₦airaland Forum

🚨 BESSENT URGES CHINA NOT TO DEVALUE THEIR CURRENCY

naptu2:
This debate about the exchange rate is one of the reasons that I was writing that SAP series last year. Unfortunately I never finished it. The debate is also related to the technology thread that I was going to write (believe it or not, I uploaded a lot of pictures on this thread and I hoped to use the pictures in the series, but I never wrote that series).


Around the time of the SAP wahala (late 1980s) the United States was putting enormous pressure on Japan to increase the value of the yen. We used to make fun of currencies like the Japanese Yen, the CFA Franc and the Italian Lira in the early 1980s. Those currencies seemed so weak. So why was the US hounding Japan about the value of the Yen?


A "weaker" Yen meant that Japanese products were cheaper than American products and at that time Japan was severely beating America in the technology sector. As I was going to show in that thread, your house would have been filled with Japanese technological products and would have no American technological products if you lived in Nigeria in the early 1980s. The Americans believed that the Japanese were artificially keeping the Yen weak in order to boost their exports and defeat American products in the market.

The Americans had a similar battle with China in the 2000s.


That's why I said that SAP was not necessarily a bad policy, despite the havoc it wreaked on Nigeria, but rather the problem was bad timing.

Nigeria had become dependent on foreign products by the time of the 1982 oil crash and it was destroying our economy. The idea behind SAP was that Nigeria should devalue its currency and cut spending, so that Nigerian goods would be cheaper and the country would be more competitive in the international market. There were two problems with this. (1) There were no large wholly domestic companies to take advantage of this policy. Most of the large companies in Nigeria in 1986 were either foreign companies or were owned by government. The government companies were not ambitious and were only interested in serving the domestic market, while the foreign companies were, well, foreign and did not have to produce from Nigeria (2) The devaluation of the currency and increase in import tariffs meant that some manufacturing companies found it difficult to import raw materials (that's one of the reasons that Volkswagen left).

SAP would have been more effective in the Obasanjo era when we had companies like Dangote, Glo, Zennon, Zenith, etc that could take advantage of it.

naptu2:
Difficult part

This brings me to something that I have wanted to explain since 2012. I have explained a bit of it when I wrote about the way we viewed the Yen and the Lira in the 1980s.

What is most important is not the nominal value of the naira, rather the most important thing is its stability.

Some countries try to keep their currency low because it benefits them (more exports). I gave you an example of China in the 1990s.

Some countries like Nigeria often try to keep their currency high (cheaper imports).

However, the most important thing is some kind of natural stability (not artificial stability). This is because people, companies and governments use the currency to plan and you can't plan if the currency is not stable.

Imagine that you take a dollar denominated loan to carry out a project and you expect to pay back the loan with revenue from naira payments by customers. It will become very difficult to repay that loan if the naira suddenly loses half of its value. That means you'll need to pay twice as much as you planned to pay. Where will you get the money from?

That's what affected Etisalat, Lekki Concession Company and has now affected Hajj planning. It almost affected Dangote and MTN.

Ttalk:
You can do better than this.

I expect an educated person to add value to the discussion and bring out facts to back his position

Ttalk:
It is now the best times for AGOBI and Obidients to make money, hope all of you are ready to sell all your Nigeria properties and hold it in dom account to benefit from the weakening naira.

If you cant do that then you just playing politics, you should be ignored

TouchNfollow:
Source:
https://saharareporters.com/2025/09/27/forbes-report-says-nigerian-naira-now-ninth-weakest-currency-africa#google_vignette

anonimi:
World Bank offers Nigeria forex rate advice, as Tinubu eyes N200/Dollar rate

April 23, 2023

The President-elect said he would work with the Central Bank of Nigeria (CBN) to *bring down the exchange rate to N200 in his first term.*

“My administration will collaborate with the Central Bank to harmonize the fiscal and monetary policy to achieve immediate stabilization of the value of the naira against the US dollars and other currencies and in the short term, strengthen the naira by boosting the supply of foreign currency and moderating demand.

“The short-term goal is to achieve a naira/dollar rate of 300 naira/US$ and gradually achieve a less than 200 naira rate over the next four years, Tinubu stated.

https://www.ripplesnigeria.com/world-bank-offers-nigeria-forex-rate-advice-as-tinubu-eyes-n200-dollar-rate/?amp

LZAA:
Who be this one abeg
Keep your propaganda in one place
Smh

BangaRice:
Not as weak as the numbers says. Deregulation of forex sales is not weakening. The true Value of naira has always been low but it was subsidized.
Thats like saying petrol should keep selling for what it sold for when subsidized.

surgical:
you still saying this gibberish, nobody was subsidising any forex ,they fix it the prices based on what they want to achieve, Tinubu devalue the naira without having the production to export being a net importer ,that was a dumb move ,there is no painting anything, if it were a smart move we will all see it in manifestation not in explanation
What Nigeria is feeling is the effect of a wrecked economy

Kindered:
see this one twisting the clear fact. Naira is finished, your propaganda won't save it, take your crumbs and eat with no dignity. FORBES na Sahara reporters abi?

Typing:
Tinubu's incompetence cost this. Naira was doing well during Buhari. Tinubu came with his incompetent Government and destroyed our economy. Everything has changed for the worst.

tunjijones:
Which propaganda. Is Ghana better than Nigeria. Is life easier in Ghana compared to Nigeria? Is Ghana economy better than Nigeria? Is cost of living cheaper in Ghana than Nigeria? One Ghana ceddis is 220 naira, why are Nigerians not fleeing in mass to Ghana?

Please provide answers to these questions if you can.

LZAA:
This silly propaganda had been bursted on X and other platforms
Again keep am one side

Mynd44:
This reports can only be taken seriously by people who dont understand how international currencies work.

This report means that the Ghanaian Cedis at 12.31 is stronger than the South Korean Won at 1,409.20 to a dollar.

Okay na

KnowAll:
Seirra Leone has redominated it is now 1 to 20

TouchNfollow:
Source:
https://saharareporters.com/2025/09/27/forbes-report-says-nigerian-naira-now-ninth-weakest-currency-africa#google_vignette

erad:
How do you call a currency weak because of how much it exchanges with the dollar? The value you get for $1 dollar in Nigeria, can you get it for $1 in those other countries with 'stronger' currencies?

Forbes should know better.

Ttalk:
You can do better than this.

I expect an educated person to add value to the discussion and bring out facts to back his position

KnowAll:
Seirra Leone has redominated it is now 1 to 20

lordm:
This kind news gives obidients joy and makes tinubu supporters sadness

naptu2:
As I said, it's time for people who understand how economies work to take advantage of the situation.

Walter Bloomberg @DeItaone



https://x.com/DeItaone/status/1909935554948440313









That's for people that understand economics, not BangaSoup or BangaRice.