Weak dollar to boost Nigeria, emerging markets, say experts

BY GODWIN ANYEBE

Experts have predicted that the ongoing trade war will significantly impact the economies of Nigeria and other emerging markets.

Earlier this lastweek, U.S. President Donald Trump imposed 25% tariffs on goods from Mexico and Canada, as well as 20% tariffs on imports from China.

This fresh round of duties on Chinese goods doubled an initial set of tariffs placed on China last month. In response, China imposed additional 15% duties on U.S. imports, including chicken, pork, soy, and beef, and expanded controls on doing business with key U.S. companies. Canada has also responded with its own measures.

Speaking on the Drinks and Mics podcast, Samson Esemuede, MD/CIO of Zrosk, forecasted a slowdown in U.S. growth relative to the rest of the world, regardless of whether the tariffs continue or are lifted.

He expressed skepticism about the uncertainty created by Trump’s policy actions, noting that markets thrive on certainty.

However, Esemuede warned that if the U.S. goes into a recession, it will negatively affect everyone because the dollar will strengthen as there will be a flight to safety.

READ ALSO: Leadership crisis hits Northern CAN

Chief Investment Officer at Cordros Capital LTD, Arnold Dublin-Green, shared a similar view. According to him, a weak dollar is beneficial for emerging markets.

“A weak dollar also means our commodity prices are good. Commodity exports in countries like us, like Ghana (gold), South Africa, Kenya exports flowers. It’s good for Africa. It’s good for EM. So we all have the same view.”

He added, “And that’s the crowded trade that you’re seeing right now. Everyone’s saying, ‘Okay, hold on a minute. It’s a weak dollar we’re going into. Let me look for cheaper assets in countries that export commodities. Our external debts also get serviced, so it’s better for us. So weak dollar, where it’s going right now, looks positive for us.”