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  • Naira rising slowly, steadily!

    Naira rising slowly, steadily!

    A raft of policy initiatives being implemented by the Central Bank of Nigeria (CBN) lately has seen the gradual but positive rebirth of the trembling but weak naira, reports Ibrahim Apekhade Yusuf

    According to received wisdom out there, the naira is bouncing back in a manner of speaking, thanks to the plethora of policies being implemented by the apex bank.

    Chief among the policies by the apex bank is the commencement of the clearance of forex backlogs to banks, airlines and other parties, The Nation can authoritatively report.

    The news media was awash with reports that the apex bank had begun to clear some of its foreign exchange backlogs.

    Hints that the federal government was determined to turn the tide in the way things are was affirmed by President Bola Tinubu when he addressed the packed audience at the 29th Nigerian Economic Summit in Abuja recently.

    Tinubu at the forum acknowledged the challenges faced by the business community in the financial markets and assured them of additional foreign exchange liquidity to restore market confidence.

    On clearing the FX backlog which has drained investor confidence, the president said, “All foreign exchange future contracts will be honoured by this government.”

    “I assure you we have a line of sight to the foreign exchange we need to refloat this economy. And we will get it,” he added.

    In the view of the Minister of Finance, Wale Edun, the amount of overdue forward payments is estimated at $6.7 billion.

    From available information, the CBN reportedly settled some of its FX obligations with certain banks such as Citibank, Stanbic IBTC, Standard Chartered, among others. This move seemed to have added some impetus to the naira.

    In separate statements obtained by The Nation, some of the beneficiary banks confirmed the payment of FX forwards by the CBN.

    Stanbic IBTC in a statement said, “Yesterday, the apex bank began clearing the backlog of outstanding Retail SMIS obligations. The total amount cleared is yet to be ascertained.”

    Also, Citi in a statement issued by its Treasury and Trade Solutions department, exclaimed, “CBN HAS DONE IT.”

    The bank impressed on its customers the need to liaise with their respective Relationship Manager or Trade Service Professional for clarification on the matter.

    The circular titled ‘Settlement of Matured FX Forwards by CBN’, said, “We have been directed to inform you that the CBN has delivered all outstanding matured forward forex.

    “We thank you for your patience and cooperation and value you for your business and partnership. Please speak with your Relationship Manager or your Trade Service Professional for clarification and additional details.

    “It is a gradual payment that was done secretly, CBN didn’t make a fuss about it. It started yesterday and continued all through the night.”

    The source added that paid banks represent a small percentage of outstanding FX forwards with the largest percentage mostly in tier 1 banks yet to be settled.

    He, however, expressed hope that they will be settled in the next tranche, maybe with a lower percentage.

    The CEO of a Tier 2 bank who does not want his name mentioned, also confirmed that his bank received $100m from the CBN, expressing confidence that the outstanding would soon be settled.

    He said, “As I speak with you, our bank has been credited with $100m by the Central Bank and we are confident of getting the balance soonest. This is a positive development for the economy and trade in particular.”

    However, there are commercial banks in the system that are not happy with the CBN because they have yet to receive any credit alert.

    Thumbs up for CBN

    While commenting on the development, the Association of Corporate Treasurers of Nigeria said the decision to settle matured foreign exchange forwards is a significant step in promoting stability and confidence in Nigeria’s foreign exchange market.

    The association comprising all corporate treasurers in Nigeria in a statement obtained by our correspondent said the action demonstrates the apex bank’s commitment to ensuring the ease of doing business and reducing uncertainty in the market.

    A statement signed by the association president, Adeyinka Ogunnubi, which reads in part, he said, “The ACTN believe that the timely settlement of matured FX forwards is crucial for our members and the broader business community. It allows our corporate treasurers to efficiently manage their foreign exchange risks and plan for their financial obligations.

    “We recognise the CBN’s responsiveness to the concerns of businesses and its continued efforts to implement policies that enhance the resilience of the Nigerian financial system.

    “As an association dedicated to advancing best practices in corporate treasury management, ACTN will continue to work closely with regulatory authorities to support policies that foster transparency, predictability, and stability in Nigeria’s financial markets.”

    The Director General of the Nigeria Employers Consultative Association, Mr Wale Oyerinde is also on the same page with Ogunnubi.

    According to the NECA boss, the actions of the new administration of the CBN have shown tremendous improvement in the FX management.

    He said, “Well, there is no doubt that the economy lacked the requisite FOREX to completely close down the outstanding matured FX in banks. However, the actions of the new administration through the CBN have shown tremendous improvement in FX management, which was a huge challenge in the last administration. The current CBN management has stepped up forex intervention in the FOREX market, which is now accounting for 75 per cent delivery of the matured FX. While we commend this action and the determination to clear all the standings, we hope that this effort will be sustained. The sustainability of this intervention will largely depend on the guarantee of FOREX inflow from all available sources. With stable, focused and growth-induced reforms, another opportunity for FOREX like increased FDI will be enhanced,” Oyerinde added.

    Also speaking, the immediate Vice President of the Manufacturers Association of Nigeria, Lagos Zone, Mr John Aluya, said he is yet to be informed of any of their members whose backlogs have been cleared.

    Aluya, who is also a current member of the National Council of MAN, noted that if the initiative is properly implemented, it will help to improve the system. But he said that commercial banks may likely frustrate the move by the apex bank.

    “But if this move is well implemented, it could be an initiative that could be done in such a way that it will be an improvement in the system. But I will tell you that for every step the CBN takes the big elephants in the house are always there to truncate it and if the CBN is not careful the big elephants will also truncate this move that they are about to make. The big elephants I mean are the commercial banks. They are the people who have always made our exchange rate unreliable because they benefit from it. When you talk of the I&E window you bid for it but manufacturers do not enjoy the window, because the banks will tell you that you will bid for I&E at CBN rate, and they will give you another account to pay the difference into and that is truncating the system.”

    The Chairman of the Nigerian Economic Summit Group, Mr. Niyi Yusuf, said, “This is in the news and it’s useful that the administration is delivering on its public commitments which should help to improve public confidence. It’s a good signal and a right step to rebuilding trust and confidence,” he concluded.

    The Chairman of the Nigerian Association of Small and Medium Enterprises, South-West region Chairman, Solomon Aderoju, queried if the payments would get to the end users.

    He said, “Will it get to the end users? How much have they cleared? If it will get to the importers and the end users, then, it’s a good development. If not, then, it’s still the same story. Nigeria’s problem is multidimensional. Even with the 43 items that they removed, are the importers now getting the forex from the banks? I am sure they are still using the black market.

