₦airaland Forum

Foreign exchange is not something you fix/ manipulate in your room and expect the world to abide by. Nigeria must have a product or service to offer the globe in exchange for the FX. None of that has changed and our export volumes are stagnant and even retrogressing.

What is Nigeria’s balance of trade to the point of floating fx?, I am not saying that the gap between CBN rate and parallel market market should be left as is … definitely, efforts should be made to bridge the gap through devaluation, more USD supply and relaxing some of the fx transaction restrictions

For Nigeria to conveniently float the rates, we must get our balance of trades rights. Until then, the CBN must have some control over the rates. The parallel market is sustained by real fx demands which you can’t wish away. with this floating, speculators and banks will drive the market while CBN plays catch up.

USD will exchange for 1000 naira in 2 months

kaydee007:
Something New Is About To Happen’ – Pastor Adefarasin Speaks On Tinubu’s Administration
Senior Pastor of House on the Rock, Pastor Paul Adefarasin, has applauded President Bola Tinubu, for the suspension of the governor of the Central Bank of Nigeria (CBN), Godwin Emefiele.

Recall that Emefiele was suspended as the apex bank boss by President Tinubu last week Friday, and was subsequently arrested by operatives of the DSS in Lagos and flown to Abuja in a private jet on Saturday.

Speaking on this, Adefarasin declared that the arrest is the greatest news in recent times, stressing that Emefiele has misguided and misused the wealth of the nation.


According to him, the latest development is a sign that something new is about to happen in Nigeria and urged Christians to be sensitive about the new thing which is about to happen.

He should just shut up. All these tribal pastors who cant speak the truth ..... always trying to be politically correct.

tsdarkside:
how high the exchange rate is doesnt matter solong we produce and sell to others....

japanese yen is very high too but the difference is they export alot....
next step is to criminalize black market rates....

As long as CBN cannot satisfy all fx demands, and we still need Form A, M etc to source FX from the banks, black market aint going anywhere.
Nigeria is a highly import dependent nation. Until our balace of trade is positive, all of these actions by FG and CBN are knee jerk reactions.

"Although the naira closed at N702/$1 on the I & E FX window, data from FMDQ showed that the highest spot rate recorded was N791/$1"

"Also, on the parallel market, the nation’s currency depreciated by N7 from N755 to a dollar the previous day, to N762 to $1 yesterday"

Lessons will be learnt

Proper planning was required for rate unification. Neither CBN nor FG had a grip of the market to open it up to supposed market forces. This is definitely a game speculators and banks love to play.

Okay

Global investment and financial institution, Goldman Sachs Group Inc., has said the devaluation of the naira by the Central Bank of Nigeria (CBN), though necessary, was not a sufficient condition for unifying the official and parallel market exchange rates.
In the same vein, renowned economist and Managing Director and Chief Executive Officer of Financial Derivatives Company Limited, Bismarck Rewane, yesterday, urged the federal government to implement institutional reforms to augment ongoing monetary and fiscal policy reforms.
This was just as the naira depreciated further yesterday, to N702/$1 on the investors and exporters’ (I & E), lower than the N664.04 to a dollar it closed the previous day.


Although the naira closed at N702/$1 on the I & E FX window, data from FMDQ showed that the highest spot rate recorded was N791/$1.
Also, on the parallel market, the nation’s currency depreciated by N7 from N755 to a dollar the previous day, to N762 to $1 yesterday.
The central bank on Wednesday, collapsed all of its multiple official FX rates into the I&E window.
Goldman Sachs Group noted that while the end-game for monetary/FX policy in Nigeria was still, “quite uncertain, we nonetheless interpret the incremental developments as positive.”


Specifically, Goldman Sachs noted that the apex bank had failed to “provide any clarity on current/capital account FX restrictions that result in a parallel market exchange rate that is weaker than that offered at the official window(s)”.
Goldman Sachs also stated that easing FX restrictions and clearing the FX backlog which it estimated at $12 billion, would be required to achieve a unified naira exchange rate.

https://www.thisdaylive.com/index.php/2023/06/16/goldman-sachs-naira-devaluation-not-sufficient-condition-for-exchange-rates-unification-wants-clarity-on-fx-restrictions

@mynd44

Guestlander:
Petrol subsidy at such a staggering amount is foolish. You actually think you benefit from it? No, only a few rich Nigerians are getting even richer while other sectors of economy suffer.

