₦airaland Forum

The PDP cries are understandable. It's the way of the opposition, after all APC used to do same a while ago. But the fact that PDP are winning elections and cases in courts invalidate their claim of APC trying to decimate the opposition.
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As for the cases of corruption, I maintain that WITCH-HUNTING is better than DO-NOTHING. When politicians begin to fear that they will be witch-hunted by the next administration, then just maybe they will rein in their corrupt excesses. The manner in which the treasury was plundered with reckless abandon and impunity during the last administration is simply repulsive.

koboko69:
His submissions are 100% correct. Weather artificial or super ficial or whatever. It was clearly stated that demand was also greater than supply....the supply was the one being hoarded to force Buhari to devalue.Drop in oil price still plays a major role. Our forex is mostly gotten from oil sales.
So where did he ere in what he was saying?

Yes, Demand could be REAL or SPECULATIVE, but as long as it exceeds Supply, Price will go up. Speculative demand or not, there are real and legitimate demand out there that the CBN cannot fill (e.g. the 41 de-listed items), and these demand will continue to put pressure on the parallel market - pushing price away from the official rate.
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We do not know the factors responsible for the sudden appreciation of the Naira but I can bet that it won't be sustainable. The economic fundamentals have not changed, and price will find its true value soon (N250 - N300 in my opinion). What ever magic Ifeanyi Ubah would have done would have had a similar cosmetic effect and then rate will quickly revert back to its fair value. But he is a smart guy - he requested for only a 30 day mandate.
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@AngryNigerian, @irynterri

psucc:
So since he made the statement haven't you heard if something strange happening in the market?

There has been some blog reports that the market is reacting to his statement. However, most mainstream media reports have it that the appreciation of the Naira recently is based on the President’s insistence of no devaluation.

There has been several media reports in the last few days concerning Dr. Ubah's audacious claim that he has a 4-point plan to bring down the exchange rate to N200/$ within a month. He, therefore, requests the FG to appoint him the Chief Consultant on Financial Stability.

I made an initial comment on the subject where I explained the determinants of exchange rate and why Ubah's claim may be a little far-fetched (https://www.nairaland.com/2949228/ifeanyi-ubah-bring-us-dollar-n200#43148209). However, I have been called out for being too academic in my analysis and why I should not dare challenge a successful business man who has racked up over $2b in assets in the last 9 years. Others have opined that he should be given a chance to offer his ideas, after all he is not asking for money and had even helped the country out during a period of severe fuel scarcity. Now, let us look at a few issues together:

(1) Has Dr. Ifeanyi Ubah made a formal proposal to the government regarding his offer? This way the government can have a basis of inviting him for a meeting. If the government were to invite Ubah based on his media claims, then that would give him so much leverage - something the government cannot afford.

(2) The CBN, under the last administration devalued the Naira twice - first from N150 to N168 and then from N168 to N197 - within a period of 4 months. Has anyone wondered why Ubah did not offer to help the then administration get the exchange rate back below N150/$, if he indeed had such magic wand?

(3) How did Ubah arrive at the N200/$ figure? Does he have full knowledge of the aggregate SUPPLY and aggregate DEMAND for dollars to be able to come up with that equilibrium price? I can bet that it is only the CBN that has data on Nigeria's Balance of Payments, and so can determine an ideal exchange rate.

(4) Even if Ubah were to, somehow, infuse over $1bn into the market within a month, and that extra supply pushes the exchange rate to an artificial N200/$, what happens after that? Does Ubah have billions of dollars to continue propping up the market every month, else the rate will deteriorate again? Obviously, he is a very smart man - he had said he will get the exchange rate back to N200/$ within a month - and so will claim that his mandate doesn't go beyond 30 days.

(5) Why does Ubah need to be appointed the Chief Consultant to the FG on Financial Stability before he helps his country? He had helped before during the period of acute fuel scarcity without asking for any appointment from the previous administration.

(6) Are there any legal basis for the government to seize the assets of a consultant which they appointed? Ok, Ubah says they should if he fails, but I can bet that there would be a lot of legal wranglings sentimental outcry should the government goes ahead to do so.
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The reality is that some of the DEMAND for dollars have been speculative attack. However, there are still legitimate DEMAND (e.g. 41 de-listed items) that the CBN cannot fill and so will push the rate at the parallel market. The fact is that once you discount speculative demand, the true exchange rate may be found around the N240 - N280 band in the parallel market. N200/$ at this time without sustained SUPPLY or heavily reduced DEMAND might still be a bit farfetched.
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@Bevista

drss:
hahahahah bevista comes to mind.
dis revelation is a clear testament dat buari dullard's cabinet is full of economic illitrates.