    “Over the years, we have been using the foreign reserve. The reserve has been depleting over the years because we are not adding anything to export. It’s the only export that can add to the reserve. So, it’s a deficit account.”

    $10b largesse to uplift naira

    The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said that the country was expecting about $10bn inflows in the nearest term, which would help to clear foreign exchange backlog and stabilise the naira.

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    Finally naira rebounds

    In what may have become a positive reawakening, the naira has risen to N1,120 against the dollar as the foreign exchange market reacted to news that the CBN has begun to clear some of its FX backlog on Thursday.

    This represents an appreciation of N50 or 4.27 per cent compared to the N1,170 it traded for last Wednesday.

    A cross section of local forex dealers during a chat with our correspondent in Lagos revealed that the naira was recovering well after making a quick recovery from N1,170/dollar in the morning to close trading at N1,120/dollar.

    The naira in Lagos recorded an average of 1,120/$ on Thursday, appreciating to 1,040/$ and 1,125/$ in different locations on Thursday. It traded at 1,170/$ on Wednesday. In Abuja, the average price of the naira against the dollar was 1,200.

    Also the president of the Association of Bureaux De Change Operators of Nigeria, Aminu Gwadabe, confirmed that the dollar closed trading at N1,120/dollar on Thursday.

    He attributed this to the CBN’s move to clear some of its backlog.

    He said, “It is closing at N1, 120. Even yesterday it came down to N1,150. Today, it started at N1,170 but it is closing at N1,120. Yes, this is because of the CBN’s move to clear its backlogs. There is a kind signal in the market. The CBN should continue to make clarifications.”

    He said, “The naira is improving but very high compared to what we were trading before the current administration.”

    He further lamented that there was a significant crash in the parallel market, forcing traders to stop sales of dollars.

    He said, “We experienced significant loss today as the dollar suddenly crashed. Most of us have stopped for now to see what the market holds. If it reduces tomorrow, we may have to sell at a loss.”

    JP Morgan’s blessed assurance on rebirth of the naira

    Expectedly, JPMorgan Chase & Co has hinted that the Naira to US dollar exchange rate will eventually strengthen towards N850 by year-end as the combination of tighter policy, as well as more attractive rates and FX levels deter incremental dollarisation and perhaps attracts some foreign capital.

    This is even as JPMorgan expects Nigerian authorities to maintain a willingness for greater flexibility of the exchange rate. Though it said that while a strengthened naira against US dollar exchange rate is crucial, “the large backlog of unmet FX demand and low net FX reserves makes the job challenging”.

    “The Central Bank of Nigeria (CBN) appears willing to once again allow a flexible exchange rate without the use of moral suasion to limit the upside. This was initially the case during the first attempt at re-caliberating the FX market, however those efforts lost steam due to inflation concerns.

    “We believe recent efforts to restore a flexible FX regime may be sustained given the willingness to accompany it with tighter monetary conditions. The interbank FX rate has risen in recent days to over N900, from N750, thereby significantly closing the gap to the parallel rate which is now just above N1,000,” JPMorgan Chase & Co noted in its November 1 note titled “Nigeria local markets strategy: Getting set for re-opening.”

    While noting that unifying the various FX windows and eliminating the longstanding list of ineligible transactions helps simplify the FX policy framework, JPMorgan said that due to still limited FX liquidity in the official market, and the fact that naira isn’t a fully convertible currency, “some FX demand will inevitably find its way to the parallel market.”

    “In our opinion, when authorities refer to the FX backlog, they are actually referring to US $6.8billion in FX forward commitments which the central bank has not honored – the majority of which has been covered by commercial banks.

    “However, we estimate there is up to a further $$3-4billion (probably less given the FX adjustment) in unmet FX demand needed for goods and services imports. CBN will need to clear both backlogs, a difficult task given the low levels of net FX reserves.

    “We previously estimated that Nigeria’s net FX reserves could be as low as $3.7billion at the end of 2022. We do not have new information about the central banks short-term contingent liabilities, however gross FX reserves have further declined by $4.1billion through this year and now amount to around $33.3billion, suggesting the net position could be lower,” JPMorgan noted further.

    According to JP Morgan, “The government is hoping to secure up to US$10bn in FX inflows over coming months in a bid to clear a substantial portion of the FX backlog and improve market liquidity. Media reports suggest this is split between US$7bn from the securitization of future gas dividends to the government, and US$3bn from the securitization of future oil-related dividends.

    “The ability of the government to raise such amounts via these channels may be challenging given the US$3bn expected from Afrexim has been delayed for months, while Nigeria LNG Limited’s historical dividends to the government have fallen well short of US$2bn annually. It also doesn’t help that the NNLG Managing Director recently confirmed that the company is operating at 50% capacity on its Train 1-6 fields and plans to expand its processing capacity with Train 8 is no longer feasible. “

    That said, the government appears to be in the final stages of agreeing a US$3.5bn package with the World Bank (part of which would be direct budget support, while the rest will be project-linked) with other reports suggesting funding from sovereign wealth funds in the middle east may be on the cards.”

    “Indeed, as we have noted previously, the CBN appears to be in the process of normalizing monetary policy, despite the fact that a monetary policy committee (MPC) meeting hasn’t held since July. Assuming the OMO auctions are held on a more regular basis, we expect it will result in tighter liquidity conditions, which will in turn help slow dollar demand,” JPMorgan Chase & Co said.

    JPMorgan Chase & Co said its economists expect the CBN to keep the policy rate unchanged at 18.75percent for the foreseeable future. “While optically and for signalling purposes, this may appear odd, especially if the OMO rate is set above 21percent for an extended period, it may be a necessary compromise given the political sensitivity and preference for lower interest rates (recall the President’s inauguration speech signaling the need for lower interest rates, see here) particularly as the MPR should typically serve as the base rate for bank loans. Similarly, the CBN might also remain cost conscious by not wanting to pay significantly higher rates on both OMOs and SDFs. In effect, the policy rate won’t matter if short-term rates can move nearer 25percent in order to narrow the current negative real rates while continuous OMO auctions and CRR debits can help to further tighten liquidity conditions, ease FX and inflationary pressures,” it noted.

    It noted further that given that domestic debt makes up around 62percent of Nigeria public sector debt, “a further rise in interest rates will increase the interest burden, even as authorities explore ways of improving oil and non-oil revenues. Higher interest rates will also come at a cost to the central bank, a cost which will eventually be absorbed by the federal government.”

  • Naira sustains rally after $7b forex backlog clearance

    Naira sustains rally after $7b forex backlog clearance

    The naira yesterday sustained week-long rally after the Central Bank of Nigeria (CBN) and commercial banks cleared $7 billion forex forward backlog that had been pending for months.