Think.... Nigerians think. Why throw away the baby and the bathing water?

Why not go after the few rich men who erode our subsidy through corrupt means than transfer the suffering on the entirety of Nigerians?

Where are savings from the stoppage of diesel and kerosene subsidy. They looted it all and same will be the case for fuel subsidy. Nigerians will be enmeshed in hyper poverty for no real reasons

Floating the naira is a very wrong move.

We do not have sufficient fx to float the naira. So-called market forces will drive exchange rate to 1000naira per USD

CBN will play catch up with speculators and banks if the naira is truly floated

GreaterFuture:
Should this Become the case, Will CBN be supplying it at that 1000/$ rate?

CBN already told you they will sell at market rate. If they sell at a lower rate, that means its no more floating.
That means we are back to where we started if CBN sells at a rate lower than market rate because everyone will target same CBN FX.

Nigeria does not have sufficient FX supply to float the exchange rate

CodeTemplar:
Record debt, and when the debt became too much, the man of the house[leader] stopped transportation[petrol subsidy], education[student loan] and pocket money[collapsed exchange rates] of the children in order to buy televisions and food processor[unutilized infrastructures] of almost nonexistent food on table.
His beer parlour friend[IMF and WB] are applauding him and calling his malnourished children[masses] slim and fit instead, yet he believes all is well.

Apt analogy

There will never be an answer to that question. I have never seen a people so in love with their oppresors

They take away the only thing the govt offers its people without plan to make life easier or reinvestment, the mumu masses applauds such even when its obvious that the savings will be looted at the expense of increased suffering on the Nigerian people.

They take away education funding and offer you loans to afford same education, another foolish round of applause

Why can't Nigerians ever think? Why are we so dumb?

I expect the Tinubu praise singers to milk this one ..... even without any output

Enough of the noise

This is what you get inflicting people-unfriendly policies without solid plans.

Tinubu’s policies are utterly reckless. Mumu Nigerians hail textbook policies that don’t apply directly. The negative impacts are not short term either cos there are no plans to cushion them.

With limited supply of FX, floating the exchange rate means banks and speculators will determine the rates while CBN plays catch up. I project USD will hit 1000 naira in one month.

Fuel subsidy removal only frees up money for looting by the political vultures. Tinubu cannot stop the criminals that supported him to power. If in doubt, point me to the savings from diesel and kerosene subsidy stoppage. Besides no plans to manage accompanying inflation.

As for stopping the funding for tertiary institutions and instituting student loans, it only means the poor cannot access tertiary education again. Forget the loan, the bureaucratic bottlenecks will ensure the average youth cannot access i

helinues:
?

You have little knowledge about this discussion.

Is Dangote an oil marketer to determine the price of a liter of PMS?

Is it not obvious you have absolutely no clue about this subject? .... I have only followed your thought process to see if you had any interest in learning.

1. Dangote owns a refinery that will produce and sell refined products (PMS, AGO, DPK etc).
2. Dangote will sell at a price ...... and that price will not be very different from what other global refineries sell because he will purchase the crude oil at global rates too
3. I have pointed you to comparable rates applicable in nations with refineries..... https://www.globalpetrolprices.com/gasoline_prices/
4. I have also mentioned that Gasoline/ PMS/ Fuel (which ever name you choose) will be sold at a price above 1USD per liter by dangote


Now i need you to respond intelligently if you can

helinues:
Chai, Dangote sell liters of oil?

What's the business of a refinerer with the amount they sell a litre of oil in the market?

Please dont divert the question and its okay if you dont have an answer

How much do you think dangote will sell a liter of PMS (GASOLINE) and what is the basis of your answer?

False news.... It was a closed ballot

helinues:
How many liters of unrefined products is FG paying as subsidy, how many litres of refined products make it back to Nigeria?

You have refused to answer my question.... I will ask a more simpler question this time

How much do you think dangote will sell a liter of PMS and what is the basis of your answer?

Grayoso:
The Nigerian Higher education model is substandard. It is not difficult to prove this.

As a side issue, please never mention Nigerian private Universities as validation of an argument for provision of even standard higher education training.

Most Nigerian private universities are a 'Chicken shed' joke catchphrase for cynical profiteering and opportunism of businessmen who know nothing about the provision of optimal education and only see money they can make from a populous but desperately hopeless people.