I wish you can engage in an intellectual discussion without resort to derogatory language.
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I repeat, the exchange rate is determined primarily by Demand and Supply of dollars. Sometimes, the demand can be Real and sometimes it could be Speculative. I have written in my previous posts that once you discount speculative demand, the true exchange rate should be around N240 - N280.
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The CBN, under Jonathan, devalued the Naira twice from N150 - N168 and from N168 - N197, all within a period of 4 months. Why did Ubah not offer to help the administration get the Naira back below N150/$?...Go figure!
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Some papers have reported that the current appreciation of the Naira is due to Ubah's audacious statement, others have reported that it is due to the President’s insistence of no devaluation, others have reported that it is due to inflow of dollars from neighboring countries. You can choose which to believe.
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Cc: @MissingBudget

abagoro:
The fact that oil was selling between 11 and 20 DPB makes him the best manager in Nigerian history.

The Oil price doesn't tell the whole story. You need to consider our population, import bill (balance of trade), FG budget, etc in the 90s compared to what it is today. You'll also need to discount the effect of inflation.
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For instance, even with an oil price of 15DPB in 1995, our budget was less than N200b and our population was less than 100m. Compare that to funding a budget of over N5tn with an oil price of 38DPB in 2016, supporting a population of over 170m. It's even worse when you consider that $15 in 1995 should be worth $84 today using a discount (inflation) rate of 9% pa.
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But, I do agree that the military were miles ahead of our democratic leaders in terms of capital projects. Alscon, NLNG, Delta Steel, 3rd Mainland bridge, Ajaokuta Steel Mill, All 4 refineries, etc are all legacies of the military.

naijathings:
If u have been on a salary of 5,000 naira since January 2015 when d dollar was still around 170, it is logical that you demand a raise because the 5,000 can no longer support you when the dollar is at 400. same thing goes for the oil seller and the garri seller cos d price of d dollar is affecting their daily lives

If the company you work for is already experiencing a challenging business environment due to the rising cost of other factor inputs, how do you think they will react to your demands for wage increase?

tejpot:
Then we should expect increase in salary from all employers

It's an economic quagmire! Employers will tell you that even though they have increased prices of their goods, overall revenue is lower because of reduced patronage. Telling them to increase wages will increase their business cost and further reduce their revenue. They will sack plenty to be able to increase salaries for the few left.

thefakestan:
But Ben Bruce said
Buy naija. To grow the Naira.




But if the naija prices are not high becos of increase in "dollars" what can someone do?


Over to you Ben


ThefakeStan

As more and more people continue to buy #MadeInNaija, the demand pressure on imports will reduce and the Naira will strengthen. This will make other items that increased in price because of weak Naira to reduce in price because of the now strong Naira.

I don't think it's completely out of place for folks to increase the price of their goods and services, even though there is no direct FX input.
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The reality is that these business men/women patronize other goods/services which have increased in prices due to dollar effect. As a result, they have to re-price their items so they can generate enough income to meet the rising price of other items. For instance, mama Nkechi (who sells palm oil or pure water) might need to buy Sardine which has increased from N150 - N200, or replace lost phone which has increased from N20k - N30k, or buy her son a laptop which has increased from N70k - N120k.
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A high exchange rate usually gives rise to (imported) inflation. Should the CBN officially devalues the Naira and fuel price increases, then the inflation will become official. Everything in the market will respond instantaneously with price increase. The REAL value of your salaries will become less since it can now only buy a fraction of what it used to buy.
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Strike action looming from NLC demanding wage increase. Employers will resist, complaining that rising wage will add to the already rising cost of business. SMH!

optimusprime2:
Which is quite likely, especially since he "is" quite capable of pulling a stunt like that.
I mean a man of his caliber is very very capable of pulling it off, as he has the resources, networks, contacts and means to...
So on this one, he shouldn't be underestimated.

Except the dollars he has (or can mobilize) is in billions, then the solution will be temporary and will revert back to current levels in a few months.

InvertedHammer:
/
You just wasted a lot of space.

Uba may not follow your plagiarized analysis but he has done the most important thing--challenge the government.