    The local currency, which crossed N1,350/$1 at the parallel market a week ago, strengthened to N1,035/$1, with analysts predicting further firming-up in the weeks ahead.

    Data from FMDQ Exchange showed that at the Investors and Exporters (I&E) window- official market- the local currency also rallied to N776.14/$1 with $99 million transaction volume.

    Managing Director, Forward Marketing Bureau de Change Ltd., which compiles exchange rate data, Abubakar Mohammed, said CBN’s announcement that it cleared the matured foreign currency contracts for some lenders prompted some speculators to offer their dollars for sale, boosting supply.

    The backlog was a significant challenge that the central bank has been “battling with in the last three and four years; there is no way this will not prop up the value of the naira,” he said.

    Another BDC operator in central Lagos, ‘Biodun Ganiyu, said the matured foreign-currency forward contracts have for years hampered dollar inflows as investors fear repatriation of funds on maturity.

    “I expected the naira recovery to continue after the forex backlog clearance. It gives more confidence to domestic and foreign investors on state of the economy,” he said.

    Looking ahead, Managing Director at Afrinvest Research, Abiodun Keripe, said the naira will witness mild succor at both the official and parallel markets in November owing to the expectation of improved supply by the CBN as efforts to secure $10 billion funding support reach advanced stages.

    On how to stabilise the naira, President, Association of Bureaux De Change Operators of Nigeria (ABCON), Dr. Aminu Gwadabe, advised the Federal Government to enhance financial intelligence by tracking people with proceeds of corruption to sanitise the market.

    He said many of the people with proceeds from corruption are the ones putting pressure on the forex market through manipulative actions.

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    “The naira is depreciating not by forces of demand and supply, but by the collective action and impact of the people with illicit funds,” he said.

    Former Executive Director, Keystone Bank Limited, Richard Obire advised that Nigeria’s heavy and skewed outward-oriented consumption of goods and services as seen in decades of long substantial bills for food and energy imports should be reversed to save the naira.

    Also, the massive corruption-driven capital outflows which in turn severely damages Nigeria’s capacity to produce at scale that will enable the country to fully engage its large population to create widespread prosperity works against the naira.

    On ways to strengthen the naira, he advised that in the short-term, there is need to find non-market damaging ways to increase the supply of hard currencies and reducing the demand for same.

    He said the insecurity that is hampering food production needs to be tackled with a sense of urgency and effectiveness.

    “Priority should be given through deploying pragmatic incentive programmes to drive up the volume of food products for domestic consumption and industrial use to reduce our food import bill.

    “All government consumption expenditures requiring the use of hard currencies should be suspended indefinitely, starting now,” he advised.

    Continuing, Obire said the turnaround maintenance (TAM) status of refineries in Port Harcourt and Warri should be appraised immediately.

    “Effort should be focused on the one which can begin producing quicker. The other one should be made to be up and running, not long after. This should reduce required forex for fuel imports.

    “In the long term, only a strong economy will produce a stable currency. To achieve this will require addressing the fundamental structural defects in our political-economy hampering an accelerated transition from an outward consumption oriented economy into a mainly balanced production driven one,” he said.

  • How to make the naira stronger

    How to make the naira stronger

    By Jennifer Iwu

    A foreign rating agency in a recent report joined Nigerians in bemoaning the fate that has befallen the nation’s legal tender, the Naira, which had exceeded the N1000 to the dollar threshold but seems to be recovering slowly at a little above N800 to the dollar.

     The currency is perceived, even by local experts as the most devalued anywhere in Africa. In the early 1980s, the currency was strong enough to be accepted as a medium of exchange in some international finance capitals. Suddenly that achievement was frittered away by administrations that did not see the wisdom in building on the attainment.

    It is from that perspective that its present state of affairs as regards its value in the currency market is considered inherently disheartening.

    This problem with the Naira is not a recent development. There was a time that the currency was treated with the decency it deserved in its competition with others elsewhere. In those days that are considered the golden era of the nation’s economy, the productive sector of the country was booming, at least by African standards. Investors were flowing in to take advantage of the favourable investment climate in the country then.

    All sectors of the economy were operating at a level that made the country a must go business destination. The agricultural sector especially was making its impact to the point that most raw materials were sourced locally.

    The textile factories survived on the lush cotton farms in parts of the North, the automotive companies that sourced a sizeable portion of their inputs from Nigeria were doing good business, transferring technology and creating jobs. Tyre producing companies promoted the cultivation of rubber in parts of the south-south and were empowering local, small holder farmers.

    There were many industries producing household products most of which sourced their raw materials from cocoa, palm oil and groundnut all grown in the country. Food drinks were not left out in that drive to really grow the economy and build its Gross domestic Product (GDP). The success of that effort reflected on the value of the Naira, there was minimal stress on the local currency. Foreign currencies were not as dominant as they are today.

    Soon to emerge was the cankerworm known as policy inconsistency and its twin sister, ill-advised import-substitution preferences. These succeeded in subduing the agricultural sector and, by implication, the industries that relied on it. This was made possible by the years of easy petro-dollar that lulled everyone into a state of complacency, especially policy-makers, who began to feel that money was not the problem, but how and on what to spend it.

    Before the nation realized sufficiently that the economy was on a downward spiral that kept chipping off the value of the Naira, it was already too late as there was not enough dollar and pound to finance the indecently acquired taste for imported goods and services.

    What happened to the Naira started when production declined and the nation lost its grip on the productive sectors. Factory spaces became churches and Nigerians started clapping and singing in them instead of putting them into productive use. Textile companies folded up and became car dealerships. A lot of measures were put in place to manage the drift which ended up compounding the problem that is presently trying to strangulate the Naira.

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    To the consternation of the citizenry already used to bank transactions when the need for foreign currencies arose, black market emerged from nowhere and took over the space. Their rates have become the benchmark for assessing the true value of the Naira. That market has defied every effort by the regulatory agency, the Central Bank of Nigeria (CBN), to control its dominance of the foreign exchange market, to no avail. Instead, round-tripping, a process of obtaining foreign currencies at the official rate and selling them at the black market at higher rates, has continued unabated.

    The situation is made worse by the deposit money banks (DMBs) who randomly refer their customers to this market if they need foreign currency above a certain limit. Curiously, this so-called black market, an outlet for underhand transactions elsewhere patronized by shady characters, is accepted as the real deal in Nigeria.

    Soon the political class joined the fray and started hoarding the dollar for political purposes denying the productive sector the foreign exchange it desperately needs for importation of raw materials and spares.

    All these have contributed to the weakening of the Naira with the disastrous effect that it is having on the economy generally. Cost of living has become outrageously high. Businesses are struggling to keep their heads above water.

