Emir of Kano Muhammadu Sanusi II has stated that the argument about devaluation of naira is misunderstood, and that the naira has already been devalued.

“This argument (on devaluation) I think has first of all been framed wrong, it’s not an argument about do we devalue or do we not devalue. The naira has already been devalued,” he said.

“What is the value of the naira? It’s what you can get for it, what you can get for the dollar in a free market between a willing buyer and a willing seller – and it is not 197.

“All that is happening is that the government has chosen to sell its own dollars at a subsidised rate to the private sector. That’s what is happening. So, if you’re lucky, you’d get something worth N300 for N200 and you save N100,” Sanusi added.

“For every $1 billion that the central bank sells, it has transloaded N100 billion to the private sector – that’s what is happening.

“So you got a huge arbitrage opportunity, which either way undermines the government’s anti-corruption stance.

“You also take so much money away from states and local governments, because this is money that from oil proceeds, from PPT, royalties, that should go to education and healthcare for the poor.

“While the president is looking at the pain inflicted on the poor, by high prices of import, he also needs to look at the pain inflicted on them by taking away revenue that could go into education and healthcare.”

While commending the President for transparency, removal of subsidy and other structural reforms, Sanusi said the federal government needs clarity of thinking in the handling of the foreign exchange policy.

“There has to be clarity of thinking. The government on the one hand says it wants to encourage domestic production, the governor of the central bank says he wants to reduce import dependence, but one would think that the way to reduce import dependence is not to make imports cheaper.

“You subsidize exchange rate – you’re making imports cheap. So you’re actually pursuing a monetary policy that undermines structural objectives,” he said.

BBC


http://www.nigerianbulletin.com/threads/nigeria-emir-sanusi-rebukes-cbn-says-naira-is-already-devalued.180145/

Burukutu sipping sanusi should quit wailing

Well said. Frankly speaking, he is wasting his time. Buhari will listen to no one. I have written off the economy since July. A rotten tree can not produce good fruits

Senseless point. The purchasing power parity of the naira is what is affected. Unless the CBN devalues the naira, its value at the offial forex rate still stands. Market forces can not devalue a currency, only an apex bank can.

We know already, just get a way to talk to oga at the top

“You subsidize exchange rate – you’re making imports cheap. So you’re actually pursuing a monetary policy that undermines structural objectives,” he said.

I have held the view in my previous posts that the exchange rate has, technically, been allowed to float and that the official rate is a subsidized rate.
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I, however, want to disagree with SLS about the government subsidizing imports. The government is not subsidizing consumption, but rather production - since the subsidized rate is only available to those bringing in critical raw materials (like pharmaceuticals) or manufacturing or agricultural machinery/equipment.

The APC zombies will avoid this thread.

Buhari had only repeated what he did in 1983 which almost destroyed Nigeria back then. Everything he did, he had literally done again. If it didn't work then, why would it work now?

Maybe he will succeed in completing that which he couldn't finish now.

I think he is right.

I think the govt has not been sincere in its monetary policies but would rather choose to blame past administration for its self-inflicted woes. In the first instance, the CBN is aware of its limited capability in meeting demand for foreign exchange but still goes ahead to suffocate the BDCs thereby breeding uncontrollable pressure in the forex market. The best bet under the prevailing circumstance is to revert to the liberalisation of exchange market by allowing the official and parallel markets to compete openly but with close monitoring. Any further attempt to strangulate the BDCs would not only be continually mettled with sabotage, the Naira will continue to experience a free fall.

On the other hand, the govt has to rescind its decision on the lifting of ban on importation of certain goods and services which can be sourced locally. The rationale for lifting bans on importation of rice and textile, from all indications was not well thought-out. Apart from stifling domestic growth, it further adds pressure on demand for foreign currency. These are basic reasonings and common sense that require little economic science.

Nobody teaches Buhari.... He is the god of integrity in Ade voice

Sanusi cannot claim innocence here.
He was CBN governor long too long ago.He was part of the crew who used their positions to feed the monster's appetite for dollars.

BUHARI KNOWS NOTHING ABOUT ECONOMY

Sanusi is being hyprocritical here.
Most people put self interest above the greater good.

"The gap between the black market and the official rate is unusual. If you now say let us bridge the gap, the least you can do is move the gap from N200 to N300 to a dollar and hope that the black market rate would still stay at N340 or N350 to a dollar. But will it? The answer is no. The Black market rate will shoot up to 400 or 500 Naira to a dollar. But let’s assume that they take the first step and they say devalue to N300 to move it closer to black market rate. What immediately happens? The price of fuel that they are applauding that we are not paying subsidy on, will suddenly shoot up to N130 or N140 per litre. Do you think Nigerians will sit down and say ‘things are bad, let us accept it as it is’? Just because of the exchange rate.

And then there is the stock market which is over N8 trillion-only about $40 billion. If it goes N300 to a dollar, the stock market will fall in value from over $40 billion dollars to a little more than $20 billion dollars. This will also be just because of the exchange rate. And if the official rate still continues to chase the black market rate and it goes to N400 or N500 a dollar, eventually the stock market would be reduced to less than $2 billion [/b]dollars, even though the buildings are still standing and people are still trying to produce. It is a serious issue. [b]And if you owed any money in dollars, you are in trouble. If you owed $1 million you would now be looking for not N200 million, but N300 million to pay. Where would you get the N100 million extra? A lot of people would commit suicide."

-- Henry Boyo.

I have 3 other topics on devaluation; you can read them.
Devaluation, is a cosmetic solution, or symptomatic solution if you will, to an underlying cause -- especially in our case -- where are our exports?!

It's like taking paracetamol for stage 4 cancer, and hoping that cures! We have an endemic problem here y'all!

http://www.opinionnigeria.com/sensible-path-to-stronger-naira-and-economic-prosperity-by-henry-boyo/#sthash.hyWWsaT0.eJNNE8Wx.dpbs

https://www.nairaland.com/2914056/naira-10-questions-gov-emefiele

https://www.nairaland.com/2573929/poison-further-devaluation-naira

https://www.nairaland.com/2944479/fastest-way-get-out-economic

The government is subsidizing imports.

How will govt sell dollar at N197 to a big importer and then he imports to offload his goods at the prevailing $1 to N400 ?

Or he even sells off some of the dollars while importing nothing.