The persistent depreciation of the Naira is seen as not having an immediate solution despite all the foreign exchange measures introduced by the monetary authority, Central Bank of Nigeria, to stem its tide.
Some of the measures are; removal of third parties from buying of foreign exchange routed through Form ‘M’, receiving of Diaspora remittances inflows in foreign currency through the designated bank of their choice, introduction of Naira for dollar scheme, discontinuation of dollar sales to Bureau De Change (BDC) operators and the most recent one, the RT200, among others.
Let us take a look at what some industry/economy experts are saying concerning the Naira depreciation.
According to Johnson Chukwu, Managing Director/CEO Cowry Asset Management Limited, he said in the long run, Nigeria must be a producing economy or manufacturing hub, producing quality products for exports.
“I don’t think there are things anybody can do in the immediate to stop the Naira depreciation because our balance of trade and balance of payment are negative. Nigeria is currently importing more than it is exporting”.
The Head of Tax and Corporate Advisory Services at PwC, Taiwo Oyedele, explained that the 43 items prohibited from accessing foreign exchange can be imported but cannot access foreign exchange and that this is a major issue. Oyedele called on the collaboration of the monetary and fiscal authorities to address the Naira depreciation.
He said the Government should address the crude oil theft, which is one of the contributing factors to Naira depreciation.
Another economy expert, Dayo Obisan, who is the Executive Commissioner (Operations), Securities and Exchange Commission (SEC), has called for the harmonization of the exchange rate to enable more foreign investment in the country. He was confident that the CBN was gradually working towards achieving a unified exchange rate policy.
In addition, Chizor Malize, Managing Director/CEO of Financial Institutions Training Centre (FITC), said Nigeria is already in a Naira crisis and that there is need to move from consumption to production.
The apex bank over the last few years have introduced various demand and supply measures to boost foreign exchange inflows and ensure the stability of the Naira but this has only done little or no good. However, with the views of some experts expressed in this article, one can say that the Naira will require a producing environment, more strategic measures and a good period of time to gradually rise above depreciation, this process is definitely not rocket science.