spinna:
Most cursed "supposedly legal" groups in Nigeria

Nigerian Politicians
Nigerian Police
Nigerian Mechanics

nairalanda1:



You also cannot say that Ghana is better than Nigeria. Ghana is broke, has issues, and is on the verge of a bailout from IMF.

nairalanda1:




Ghana is doing well against the dollar...

Joke of the century.....

for jols sake...one dollar is equal to 1228 South Korean won. Is South Korea worse than Ghana, or even Nigeria?
You can’t use South Korea as an example they devalue their currency on purpose, fyi they are a manufacturing and highly industrialized economy and devaluing their currency would favor them because it means they can dump their cheap Kia and other products in Nigeria in exchange for usd, unlike Nigeria we don’t manufacture neither are we industrialized , our currency doesn’t need all this imf advice on devaluation or floating we should have pegged it at 350 to usd.

If we take your analogy too far, we would be saying that Nigerian economy and Ghana economy better pass South Korea (lol)

That's not how economics works. That a country has a currency that is 'stronk' does not mean it's economy is doing well.

P.S Add two zeros to anything in cedis...and you may get an idea.

GerogeI:


First our GDP is not insignificant, so we do not have forex issue cause if IOCs remittances, but because of a dumb Government, they have no idea of what a free market is. They floated the Naira against foreign currencies which is creating foreign currency demand, without floating foreign currencies against Nairà to create Naira demand in order to arrive at equilibrium pricing.

That's what you are calling IOC remittances. Basically, for you to float your currency, your exports should be in your currency. So foreign importers will approach your banks to get your currency in order to buy your items. They will have to haggle with your bank for an exchange. Basically your banks will be negotiating for more dollars for less Naira in order to make profit. That drives exchange rate in favour of Naira.

But now, we only have local importers going to ask banks for foreign currency, banks and bdcs must make money hence they will negotiate for more Naira for less currency. That drives the exchange rate against the Naira in a bottomless spiral without counter balance.

If you do not have demand for raw local currency, and demand for raw foreign currency in the market, float one of them is a stupid idea, cause there is no counter balance. It is not a free market. In the Current case, the exchange rate will not favour Naira even at 10,000 Naira to 1 usd it will still be sliding down against USD. The fall is bottomless, that why it's stupid plain and simple.



Why do we not have foreign demand for Naira, the Federal Government and politicians want easy access to USD. It makes money laundering easy. If you visit any ministry in Nigeria. Listen to the directors, they do not talk in Naira anymore. They are all dollarized. So just like Russia started selling oil in Rubbles, Nigeria must first sell oil and all other exports in Naira before floating the Naira. That's why past Govt. Maintained fixed exchange cause they want CBN to collect dollars for them. This one still wants CBN to collect USD, but wants to play with the idea of floating Naira to please western interest in devaluing African currencies to get cheap raw materials. Basically it was to buy for the controversial govt. Legitimacy in the eyes of the West.


Only countries with huge manufacturing like China, or Germany can benefit from currency devaluation. Like
you said, Raw materials exporters like us are better of with commodity based currency like gold, which the West have carefully killed since colonisation. If you use any commodity as money, it is resource based economies like Africa that benefit. If you use paper based manipulative currency, the technology based economies like West Benefit.


This warped decision on floating is my only reason to believe that Tinubu was never an accountant.

GerogeI:


The corruption in CBN has no direct link the exchange rate. There are many other ways to allow banks handle forex flows independently not CBN.

Defending naira means using your export earnings to pay your import demand. This is not the problem, every country is doing this one way or another.

The problem lies in overcentralization of forex controls where all dollars goes to CBN, and is made available for politicians, who prioritize their access to local value. The consequences is that they artificially devalue the local currency every time their is a pressure of higher import than export.

A simple way to understand this is to compare Nigeria Import /Export Ratio in USD. This Ratio in ideal situation should be the exchange rate of naira to USD.
For 2022, Nigeria imported 56.3 billion USD worth of goods. And exported 46.9 billion USD worth of goods.

Our import exceeds our export by 10.6 billion USD., And the Ratio is is 56.3/46.9=1.2. The USD should be worth 1.2 Naira. Let's consider all the imperfections in the system and make this 10 times worse than ideal. 1 USD should be worth 1.2x10=12 naira.

Let's do a similar Analysis for a comparable African country, Egypt. In 2022 Egypt imported 85.76 billion usd in goods, and exported 51.6 billion USD. Egypt Import Export Ratio for 2022 is 85.76/51.6=1.66
Multiply by 10 to consider real world imperfections, Egyptian pounds should exchange at 16.6 To USD. In reality Egyptian pounds traded at 15 to 1 USD in Jan 2022, and 24 to 1 USD in Dec 2022.

Let's look at South Africa.

Imports 2022 was 136.2 billion usd
Exports 2022 was 122.9 billion usd

Import Export Ratio =136.2/122.9=1.10
Multiply by 10, 1 usd should ideally be 11 rands.
In reality in 2022, 1 usd was 16.88 rands.


These comparisons shows you how well the economy is being managed. For Nigeria instead of 1USD to 12 naira in 2022, we had 740 naira.
Our economy and currency is simply being mismanaged for politics and theft, and its been going on for decades. Currency devaluation not only enables politicians to steal, they use it to please the West. It should banned by law.

When was the last time naira exchanged at 12 naira to 1 USD? How much has the Naira been devalued? As at 2022, it was 740/12×100=6166% devalued.
This is the only reason coins have no value any more.

Someone will come to argue we should use forex earning not import and export. They mirror , so it's same thing. Or they can argue that our population is large. It reflects in the size of our imports, vs local production. The summary is that Nigeria earned only 20% less foreign exchange than it needed for purchases in 2022. How that warrants today's exchange rate of N1150 to usd is a mystery. But that forex is scarce I'd a big fat lie we have at least 80% of what we need.

TomjoTM:
People still overestimate the influence of the North and underestimate PBAT, The influence of the North was orchestrated by the divided south and sustained by the military rule, and thus, has given an illusion and perhaps impressed on a lot of people that the North has absolute power and influence, but without the Military rule, the North has no leverage. The military rule made Babangida, Abdulsalam and a host of other former military boys who would otherwise have been unknown really influential and be in a position to control our political scene the way they did decades back.

Democracy on the other hand is a totally different game, the influence those retired northern military boys had on Obj in 1999 has dwindled so much that for the first time in our history, an election was won by a civilian without any significant role or influence of any of those Northern military boys, reason why a Wike can be FCT minister and southerners appointed head to where exclusively used to be northerners playground. Doings like that are doings of a man devoid of any external control, and for as long as we continue to run a democracy, northerners have nothing on southerners. Abiola and PBAT have proven how easy it is to get the northerners to do your bidding, easier to control the northerners than the southerners, you just have to know how to tactically and strategically use them, they are highly predictable.

BennyDGreat:


What implications

stuffs2002:



Stop being a pessimist.

Robots are used extensively in China and they are not running from it.

kaysi:
We are getting there