Strengthening Naira Value By Dr kenny Odugbemi

Strengthening Naira Value

The floating of Nigeria's currency Naira was eminently discredited by most radical Financial analyst  as being ill-concieved without proper cushioning approach and major buffer in our depleting foreing reserve ,just coming out of financial wrecklessness and clueless last administration, it's obvious that if we continue in trajectory of have N300 abitrage, where we have emergency billionaire with portfolio springing up almost every day, without any real impact in any exchange of goods and services,this is a major signal of collapse collapse of our National Financial network,the introduction of floatation for Naira to find it's level, is a major check and balance to checkmate dubious speculators who are bent of taking Nigeria on verge of economic collapse like Venezuela,any administration worth it's onion as reasonable must stop the litany of insanity that is gaining ground catching wild fire to destroy the Nigerian economy

Naira is a means of exchange,and Vehicle of exchange of goods and services on one hand we give kudo to CBN for taking charge using such temporary stop of speculative arbitrage.

*FMF/CBN financial ideology

✓Domestic resources mobilization

✓Prudent management of finance

Alignment of monetary and fiscal policy

✓Encouragement of PFI's,DFI's to invest in diverse economic and profit driven opportunities

Our total public debt is over N87trn,with new addition of N1trn being accrued on Eurobon

Crude oil price in international market is $86.

We are far below OPEC quota as we oscillate between (1.2-1.4)mbpd,with production cost of $48,,We are left to share the balance with other Multinational oil, leaving no appreciable increase in our foreign reserve and revenue from oil account for over 90% og our forex.

*Naira is highly volatile due to our increasing foreign debt and local debt, depreciation, devaluation,insecurity and financial leakages

*CBN intervention

These includes and not limited to the following

✓BDC reduction licencees from 5000 to1500, which is still too high to manage

✓Continuous mopping of Naira across all financial linkages

✓Termination of cryptocurrency and Binance who are the major speculators

✓Proposed recapitalization of local.bank to meet N1TRN in preparation of our decade projectuon of $1trn GDP


All these are regarded as low hanging fruits to strengthen Naira

Secondary intervention

✓We need an enhanced strategic relationship with the following stakeholders

Foreign Multinational financial institution-

*Worldbank

*IMF, 

*Sovereign trust. bank

*WTO 

and others like Afriexim etc and our local banks

*Effect of dollarisation

✓We need to dimistify usage of dollar transaction I. Our daily life

Reduce all our need to our domestic environment

Complete paradigm shift to eating and drinking what we can produce and wearing cloth only from our textile just like India did to attain self sufficiency


Conclusion

We now need to address other fundamental that will strengthen Naira

Import substitution to reduce our dependency

Export substitution to increase export of more non oil related goods and services

We in addition need new industrial policy that will reflect our current realities and stem up fierce competition against smuggled foreign goods.