“Nigeria’s economy has weakened more than we expected owing to a marked contraction in oil production, a restrictive foreign exchange policy and delayed fiscal stimulus,” S&P said Friday in an e-mailed statement after markets closed, according to Bloomberg.
Africa’s wealthiest man, Nigerian billionaire Aliko Dangote, told CNBC he knows what could help Nigeria move out of the recession — selling government assets.
“We know what to do,” Dangote said. “I think the real challenge for us is now for us to have the political will in terms of selling some assets,” Dangote told CNBC Africa on Friday.
“I think it’s an easier route than the IMF (International Monetary Fund) or the World Bank to borrow money, because what you need to do is actually to beef up the reserves.” Nigeria’s economy is set to contract on an annual basis in 2016 for the first time in 21 years.
The country’s gross domestic product dropped by 2.06 percent in the second quarter of 2016, after falling 0.36 percent in the previous three months.
Nigeria should have been diversified a long time ago, he said, lamenting its over-reliance on oil. He urged the government to sell assets in some of its joint ventures with the private sector in an open tender process.
He said that Africa Finance Corporation – a development finance institution established in 2007 – would fetch close to $800 million. He said policymakers should sell 100 percent of the country’s stake in Nigeria LNG Limited, a natural resources firm.
“If I had challenges in my company, I would not hesitate to sell assets, to remain afloat, to get to the better times, because it doesn’t make any sense for me to keep any assets and then suffocate the whole organization,” Dangote told CNBC.