grandstar:


For the past 40 years, the country has been preaching the gospel of "Buy made in Nigeria."

The Naira takes a tumbling when crude oil prices fall and there's a fall in dollar inflow because of it. It is at that time everyone becomes an economist.

But the Naira's fall was not Nigerians buying locally produced goods but a collapse in dollar inflow. For things to get better, Nigeria needs to export to encourage dollar inflows.

As the Economist magazine rightly said, "Protectionism has failed to industrialize the country,"

It won't help the Naira. If you like, effectively ban the importation of every foreign product and use of every foreign service, the Naira's value will not appreciate at all.

Imports aren't bad for a country. What Nigeria lacks is export. France and Germany, especially the latter are export giants. They even practice the complete opposite of what you preach: as members of the EU, there are zero tariffs between all EU countries.

Self sufficiency does not make countries wealthy. The best a country like Nigeria can achieve with protectionism will be no better than India in the days the License Raj in India which left India poor. Nigeria has tried it for 40 years and there's nothing to show for it.

India has changed its ways and is more focused on exports now and foreign companies like Foxconn has set up shop their manufacturing Iphones.

A weak Naira isn't enough to boost exports. It might even achieve the opposite has it may make it expensive to import much needed machinery to make goods produced here competitive.

Presently, exports have mostly comprised of low hanging fruits: things that don't take much effort to export which are largely unprocessed commodity and goods. Nigeria needs to scale up to exporting value added products and that is the area the country has done poorly but why you may ask?

The primary answer isn't poor infrastructure and bureaucracy as many will want to believe.

The primary problem is the high cost of credit. With bank lending rate over 25%, this will hamper the setting up of factories to produce value added goods for exports.

Until cost of credit falls below 10%, Nigeria will struggle with exports.

Nicely put.

kcprince:


Oil and gas is terrible now becasue there is no margin again due to high cost of buying . Like today diesel is bought at 1250. I am still wondering how much I will sell buy the time it arrives .

You can go into gas but on a small scale with room for expansion. But don’t expect to make duplex money there o. Na just survival money wey dey there .

Thanks so much for this insight really appreciate.

hansomb:
There's a system Indonesia used against their currency that any fluctuations of dollars will not affect it . Sorry Malaysia.

What's the system?