    Sadly, the Central of Nigeria (CBN) is being made the fall guy as everyone expects it to satisfy their foreign exchange requirements without stopping to ask the pertinent question, how can the nation generate the foreign exchange enough to go round? The CBN, like any other elsewhere, is not in the business of mass producing any foreign currency for that matter. The only way to generate this hard currency is to expand and increase the inflow of foreign exchange through productive exercises for export. Presently, not much of this activity is going on. There is no quick way out of the quagmire other than for the nation to reorder its priorities. Already, the nation’s foreign reserve is depleted. What this means is that the nation must look inwards if the present situation is to be reversed.

    Without productive activity, there is not much anyone can do to save a situation that is becoming increasingly dire. If the nation desperately needs foreign exchange as it presently does, then the citizens must necessarily roll up their sleeves and work hard to produce not just for local consumption but also for export.

    The continued importation of petroleum products is a drain on scarce foreign exchange. Non-essentials like medical and educational tourism at state expense added a dangerous mix that is utterly unhelpful.

    At a certain time, the CBN toyed with the idea of bringing the Chinese Yuan as an added currency to ease the pressure on the dollar. The nation was upbeat just as the CBN warned that even that must have to be earned. In other words, without a strong productive base the country still has a long way to ease itself out of the logjam of low currency value and its impact on the economy.

    What this suggests as a solution is a serious and determined approach to the diversification of the economy away from hydrocarbon. This is a policy that must necessarily escape the lip service it is presently receiving. Non-oil sectors such as solid minerals, agriculture and tourism must take the front burner of economic discourse if the Naira is to regain it stability in the open market.

    As at today, the nation is an import-dependent country. We import everything from apples, biscuits to tooth pick. But the economy must come off its import dependency malaise and focus on economic activities that promote local sourcing of raw materials and produce for export. That is the way out of what is going on now. That is the way to restore the value and prestige of the Naira. What is required is the political will to do the needful.    

    •Iwu is a retired banker based in Lagos

  • Naira pressure eases on $10b forex inflows prospect 

    Naira pressure eases on $10b forex inflows prospect 

    • Forex dealers: Naira stability sustainable 

    The pressure on the naira eased at the weekend after disclosure on sources of the expected $10 billion forex inflows announced by the Federal Government.

    The expected dollar inflow has not only raised market confidence, but also pushed the Naira to record significant gains across forex segments. The Naira closed the week at N1,145/$1 at the parallel market, and N789.94/$ at the Investors and Exporters (I&E) window where over $400 million transactions were consummated on Friday. 

    Friday’s closure was a massive appreciation from the N1,315/$1 it exchanged at the parallel market on Thursday.

    Finance Minister and Co-ordinating Minister for the Economy, Mr. Wale Edun, had announced that Nigeria expects a $10 billion FX inflow in the next few weeks to ease liquidity in a foreign exchange market. About $7 billion is being expected from Nigerian Liquefied Natural Gas (NLNG) dividend securitisation by a consortium of lenders led by Standard Chartered Bank this next week.

    Another $3 billion is expected from the over two-month-old emergency loan secured by Nigerian National Petroleum Company Limited (NNPCL) from the African Export-Import Bank (Afreximbank).

    Both deals will bring the cumulative short-term forex inflows to the economy to $10 billion, which analysts said is enough liquidity to put the naira on sustainable path of recovery.

    In a note to investors, Managing Director of Afrinvest Research, Biodun Keripe, linked the naira appreciation to clarity on the sources of the anticipated $10 billion inflows by the Federal Government. 

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    The Afrinvest Weekly Market report released on Friday said: “Consequently, activity level in the Nigeria Autonomous Foreign Exchange Market (NAFEM) improved 3.3 per cent week-on-week to $440.4 million. Also, the Naira strengthened 2.3 per cent week-on-week to N789.94/$1 at the NAFEM window. Similarly, in the parallel market, Naira appreciated 0.9 per cent week-on-week to N1,145/$1.

    “At the FMDQ Securities Exchange, Forex Contract Market, the total value of open contracts dipped 15.2 per cent, week-on-week to $4.2 billion. This came on the back of matured October 2023 instrument valued at $744.8 million. In the week ahead, we anticipate mild gains for the naira following expected dollar inflows.”

    Speaking on the state of the forex market, President, Association of Bureaux De Change Operators of Nigeria (ABCON), Dr. Aminu Gwadabe, said Naira’s ongoing rally is sustainable given the gradual return of confidence in the market. According to him, the depreciation of the Naira was not truly market-based, but artificial and will correct with improved liquidity.

    Gwadabe described the efforts of the Federal Government toward ensuring the rebound of the naira as laudable.

    He said: “The depreciation of the naira is out of speculation, currency substitution and loss of confidence in the market. That confidence is gradually retuning and we expect to see further appreciation of the naira this week and beyond.

    “The authorities’ ability to induce confidence in the market is commendable and should be sustained. It is also important to note that the Naira is just trying to discover its place as it is difficult to control price mechanisms by fiat in a competitive and liberalised market. The Naira rebound will be sustained in the market despite resistance by speculators who are already counting their losses.”

  • Foreign reserves’ buildup raises hope on naira

    Foreign reserves’ buildup raises hope on naira

    Nigeria’s foreign exchange (forex) outlook has improved as increase in reserves and naira appreciation raised optimism on the nation’s currency management.

    The external reserves recorded its third consecutive weekly accretion at the weekend with the gross reserves increasing by $51.97 million to close at $33.31 billion.

    Three weeks ago, the forex reserves had recorded a modest increase of $1.72 million to close the week at $33.22 billion, the first accretion since May 19, 2023.

    The naira also appreciated by 2.3 per cent to close weekend at N789.94 per dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM). Total turnover at the NAFEM also improved by 3.3 per cent to $440.4 million. Trades were consummated within the N644.00 and N981.00 per dollar band.

    Nigeria’s external reserves, which closed 2022 at about $37.08 billion, had picked at $37.211 billion on January 16, 2023. It has since suffered a streak of long losses, the latest being its five-month continuous decline since May 2023.

    Economic experts were unanimous yesterday that the buildup in external reserves is a good indication for the country’s currency management and macro-economic stability.

    Analysts expected that changes in forex management rules, steady improvement in crude oil production and upbeat in global oil price could help the country mitigate its volatile forex situation.

    Managing Director, Arthur Steven Asset Management, Mr. Olatunde Amolegbe, said the increase in forex reserves will support government’s current efforts aimed at fostering liquidity and stability at the forex market.

    “The increase is a positive signal for improved liquidity in the forex market. This should ultimately help to stabilize the exchange rate of the naira or even strengthen it against the dollar if the increase is steady and consistent,” he said.

