SIRTee15:


Most global currencies may depreciate this year....
American dollar may escape the hammer, because they are like the de facto global currency....
Federal reserve can afford to print more dollars not backed on any transaction n get away with it.....
They will simply export the inflation.....

Nigerian CBN dont have that privilege....
Printing artificial naira into circulation will only breed internal inflation....
The only way out is to devalue the naira.....

The above is why America will fight and destroy any nation that attempt to replace dollar with an alternative global currency.....
The free money is just too sweet to abandon....

Mizwisdom:



So you agreed that America is a scam? If it wasn't for the dollar being a defacto currency, it would have been almost valueless by now so why Lord it over others to devalue when we all use their currency? they predict doom and gloom for others because they simply go and print more and more dollars to help them stay afloat. Allow others to extend some level of independence and stop this gloomy tales, nobody holy pass.

meavox:


Can Nigerians compare themselves with Chinese?

Chinese love themselves. Do Nigerians?

Chinese deal harshly with corruption. Do Nigerians?

Chinese used Science & Technology to develop fast fast. Can Nigerians who depend on juju, on miracle, on say it and claim it, on visions, on "man of god"?

My brother Nigerians are NOTHING at all like Chinese. It's to me a great pity.

iamJ:
china has population and they used it to their advantage, provided cheap labor for the world, when you come to make your product with their cheap labor, they will copy ur products and make cheap versions that's china

So I no understand wetin concern Nigeria with china progress, that method can only be done once

All those plenty jobs took many Chinese out of poverty and made many rich

Also na communist state so if you do company government will assist you to blow, America do it to they call it bailout

Nigeria no follow for anything na church we know

PHijo:


....because Nigeria has got no choice!
Whether she likes it or not, the Naira will be devalued until she starts doing things the right way or cease to exist as a country.

There is no way Nigeria's government can pay salaries or contractors under the current circumstances. If Naira loses value by say 50 percent, it means the government will have double to spend in Naira terms.

That is one of the reasons some of us insisted on a deregulation of the downstream sector in 2012. The 'know it all' people in Lagos had their way.

Many unsustainable policies are being embarked on. In 2016 there was a golden opportunity to deregulate, Buhari failed to. There is another opportunity in 2020. Nigeria has failed to use it thus far.

We can avoid devaluation if we remove fuel and electricity subsidies. Reinvest all of that money in industrialisation, cut recurrent expenditure ( including Aso Rock & NASS). Place a permanent cap on how will be spent on budget from oil sales. Any excess should go straight to the Sovereign wealth fund. Weigh the funds investment to be 20-25 percent Nigeria, 30-40 percent Africa and 20-30 percent the rest of the world.

Anything short of that, we are just playing like children will usually do.

Mizwisdom:



So you agreed that America is a scam? If it wasn't for the dollar being a defacto currency, it would have been almost valueless by now so why Lord it over others to devalue when we all use their currency? they predict doom and gloom for others because they simply go and print more and more dollars to help them stay afloat. Allow others to extend some level of independence and stop this gloomy tales, nobody holy pass.

SIRTee15:


Yea I agree, but global economy don't operate on sentiment.....
After preaching equity and fairness, every country does what's best for its economic interest and survival....

Nigeria at the moment can't afford to support the naira.....
It will be too expensive and an eventual futile effort....

The global economy will enter recession this year and that will definitely affect the price of oil.....
Except Nigerians also reduce their appetite for foreign good....
I don't see how the naira will come out of this unscathed....

SIRTee15:


I wouldn't agree America is a scam...

American economy is the reason globalisation is successful....
No country in the world can have such alarming trade deficit and still remain stable.....
America's ability to sustain huge negative account balance, means emerging economy can embark on export oriented economy.....
These emerging economies have been able to build a solid industrial economy n a growing middle class courtesy American strong import apetite.....


In return, the whole world has to use the dollar has the global currency....
This means Americans can continue to afford cheap goods from other parts of the world on Amazon or Wal-Mart shelf....

Now if u want America to give up his dollar privilege status....
U had better find another country with a huge import apetite and a middle class with strong consumer spending....
And good luck with that.....

