If you are a Nigerian, am sure your ears would be awash with news of the Naira's appreciation. For the last three weeks, the CBN has pumped more than $1.5 billion into the market to boost liquidity, hence ending speculation and a supply glut. Depending on your viewpoint, this may be either news worth celebrating or one to be highly skeptical about because of the volatility in the Crude Oil market. However, am writing this article to bring your attention to a third perspective - The Ripple Effect.
A convergence between the official and parallel Market rates May not be such a good thing for our backward integration policies and in our quest to look inwards for local alternatives. With the Naira appreciating to, say, N320 to $1 (with the official rate being N307 to $1), what we may witness is an increased demand for imported goods due to cheaper dollars and costlier domestic alternatives.
Amongst the hardest hit would be the 41 items banned by the CBN from accessing FOREX from the official window for importation. We may see an upsurge in the importation of rice and palm oil, thus putting an end to the unprecedented growth experienced by domestic industries who have benefited from this ban. Without a dramatic change in our appetites for foreign goods, we may revert to square one once given the option of cheaper imports. As highly critical as I've been of this administrations policies, the made in Nigeria campaign is certainly a step in the right direction that would pay off in the medium to long term.
I predict that the Naira would stabilize around N350 to $1, because am sure the monetary policy makers must also be seeing this disaster waiting to happen. What do you think?

Subsidizing the Naira is a populist measure which serves political interests. How many Nigerians need the dollar in their everyday transaction. The Naira is being subsidized for the benefit of the already rich.

Well personally I suggest we wait and see first, let's not conclude yet, about some weeks ago nobody knew the naira would gain and become what it is now, I suggest we wait and see what the future holds

kITATITA:
Subsidizing the Naira is a populist measure which serves political interests. How many Nigerians need the dollar in their everyday transaction. The Naira is being subsidized for the benefit of the already rich.

Hmm. I don't quite agree with you bro. A Country's currencies strength is an indication of its Macro economic Stability. A $1 to N1 ratio would definitely affect the masses as it means cheaper imports (which is fantastic for an import dependent nation like ours) and lower prices (deflation). However, I see your point - the vast majority of the populace that has switched to local alternatives would hardly feel any devaluation of our currency