    Amolegbe however, noted that government would need to improve on existing forex market structure.

    According to him, a structure that is more transparent, and discourages arbitrage and rent seeking will need to be put in place as a matter of urgency.

    President, Association of Capital Market Academics in Nigeria, Prof Uche Uwaleke said the increase places the CBN in a stronger position to meet forex obligations as well as intervene in the forex market.

    “If this development is sustained, we are likely to witness an appreciation of the naira in the forex market and more stability in the exchange rate following improved liquidity. This is one positive development capable of keeping away destructive speculators from the forex market,” he said.

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    Uche explained that the increase could be due to increase in oil revenue as a result of the rise in crude oil price and the recent increase in crude oil production.

    He added that the external reserves could also increase if the government has received any of the concessional loans it has negotiated with the World Bank.

    Most analysts said the Central Bank of Nigeria (CBN) appeared to be making the right moves on the country’s forex management, although there remains concerns about possible gap in forex supply.

    Senior Research Analyst, FXTM, Mr. Lukman Otunuga, said the removal of forex restrictions on 43 items had sparked some optimism with more dollar supply to the formal market.

    He said the “development offered an opportunity for the naira to fight”, noting the international endorsements that had trailed recent forex policies by the CBN.

    Otunuga pointed out that the resolution of the forex crisis remains a key point in addressing Nigeria’s rising inflationary trend.

    According to him, the inflation menace has continued to draw strength from the removal of fuel subsidies, devaluation of the official naira and security issues in food production regions.

    “This vicious cycle of rising inflation and interest rates certainly presents a risk to Nigeria’s fragile economy,” Otunuga said.

    He noted that oil prices, which gained about seven per cent last week, has the potential to extend gains due to escalating tensions in the Middle East, home to almost a third of global oil supply.

    “Bulls are likely to draw additional strength from the U.S. tightening its sanctions against Russian crude exports. Supply concerns remain rife with growing concerns over the conflict between Israel and Hamas spreading through the region, resulting in major disruptions in an already tight market.

    “While oil is likely to remain supported by supply-side factors, the demand side of the equation may create headwinds down the road – especially when factoring global recession fears. Looking at the technical picture, Brent bulls have a steep hill to climb before heading anywhere near $100. But the daily close above $90 last Friday could be the first signs of bulls reclaiming lost territory,” Otunuga said.

    Most analysts agreed that the removal of forex restriction and recent pronouncements could mitigate the volatility at the forex market and foster the goal of a rate convergence.

    Afrinvest West Africa said the reversal of the forex restriction holds the potential to reduce demand pressure in the parallel market and curb speculative activity which is fuelling the sizeable divergence between the official and parallel market rate.

    “In our opinion, the policy is well-intentioned as it aims to circumspectly improve market confidence, which has been derailed by illiquidity and legacy unorthodox policies,” Afrinvest stated.

    Afrinvest however urged the CBN to roll out more complementary policies to attract the level of forex necessary to meet the policy objectives.

    “In addition to the recent move to obtain a $3.0 billion loan from Afreximbank to support the declining foreign reserves, we recommend exhausting concessionary loan opportunities from bilateral and multilateral institutions to build a forex reserves wall chest. Likewise, we strongly advise exploring more oil-for loan agreements to unlock liquidity. Furthermore, the current administration will need to strengthen ongoing efforts to curb oil thefts and enhance oil production to the target of 1.69mbpd,” Afrinvest stated.

    The World Bank has said it was considering Nigeria’s request to provide $1.5 billion in financing to support key policy reforms.

    The Development Policy Financing (DPF) provides direct budget financing and supports countries with reforms to policies and institutions that boost economies and specific sectors, World Bank spokesperson Mansir Nasir said.

    Cordros Capital said the removal of forex restriction is “another step forward”, but urged the apex bank to prioritise forex liquidity to avoid further forex pressures at the official and parallel markets, more so that the forex queue will now be longer at the official market without liquidity.

    Analysts said while removing demand-side restrictions is necessary, a significant forex liquidity will be required to complete the reform process and give the naira a breathing space.

    Cordros Capital said the country must remain focused on the economic diversification agenda in order to ensure a long-term stable base for the country’s currency.

    “Over the medium-to-long term, diversifying the economy’s export base is paramount to solving the reoccurring exchange rate issues. The country needs to look beyond crude oil and earn more from stable exports,” Cordros Capital stated.

    Cordros Capital however expressed concerns that minimal supply of forex at the NAFEM would continue to push demand to the parallel market.

    They noted that the incentives for holding the naira continue to be limited by the day, coupled with the panic-buying arising from the expectations of further currency pressures amidst limited forex  supplies.

    “Consequently, barring any significant forex inflows or convincing action by the policymakers to turn the tide, we expect the exchange rate pressures to linger in the short term,” Cordros Capital stated.

    Managing  Director, Highcap Securities, Mr David Adonri noted that the recent market reforms were targeted at conserving forex to enable the external reserve rebuild.

    According  to him, the reforms were also geared towards making domestic production more competitive. 

    “Increased foreign reserve will boost investors’ confidence and strengthen the naira,” Adonri said.

  • Former CBN deputy gov Moghalu reveals one way to fix Naira crisis

    Former CBN deputy gov Moghalu reveals one way to fix Naira crisis

    Former Deputy Governor of the Central Bank of Nigeria (CBN) and YPP Presidential candidate in 2019, Prof Kingsley Moghalu has expressed the ‘only’ solution to the Naira crisis.

    He stated that the naira can only be strong again if Nigeria becomes an export-driven economy.

    Moghalu revealed this on Monday during the 29th edition of the annual Nigerian Economic Summit held in Abuja.

    This year’s edition was tagged ‘Pathways to Sustainable Economic and Transformation and Inclusion’.

    In response to a query on how to stop the naira’s wild decline, Moghalu stated that the solution to the naira’s problem should be long-term.

    He said: “The way to fix the naira has problems is a combination of things. Some of them are short-term, but let me start with the long-term because we’ve been trying to fix the problem of the naira for a long, long time. It’s just been getting worse,” Moghalu said.

    “The only way you can fix the naira is that the Nigerian economy needs to become a productive export-driven economy,” he affirmed.

    Read Also: Kingsley Moghalu, wife stuck in elevator for over 30 minutes

    The political economist, however, lamented that the country has not devised a robust plan to make the naira strong.

    “I can’t say this enough and I’m not the only one who’s saying it. But up till today, we have not seen a comprehensive plan with targets to achieve this,” he said.

    “And even when plans are made, they are not always as informed as they should be. But I don’t know if you heard the President today because I heard him talking about clearing the backlog and doing all of this.

    “You see. I mean, it’s important to clear those battles because one of the problems and a major problem that is affecting the naira is confidence.”