The FG should take him up on the offer since he is risking his business empire. They can then prove him right or wrong.
/

Plagiarised analysis? Very funny!
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The government does not need to take Ubah up on any nonsense offer. He is a Nigerian elite, he has access to the Presidency, NASS, CBN, media houses, etc. Let him vomit what he has to offer. Why does he need to be consulted before he offers suggestion to help his country in crisis?

stancydg:
Your analysis is no doubt very much on point sir and i must commend you for educating nairalanders but sometimes herculean tasks require crazy, out of the box thought processes mostly displayed by nerds, geniuses, creative folks and more importantly God's prophets, even though I hate to sound religious. A prophet once declared in Israel that the comatose economic situation will change within 24hrs and some experts faulted it, citing economic indices, faultlessly as you have done here but the prophecy came to pass anyway. The business mogul may just have an ingenious solution characteristic of geniuses and nerds or may even be God's prophet to save the nation at such a time as this. I think our govt. should hear him out, especially as some have quoted him as making good some form of gargantuan claims in the past. Cheers bro and may God bless the Federal Republic called Nigeria.

Every Nigerian wants to hear Ubah out, not just the government. But he is being true to type, he wants to be consulted so he milk the country millions in consultancy fees.
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Nigeria is in an exchange rate crisis. If he is, indeed, a patriotic Nigerian, he should air his views openly so we can all interrogate his suggestion. The Israeli prophet you referred to, most likely, aired his views openly.

optimusprime2:
My brother, you just highlighted that this exchange problem is as a result of dollar scarcity in the country at large...
What if Dr Uba has about 100 million or 1 billion $ raw Cash stashed in a vault somewhere, and willingly injects it into the economy by directly exchanging it for naira at a pegged 199 exchange rate at CBN... Do you know that could temporarily drop the rate on the parallel market in a very sharp manner, afterall it's an artificial effect caused by the simple law of demand and supply. Don't forget the official Forex rate for the dollar to Naira is 199... Dr Uba might be making a point you know.
I mean it's not rocket science.

Then that would simply validate my last statement as the only plausible option he may have.

Amucha:
That is the problem with Nigeria and Nigerians. The textbook knowledge is not working yet you you are feeling big to consult. Consult Uba and let him tell Nigerians how he is going to do the magic instead of dismissing his claims with a wave of hand. He talked confidently. You said he has Zero Knowledge on what he is talking about? and he is a billionaire? well, let us consult him, I think we need this knowledge now cos we can't be doing the same thing and expect a reversal.

And why does he need special consultations to help his country in a crisis period? Many Nigerians have been preferring solutions to help the economy, whether their solutions is right or wrong. But Ubah is a typical capitalist who wants to first milk the government of consultancy fees before prescribing his recommendations. Let him say it out and if I find merit, I'll apologize to him.
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Being a successful business man has nothing to do with being a sound Economist.

Mboi:
What you said is absolutely right. I wish Buhari will come, read and digest this so he'll understand the gravity of the blunder he comitted duri g his campaign when he said in Owerri that he'll make $1 equal to N1.
You remember sometime in d past when Okonjo iweala was warning federal and state govts about the drop in crude oil price and how it will affect foreing reserve so badly in very near future. She den adviced that the extra crude account should not be shared and also adviced governors to focus more on IVR and payment of salaries and drop capital projects but they refused.
Now CBN cannot meet demand for fx because of depleting forex reserve. In a bid to salvage the situation, CBN stoped selling dollars to BDC but asked them to source fx from other means so as to meet the customers demands.
Moreover CBN said they'll give license to travelex to operate in Nigeria to replace BDC. Therefore while the exchange rate is now so high in black market is because CBN only sell fx to commercial banks @ official rate of N199 to $1 and BDCs now have limited amount of fx to sell to their customers.
I can tell you that if BDC operators start getting enough fx from neighbouring countries to sell in Nigeria, naira will begin to appreciate and our foreing reserve also will keep increasing gradually.

What Ifeanyi Uba may want to do is to get approval from the authorities and operate a venture like that of BDC and or travelex. With that he can achieve what he said if he can meet people's demand for dollars.

