The pressure on the Nigeria is at an all time high and one wonders if there is a solution. This is write up is in response to a post here on Naira land https://www.nairaland.com/3287305/failed-naira-advice-federal-government and I wish to contribute my idea to a better Nigeria.

My posts are very controversial, but some of them are good. Like the write up on ‘Stimulating a stale economy on https://www.nairaland.com/2702992/stimulating-stale-economy#39532358

To ease pressure on the naira one must know what the Nigeria economy is and what we intend to achieve.

How is the Nigerian Economy:
The Nigerian economy is driven by an unrecognized sector, the small and medium entrepreneurs. These range from farmers who produce our foods, to petty traders, to artisans, to manual labourers, e.t.c. They are the ones that engage a larger percentage of the society hence we can’t have a Venezuelan situation as these people service the day to day need of the populace. But they soon face low but also continuous patronage when the big sectors face low activities. The Civil service, banks, telecommunication and multinationals that pay a lot only engage a fraction of the workforce.

What we intend to achieve:
I am sure what the major concern is a stable exchange rate and not the rate itself. If a dollar should sell for N500 to 1$, it should remain so and appreciate steadily over time. Investors, traders and the economy prefer a stable rate. You can imagine buying your goods for X amount today and be told it is now Y amount tomorrow and Z amount the day after. It makes it difficult to predict business which is bad for investment. This is one reason there is low foreign investment into the country lately.

But how do we ease pressure on the Naira?
The naira itself suffers just as Nigerians. For example: I step out In the morning to go to work, I gave the Taxi man N50 note who in turn gave it to another passenger as change who used it to by gala from a seller who gave it to another as change and the stress on the N50 note continues. It might be lucky not to get to the bear spot at night and finally into the hands of a, let me end it here. A naira not could be defaced as little as one week in circulation and the CBN has to mint and keep minting. I doubt if the cost of minting a N20 note is actually N20, and for how long does it last? I would encourage cashlessness. I would pay people who use P.O.S. I would introduce ‘Me to you mobile Money’ which helps to make transfer from one person to another using ATM card and BVN with like N20,000 max per transaction and say a daily limit of like N100,000. Such operators are scattered around like you recharge card sellers and get commission from the government for every transaction. If I go to my site to pay workers, I don’t need to go with cash; I could go with a ‘Me to you Mobile Money’ agent to pay my workers. This will help since the set of people who make massive transactions don’t have the time to queue at ATMs and may not be able to use them sometimes. The government spends less in minting money. That is huge savings in a year. This is to cut waste, let’s go back to the topic.


There are two approaches to the situation which can work together or independently.

1. Registering all businesses: Most businesses in Nigeria are not registered. For fear of paying taxes e.t.c many businesses operate hidden. Would you blame them? I may not. If you examine the cost of doing business today you would understand. You have to open a retail outlet for instance; you would have to rent a shop, fortify the shop against robbery, do business on bad road, provide your own electricity, e.t.c and you bear the cost alone. It might be tempting to want to share the gains with someone whom you think has not taken any risk. For this reason, so many businesses go through the back door to find forex for their transactions. To do this the government should introduce some incentives to SMEs to register their businesses and get legal and genuine access to forex. This could be in for of prolonged tax holidays, interest free bank loans, e.t.c to carter for the inconveniences they go through to start up a business. This will encourage a lot of businesses to register and if they can access Forex the right way, the parallel market will lose customers and pressure on Naira will fall a margin.

2. Use what you have: I am an Engineer by profession, a father by nature and an Economist by interest and face this every day. I have an abundance of rice I get at a very cheap rate, sometimes free of charge. But my kids can’t eat rice alone, they eat rice with beans and without beans they don’t eat well; but beans I don’t have. What do I do? Three different approaches. i: Encourage and force the children to eat only rice. The problem with this is that the kids start looking for beans through the back door if they can’t eat only rice. ii: By enough Beans so that the children can have it to eat rice anytime they want to eat. This is good but I may run out of cash to run my home, but my kids are healthy. They may even become wasteful as they find food every time. iii: Let the children have access to beans from any source but make them give up a portion of their abundant rice when they have beans. This is to introduce control and make your rice have value.
In this case, the rice is our Naira with which we buy and sell local goods, the beans is the dollar with which we buy foreign goods. This administration adopts the first option; previous administration adopted the second option. The third option is making sure there is enough dollar in circulation by allowing a free flow even through the banks but since Naira is the medium of exchange, every Non naira account should be considered as a business account and made to pay tax on deposit as applied to every businesses. The tax should be in Naira so that the account holder has to have Naira to run his non-naira account. Also, every dollar to dollar transaction is charged two sets of profit, one on the business gain and another on the currency value. With time, the dollar gradually loses its value as people now value the naira they lose in trading with the dollar.

I am able to find time to write this piece as I am out of job and have some spare time to sit at my desk and compose.
God bless Nigeria.

So u knw all this, y dint u contest 4 president

Long thing o

youngest85:
So u knw all this, y dint u contest 4 president

You go vote for am

Nice write up.

....but would it be safe to say being out of a job brought out the writer in you?

This is insightful and frontpage worthy.

youngest85:
So u knw all this, y dint u contest 4 president

Don't expose your stupidity.

dowjones:

Don't expose your stupidity.

Ok.....i wont expose it.





#coveringmystupiditywithallmystrength#

menxer:
Nice write up.

....but would it be safe to say being out of a job brought out the writer in you?

Sometimes in life you need to go down to go up. My best ideas in life come when I am down.
Cheers!

Prophet Onatisi, what do you think about the suggestions? Though some are achievable.

aleshsenior2000:
Prophet Onatisi, what do you think about the suggestions? Though some are achievable.

People still don't realize the gravity of the Nigeria situation, it is more precarious that simple problems. Nigeria Is virtually broke now and the political leadership is confused. The solution lies with the people.
There is no two ways about Nigeria simply has to go back to the basics . On individual level,agriculture ,exportation and service rendering is the next big hit