- Poll Delay: Experts Put Financial Loss at N2.737trn
Financial experts have said the decision of the Independent National Electoral Commission (INEC) to reschedule the general elections will cost businesses in the country about $7.605 billion (N2.737 trillion).
The experts who spoke to ThisDay said the amount represents two per cent of Nigeria’s Gross Domestic Product at US$375 billion.
Mr Bismarck Rewane, Chief Executive of the Financial Derivatives Company Limited, listed the costs associated with the postponement of the elections as direct cost, disruption cost, opportunity cost, consequential cost, and reputational cost.
“So, the fact that everybody stopped work today (Saturday), there is a direct cost of $1.170 billion. Then, there is the disruption cost.
“Disruption cost is that you multiply the daily cost by three. That is because if I had booked a wedding today and now I have to shift the date again. So, that is $1.170 billion multiplied by three.
“Then, there is what is called the opportunity cost. That is, the things people would have done today, which is about 50 per cent of the direct cost. Then, there is what is called the consequential cost, which is usually twice the direct cost. That is a total of almost $8 billion, which is about two per cent of Nigeria’s GDP.”
He later added reputation cost, which he said would be hard to quantify. This he attributed to the damage the election postponement would have on the country’s investors that have their projections altered because of the rescheduling.
“We have investors that have made their projections about this election and they never factored in this postponement,” he said.
He said: “Normally, if you have a project, you ought to be reviewing it every day. So, the fact that they (INEC) knew and announced the postponement five hours to the election, shows total lack of preparedness and it is disappointing.”
“But the hope is that what they haven’t achieved in four years, we can achieve in seven days. Our hope is that they would do something dramatic.”