I have already made several comments regarding the $1 = N1 rhetoric. Buhari never made such statement, but that is another story entirely.
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As regards the excess crude account, when it was shared, the FG got 52% of the share. Can NOI tell us how she saved the FG portion?
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Nothing stops BDCs from getting dollars anywhere to meet local demand. CBN only stopped them from getting dollars from the Foreign Reserves.
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We can speculate about how Ubah wants to go about the $1 = N200 campaign, but if it is about setting up a BDC, then I wonder how he will do better than the thousands of BDCs currently existing.
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As I said, it's about supply. Where is Ubah going to get his dollars from? Clearly not from CBN. If he already had his sources, he should flood the market already with his dollars and make a killing from it.

ivili:
i do admire your write up but i believe Nigeria never had $62 billion as foreign reserve rather it was $42 0r $45 billion.The administration increased the figure by adding our excess account.I know you are aware,i just wanted to add that...thanks for the knowledge,ive learnt something positive.

You interpreted my comment as comparing OBJ administration and that of Yar'Adua/GEJ, but that was not my objective. I deliberately used dates without making reference to any personalities.
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My comment simply pointed to the fact that during the GFC in 2008, Nigeria had FR of ~$6bn, and that is a fact. Of course, OBJ left the Reserves at ~$43bn which the Yar'Adua administration built up to over $62bn (just in case that was your point).

Sacluxpaint:
You have the facts on grounds, is there any quickfix SOLUTION to this? I think we have analyzed the problems too much but solutions should be in our comments.What do you think?

There is no quick fix solution. We spend years doing the wrong things and simply want to correct them in months.
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We are in an economic zugzwang. Any policy of the government will have negative consequences, but the govt has to go with the policy with least consequences. In the short term, we can immediately focus on expanding local production/manufacturing capacity so we can substitute for imports. In the long term, we need to diversify our export earnings by exporting other items apart from oil.

movingforward:
this is what i call an educated illiterate conclusion,you mean apart from oil there is no other way to solve this pressing issue?so we will have to wait until the west decide on how much to buy our oil,before we can do business ?all i see in your writes up's are oil this oil that,with a heavy heart i pity your parent's that suffered to train you as an economist,because the conclusion of your useless theory or ideology is that we should just wait,no other option than to wait ,until our almighty master's decide,Oga we need all hand's on the table to tackle this issue,if mr Uba or whatever he call's himself claim to have the perfect wisdom to run the matter and even ask for just one month to fix it,why not try him ?instead you sit in your office n type rubbish and jump into conclusion,if europe is in currency trouble and someone demanded to be consulted to give a solution,they will swallow there pride and consult the person,even from outside there country.

My analysis focused on short term causes, effects and solutions. Of course, in the long term, the country can diversify its FX earnings by exporting other items and reducing dependency on oil FX revenues.
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I will ignore all the other childish insults in your comment.

dancewith:
I beg to disagree on some of your assertion. Contrary to your position we do have control over the supply side. Which is by encouraging and promoting exports. At the moment the FG's policies doesn't .

I stated earlier that the current mismatch of demand and supply giving rise to galloping prices present's a unique opportunity for Nigerians to boost export and export initiatives. Woods, charcoal, lead ore, zinc, cash crops abound which we could easily take advantage of to earn foreign exchange thereby boosting supply

But what does the FG do? They force exporters to sell their export proceeds to the already rich commercial banks at the ridiculous rate of N197. This clearly is a policy targeted against boosting export. Pray, why won't prices continue to rise when you are discouraging imports and exports at the same time

I said that there is nothing that can be done "in the near term". Of course, export promotion can help supply but that is long term. No export policy today can yield results in the next 12 months Our priority should even be import substitution before thinking exports.

ellabooz:
Choi ,so you knew all these and you kept quiet when they were calling for GEJ ' s head for this issue in last administration.
You shall be dealt with thesame measure used for Jonathan, no excuses.
Your narration is here by declared absurd and useless.
Thanks

But you try shaaaa

It's not about me. I'm not taking sides for/against Buhari or Jonathan. I am only making an objective economic analysis of the situation.

mcgaius:
In case you don't know,anything that has to do with the government has to follow a due process.Uba cannot force himself on the government.He has made his claim.Its now left for the government to give him a trial.

So, assuming the government does not reach out to him, can't he discuss the issues publicly? That way, anyone in government can hear and maybe implement it. Why is the information coded?

Sacluxpaint:
Bevista, thanks for this wonderful basic explanation, no one has explained it better on here BUT some of the CBN gov's policies made it worse. Fine our FX has depleted but when you stave the BDCs off dollars, you encourage round tripping, hoarding and the likes. Nigeria has always been importing whether economic recession or not. Funny policies and the panic button makes it sky rocket. Till we start manufacturing, I don't see this dollar coming down, infact its worse to hear that we don't even produce our own fuel. We import it back.

