Nigeria on edge as Trump threatens sanctions and military action {Business Africa}
Africa is witnessing major shifts in economics, education, and community development this week—from rising market fears in Nigeria to life-changing opportunities for East African students and women-led energy innovation in Zanzibar. Here are the stories making headlines.
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00:06Welcome to another edition of Business Africa. I'm your host Afol Laki. We know you're the top stories this week
00:17Trump's threats of sanctions and military action hit Nigeria's economy pushing up prices and sparking market fears
00:25From poverty to global opportunity, the Malengo model helps East African students access world-class education and high-paying careers abroad
00:38Empowering women to light up Zanzibar, solar mommas in Tanzania transform rural communities with solar power
00:50Nigeria's economy is reeling after U.S. President Donald Trump threatened potential sanctions and military action accusing the government of failing to protect Christians
01:02The move has shaken investor confidence and raised fears of rise in inflation in one of Africa's largest economies
01:10Kunle Babs report from Abuja
01:13As the cost of goods rises across Nigeria, traders are feeling the strain
01:17Including Matthew Angelo, who runs a store in this market on the outskirts of Abuja, the nation's capital
01:24In the last three weeks, food prices have become more expensive
01:28And as traders, we have to make a profit when we sell
01:31But the buyers are now complaining of high prices
01:35It's not just traders feeling the pressure
01:38Buyers also say everything now costs far more than before
01:41Things are very, very expensive in the market
01:44Things you are buying like before, 1,000 naira, it's now downstream
01:48The United States is one of Nigeria's most important trading partners
01:51But the Trump administration's decision to classify Nigeria as a country of particular concern
01:56Along with threats of military actions has raised fears of sanctions that would restrict trade and foreign funding
02:01For an economy already struggling with record inflation, the shock has made the bad situation worse
02:07We already saw the impact on our market
02:10Within one day, when that announcement was made
02:14The stock market plunged by about 1,400 points
02:19We lost nearly 1.3 trillion in market capitalization
02:24Within a week, we lost nearly 2.3 trillion
02:28You can see how devastating that effect has on our market
02:33Analysts say Nigeria must act fast, using dialogue and diplomacy to ease tensions
02:39What we need to do is not to dismiss the threat from the U.S. president
02:44I think this is the time for us to employ diplomacy, foreign relations
02:50This is what can definitely help us at this time
02:54Nigeria's government says it's engaging Washington diplomatically to prevent sanctions
02:59Reassurance that offers little comfort to millions already struggling with rising prices
03:04To give us more insight, we're joined by Dr. Jewel Arano from Abuja
03:09Thank you for joining us on the show
03:11Tell us how might the ongoing sanction threats affect Nigeria's inflation and investor confidence
03:16Over the past few weeks that that pronouncements were made
03:22Our exchange rate, Naira to dollar, came to an all-time low of about 1,422
03:28Earlier in the month of October
03:31As we speak today, we are north of 1,437 to the U.S. dollars
03:36So you can see clearly that the Naira has lost over 15 to 18 Naira to the U.S. dollar
03:44Within the few days that this pronouncement was made
03:48We have also seen a noticeable decline in investors' confidence in the country
03:53This is already affecting our macroeconomy
03:55We saw it play in the Nigerian stock market
03:58With the Nigerian exchange losing about 1,400 points within the last few weeks
04:03We also saw a whooping decline in our market capitalization
04:10I mean, in just one single day, we lost about 1.9 trillion
04:13Over the last few weeks, we've lost between 2.4 trillion to close to 4 trillion
04:19Since this announcement and threats for sanctions were made by the U.S. government
04:24How dependent is Nigeria on U.S. trade and which sectors are most at risk?
04:29One of the significant impacts the possible sanctions may have on Nigeria is in the health
04:36Because as we speak, the U.S. AID accounts for over $2 billion in assistance to the Nigerian health sector
04:46PEPFA has been doing quite a lot in Nigeria
04:4990% of treatment, you know, provided to
04:53Of the over 2 million Nigerians living with HIV
04:561.6 million of them have been taken care of by intervention from the PEPFA
05:02And that's roughly over 90%
05:04So you can imagine the kind of health crisis that Nigeria will run into
05:10If the U.S. be told that health is an intervention from Nigeria
05:15So it's so critical
05:17And as for the manufacturing ends
05:19Most of some of those equipments that we buy from them
05:22That helps us in the manufacturing industry
05:25Is also going to, you know, significantly affect the industrialization drive
05:29And the expansion of the Nigerian economy
05:31So what urgent steps should Nigeria take to cushion its economy against possible sanctions?
