How Brexit Will Affect Nigeria, | Independent Newspapers Limited
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How Brexit Will Affect Nigeria,

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Posted: Jun 26, 2016 at 6:18 am   /   by   /   comments (0)

By SBM Intelligence

 

People talk about political earthquakes.

The UK’s decision to end its relationship with the European Union is not so much an earthquake, just for Britain, but a tsunami for the whole world. Britain’s place in the world will shift, and the United Kingdom of Great Britain and Northern Ireland itself, may come to an end. The vote within the UK highlighted deep divisions.

With the exception of London, England voted massively to leave the EU. Scotland, which only a year ago, voted by a thin margin to remain in the UK, voted by almost 2 to 1 to remain in the EU. Wales voted to leave, while Northern Ireland voted to remain. These divisions have already had an immediate impact as politicians in both Scotland and Northern Ireland have begun to take positions regarding the continued stay of their countries in the UK.

We may well see Scotland hold another referendum, and leave the UK in short order. Northern Ireland may decide to join the Republic of Ireland, itself, an EU country. Economically, the pound sterling has already taken a battering, falling to its lowest level for 31 years. There is going to be volatility as the UK eventually comes to terms with being a smaller economy.

With the decrease in the size of its economy, and possibly reach of its economy, Westminster will have to find other forms of revenue. It will either have to raise taxes, or cut its budget, neither decision will be taken lightly, and either one taken, will feed into the political mood in the UK home countries.

How does this affect Nigeria? In the short-term, being our former imperial rulers, the UK has been one of Nigeria’s traditional trading partners, and because of a shared language, has remained a destination of choice for most Nigerians. Our elite are deeply ingrained in the UK, and have bought into that country very deeply. With a population of 201,184 according to the 2011 Census, the UK is home to one of the largest concentrations of Nigerians outside Nigeria.

Issuance of visas to Nigerians may take a hit as immigration was one of the key issues in the Brexit vote. However, in reality, the UK is not Nigeria’s biggest trading partner, even in Europe. As a destination for Nigerian exports, the UK at $5.21 billion comes fourth behind Spain ($9.7 billion), the Netherlands ($5.59 billion) and France ($5.48 billion). As a source for Nigerian imports, the UK at $2.28 billion, comes third behind the Netherlands ($3.4 billion) and Belgium ($2.59 billion).

These realities, and the UK’s diminished status, have to be taken into account in the renegotiation of trade agreements that are sure to come. Nigeria must look to increase her ties with the bigger market that is the EU, while taking into account the cultural ties, especially the monies spent by Nigerians in British schools. According to the Senate Committee on Tertiary Institution and Tertiary Education Trust Fund, Nigeria currently spends over $2 billion annually as capital flight on education abroad, with the UK chalking up the lion share of those education dollars as 66 per cent of Nigerian foreign students attend universities in the UK, according to Euromonitor International.

Nigerians received a total of $3.7 billion from relatives residing in the UK in remittances in 2015, according to the Global Knowledge Partnership on Migration and Development, second only to the United States. Also, a contracting UK economy will have a deep impact on aid programmes to Nigeria, especially DFID interventions, which have been a burning political issue in the UK. Politically, Westminster has always been a strong supporter of Abuja.

This will not change. However, the strength of that support will wane. This will give some impetus to separatist movements within Nigeria. For a start, the Indigenous People of Biafra, far and away the loudest separatist movement in Nigeria today, has a very large diaspora support in the UK. Should the political effects of the Brexit happen and the UK eventually disintegrate, IPOB, and its supporters will only get louder in their demands for a similar referendum here, and England, the only part of the UK that may maintain an interest in meddling in Nigerian affairs, will no longer be in a position to offer unconditional support to Abuja.

The case for self-determination would have been made stronger, and Nigeria may end up having to conduct referendums of its own, with uncertain results.