People do not understand how dire the situation is. I'm sure if the CBN were to say it the way it is, we'll all go into complete panic mode.
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When you say the CBN starves BDCs of dollars, the question is - does CBN still have enough dollars to continue funding the BDCs? Secondly, most of the BDCs were doing roundtripping due to the divergence between the official and BM rates.
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Go back and check what our import bill was in 2000 when oil was around $30/bbl and compare that to what our import bill is today. It is more than 10 fold, yet we are to still fund the imports with the same oil price. Add that to the fact our population has increased from ~120m to ~170m. All these add to the Demand pressure. In Nigeria, we do not plan for tomorrow. For instance, most cities worldwide anticipate their population needs in 5-10yrs and start building infrastructure that will support it, but look at Lagos!

mcgaius:
You are part of our problem.Nigeria has many people like you and yet we suffer in the mist of plenty.Imagine you have this knowledge yet we are still sinking in hardship.I guess if the guy that invented air plane has shared his idea with you,you would have discouraged him saying its not possible and quoting all the ancient science that you know.lets give that guy a chance lets know if he really has something to offer so that we do not treat him like a certain Dr Agbalaka who claimed he has the cure for HIV only for the Nigerian medical association threatened him till they killed his dream. You are a typical black man

Nobody is stopping Mr Ubah from sharing his views. He was on air yet he could not say what he believes can save the Naira. Why does he want special consultancy to help his country. A lot of Nigerians debate our problems and solutions openly on air so that others can hear and enrich the debate, but Ubah want consultancy from the government before he can advise them. So much for patriotism.

Ordinarily, I should not comment on this thread since Ubah has not mentioned how he would go about it. However, for the benefit of those who might get swayed by his cheap claims, I'll say something.
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The exchange rate (PRICE of dollars) is determined primarily by SUPPLY of dollars (through exports, FDIs, foreign borrowing, etc) and DEMAND for dollars (through imports, payments of foreign school fees/medical bills, online purchases, etc). The NET flow of these transactions determine the Balance of Payments (BOP) account with the Central Bank. Elementary economics tells us that when demand exceeds supply, prices go up!
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Coming back to Nigeria, it is well known that oil accounts for 95% of our FX earnings. As oil prices have collapsed from ~$100 in 2014 to ~$30, our supply of dollars has dropped tremendously. This is even worse when one considers that our cost of oil production is ~$20/bbl, meaning that our dollar revenue from oil has dropped from ~$80/bbl to ~$10/bbl. On the demand side, the request for imports are increasing. With such supply shock and increasing demand, there is only one way for the exchange rate to go. This is basic economics and has nothing to do with Emefiele or Buhari, except you are simply being mischievous or grossly ignorant.
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When oil price collapsed from around $147 to $38 in 2008 due to the Global Financial Crisis (GFC), Nigeria had a Foreign Reserve of ~$62bn. The then CBN Governor had to spend ~$20bn from the Reserves to meet import demand thereby preventing devaluation/depreciation. Between 2011 & 2014, oil price was above $100, meaning that the administration never had a dollar supply problem and so could maintain a stable exchange rate. Fast forward to late 2014 when oil prices slid to ~$60 and the administration faced its first supply shock, the CBN had to devalue the Naira twice within a period of 4 months (Nov 2014 & Feb 2015) because the Reserves were too low (<$35bn) to deplete to support imports. Now in 2016, oil prices are around $30/bbl while FX Reserves is less than $28bn. The supply shock has reached unprecedented levels, yet demand for imports has not decreased. There is absolutely no way that the exchange rate can stay below N250/$. Simple economics says that price will continue to move till a new equilibrium is reached where demand equates supply.
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There is no policy from Emefiele, Soludo, Greenspan, Bernanke or any other Central Bank governor that can strengthen the Naira in the near term. Except we want to completely deplete the Reserves or go to the IMF to borrow SDRs just to meet import demands. Brace up folks, if oil price collapses to $20 (thereby increasing the supply shock) the exchange rate shall hit N1000/$ and I repeat, this has nothing to do with Emefiele or Buhari but simply economic forces. The only thing that can save the Naira is either for SUPPLY of dollars to increase (through high oil price) or DEMAND to reduce. Since we do not have control over the supply side, we can at least focus on managing the demand side. Remember Ben Bruce #BuyNaijaToGrowTheNaira? It's about demand management.
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So Mr Ifeanyi Ubah, you have zero knowledge on what you are talking about. With all the money you made from the last government, you can start by building a refinery or some other manufacturing facility (like Dangote) to help us substitute for imports. That would help the Naira more than you seeking cheap consultancy from the government. Or except you want to broker a deal for the government to give amnesty to your Dasuki-Gate friends, so they can bring out stashed up dollars from soakaways and graveyards to support the economy.

