For more than 24months, price per barrel was consistently high to the tune of 100$per barrel but the value of our naira didn't appreciate during those times. As soon as the price started fallen, naira has been losing its value in a very ridiculous way. I am not an economist but I have applied my knowledge of elementary economics to understand the basis. Is it because our economy is not diversified or because of the import dependent economy that we operate in Nigeria? Please cure my ignorance!

OP: Many factors contributes to the naira fall.

Our balance of trade (Import/export)
CBN's Monetary policies
FG's fiscal policies and others...

But definitely was influenced by our economic managers

I blame GEJ

jaybee3:
I blame GEJ

Do we have to blame him? If yes why? I think it is a global problem....*my opinion*

Davvymavvy:


Do we have to blame him? If yes why? I think it is a global problem....*my opinion*

Though the upward price movement of naira is largely due to the downward pressure created by the increasing volatile crude oil.
Nigeria's GDP is about 70% dependent on crude oil meaning our income is mostly derived from crude sales.

If as expected we have less income coming in, the CBN wouldn't be able to peg back the Naira (most central banks peg back their currencies to control volatility and sometimes make it deliberately cheap to help exporters)

Back to your question, it's GEJ's fault because as president,
He has failed to diversify our economy for the past 6 years
The excess crude oil account has been depleted meaning we don't have enough money to support the naira

Last bullet, make sure you use your vote to change the course of our once great nation

barcanista:
OP: Many factors contributes to the naira fall.

Our balance of trade (Import/export)
CBN's Monetary policies
FG's fiscal policies and others...

But definitely was influenced by our economic managers

Barca, hope you don't mind if you throw more light on how the above factors contribute to the fall in naira?

Saying our economy was not diversified in the past 6 yrs reeks of political colorations.

All our leaders, especially the military, NEVER diversified our economy. Maybe only GEJ has even made minimal efforts, reducing imports such as Wheat Substitution, tomato paste import reduction, etc

And our CBN Governors all along believed in using our Reserves 'Manage' the Naira instead of allowing it to float with purely market forces;

And our political crew, esp Governors(both PDP and APC) always using Governors Forum to force President to liquidate Excess Crude Funds..

Davvymavvy:


Barca, hope you don't mind if you throw more light on how the above factors contribute to the fall in naira?

It will make a very long long epistle and maybe argument. But I wl try.

Fiscal policy: has to do with economy diversificationn strengthning of local production to discourage importation Óf certain commodÍties-and even exporting. Less import means that the naira will be mostly used within our economy. The government should also make policies to make it madatory for all people working in Nigeria to be paid in Naira. Use of dollars as a means of exchange within Nigeria should be discouraged, and use of Naira be encouraged. People can always convert their dollars to Naira. making and implementing policies to create jobs and provide infrastructures so as to encourage the use of the naira in transaction more.… corruption should be addressed. A Çorrupt official loot in Naira, converts to dollars and send it to his account abroad. With that, he's helping the dollar against the naira. He shd instead loot in Naira, and use the money to invest in Nigeria(that is if he has any pity on Nigeria). But if corruption is addressed, that is so fine!

CBN also has the responsibility of defending the naira. However, they will have little role to play if the ExecÙtives are írresponsible. My guy, if I go details, na epistles we go de read.

jaybee3:


Though the upward price movement of naira is largely due to the downward pressure created by the increasing volatile crude oil.
Nigeria's GDP is about 70% dependent on crude oil meaning our income is mostly derived from crude sales.

If as expected we have less income coming in, the CBN wouldn't be able to peg back the Naira (most central banks peg back their currencies to control volatility and sometimes make it deliberately cheap to help exporters)

Back to your question, it's GEJ's fault because as president,
He has failed to diversify our economy for the past 6 years
The excess crude oil account has been depleted meaning we don't have enough money to support the naira

Last bullet, make sure you use your vote to change the course of our once great nation

you have just succeeded in posting trash, tell us how GEJ has fail to diversify our economy? don't just jump into conclusion and think everyone is gullible..

so pls continue with your explanation.

Economic diversification is not a day job just like getting a stable power supply. I think some past leaders didn't forsee a day like this, if not, the effort ought to have started long time ago such that incumbent president would just be solidifying the viable economic structure he met on ground. I humbly submit that reverse has been the case.

However, the failure of one does not exclude the success of another. Six years, yet, the pointers are not there. We so much depend on oil money like we can't make headway without it. With six years and no indicator of a stable economic environment, I am afraid if the team assembled by Jonathan are up to the task?