The possible scenario is a repeat of the 1930s depression....
When every country wanted to export, but no one wanted to import....

iamJ:
Yes Bloomberg

Try to cause changes in developing nations that favors you


Na so they try to do with China

China ignored them back to back


Today look at china

They may be Currency manipulators but they are the 2nd biggest economy in the world


Economic analyst are no different from those lotto players all na guess work

iamJ:
Yes Bloomberg

Try to cause changes in developing nations that favors you


Na so they try to do with China

China ignored them back to back


Today look at china

They may be Currency manipulators but they are the 2nd biggest economy in the world


Economic analyst are no different from those lotto players all na guess work

iamJ:
Yes Bloomberg

Try to cause changes in developing nations that favors you


Na so they try to do with China

China ignored them back to back


Today look at china

They may be Currency manipulators but they are the 2nd biggest economy in the world


Economic analyst are no different from those lotto players all na guess work

uncle005:
Still struggling with your point, Nigeria Govt cannot pay salary under this present circumstances, meaning with current value it is difficult for govt to pay salaries.

Then with devalue naira by say 50% according to you, govt will spend double, i am still strugling with that.

The only point i will agree with is removal of subsidy. But this present govt are not proactive enough to prepare structure for subsidy removal

PHijo:


Let me try to explain it. You have $100. With current exchange rate it is 380. A month ago you used to have $200. Then exchange rate to Naira was 300 Naira. Meaning your $200 will fetch you 60,000 Naira. If exchange rate falls by 50 percent it means you will get 60,000 for $100.

Let's assume you had a cleaner and cook, both are being paid 60,000 Naira per month. When you had $200 you could conveniently pay them. Now you have $100 you can only pay half of their income with the current rate, borrow to pay or hope the exchange rate changes.

In the case of the government it is different, they can influence demand or supply of the Naira. With that, 30,000 minimum wage can be paid despite the fact Nigeria's net US dollar earnings has dropped.

What this means is that Nigeria can earn 1 dollar but decide to treat it like 300, 600, 900, 1,500 or any other amount they wish to treat it as.

Often what people look at when 'subsidy payments ' are made is the subsidy component. We tend to forget that the commodity is paid for in USD. In essence we deplete our reserves the moment we import and we further deplete it through subsidy payments. In a bid not to deplete the reserves rapidly our government 'devalues' the Naira to pay petroleum marketing companies. Those companies know that and always find a way to pass that cost to the Nigerian customers.

plaetton:


Foolish Nigerians, always averse to real facts, and ever beholden to fantasy and wishful thinking.
If the analyst predict N600 exchange rate, everyone should get ready for N700 or N800 very soon.
That is reality.
No hail Marys on raw economic facts.

quisera:
If naira depreciates against dollars again nai bsay yahoo boys no go let person hear word again... Who pick $2k don turn millionaire bdat

ZombiePUNISHER:

They were taken unaware...

We had time and everything working for us...
But incompetent Buhari couldn't capitalise

Shut the borders since... Buhari said no
Not until we got the virus

Well... Help me tell him.. It's in Abuja and on its way to Aso rock

festacman:


You crave for 'defence of my position' but here you are unable to see the defence you seek. My hands are tied.

iamJ:
Yes Bloomberg

Try to cause changes in developing nations that favors you


Na so they try to do with China

China ignored them back to back


Today look at china

They may be Currency manipulators but they are the 2nd biggest economy in the world


Economic analyst are no different from those lotto players all na guess work

The reason -- Nigeria’s import dependent economy [/b]has seen inflation accelerate to a 22-month high in February and could rise even faster if the currency weakens. [b]Despite being oil rich, the West African nation imports almost 100% of its gasoline due to mismanagement of its domestic refineries. The fuel is then sold at subsidized prices to Nigerians. A weaker naira would raise the cost of those subsidies, which already consumes a chunk of government revenues at almost $2 billion a year

alexistaiwo:
Pardon my curiosity but your first and second paragraph, is that not a recipe for inflation?

VolvoS60:


^^^


Speak plainly.

I genuinely wish to learn.

I have pointed out just one of the ways in which the Buhari administration is getting it wrong - with multiple exchange rates - rates set by administrative fiat. With the fall in forex earnings and our low forex reserves, a devaluation is inevitable. And you know what that means.

