The world woke up Wednesday to chilling news that Nigerian soldiers had turned their guns on peaceful protesters, a development now set to worsen risk perception in Africa’s biggest economy.
Following over a dozen days of youth-led protests at strategic locations across Nigeria against brutality by a rogue police unit, the Special Anti-Robbery Squad (SARS), violence erupted in parts of Lagos leading to the burning of a police station. The Lagos state government declared a curfew on Tuesday and soldiers brought in to enforce it reportedly shot at protesters killing many.
On Wednesday hundreds of youths defied a government lockdown and returned to the streets of Lagos destroying government property including a local television station.
The youths, who carried sticks and metal poles, chased cars that tried to evade barricades they’d erected on Lagos’s main expressways. The imposing new bus terminal at Oyingbo in Lagos mainland was burning Wednesday morning.
Prior to the crackdown on protesters, Nigeria’s risk perception was already poor. In 2019, the Euroasia group published a risk assessment report that described President Muhammadu Buhari as “an elderly, infirm leader who lacks the energy, creativity, or political savvy to move the needle on Nigeria’s most intractable problems.
Country risk, which refers to the uncertainty associated with investing in a particular country, is worsened by political instability which can roil financial markets. Poor risk perception partly accounts for Nigeria’s declining foreign direct investments.
According to the United Nations Conference on Trade and Development (UNCTAD) 2020 World Investment Report, FDI flows to Nigeria totaled to USD 3,3 billion in 2019, showing a 48,5 percent decrease compared to the previous year (USD 6.4 billion).
The troubling images and videos shared on social media and on television screens across the world is fueling calls by world leaders, celebrities, and foreign governments to the Nigerian government to halt violent attacks against protesters. This is also worsening Nigeria’s risk perception.
Andrew S. Nevin, Partner – West Africa Financial Services Leader and Chief Economist, Nigeria, said that countries that have managed to improve their security situation and good governance reap the benefit of it and that is where Nigeria needs to get to, “but right now the focus needs to be on the safety and security of all Nigerians and the international communities looks to the Nigerian authorities to do the right thing for all Nigerians.
“On the other hand if the movement leads to improved governance, rule of law better security for everyone then ultimately it will lead to better investment climate,” Nevin said, adding that security challenges in Nigeria is one of the reasons investors are conscious of the nation with the largest economy in Africa.
Joe Biden, the democratic party candidate in the November 3 US presidential elections, released a statement Tuesday urging President Muhammadu Buhari and his military forces “to cease the violent crackdown on protesters in Nigeria, which has already resulted in several deaths.”
Hillary Clinton, former United States secretary of states Tuesday night asked Nigerian authorities to “stop killing” persons protesting against police brutality in the country.
Many others including US Congresswoman woman Ilhan Omar, celebrities including Beyonce, and a growing list of international observers have called on the Nigerian government to halt a violent crackdown on peaceful protesters.
These calls happening amidst loud silence from Aso Rock is feeding the perception that the government is unwilling to engage and drumming aghast at home
Clement Isong, executive secretary and CEO Major Oil Marketers Association of Nigeria told BusinessDay that his heart is broken over the development as he sympathised with the family of those who lost loved ones in the struggle.
“This is an opportunity for the government to move quickly, and show its human rights credentials at a time we are deregulating the downstream oil and gas sector with the hope of attracting foreign investments. The government needs to be seen as respecting the rule of law” said Isong.
The UK parliament says it will consider a petition asking the country to sanction the Nigerian government for human rights abuses over the #EndSARS movement. This is following a petition by more than 133,000 signatures, less than 24 hours after it was created, and is more than the 100,000 signatures required by the parliament before it considers a petition.
Gory images of bloodied protesters were a constant feature in newspapers and television stations across the world. The New York Times reported the tragic climax to days of mainly peaceful action by the youths with a headline titled, “Nigerian forces fire on demonstrators protesting police brutality”.
Atlanta US-based Cable News Network, CNN titles its online story, “Eyewitnesses say Nigerian forces opened fire on protesters in Lagos.”
In its account, the newspaper for the world’s business elite, Wall Street Journal said “Nigerian protesters killed as soldiers opened fire in Lagos. In the report, WSJ said, ”several people were killed as Nigerian soldiers opened fire at a key protest site in Lagos, witnesses said.”
The London Guardian newspaper said “Nigerian forces have opened fire on hundreds of protesters in Lagos, as rallies against police brutality continued in defiance of a 24-hour curfew imposed by the government earlier in the day.
The impact of this negative coverage is bad for business, analysts say. “Investors do not like uncertainty. In the short term, it is going to significantly impact foreign investment inflows into Nigeria. How it turns out, in the long run, depends on how government resolves the issues on the table,” Trevor Ward, managing director, London-based W Hospitality Group said.