  • ‘How to strengthen naira’

    ‘How to strengthen naira’

    The only way to strengthen the Naira is for Nigeria to increase productivity, increase capacity, and become export-oriented, former Minister of Industry, Trade and Investment, Mr. Olusegun Aganga, has said.

    Aganga, who was also Nigeria’s former a Minister of Finance and Chairman of the Economic Management Team, was Guest Speaker at the third Adeola Odutola Lecture/Presidential Luncheon, in Lagos.

    The lecture was the last part of activities that marked the 51st Annual General Meeting (AGM) of Manufacturers Association of Nigeria (MAN).

    Aganga said Nigeria’s export to Gross Domestic Product (GDP) ratio is very low compared to Malaysia, 76 per cent; South Africa, 31per cent; China, 24 per cent and Brazil, 12 per cent.

    “Nigeria will need to earn about $72 billion from non-oil exports to achieve 15 per cent export to GDP ratio, Aganga, a former Managing Director of Goldman Sachs, London, said.

    While emphasizing the need for Nigeria to focus on export-oriented growth, Aganga recalled, for instance, that in 1980, both China and Nigeria each accounted for one per cent of global world exports.

    He, however, said by 2011, China accounted for 11per cent of global exports (all non-oil), while Nigeria was less than 0.4per cent and shrinking.

    “China has grown richer and its currency, the Yuan, much stronger. Like the Chinese, the only way to strengthen the Naira is to increase productivity, increase capacity, and become export-oriented,” Aganga stated.

    The Naira has been on a free fall, crashing to an all-time low of N1, 210/$1 on the parallel market on Monday, Oct. 23.

    This was as Minister of Finance and Coordinating Minister for the Economy, Mr. Wale Edun, during a panel session at the ongoing Nigeria Economic Summit, said around $10 billion of forex inflows is expected within weeks rather than months.

    But Aganga said to strengthen the Naira, Nigeria must now prioritise attracting and retaining foreign investment into sectors identified for exports to bolster export capabilities. 

    According to him, the Nigeria Industrial Revolution Plan (NIRP) already identifies 13 items/sectors where Nigeria has a comparative and competitive advantage and can become a top 10 global producer.

    Read Also: Naira may rise as CBN plans tosanction banks hoarding dollars

    The NIRP focuses on value addition and identifies sectors where Nigeria can truly win and dominate, based on an assessment of the country’s competitive and comparative advantages.

    It proposes specific initiatives and interventions to improve productivity and competitiveness in those target sectors and increase production output.

    Launched in 2014, the implementation of Nigeria’s industrial plan commenced, but was put on hold for eight years.

    “If it (NIRP) had been implemented rigorously, Nigeria would have become a top competitive global exporter in at least 3 or 4 of the 13 products identified for export by now. It is all about continuity and discipline,” Aganga said.

    The former minister, therefore, said: “There is no better time than now for Nigeria to update and commence the rigorous implementation of its own Industrial Revolution Plan.”

    He said in doing so, the Nigeria Export-Import Bank (NEXIM) can be empowered to play the role China Exim Bank plays in Africa by providing loans to credit-worthy countries in Africa to buy Nigerian manufactured products and services.

  • How to save naira, by Senate Leader, others

    How to save naira, by Senate Leader, others

    • ABCON boss blames illegal forex dealers, seeks active participation in FX market
    • Currency outside banks hits N2.35 trillion – CBN

    Senate Leader  Opeyemi Bamidele yesterday challenged his colleagues in the National Assembly to come up with creative legislative frameworks and provide robust oversight support to aid  the appreciation and stability of the  Naira.

     He cited regular parleys between federal lawmakers and the Federal Executive Council as a viable means of integrating the eight-point agenda of President Bola Tinubu with the programmes of the 10th National Assembly.

     Bamidele spoke at a two-day retreat for senators at Ikot Ekpene, Akwa Ibom State under the theme, Fiscal Policy and Tax Reforms in Nigeria.

    Former Senator representing Bayelsa East, Ben Murray-Bruce and The President Association of Bureau De Change Operators of Nigeria (ABCON), Alhaji  Aminu Gwadabe also showed concern over the current status of the Naira and proferred suggestions on how to deal with the problem.

    For Murray-Bruce,the solution lies in Nigerians consuming  locally-made goods and services in preference to foreign brands while Gwadabe canvassed the  active participation of Bureaux De Change (BDCs) in the retail segment of the exchange market to ensure stability of the Nigerian currency.

     Bamidele, speaking at the retreat organised by the National Institute of Legislative and Democratic Studies, said  a joint retreat between the executive and legislature would help in  working  out modalities to integrate Tinubu’s eight-point agenda with the programmes of the National Assembly.

     He explained that the proposed retreat would provide opportunity for all chairmen of standing committees in the Senate and House Committees to sit with ministers and their permanent secretaries to synergise on the approaches to implementing the eight-point agenda of the Tinubu administration.

    Similarly,he called for  appropriate legislative frameworks and oversight support for the implementation of responsive fiscal and monetary policy with a view to rescuing the economy from regression.

     He said the two  chambers of the National Assembly “are under obligations to stem the recurring decimal of Naira devaluation and promote economic stability.”

    This,he said, entailed appropriate legislative framework and oversight support for the implementation of responsive fiscal and monetary policy measures.

     “Henceforth, developing appropriate legislative frameworks is central to ensuring macroeconomic stability with focus on managing inflation, addressing high interest rates as well as foreign exchange deficit,” the Senate Leader was quoted as saying by his media office.

     He drew attention to  some of the   socio-economic challenges he thought were militating against Nigeria’s development.

    Read Also: Naira depreciation: Bamidele seeks innovative legislation to ensure stability

    One of such is the  Land Use Act of  1979 which he said should be reviewed to redress the current land tenure system and give Nigerians more access to arable farmland nationwide.

     Ensuring more access to arable farmland,he said, would boost agricultural production exponentially and guarantee food security nationwide because most Nigerians, especially those in the rural communities, are predominantly farmers.

     He emphasised the need to prioritise the Small Towns and Village Recovery and Development Bill in order to restore economic fairness to the rural communities in the scheme of national revenue allocations as well as the provision of rural infrastructure.

     He added that the initiative would obviously stem the alarming rate of rural–urban drift and the attendant urban population explosion, urban criminality, environmental degradation and huge gap between available resources and demands in the cities.

     He explained that effective implementation of the poverty alleviation programme “is fundamental to promoting peace, harmony and sustainable democracy in Nigeria where over 70 percent of the nation’s population is reportedly living below poverty line.

