naijaoyibo:
People argued about this same thing in 2014 and 2016. The Naira was devalued from 150 Naira/$ to 360 Naira/$. It stayed like that till recently. What has changed from 2017 till now? The Naira has been consistently devalued since its introduction in 1973. What has changed in Nigeria from 1973 till now? If we are to be honest, things are worse now. Devaluation of the Naira will probably not help. If we devalue to 500 Naira now, people will get used to it. And after 4 years you would call for another devaluation to 1,000; and the vicious cycle continues. It's too simple a solution. There has to be a fundamental and national orientational change in Nigeria and Nigerians first. Until that happens, devaluation will not solve our problems.

People don't just get use to things that concern finances.
You have to find that midpoint in its value that changes everything and I believe they've got it,just politics in the way.
Remember 2016 when the CBN floated the naira for many months,it did not depreciate past 500-520.It hovered in this range for a long time for a reason.
It means this is the point where no one is willing to pay more naira for the dollar,that is they will rather look for whatever they want to get overseas elsewhere(especially locally) than pay over 520.
This is the true value of the naira.
You don't under-devalue a currency and expect change,people will simply adapt to the slight changes.
You make the gap very wide and force the people to produce what they consume.
And whoever thinks Nigeria is not producing anything is not sure of what he is saying.Nigeria is not producing enough to support everyone in it,not that Nigeria isn't productive
I will tell you the things that have changed since 1973;
Promasidor came in 1993.(imagine it's employees,distributors,etc...it caters for)
Dangcem,
And a host of other manufacturers I can't mention.
If the government removes fx subsidy and use that money to fix power step by step till completion,Nigeria will change in 8 years.

mickky22:



I disagree with you. There's no nation of the world that Nigerians are not doing great. Our major problem is bad leaders or leaders without vision.

I strongly believed, one day we will get it right.

We have just one problem,
Artificial naira.
#devaluenairanow!

Bluetec=diesel.

Whoever imported this car made a huge mistake.
Either he drives it or sell it to me for 2m so that when I use it and it starts its problems,I can throw it away with no regrets
Better take it to Ghana or Cameroon to sell.
No one buys diesel in Nigeria

Anybody that gives money to anyone over any sob story is a fool and part of Nigeria's problem.
This girl and her stories are all lies.
Let her upload pictures of her self,upholding photos of her moniker written on a placard along with the time and date the photo was taken.
And the person in this picture must be the lady on her DP.
Person go just come up with sad story,una go dey drop money dey talk nonsense and you guys wonder why you are still poor from year to year.
Stupidity at it's finest

ositadima1:


My brother, you are wrong. Their is not a one to one matchup between imported goods and locally made goods. Their are many many things that are not made locally. You know na.

How will the poor masses figure out how to build power stations, roads and basic infrastructure which as it is now is not available?

Any government that devalues our currency any how will not last, we are not Venezuela or Zimbabwe. People will tear the government up. Already a lot of people are managing o.

Can you name those many things that is imported that aren't or can't be produced in Nigeria?
In 2016,some people I know wanted to bring a tile adhesive company to Nigeria,my city sef.
Chinese imports were selling for N900 a 20kg bag and their calculations were already at 1400 a bag to be produced in Eleme,Rivers.
The only way they could beat this down to N1050 a bag was to increase capacity of the factory to be able to spit out up to 24,000 bags a day.
Now where will the average Nigerian industrialist get the capital or financing to build that kind of factory with such economies of scale from the get go?
Even if a person can borrow,he won't be too confident to do so as he is not sure of market share thereby abandoning the project.

If the CBN start saving all or most of the dollars it use to defend the naira,turning around the power situation of this country will only take 4years max.
I hope you know Nigeria only needs $50b to fix most of its power problems.
As for roads,devaluation will give the government enough naira to take care of it's local needs and still save a good chunk of dollars.

Economies of scale wouldn't matter so much as people with limited capital can still start production and be profitable.
Since import of raw material will be so expensive,this will breed local demand for raw material thereby boosting that segment too.

Devaluation will move Nigeria from consumerism to productivity.

The government can't build power stations because na dollar them dey use do am as most of its machinery will be imported,that is why they keep borrowing to fix power.
If it was a naira base expenditure,them for don do am since.
Now if you end that scheme that keeps finishing Nigeria dollars in the name of intervention,this should tell you that Nigeria will have enough dollar savings to fix power without borrowing at ridiculous interest rate.

Honestly artificially defending naira is simply a short term myopic investment to satisfy the needs of Nigeria elites and consumers.
If you want drive benz,pay the price for it and not have the CBN subsidise it for you at the expense of our youth's future.

ositadima1:


You keep talking about devaluation, you are not seeing the bigger picture here.

Devaluation means my salary will be worth much less. What will you do when Labour wakes up and begins to demand for further increase in minimum wage?

What of the millions of retirees who depend on their small pension which now will not be able to buy their drugs and other things? I know a lot of them that have BP, diabetes, kidney condition? They should just die abi?

