By Elohor Igbru
For Nigerians concerned about the unprecedented fall of the Naira against the dollars, there might be a solution in sight as Vice-President Yemi Osinbajo has called on the Central Bank of Nigeria to devalue the naira to reflect the reality of the market. Osinbajo who was speaking at the midterm retreat of President Muhammadu Buhari’s second tenure, said the exchange rate is artificially low, and this is deterring investors from bringing foreign exchange into the country.
“As for the exchange rate, I think we need to move our rates to [be] as reflective of the market as possible. This, in my own respective view, is the only way to improve supply. “We can’t get new dollars into the system, where the exchange rate is artificially low. And everyone knows by how much our reserves can grow. I’m convinced that the demand management strategy currently being adopted by the CBN needs a rethink, and that is just my view. “Anyway, all those are issues that when the CBN governor has time to address, he will be able to address in full,” Osinbajo said.
There is a wide discrepancy between the official rate of the naira and that of the parallel market. The naira is changing for a dollar at 411 at the official side of the market, while the same goes for 565 to the US currency at the parallel market. Osinbajo called for synergy between the different arms of government responsible for fiscal policies and should not be seen as competitors.
“There must be synergy between the fiscal and the monetary authority. We must be able to deal with the synergy, we must handle the synergy between the monetary authority, the CBN, and the fiscal side. “Sometimes, it appears that there is competition, especially on the fiscal side. If you look at some of the interventions, you will find that those interventions are interventions that should be managed by ministries.
“The ministry of industry, trade and investment should handle MSMEs interventions, and we should know what the CBN is doing. In other words, if the CBN is intervening in the MSME sector, it should be with the full cooperation and consent of the ministry of industry. Sometimes you will get people who are benefiting more than once
because we simply have no line of sight on what is going on,” he said.”
Osinbajo praised President Buhari for handling the economy well. “Let me say on the whole that we have been able to weather the storm of a
very very serious economic challenge. I think that is largely on the steady and stable leadership we received from the president. I think if Mr. President had panicked in
that period, we would have had a lot of difficulties, perhaps we would be in a much worse situation.
“He deserves the commendation for providing that steady hand when that was required.”
