Economic Bulletins

The United States and the new World Order Published on Business Day Newspaper – October 5, 2025 After the second world war, the world was devastated. Europe was in ruins. Germany, the aggressor, was disintegrated. The Soviet Union was in disrepair. Japan was in rubbles. But the United States was unscathed. The US was the only country whose production capacity and economic power was not adversely affected by the war. However, the Americans and their leaders learnt a lesson that you cannot live in peace when your neigbhours or allies are in crisis or war. It is a matter of time before the crisis will affect you either by refugees from your neighbours besieging your territory or the aggressor encroaching into your country. It can also affect you by reduced trades and economic relations with your war-ridden neighbours. The World War 11 ravaged the world with destruction and inflicted global poverty, hunger and despair on it. The world gasped for peace, reconstruction, rehabilitation, redirection, purpose, dignity and restoration. There was a leadership vacuum. This was the period of the global outcry of, too little, too late. The great Franklin D. Roosevelt, the 32nd President of America and later his successor, Harry Truman, the 33rd President of America led America to rescue the World. First was the founding of the World Bank and IMF commonly referred to as the Bretton Woods Institutions in 1944 to help rebuild Europe and Japan. Later, American discovered that what Europe required to be rebuilt was not loans but grants hence the Marshall Plan. Gradually the World Bank shifted its focus to restore financial stability and reduce poverty in the world. At the Monetary and Financial conference in Bretton, a new economic order was set up with an agreement that there will be a fixed relationship between currencies. It was decided that the American dollar (the greenback) would be the world’s reserve currency since US was undisputably the world’s most economic power holding two-thirds of the world’s gold reserve. This was followed by the founding of the United Nations in 1945 for global peace and harmony. The Food and Agriculture Organization, an arm of United Nations was founded in 1945 for global food security. The Marshall Plan was implemented in 1947 to restore the economies of Western Europe. It cost the US the sum of $13.1 Billion to implement. It remains undeniably the most benevolent gesture, sacrifice and grant that restored 13 countries of western Europe to economic prosperity and political prominence. The World Health Organization was founded in 1948 to expand universal health coverage. NATO, an alliance of countries of Europe and North America for co-operation in defence and security was founded in 1949.NATO remains the most successful defence alliance in the last 76years. Other global institutions founded by the leadership and most times with the initiatives of US included International Court of Justice, UNESCO, UNICEF, WTO, G7 group of nations, G20 group of nations. USAID is the large heart and giving/philanthropy arm of America. America also initiated the global consensus on global human rights, peace, international law, justice and norms. These institutions helped to maintain relative global peace, stability, reduce inequality and poverty as well as engender economic prosperity in the world. Indeed, there has not been any war of global dimension since 1945.The propensity of territorial acquisition and encroachment was eliminated. Territorial aggression vanished until the Ukraine-Russia war which started in 2022.Yes, there has been wars like Israeli -Arab war, Vietnam war, Israeli-Palestinian war, Iraqi war, Libyan war, Syrian war, Congo DRC, Sudanese War but none has been of global dimension or territorial expansion like the World 11. America organized and held the world together around a series of noble ideas and global multilateral institutions that catered for the needs of the world. When the cold war which started in 1947 ended with the disintegration of the Soviet Union in 1991, America became the sole global superpower. With her triumph in the cold war, America’s brand of capitalism and democracy became the thrust of global economic and political system. Liberalization, free market economy, privatisation, globalization and competition became the recommended anchors of economic policies. The former Communist world emulated and adopted the capitalism principles in their economic management. By 1978, Deng Xiaoping led China to open their economy to the world. They established socialist market economy, developed capital market and promoted stock exchanges. They privatized most of the small and medium sized public enterprises as well as lifted price control. China promoted private investment and accepted foreign direct investment. This was the beginning of China’s industrial revolution and it has become the world’s manufacturing hub today. On its part, Russia after the collapse of the Soviet Union in 1991, under the leadership of President Boris Yetsin opened the Russian economy to the world through a series of post -Soviet reform policies which included price liberalization, currency stabilization, tax reforms, energy sector reforms and economic diversification. Other Asian countries like Japan, India, Singapore, Hong Kong, Taiwan, South Korea, Malaysia, Turkey adopted the free market economy. In fact, these countries became the economic miracles of the 20th Century through the adoption of free market economy. The Washington Consensus became the template of economic development reform framework for the developing nations. The American Dollar (the greenback) became the currency of the world. The world became America’s market. Currency drives trade, trade drives wealth and economic prosperity. American and its Western allies prospered beyond their forecast. As at 1945, the average per capita income in the US was $12,100; by 2024, it was $82,769. It was at the height of this level of economic prosperity in 1999 that President Clinton in his state of the Union address, declared that “the promise of our future is limitless”. America influenced the world in diverse ways. It became the policeman of the world with the highest military and technological and economic might. However, America also incurred the wrath of many of her admirers by the use of its might