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“While the CBN has been active in trying different options, business managers and investors are still waiting for the managers of the fiscal policies to present their response to the crises, which should be harmonised with those of the monetary authorities,” he said.

This has been my grouse with this administration. The inability of the FG to properly articulate and communicate its fiscal policies is quite disturbing.
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OK, we should be self sufficient in agriculture, but what is government policy and Strategy for achieving it? Are there any low interest loans for farmers? Are there any government concessions or support for those willing to go into agro-processing? Any government policy to increase cheap access to farmlands? etc.
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We should be self sufficient in manufacturing. What is government target for power generation? Any access to finance for those willing to setup factories? Any Tax considerations? Are there any clear plans and strategies for encouraging OEMs to setup local production facilities in-country?
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What is the government industrialization plans & policies? What specifically are government plans for diversification of the economy? What exactly is government plans to reduce unemployment?
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The administration needs to communicate more. In my elementary knowledge of Finance and Investments, capital only goes to where there are less uncertainties. This government has practically relied on CBN monetary policies with very little input on the fiscal side.

Tpave:
Chai, my naira don finish. But what can be done now to reverse the situation now cos it's getting out of hand?

You do not compare a country's currency solely based on their face/nominal value but based on Purchasing Power Parity (PPP).
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Japan is the world's 3rd largest economy, yet the nominal value of their currency is lower than the next 10 largest countries. South African Rand has a higher nominal value than the Japanese Yen, does that make the South African economy better than that of Japan?

Freelanswer:
I have to acknowledge you're one of the few Nigerians who reason clearly. You have exhibited this in this post especially in the re-quoted paragraph. I only have to add this: Yes, this is the situation with all the oil-based economy, and we know why, but how it is handled could make it better or worse. And the way it is handled depends a lot on the government in power at the moment. I hope you know the current woes with the OPEC economies did not begin today. It began the day America announced the debut of its oil fracking technology. And Nigeria's case began to get even worse from the day America withdrew from importing crude from Nigeria where they were our major market beforehand (This happened way back in 2013). But why is the situation getting so worse so suddenly? I leave your obviously super brain to work this out.

Meanwhile, I don't think anyone has taken any sides here. And 2019 (if Nigeria eventually gets there) is not going to be all about PMB/APC and GEJ/PDP. As far as I know, this has gone into history for ever.

@ $100/bbl oil price and ~$25/bbl production cost, Nigeria was earning ~$75/bbl in crude oil sales. With oil price at $30/bbl, Nigeria is earning only around $5/bbl in oil revenue.
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Oil accounts for 95% of FX revenue into the country. FX revenue currently stands at less than $2b/mth, yet FX demand for imports is well over $3b/mth - creating a negative balance of payments. If the CBN has delisted 41 items from accessing government FX and yet the reserves is still going down, imagine what would happen if the CBN were still supporting all those items.
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Over the last 1 year countries like Saudi Arabia and Russia have spent 100s of billions of $$ to support their currencies since oil prices started going down. Saudi Arabia had over $750b in Reserves while Russia had over $450b in Reserves. Nigeria, on the other hand had only $30b in Reserves.
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Countries shore up their Reserves during oil boom and use those Reserves to support their economies during times of low oil prices. OBJ left over $60b for Yar'Adua in 2007. During the GFC in 2008 where oil collapsed from $147 to $38, Yar'Adua was able to use the Reserves to defend the currency. He had to spend over $15b of Reserves to do so. Jonathan inherited Reserves of nearly $50b and yet managed to deplete it to $30b in spite of the fact for 3 years during his tenure, oil averaged $105. It was only in his last year that oil dropped to around $60. When you also consider that for the 3 years that oil averaged $105, our budget was benchmarked at $75, then one wonders where all the extra $25 went to.
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Jonathan had to devalue the Naira twice in the last 6 months of his administration because he had no Reserves to defend the currency. PMB, unfortunately, inherited Reserves at <$30b and so is incapacitated to defend the naira with oil trading at $30/bbl.
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What is the cause of the huge distortion in exchange rate? Apart from low supply of $$, it is our huge dependence on imports. PMB is trying to encourage Nigerians to become self sufficient source for items locally, which will reduce the pressure on the exchange rate. That is not an easy solution because there are no ready made local substitutes, but that is the conundrum as there is no other better solution. We are in an economic zugzwang - any option you choose leads to some negative outcome, so the president has to choose an option with a lesser negative outcome.
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Pardon my long rants bro.

