sustain investor confidence and protect the welfare of Nigerians.
The EMT, chaired by Edun, was said to have met to assess the
potential impact of the conflict on Nigeria’s economy.
The minister also presided over a coordination meeting on
the Naira-for-Crude policy to review developments in the energy market and
their domestic implications.
According to the assessment presented at the meeting, the
global situation remains fluid, with uncertainty driven by concerns over
possible disruptions to critical energy supply routes, particularly the Strait
of Hormuz, a major corridor for global oil shipments.
The government identified three key channels through which
the crisis could affect Nigeria’s economy.
The first is volatility in crude oil and gas prices, which
could drive increases in domestic prices of fuel, diesel, cooking gas and
fertiliser.
The second relates to capital flows and financial markets,
where heightened geopolitical risks could lead investors to move funds to safer
assets, potentially affecting capital inflows into emerging markets such as
Nigeria.
The third channel involves global logistics and supply
chains, as disruptions to shipping and energy routes could raise international
freight and logistics costs, placing additional pressure on domestic prices.
The minister noted that prolonged instability could lead to
further increases in the cost of goods and services, intensifying inflationary
pressures and the cost of living.
The EMT said it would continue to track developments across
key macroeconomic indicators, including global crude oil prices, exchange rate
movements, capital flows, financial market conditions, and implications for
Nigeria’s fiscal outlook and external reserves.
The government reiterated its commitment to maintaining
economic stability while taking necessary steps to protect Nigerians from the
impact of external shocks.
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