Capital Flight Threatens Emerging Markets, Warns Nnanna

Joseph Nnanna, the Chief Economist at the Development Bank of Nigeria, addressed concerns regarding capital flight threatening emerging markets amid ongoing global shocks and geopolitical tensions. Speaking at an investment forum organized by VNL Capital Asset Management in Lagos, Nnanna highlighted that the changing global macroeconomic environment is forcing investors, businesses, and policymakers to rethink their strategies.

He noted that global instability, particularly conflicts, has direct implications for inflation and investment flows, which are crucial for economic stability. Nnanna traced the current global volatility to a series of geopolitical shocks that have disrupted supply chains and heightened inflationary pressures, exposing emerging markets to external vulnerabilities.

He encouraged the adoption of local currency trade systems, such as the Pan-African Payment Settlement System (PAPSS), to reduce reliance on the dollar. Recent events, including the killing of a senior official in Tehran, have triggered widespread unrest, further complicating the investment landscape.