What you identify correctly, even if you have proffered the wrong validating argument, is that Nigerians do not have intellectual deficiencies in comparison to others.

This, and nothing else, is why Nigerians excel when placed in systems, abroad, where success is commensurate to natural talent and hunger for success.

Those systems incentivise citizens to be their best because their inventors know that is what spurs and will continue to maintain productivity and innovations for modern societies.

What we have today, per higher education i.e degree, post grad and PHD level, is an insult to the potentials of Nigeria that needs to be binned and replaced with a model that can produce optimally educated Nigerians, not deficient in comparison to anyone, who can
provide solutions for a society and even enough to export, as skilled labour, to assist others solve problems outside the borders of Nigeria.

If you can show me one Nigerian firm that is even remotely close to Julius Berger in top level civil engineering Project deployment accross Nigeria, talk less of even the world, then I will concede you are correct and I am wrong

As long as we continue to import specialist skills, from overseas, to tackle our problems in Nigeria then it means our training or intellect is inferior.

I don't believe it is intellect given how Nigerians excel when optimally trained and educated outside Nigeria. Logically, any averagely intelligent adult will conclude our training is the problem. Over to you Sir.

I think you made my point already. "Nigerians do not have intellectual deficiencies in comparison to others". The enabling environment is all that is required.

Infact i go further to say that irrespective of the level/ standard of education that Nigerian university offers.... without an enabling environment to apply such education, it a lose-lose scenario.

Finally, What you see in private universities today will be the best case for the government universities if these policies sails through. Tertiary institutions will become a cesspit of corruption and looting to levels never experienced in the history of Nigeria. I repeat, no sector of Nigeria operates in a vacumm...... Nigeria/ corruption happens to them all.

Sitwalkstand:
Here is my honest view

It is too early to score Tinubu high. Have you seen a new employee start work before? They are at their best trying to impress. When you tell an employee that he is on probation period of 6 months before he is confirmed as a full staff. The staff brings his best in that 6 months. seeking to impress with best behaviour.

Tinubu is good at the game. He knows that so long as the case remains in court, he is on probation. The smart thing to do is to gain endorsement of the people. win the heart of Nigerians by bold policies and and decisions.

Nothing sweets a Nigerian like when you say you have arrested a politician. even if you plan to let them go after the media headlines.
We have seen arrests, Buhari arrested Dasuki and many others. Today, all of them are in their houses eating their loot. Nigerians forget very easily. While we celebrate these arrests. Tinubu may be after political cabal in the villa who frustrated his presidency. He will have intel of those who were against him. So, might not necessarily be a fight against corruption. How do you arrest Emefiele without arresting Mallami and Maman Daura. Buhari was Nigeria's minister for Petroleum for 8 years. All the oil theft, racketeering, missing oil ships happened under Buhari as minister. Buhari has questions to answer.

Yes,

1. Tinubu has made bold decisions.
2. The successful removal of the subsidy was because those in the game are people he ( Tinubu ) knows. He knows where to hold them if they dared him. Peter Obi may have taken up to 5 months to successfully remove it because they would have opposed him big time
3. The conditions to get that student loan is as difficult as trying to be a virgin after 3 kids. go and read the entire document and see that to access the loan, you need to present your head on the table.


So long as Peter Obi and Atiku are in court. Tinubu will keep dolling out solid policies which Nigerians will gain from.

His real tenure starts if he wins at the Tribunal. If he continues to roll out people friendly policies after it, then. Happy days.

Till then, i will score him 2/10 (Two over ten)

What are your views and what will you score him?

Apologies but the policies are ill-thought and not people friendly. The objective of the policies are not also what you think its is

Tinubu’s policies are utterly reckless. Mumu Nigerians hail textbook policies that don’t apply directly.

With limited supply of FX, floating the exchange rate means banks and speculators will determine the rates while CBN plays catch up. I project USD will hit 1000 naira in one month.

Fuel subsidy removal only frees up money for looting by the political vultures. Tinubu cannot stop the criminals that supported him to power. If in doubt, point me to the savings from diesel and kerosene subsidy stoppage.

As for stopping the funding for tertiary institutions and instituting student loans, it only means the poor cannot access tertiary education again. Forget the loan, the bureaucratic bottlenecks will ensure the average youth cannot access it.

Nigerians deserve all they get cos they can’t think.

helinues:
How about money saved from shipping to and fro?