This is your opportunity to set the record straight - if you can. Say here and now what campaign promises this administration and the ruling party have actually fulfilled after 5 years.

ositadima1:


I am not an economist but I would like to give a simplified explanation, as I understand it.

▪︎ Most of the world accept dollars as a means of payment for goods and services.

▪︎ Naira is only used within Nigeria by Nigerians

▪︎ Everytime Nigerians buy a service or product from outside the country they pay in dollars, meaning that they have to first of all exchange their Naira for Dollar within Nigeria.

▪︎ Now, central bank has a large deposit of dollar notes which they exchange with Nigerians that wish to transact with the outside world.

▪︎ The size of the Nigerian dollar deposit is very important because with it Nigerian goverment can get Foreign Loans, buy foreign goods and services on credit, as well as pay for services etc. It gives us confidence.

▪︎ This dollar deposit can grow larger if we sell enough goods and services to the world, or it can shrink if we buy more goods from the outside world.

▪︎ So, the Nigerian central bank tries to maintain a balance by either increasing or decreasing the exchange rate to keep our dollar deposit from shrinking toomuch.

▪︎ You see, it varies with demand and supply.

▪︎ To answer your question, we have to devalue Naira (increase the value of dollars) to drive down demand for dollars or Nigeria will risk having its dollar deposits shrink a lot which is bad.

▪︎ Nigeria is currently not earning enough dollars to balance its expenses.


I hope I made a little sence.

festacman:

On the exchange rate strategy, the fact is that there is no almighty formular in Economics. CBN team, Finance ministry and other economic advisors are no dunces to wilfully lead the country into a 'ditch' by choosing the multiple exchange rates option for now as opposed to outright devaluation. I am sure they must have weighed all options.

festacman:

There is no short cut when we have less export and more import regimes. It is a lot more difficult situation than you are making it seem because some impact could deal a mortal blow on the economy if care is not taken.

festacman:

On the accomplishments of Buhari presidency since 2015, if you are insisting that he has done nothing then none of what I will say would change your mind. And I don't have energy for argument.

NaijaMutant:



Stop beating about the bush.


Just say Buhari is a dunderhead, nobody go beat you

VolvoS60:


^^^^


Your almost childlike faith in the sincerity of purpose and the competence of Nigerian policy makers is touching. Unfortunately, I live in the real world where hard nosed pragmatism, doubt and scepticism are far more useful and effective in holding these people accountable.

There is no room for wishful thinking here. The Buhari administration got things terribly wrong. And it continues to do so. It has stubbornly insisted on multiple exchange rates for years - a policy that simply encourages rent seeking and has made some people very rich through currency round tripping. The administration also stubbornly insists on defending the Naira - even when it is clear that the reserves to do this successfully do not exist. If the Russians and other big oil exporters took their bitter medicine during the last oil price shock - and devalued their currencies, did you really think Nigeria would escape?

We are back there again.



^^^

Ok.



^^^
No sir.

I am not stirring up arguments for their own sake. I am keeping an open mind - and I am performing my civic duty by holding the administration accountable. I am simply asking that the administration be held to its word - to what extent have its campaign promises of 2015 and 2019 been kept?

These are fair and legitimate questions, don't you think?

Mizwisdom:





There's no harm in trying something new, America shouldn't have the monopoly in determining other nation's prosperity. I think China has a better deal for us and should be given a chance. Yes they flood markets with their products but we get them at a much cheaper rate than America offers. In short every country no matter how good their intentions may seem, will always look out for it's own interests. We know how ferocious America's appetite was for Arab oil before it discovered it's own large reserves. No country is holy, It's time for world economy to have a new leader especially one that lives and let's others live. Even if the naira is eventually devalued, there's no need for this outcry. How does this even affect them?

PHijo:



Nobody stops Nigeria from prospering! Nigeria failed to prosper because it is at war with itself. Bigotry makes people promote people they hope will advance their ethnic, religious or regional interests. These factors also play a much greater role in the government's decision making process. The South seems to be in favour of reforms that will reduce government participation in the economy. The last 20 years, the two occasions Northerners took over there were deliberate attempts to whittle down those reforms or wipe off the gains.



.....
.....

Are you sure?