     He said:”To reduce the increasing inequality between the poor and rich, we urgently need to strengthen the National Directorate of Employment through the amendment of relevant legislations that will create limitless opportunities for our teeming jobless populations.

     “We are also under obligations not just to overhaul our National Poverty Eradication Programme and National Economic Reform Plan, but also back them up with adequate funding to provide social safety nets for the poor and the vulnerable across the federation.”

     He deplored the  the alarming rate of corruption in the public space and  warned that the country should prepare for mass action from the downtrodden, which might manifest in the form of protests.

     As a matter of national security, the senate leader tasked the National Assembly to work out preventive measures to address corrupt practices rather than emphasising antidotes to cure them.

     Bamidele also challenged the federal government to discourage selective treatment, executive lawlessness, high handedness, and political persecution of perceived enemies in the fight against corruption.

    The retreat was designed to build the capacity of the senators to enact pro-people legislations that could promote enduring peace; guarantee sustainable development and deepen peaceful co-existence, among Nigerians.

     At the brain-storming were  Senate President  Godswill Akpabio; House of Representatives Speaker  Tajudeen Abbas; Deputy President of the Senate Barau Jibrin; Finance and Coordinating Minister of Economy Wale Edun and other members of the Federal Executive Council.

     Floating the naira is the way to go, says Murray-Bruce

     Murray-Bruce,a former Director General of the Nigerian Television Authority (NTA) said on his X handle ,that the federal government’s decision to float the Naira was a right step in the right direction.

     “The decision to float the Naira and stop defending it with our reserves and other dollar stockpiles is the way to go,” he said.

    Continuing, he said: “It was never sustainable, and it was taking us the way of Zimbabwe and Venezuela. The best way to strengthen the dollar is organically.

    “When we #BuyNaijaToGrowTheNaira, the Naira will rise.

    “ And most significantly, we must encourage our diaspora to repatriate their wealth back home. “If we continue the previous practice of spending $20 billion a year to prop up the value of the Naira artificially, we will eventually go bankrupt, and at that time, we will be talking ₦100,000 to $1.”

     Why BDCs are crucial to saving the Naira, by  ABCON boss

    Gwadabe, while presenting a pathway to stable exchange rate yesterday in Lagos, said  the current leadership of the  the Central Bank (CBN) has all it takes to achieve a strong and stable exchange rate and build a highly liquid forex market that supports the domestic economy.

    According to him, one best way to confront the problem headlong is for everybody to get involved, adding that the BDCs, which are licensed to play at the retail end of the forex market, should be fully involved in providing lasting solutions to the ongoing volatility in the exchange rate.

    The continuous depreciation of the naira at both official and parallel markets does not bode well for the domestic economy, hence steps should be taken to reverse the trend and strengthen the local currency for maximum impact on the economy.

    The naira on Tuesday crossed N1,100 to dollar mark at the parallel market even as it continues to weaken considerably at the official market due to persistent dollar scarcity and speculative activities of illegal forex dealers.

    He said the several measures by the apex bank to bridge exchange rate gaps showed genuine intentions of the regulator to entrench exchange rate stability, but getting the BDCs involved in the solution recipe will bring the desired results of not only a highly liquid market, but stable rates.

    Gwadabe said that like every other segment of the market, the illiquidity in the market remains a major concern to the BDC sector.

    He said aside illiquidity in the market, the ABCON is not happy with the unlicensed forex dealers who are at the centre of speculative activities, and attracting negative image to the sub-sector.

    He said ABCON can only continue to educate the general public against patronizing the illegal forex dealers because the suspension of the Self-Regulatory Organization status of ABCON makes it difficult for the group to directly sanction the illegal operators.

    He said enforcement of regulatory sanctions against non-compliance with guidelines are expected to be  prompt and stiff against erring members as a deterrent to others.

    Gwadabe said the ABCON recommended that the apex bank approve its overdue request that BDCs be made agents through which over $20 billion annual inflows from the diaspora enter the economy. Securing such regulatory approval will boost dollar liquidity and strengthen the naira.

    “We at ABCON advise that BDCs should be allowed to access dollars or diaspora remittances through the autonomous forex windows like allowing operators to receive IMTOs proceeds, carrying out online dollar operations and Point of Sale (PoS) Agency, among others,” he said.

    Gwadabe said the Diaspora remittances remain a low hanging fruit for the apex bank and tapping the full potentials would require creating multiple channels of inflows to make it easier for Nigerians in diaspora to send funds home.

     A former Minister of Finance, Olusegun Aganga, said on Thursday that the naira would continue to experience a free fall if Nigeria remained an import-dependent country.

    He said at the 3rd Adeola Odutola lecture to mark  the 51st Annual General Meeting of the Manufacturers Association of Nigeria d that Nigeria must produce for local consumption and for export, for the naira to be strong.

     “What is the wisdom in spending billions defending the naira when it continues to fall instead of investing in genuine manufacturers and exporters of high-value products that would earn Nigeria foreign income and more?” he wondered.

    Currency outside banks hits N2.35trn

     The CBN in its Money and Credit Statistics data for September 2023 obtained yesterday put the total currency outside banks at  N2.35 trillion last  September.

    This represents  a 6.0 percent month-on- month (MoM) rise in comparison to the N2.29 trillion the previous month.

  • Naira touches N1,100/$at parallel market

    Naira touches N1,100/$at parallel market

    The naira yesterday closed at N1,100 to dollar at the parallel market due to persisted dollar scarcity.

    The local currency, however, exchanged stronger at N790.68  to dollar at the Investors and Exporters (I&E) window – the official market.

    The Central Bank of Nigeria (CBN) last week said it would occasionally intervene to boost liquidity in the forex market, and stabilise the local currency.

    Dealers and financial experts said the volatility in the market was a fallout of acute dollar scarcity and speculative activities by illegal forex dealers.

    Former Registrar, Chartered Institute of Bankers of Nigeria (CIBN), Dr. Uju Ogubunka, said Nigeria’s trade balance had been weakened by its inability to produce and earn forex, a process that has contributed to dollar scarcity.

    To firm up the naira, he said Nigeria must find new ways to boost production to earn more dollars and boost foreign reserves.  Ogubunka, who is also the President, Bank Customers Association of Nigeria, said aside boosting production, there was the need to tackle insecurity to allow farmers go to their farms.

    He said such effort would help increase crop yields and bring more dollar earnings for the economy, adding that that would ,firm up the local currency.

    Read Also: Can CBN rescue naira from free fall?

    According to him,  insecurity and the political uncertainty are delaying several corporate investment decisions that would have brought in more dollars to the economy.

    President, Association of Bureaux De Change Operators of Nigeria (ABCON), Dr. Aminu Gwadabe, said there was the need to encourage market participants to source forex from independent windows to boost liquidity.