How much is the shipping savings per liter?,

Benchmarks already exist on the prices of refined products in countries with functional refineries and without subsidies and shipping cost. Infact, i project that dangote product pricing will be more expensive than global market prices (> 1USD per liter) due to corruption and lack of infrastructure.

Again see prices of gasoline in countries with refineries
https://www.globalpetrolprices.com/gasoline_prices/

helinues:
This one no even dey positive about the Dangote refineries which will save the cost of first, exporting the crude oil to other countries, importing it back to Nigeria .

Funnily, FG has been paying ghost subsidy money as half of those products don't make it to Nigeria

How will dangote refinery save cost?, do you think dangote will sell at a rate less than global market prices?

The minimum dangote will sell is 1USD per liter and the prevalent exchange rate at the time will determine the price at the pumps. If in doubt see link below for prices of gasoline in countries without subsidy

https://www.globalpetrolprices.com/gasoline_prices/

Make una dey joke

False, No source ...... anybody can put this spreadsheet together. It was not an open ballot election

Grayoso:
I gave the UK as a random example where a move away from subsidized University education has worked successfully. It is not the only example.

Nigeria can modulate her own model, under Tinubu, to facilitate our peculiarities. Some of which you highlight.

To argue against what is a clear, developmental and evolutionarily progressive way forward is lunacy.

I don't even need to go more than a mile from my Lagos home to note that Nigeria is not producing anywhere near the standard level of graduates required to deliver "Nigerian solutions for Nigerian problems".

When you replied with those words, I am sure you were not ignorant of their implications given that the UK, with a far superior University education in comparison to Nigeria, continues to produce graduates who can deliver solutions for the UK and the world.

Whereas Nigeria, as a sad example, does not have one civil engineering firm, driven by Nigerian graduates, that can deliver Lagos Fourth mainland bridge start to finish because we simply do not possess the education system to deliver that sort of highly skilled world-class labour.

Truth is that this is a redundant back and forth discussion, perhaps tainted heavily by sentiments and emotions, we should not even be engaging in.

Incentivising the University level education of Nigeria to produce highest calibre graduates, with a capitalist funding model, will provide great yields for Nigeria.

This is because it can deliver superior graduates who can provide "Nigerian solutions for Nigerian problems" as a way forward for us nationally and internationally.

How can you be blind to this simple concept and the ruthless drive, even if uncomfortable in the short term, to achieve it?

In fact most progressive observers and analysts would argue Nigeria, far more than the UK and USA etal, needs a competitive University education system that will produce premium level graduates who can begin providing solutions for all sectors and fields of Nigerian socio-economic deficiencies !!!

What obtains today is dross and abject mediocrity where a secondary school student in the West can think and provide solutions better than most Nigerian University graduates. We must turn this deplorable status quo around if we want to become a developed nation and the true giant of Africa meritoriously.

Without getting into much details, the educational system you tend to project are already in practice in the private Nigerian universities .... then why is there a gap in the application of acquired education?. The answer is simple, its the environment... the enabling environment.

No sector of the Nigerian economy operates in a vacuum and corruption applies to all. Infact I will argue that our education (even with its subsidy) in Nigeria is not substandard because Nigerians perform wonders when they travel to developed nations and without any additional education.

Stop treating the symptoms, treat the ailment. How can we all adopt all western policies without the corresponding enabling environment it offers. I repeat, Nigerian solution for Nigerian problems....... Nigeria is not ripe for unsubsidized education. The politicians should stop the looting and reduce the cost of governance to fund the education sectors. Nigerians have suffered enough.

A lot of developed nations still subsidize education, stop pointing the US alone as its not the only developed nation

It’s not that simple. Foreign exchange is not something you fix in your room and expect the world to abide by. Nigeria must have a product or service to offer the globe in exchange for the FX. None of that has changed and our export volumes are stagnant and even retrogressing.

What is Nigeria’s balance of trade to the point of floating fx?, I am not saying that the gap between CBN rate and parallel market market should be left as is … definitely, efforts should be made to bridge the gap through devaluation, more USD supply and relaxing some of the fx transaction restrictions

For Nigeria to conveniently float the rates, we must get our balance of trades rights. Until then, the CBN must have some control over the rates. The parallel market is sustained by real fx demands which you can’t wish away.

USD will exchange for 1000 naira in 2 months

RIP to him

False, No source ...... anybody can put this spreadsheet together. It was not an open ballot election