Financial experts have attributed the recent downturn in Nigeria’s economy to U.S. President Donald Trump’s designation of Nigeria as a “Country of Particular Concern” (CPC), coupled with his threat of possible military action.

Over the past 10 days, the Nigerian Exchange Limited (NGX) has seen a loss of over N2.8 trillion, while the Naira weakened to N1,437.29 per dollar across official and black markets.

According to economists, the sharp decline is largely due to shaken investor confidence following Trump’s statements.

Mazi Okechukwu Unegbu, former president of the Chartered Institute of Bankers of Nigeria, explained that fear among investors has caused many to halt investment plans, leading to a widespread economic ripple effect. Unegbu, however, expressed doubt that Trump would take direct action against Nigeria. He also noted that the situation presents an opportunity for strategic investments, stressing the need for increased local production and reduced import dependence to stabilize the Naira.

Similarly, Prof. Godwin Oyedokun, economist and university don, highlighted that the CPC designation has raised fears of capital flight, sanctions, and geopolitical risks. He emphasized that markets react swiftly to signals of strained relations with major global powers, impacting both currency and equities markets.

Oyedokun advised Nigerians to avoid panic-driven decisions such as speculative forex purchases or hurried withdrawal of investments, which could worsen volatility. He urged the government to:

• Engage diplomatically with the U.S. to clarify concerns
• Stabilize the economy through coordinated fiscal and monetary policies
• Address governance and human rights issues to align with international standards
• Enhance domestic economic resilience by promoting industrial diversification and productivity

“The immediate economic shock is severe, but it also provides an opportunity for Nigeria to strengthen its global standing through transparency, reform, and strategic engagement,” Oyedokun said.

Experts stress that restoring investor confidence, rather than reacting in panic, is crucial to reversing the current economic downturn.