Allwility:
The policies of the government in the last few weeks are nothing but knee- jerk reactions. Today we tighten our FX policy, tomorrow we relax it, next we ban sales of forex to BDCs then we remember an FEA Act of 2004 that if implemented will make banks become no different from BDCs. An Act that if implemented will just be stating the obvious- we are a step away from devaluing the naira. All these are reactive policies. If the government is serious, they need to come up with something more proactive- a sound economic plan.

First, we need to understand how we got here. Falling oil prices, corruption in high places, and an import based economy have contributed majorly to the depletion of our foreign reserve. Oversupply of oil (caused by the Saudis trying to kick out American producers and Iran coming into production) might just ensure oil prices never see the $100 dollar high in the coming years except maybe if there is a war which nobody prays for.

We need to tell ourselves the truth. Our economy is at the point of recession and may not be able to absorb further shocks. Devaluing the naira is a no-no and this FEA 2004 Act will only provide us with a false sense of relief in the short term. We need to come up with something more solid. We need a concrete plan that will guide us out of this seregenti we have found ourselves.

Here's what I believe might work for us:

1. We need the best minds to start with. The President should stop looking for FDIs but concentrate on bringing in technocrats to run key sectors of the economy. Let me give an example, if we bring in top Nigerian researchers and give them a mandate to produce say wheat within the country, Nigeria would become self reliant in wheat production saving us scarce forex. We might even export to some African countries. Now consider replicating this in areas such as pharmaceuticals, food, textiles, industrial machineries etc etc. we will be doing ourselves a lot of good.

2. We need to invest more on infrastructure. It is not a sin to have good road networks, stable electricity, security and so on. This will create an enabling environment for FDIs. I mean these are the things investors look out for before bringing in their investments to your country.

3. We need to develop our solid mineral industry. Tin and Columbite, Iron, Uranium etc can still fetch us some forex you know.

4. We also need to build more refineries and stop the importation of petroleum products. I mean if we have small but highly efficient refineries spread across the country, and break up the monopoly of NNPC, we will stop this madness called fuel importation. This will really save us a lot in forex.

5. Finally our imam and pastors need to pray more. They need to pray that the spirit of Chrometophobia (fear of money) and Kleptohobia (fear of stealing) come upon all those politicians that steal from our national wealth and hide it in all those bad bad places eg Panama. Just Negodu. Arrant Nonsense

Thank you, fuel importation killing our economy.

14:
Nigeria = $10m a day for FX trading
SA = between $2bn and $4bn a day for FX trading,

So who has got more money and who is the richest? paper economy will kill nigeria.

PDP rate our economy on importation of fuel as the largest economy.

grandstar:


The official rate's 197 and the black market'ss 320 and you say no no to devaluation

The naira's already worse than devalued!

The naira is already devalued, lets mot devieve our self. I this the best way forward is to float the exchange rate. This peg is mot working and by devaluing thw naira, we may still come back to this same position in the near future

One of the greatest problems of Nigeria is our 'Rule of Law' individuals (politicians & civilians) use their social status to propel all sorts of ulterior and egotistical motives without giving a hoot of the possible consequences
Why the wide margin between the offcial rate?
The answer is a simple word called 'GREED'. Monetary policy makers know how to resolve this quagmire we re in as a country but would rather keep mute because of the selfish benefits they get from it
What's the way forward?
The federal Govt should employ a centralized forex control mechanism that would check-mate any form of arbitrate dealing.
Punitive measures should be put in place for those caught flouting the rules of engagement

Lastly, I pray these our theoretical leaders get a more practical approach towards solving Nigeria's problems because its the only solution, not hypothetical idealism. We need to make things work!!!

WhoBeThisMan:

The naira is already devalued, lets mot devieve our self. I this the best way forward is to float the exchange rate. This peg is mot working and by devaluing thw naira, we may still come back to this same position in the near future

You want to have a stable currency, then the CBN must set tough inflation targets of 2% maximum

Good stew na money kill am!

With this policy, in no time our foreign reserve would be depleted on importation. Then Nigeria's credit line would be more restricted. Pray!

Deen77:


Thank you, fuel importation killing our economy.

na wa oo, we spend 40% of our forex on fuel importation alone, this is like sucking blood close to the heart,