05:38My number one advice would be for the Nigerian government to engage in that bilateral meeting with the U.S. government
05:47Of course, again, they should look towards engaging in congressional outreach
05:54That could bypass even the executive
05:57And then have engagement with some of the congressmen
06:01That have business interests in Nigeria or in Africa
06:05Those who are also sympathetic to some of our causes
06:09So if they're able to engage some of those congressmen
06:13They could go a long way in shaping some of these narratives
06:15Another one could be third-party mediation
06:19We should be able to leverage our relationship with some of these countries
06:24That are very strong allies of the U.S. government
06:27Like the UK, the Gulf states, some of these Gulf states
06:32Saudi, UAE and the rest of them
06:35Which we also have a very good relationship with
06:37If we leverage our relationship to have with them
06:40To mediate on our behalf
06:42I mean, to go a long way
06:45Dr. Arunel, thank you so much for those insights
06:48Thank you for having me
06:49For many young people in East Africa
06:55The dream of attending university ends before it even begins
06:58Not only is the cost of higher education previously high
07:02The promise of high paying for those with love to university qualification
07:06Is no longer guaranteed
07:08But one program is helping students to rewrite their futures
07:12Let's take a look
07:13Across East Africa
07:16The cost of higher education remains a major barrier
07:19In Uganda, for example
07:23Only 1,200 students receive loans each year for higher education
07:27Leaving many talented young people without prospects
07:29Malengo wants to change that
07:33The organization believes that international education migration
07:37Can be a powerful tool in the fight against poverty
07:40And it recently secured over $12.9 million dollars
07:44To expand opportunities for students and refugees
07:47From Kenya, Uganda and Rwanda
07:49Despite concerns about brain drain
07:52Malengo's founders says the data shows the opposite
07:56The academic evidence actually really does point in the direction of brain gain
08:02Remittances are the most obvious ones
08:05But then they also serve as role models
08:07And so they motivate others back home to invest more in their own education
08:11This empowerment is life changing
08:14For students whose families survive on as little as $1.40 a day before entry
08:19Malengo facilitates university and vocational training in Germany
08:22Preparing them for graduate jobs with starting salary above £40,000 per year
08:28The Malengo program relies on the self-sustaining income share agreement model
08:34Which provides full financial support upfront and requires zero repayments
08:38Unless the scholar earns above a minimum income threshold
08:42These repayments only kick in after the students make a high income
08:47So we're not asking them for money if they can't afford it
08:49It is a supportive model where each graduate's success paves the way for the next
08:55Creating a sustainable pathway out of poverty
09:05Nearly half of Zanzibir's 2 million residents still live beyond the reach of electricity grid
09:09But a groundbreaking initiative is changing that by training local women as solo engineers to power homes across Tanzania's semi-autonomous archipelago
09:20Here is more to that report
09:21When darkness fell in rural Zanzibir, smoke-filled oil lamps were once the only source of light for Hamna Salima Nyange's family
09:33Like half of the archipelago's 2 million people, her home wasn't connected to the electricity grid
09:39Her eight children studied by the dim smoky glow
09:41Today that has changed thanks to solar power and a unique initiative putting women at the centre of the solution
09:50Barefoot College International trains middle aged women from villages that aren't electrified
09:55To become solar mamas who install and maintain home lighting systems
10:00Bringing lights to the rural communities
10:03All the villages which were not yet connected by the grid will select women from there will give them light
10:10In Zanzibir alone the program has already brought light to more than 1800 homes
10:16Tate Omari Hamad, now in her 60s, remembers how daunting the work seemed at first
10:21The tools seemed difficult to use at first
10:25But after a short time I managed to handle them
10:29The shift to solar power is also improving health
10:34Kerosene lamps, once common, cause lung problems, eye irritation, burns and house fires
10:40Doctors say they often treat children injured by them
10:43Despite funding cuts and resistance to women in technical roles
10:47Barefoot College is spreading across Africa from Madagascar to Malawi
10:50That brings us to the end of this edition of Business Africa
10:58Thank you for watching
11:00For more business stories and the latest updates
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