Ministers' Sack: Analysts Foresee No Change In Economic Direction, Say It's More Of A Political Play

President Goodluck Jonathan's sack of nine ministers, Wednesday, has been seen by analysts as more of political play than a change in economic direction.

Although the presidency cited the need to reshape the administration as reason, a cross section of analysts who spoke with BusinessDay, say there are political and fiscal risks that will come to play from 2014, which will weigh on the market and even macro-economic stability.

"Since these positions are not of huge policy significance it appears to be more of a political play than a change in economic direction," says Clement Nwankwo, a political analyst at the Abuja-based Policy and Legal Advocacy Centre.

Samir Gadio, emerging market strategist at Standard Bank London, says though the country's asset classes may not be affected in the short-term, there are huge fiscal risks that will be apparent next year.

"We do not expect Nigerian asset classes (Eurobonds, local currency fixed income, equities, FX) to be affected in the short-term. Yet, this is a reminder of the political and subsequently fiscal risks that are likely to become more apparent from 2014, and will eventually weigh on market confidence and even macro-economic stability," he says.

The analysts specifically cited the planning ministry, where a lot of initiatives have been introduced by the outgoing minister, Shamsudeen Usman. They wonder, going by the nation's culture of non-continuation of policies of predecessors, if the plans of the minister will be carried to the letter by the incoming minister.

Shamsudeen Usman is undoubtedly one of the longest serving ministers under the current administration, having being appointed into the National Planning Ministry under late President Umaru Musa Yar' Adua. He is regarded as a major strategist in the Jonathan administration, having played a very strategic role in the setting up of the agenda for performance appraisal as a benchmark for assessing ministers serving in the Jonathan cabinet as well as a performance contract for ministries, departments and agencies of government (MDAs).

Most political watchers believe that the cabinet reshuffle, coming at a time when all eyes are on the general election of 2015, may be informed by the need to whip supporters in line for the party's nomination for the incoming presidential election.

However, other pundits say the exercise is hugely connected with the current crisis rocking the Peoples Democratic Party (PDP) and it is being used to punish opposition within the party.

The nine ministers sacked are ministers of foreign affairs, Olugbenga Ashiru (Ogun); education, Ruqqayatu Rufai (Jigawa); national planning, Shamsudeen Usman (Kano); lands, housing and urban development, Amal Pepple (Rivers); environment, Hadiza Mailafia (Kaduna), and science and technology, Ita Ewa (Cross River).

Others are ministers of state for defence, Olusola Obada (Osun); power, Zainab Kuchi (Niger), and agriculture, Tijani Bukar (Borno).