    He called for enabling environment and fair treatment for the players to achieve exchange rate stability.

    He advised that the Federal Government should enhance financial intelligence by tracking people with proceeds of corruption to sanitise the market.

    Gwadabe said many of the people with proceeds from corruption are the ones putting pressure on the forex market through their manipulative actions.

    “The naira is depreciating not by forces of demand and supply, but by the collective action and impact of the people with illicit funds,” he said.

  • The travails of the naira

    The naira is what 95% of Nigerians need to carry out their daily shores including putting food on their table and sending their children to school. Unfortunately, parasites waging war against our naira, their collaborating crooks in government and in the media and our foreign detractors often make us feel that without the almighty dollar which without any objective criteria they claim today exchanges for N1,000 to $1, Nigeria is doomed. But in truth, the naira in terms of its purchasing power is in high demand by our toiling but short-changed farmers in Nigerian rural communities in spite of the hysteria of parasites in the urban centres.

    It is on record that our naira, until a coordinated assault by crooks, parasites and their foreign sponsors, competed favourably with both the dollar and British pound sterling. I remember when I travelled to London for three weeks’ vacation as a young employee of the Guardian in 1983, my Personal Travel Allowance (PTA) was N500. But the real story was that when I finished spending the value of my travellers’ cheque, I went to Liverpool Street where those Indian traders accepted naira without any hesitation.

    Assault on naira started in 1986 with Babangida’s Structural Adjustment Programme (SAP) which sounded the death-knell of our budding industries, the backbone of our naira. Olu Falae and Kalu Idika Kalu and other agents of our creditors who claimed there was no alternative to Structural Adjustment Programme (SAP) spoke of ‘inevitable large scale programme of devaluation’ despite warning by professors Ricardo Fari of John Hopkins University and Sam Aluko of the University of Ife who insisted there was alternative to even death which he said was life.

    In November 13, 1986, the first-tier rate put the exchange rate at N2.80 to $1. By November 13, it has depreciated to N3.45 to $1 and by November 1990, it was N10.75 to $1. By July 1991 it was N11.32 to $1 forcing Augustus Aikhomu, Babangida’s military vice president to warn the CBN that “the value of the naira cannot be left absolutely to the whims and caprices of market forces”.

    Babangida went on to institutionalise corruption through the foreign exchange policies that allowed military men and their fronts to amass so much wealth with which they embarked on a wholesale importation of the labour of other societies.

    The parasites adopting Obasanjo, as their arrow head, took over power in 1999. With their privatization programme which according to a National Assembly probe, was nothing but a ploy to sell to themselves Nigeria’s total investment of about $100b  for a paltry $1.5b,  it was obvious, his administration merely continued the war against the naira from where Babangida stopped.

    The assault on the naira continued under Jonathan with his administration’s extension of tax waivers to parasitic car importers.  Our leaders continued to play the ostrich even as Michelin, Dunlop and some pharmaceutical firms relocated, ostensibly because of poor power supply to Ghana which ironically depends on Nigeria for her energy needs. We all played the ostrich pretending not to know that their relocation was due to uncontrolled importation of substandard tyres from China and expired tyres from Europe by dangerous and desperate parasites with the help of crooks in government.

    But no one puts this better than Audu Ogbe, former Minister of Agriculture in a speech he gave back in 2018 titled ‘the problem of importation’ where he concluded that “a ship load of rice translates to a ship load of unemployment.”

    Read Also: Lagos will open Yaba, Ikeja along vehicular bridges October, says Sanwo-Olu

    According to him “the tragedy of Nigeria began with SAP in 1986 when we  became importers of everything including milk, sugar, pencil, handkerchief and champagne, consumed more by Nigerian than any nation on planet earth according to Jacques Champagne  de Labriolle, the  French ambassador to Nigeria; and toothpaste and tomato paste which cost Nigeria $18m and $400m respectively annually.”

    Hitting the nail on its head, he had submitted that “someone is making sure you fail when you want to produce at home. These are people who can kill if they have a chance… these guys have seized this country’s economy; they have taken us a hostage and have no intention of giving up because this is a huge market… and they have taken control”.

    He did not forget to call attention of Nigerians to the unpatriotic role of (some crooks in the media), working for their principals, who with their publications try to demoralize Nigeria local farmers in the case of rice local production. For him: “To cure Nigeria malady will take a while and will take a strong government”.

    He was right. Both late Obafemi Awolowo and Dora Akunyuli had the foretaste of how vicious these desperate groups could be.  The former, for saying he would stop importation of second hand clothes if he won the 1959 election, had his helicopter stoned in Onitsha while the latter had a close shave with death when her car was sprayed with bullets in Onitsha because of her war against importation of substandard and fake drugs into the country.

     But Tinubu who has said we should not sympathise with him has his job well cut out. He already has the answer to the question of contribution of importers of the labour of other societies to our economy in our army of unemployed youths in Nigeria and thousands of others that have migrated to Britain and Canada where many of them do menial jobs.

    As to the source of the parasites’ foreign exchange, he like other Nigerians already know it is CBN which was converted into an ATM without a password under President Jonathan and Emefiele. It only got worse under Buhari and Emefiele.

    We also now know that some of those who secured CBN foreign exchange allocation for importation of raw materials often end up using such to import substandard products with the active support of crooks in government and cover up by crooks in the media.

    If you are in doubt, ask yourself how the prime suspect in the case of banned imported crusader medicated soap and Mekado soap which (contained mercury which can damage skin,  eyes, ears, brain, kidney and the nervous system”) with a street value of N1b who according to Professor Adeyeye,  NAFDAC boss, has not produced a bar of the soap in Nigeria since 2013, secured foreign exchange to import the soap seven times in 2021 alone with each consignment not less than three containers?(Guardian Sept 16, 2023).

     The battle to protect our naira must start with starving of parasitic importers of labour of other societies of foreign exchange. The president must also devise a means of protecting our local industries.

     Our own Ngozi Okonjo-Iweala the WTO  chair,  during a recent chat with CNN’s Richard Quest pointed out that that both the US and China, the world biggest economies have accused each other of protectionism. The truth is that the West that claims we are all equal in a globalised world subsidizes each head of cow owned by those in animal husbandry industry by $2 dollars. And going by World Bank claim that 70% of Africans live below two dollars a day, that would mean the life of a cow in the West is worth much more than that of a man in Africa.

    Our rural farmers that need the naira most can also be empowered by state governments buying off their farm produce just as government of rice-producing states in Asia do before exporting same to Nigeria several years later. Some of the savings made by withholding foreign exchange from parasites that bring only misery to Nigerian youths can be used to help the states set up cottage industries.