Benefits of Devaluation:
(1) More revenue for all tiers of government.
(2) Convergence of official and parallel market rates.
(3) From 2 above, reduced roundtripping of dollars by rent-seeking economic agents.
(4) Attraction of foreign portfolio investors.

Disadvantages of Devaluation:
(1) Increase in pump price of Petroleum products or increase in subsidy.
(2) Rise in cost of importing critical raw materials and agricultural machinery/equipment
(3) From 1 & 2 above, rise in headline inflation, leading to reduced purchasing power and increased poverty.
(4) From 3 above, industrial action by organized labour demanding wage increase to counterbalance the effect of devaluation & inflation
(5) From 1 & 2 above, Nigeria continues to depend on imports as high cost of doing business makes us less competitive with imports. Job losses!
(6) The Market Cap & ASI of the Nigerian Stock Exchange gets devalued in dollar terms - scaring away foreign portfolio investors.
(7) High interest payments on foreign loans.
(8.) Devaluation or not, CBN is not likely to re-enlist the 41 delisted items. So how does devaluation benefit importers?
(9) Devaluation will not increase the amount of dollars in circulation or in the Reserves, hence Naira is still likely to continue depreciating even after devaluation.
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Fayose is, obviously, speaking from a position of self interest, since devaluation will increase his allocation by over 50%. However, the FG and CBN have larger macroeconomic issues to worry about than just higher revenue to states.

I have been a proponent of devaluation in the past, primarily because I thought the high exchange rate will rein in our demand for foreign goods and incentivize local manufacturing/production. However, events of the last few months where Nigerians continue to demand for dollars at over N350 has now convinced me to change my views on the subject. Now, #IStandWithBuhari on the issue. The disadvantages of devaluation far outweigh its benefits.

We need to curb our appetite (demand) for foreign goods, that is the first patriotic duty of every Nigerian to save the Naira!

Freelanswer:
You've got a point there. But I think what the OP asks for is how to survive the situation until 2019 in the first place.

Until 2019.... Very funny!
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Venezuela just increased petrol pump price by over 5000%. Their currency (the bolivar) is in a free fall worse than Nigeria. Angola is experiencing similar FX controls like Nigeria. Even oil heavyweights like Saudi Arabia, Russia, Canada, Norway, Kuwait, etc are going through torrid times - either depreciating their Reserves or their currencies. What is happening is not peculiar to Nigeria, but to every oil exporting nation.
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The current challenges have no short term solutions. It will surely get worse before it gets better. If we are not even discussing the issues properly, changing political parties in 2019 will not bring any solutions. Of course, political parties will exploit the situation for electioneering gains, but with no solution.
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Everything (especially macroeconomics) should not always be about taking sides for/against PMB/APC or GEJ/PDP.

SHOPPERS:
Even if he ordinarily registered his dissatisfaction concerning the rise in price, he still have failed. Jonathan met the dollar at about 150 naira and left it around 200 naira within about 6 years.
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PMB met it about 200 naira and now it is close to 400 naira. That is 100% increase.
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Simple Mathematics tells us that Jonathan is 100/33 = 3 times better than Buhari.

I wish it were that simplistic.
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The exchange rate is determined by supply and demand of dollars. Yes, Jonathan met the exchange rate @ N150, but you have to understand that he was fortunate to have more inflow of dollars into the country due to high oil prices. The first oil price shock under his administration (from $105 to $60/bbl) saw the CBN devalue the Naira twice in Nov 2014 and Feb 2015.
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Now compare that to an administration who has had to deal with average oil price of $30/bbl. Meaning that the inflow of dollars into the country has reduced significantly to next to nothing, yet our demand/appetite for imports is increasing. Where does the government get FX to satisfy all the import demand?
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I dare say that with the President’s disposition towards self sufficiency and Imports substitution, the naira would be exchanging for less than N150/$ had PMB met oil price @ $100/bbl.