Repositioning the Nigeria’s commodities ecosystem with Investments and Securities Act, 2025 Published on Business Day Newspaper – September 28, 2025 Nigeria is a commodities-driven economy. Since the scrapping of the Commodities Boards in 1986 in line with the deregulation of the economy, the Nigerian Agricultural Commodities market was left in the hands of local producers and private operators. The major processors like the Fast-Moving Consumer Goods Companies (FMCGC) like Nestle, Cadbury, Flour Mills, Nigerian Breweries, Olam, Guinness, etc, had to develop their own raw material supply chains by developing their own farms, partnering with some selected farmers to produce for them or work with local aggregators to supply them their needed commodities. This is how private markets like Dawanau grains market in Kano, Birnin-Gwari Grain Market in Kaduna and others developed. In 2015, Securities and Exchange Commission (SEC), Nigeria, launched the Capital Market Masterplan 2015-2025. In that policy document, SEC planned to develop a thriving Commodities trading ecosystem where commodities, standardiSed commodities contracts and futures contract would be traded on licensed commodities exchanges with the concomitant advantages of price discovery, risk management, quality standards, access to capital, assured delivery etc. The above initiative led to the licensing of Commodities Exchanges and the trading of commodities and commodities contracts on formal commodities Exchange. The robust positioning and development of the Commodities Ecosystem as envisaged by the Capital Masterplan was not fully achieved because the then prevailing capital market legislation, Investments and Securities Act, 2007 had limited provisions for a commodities market. In March,2025, Investments and Securities Act, 2025 (ISA, 2025) was enacted which repealed Investments and Securities Act, 2007. ISA, 2025 has 358 sections which are divided into 18 Parts. This new law has completely redefined, repositioned the Nigerian Commodities ecosystem in several ways. Section 357 expanded the definition of Securities beyond shares and bonds to include commodities, futures, contracts, options, and other derivatives or any other instrument deemed as securities which may be transferred by means of any electronic mode etc. Section 224 -239 provided the framework for the commodities exchanges with other ancillary provisions like registration of commodities exchanges with SEC, power to SEC to prescribe minimum share capital for the Commodities exchanges, requirements for the incorporation of commodities exchanges with CAC, the power of commodities exchanges for self-regulation etc. The definition of Commodities was made in its broadest terms in Section 357 to include precious metals, electricity, crude oil and gas, agricultural produce, livestock, currency, solid minerals, digital assets, by-products of commodities, processed commodities products and such other commodities as are customarily traded on the exchange. This definition has deepened the commodities market and enlarged the varieties of commodities that can be traded on an Exchange. Before now, the definition of commodities was restricted to agricultural commodities. On the other hand, a warehouse is described in Section 357 as any commercial space, building, silo, cold chain, tank farm or compressed tank, vessel, vault, structure or other protected enclosure approved by the Commission to be used or useable for the storage or conditioning of commodities or buildings used for storage purposes. One of the challenges that has hindered the development of commodities trading and the Nigerian commodities ecosystem is limited access to capital. The banks, other financial institutions and major investors complain of the absence of a law backing the issuance of warehouse receipts which will act as tradeable and transferable collateral in the funding of commodities transactions. One of the major turning points of the provisions of ISA, 2025 is the recognition of warehouse receipts as tradeable and investment assets. Section 240-267 provides for the operations of warehouses, warehouse owners, collateral management and the issuance of warehouse receipts as tradeable assets. From the foregoing, ISA, 2025 has made robust provisions to reposition the commodities market. It has defined the depth and breadth of the market, the products, market participants, trade instruments, assets and charted prospective market dynamics. With its provisions, it can now be said that apart from the equities, fixed income, OTC, and the new digital markets, the commodities market is the new frontier and investment destination in the Nigerian capital market. However, a law is as effective and impactful as the operators are able to implement it. The coast is now clear and their job is now cut out for the regulator, SEC, the operators and other stakeholders of the commodities ecosystem to take advantage and harness the expansive provisions of ISA, 2025 to create wealth and deepen the commodities ecosystem. SEC has done very well, its management team and staff deserve our commendation for envisioning, coordinating, driving and achieving the promulgation of ISA, 2025. The major five major Commodities Exchanges in Nigeria, namely, Nigerian Commodities Exchange, Afex Commodities Exchange, Lagos Commodities and Futures Exchange (LCFE), Gezawa Exchange and Prime Commodities Exchange have operated for some years. The new ISA, 2025 has enlarged the horizon and the scope of their market. There are many opportunities to explore. Our Agricultural commodities such as Maize, Oil palm, Cocoa, Sorghum, Ginger, Cassava, Rice and fruits are in high demands in the local and international markets. Every community in Nigeria is producing one exportable agricultural commodity or the other. Trading them on the exchanges will raise their demand and create incentives for farmers to produce more. Price volatility will be ameliorated. One of the challenges facing the commodities exchanges is the issue of generating sufficient volumes of commodities to satisfy the demand. Our farmers are usually smallholders. However, involving Aggregators can solve this challenge. Gold is currently being traded on LCFE. Trading Gold and other solid minerals such as Lithium are greenfield waiting to be catalyzed and explored. Three minerals that are shaping the 21st Century like Lithium found in large quantities in Nassarawa and Ekiti states, Noibbium in Kogi, Cobalt in Zamfara and Kaduna can be traded on the Exchanges. Crude oil, refined petroleum like PMS and gas can be traded on the Exchanges as they are being traded in Switzerland, London. Cows, Goats, Sheep, pigs can be