How The Us Israel-Iran War Will Affect Nigeria –Risk Managers

Risk managers in the country have taken time to analyse how the ongoing confrontation in the Middle East would affect Nigeria.

This is coming on the back of a launch of offensive on Iran by Israel and the United States of America (USA).

The risk managers spoke under the aegies of their association – The Risk Managers Society of Nigeria (RIMSON) stating that the conflict has economic consequences also for Nigeria in a variety of ways.

RIMSON President, Dr Abbas Idriss, in a statement in Abuja Idriss, said the war could impact Nigeria in a number of ways listing these to include:

1. oil price and revenue
2. supply disruptions
3. diplomatic relations
4. increased security spending
5. foreign remittances
6. foreign investment

Expatiating on the above, he said that being Africa’s largest oil producer, that Nigeria was highly sensitive to global oil prices.

Supply disruptions he stated and fears of instability are two factors he cited that stand to affect oil prices on account of the conflict.

He also said that Nigeria may find itself navigating complex geopolitical dynamics as Iran supports certain groups and governments in the West African region.

The conflict could also affect Nigeria’s diplomatic relations and foreign policy, especially regarding its Muslim population and for reason of regional stability.

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”Nigeria has been grappling with its own security issues, including terrorism, banditry and ethnic conflicts.

”Increased instability in the Middle East may lead to a focus on security spending, which can divert resources from economic development and infrastructure projects,” he said.

According to him given that Nigeria on foreign goods as well, the war could drive up the prices, thereby affecting Nigeria.

Idriss further said that the war could impact negatively on remittances which he described as “vital parts of Nigeria’s economy”.

He noted that many Nigerians have family members abroad, including in the Middle East, stressing that if a conflict resulted in instability in the region, it may affect remittances.

According to him, reduced remittances can lead to decreased household incomes and increased poverty.

He said that a global conflict could lead to increased risk aversion among investors.

”Overall, the consequences of such a conflict will depend on several factors, including the duration and intensity of the conflict, Nigeria’s diplomatic responses, and the resilience of its economy.

”The interplay of global energy markets, security issues, and regional dynamics will play crucial roles in shaping the outcome for Nigeria.

”The price of oil is expected to rise to up to $150 per barrel. Dangote has already responded by increasing the pump price. Others will surely follow,” he said.

He urged the Federal Government to carry out risk management measures to manage, retain and transfer certain risks as appropriate.

”This further amplifies RIMSON’s call for a proactive risk management culture that is far more beneficial than the reactionary one,” he submitted