You forget that some many essential products are imported and cant be made in Nigeria, atleast not now, with poor power generation and all.

The government is supporting our currency and that is what it should be until we put our shit together.

Would you rather have severe hardship and backwardness so that you can build up huge USD deposits? What is the excess dollar account for if not to benefit its citizens?

Everybody claims to be an economist this days.

You ignore the cry of the masses.
That cry and desperation is what is going to make them buy what Nigeria businesses is offering at lower prices than their imported counterpart.
The reserves Nigeria is going to build by devaluating will be used for the massive industrial revolution that will follow suit in Nigeria,not for subsidising consumer imports anymore.
Capitalism is not meant to favour everybody,Nigeria is not a socialist state.
People will figure it is better to export than import.
Lots of jobs will be created by this,giving more and more working people disposable income.
Medicine to most people is a one-off purchase,not an everyday consumer commodity so making reference to it is really shallow.
If coartem price rises today,people won't complain as much as if it were food because they only get to buy it once in a while.
So yes,people can very well live with inflation of prices of drugs caused by devaluation.Abi drugs na food
I don't remember calling myself an economist,the things I share are mostly from experience being an active tradesman.

Tesclaros:
I just got my first benz today 2013 E350 .. And i know nothing about benz. From what i have read so far here, I’m really scared cos i learnt that maintenance isn’t a child’s play. Please is 2013 E350 a good car? What are the major problems? Can it last if i drive it well?

Cc heavenlybang

LordAdam16:


The CBN did not merge all rates to a single rate.

I don't want to type out large blocks of text. I'm seeing a 6 where you're seeing a 9.

Clearly, the CBN has the reserves. Clearly, there's been an oil price rebound. Clearly, things are looking up globally. Clearly, most economists and CFOs do not see a substantial mid-term devaluation in the horizon.

Therefore, it is not helplessness stopping the CBN from intervening more strongly in the parallel market, it is a policy decision. For the moment. In March, you could call it helplessness: In June, it isn't.

As the Americans would say, "If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck."

-Lord

If the CBN didn't merge rates as you say,then what did it do?
Oil price at $40 doesn't mean it can't fall again to below 35 again.We all saw what happened at OPEC+ meeting on thursday.
This is why the CBN is silent for now,too much uncertainty.
Also,oil the price rebound came at a cost.Cutting production means less revenue.You should know what this means.
You keep saying "interfering in the parallel market".
The CBN doesn't need to start giving BDCs money to trade on the streets for naira to strengthen.
A mere removal of restrictions on cards for international transactions,supply of fx to investors repatriating funds officially and sales of fx to Banks to sell to manufacturers and industrialists for their fx purchases will ease the pressure on the naira,not necessarily "parallel market".
The CBN has not been doing these things since the lockdown,so all these people have moved to the parallel markets to fulfill their fx needs,putting the naira under pressure and its price spiralling out of control.
So when you keep talking about interfering in the "parallel market",I really find it hard to understand what you mean
It's like saying the CBN has been satisfying official needs but fail to supply BDCs is the reason naira is depreciating
And I don't know why you keep putting Lord at the end of every post,it's beginning to make me uncomfortable.

LordAdam16:


Nigeria currently operates multiple rate windows. The Official, Customs, NAFEX, BDC, Interbank, Parallel rates are markedly different.

Pre-corona, there was a sustained effort towards convergence, but it wasn't absolute.

Post-corona, the spread is more or less the same. Our monetary policy hasn't changed fundamentally. What has happened is an officially-sanctioned 10-15% devaluation (or as Emefiele calls it, "Currency Adjustment" to reflect the current pressures, downturn and our fiscal situation.

For instance, Customs rate was 326 when BDC was 357. Today, Customs is 361 while BDC rate is 380.

However, because most of us here are exposed to the black market, it seems like the sky is falling. Whereas in that market, the CBN simply reverted back to 2015 to early 2017 policy with a distinct stopgap.

I don't want to write a dissertation on why the policy is understandable, and what the pros and cons are; but know this--the CBN can crash the rate to 380 and defend it for the next two months easily. The 12-month forwards rate is currently around the 450-460 mark from 522 last month.

The three questions stopping the CBN echelon are:

1. At what cost?
2. Why?
3. How confident is the current COVID rebound?

Put simply, defending the naira in the black market is not the best use of dollars currently. That's it. Nonetheless, they'd not let the rate spiral out of control.

-Lord

CBN merged all rates to one single rate,besides I don't know what multiple exchange rate has to do with falling naira or why CBN isn't defending it.
Don't you think naira future forwards appreciating to N450 should make the naira appreciate currently as speculators and BDCs would be afraid of buying now at high price?
Why isn't it appreciating?
CBN has reserves to do it,but why aren't they doing it?That's the question and what matters.
They've realised their mistakes and are adjusting.
It's not a thing of choice but helplessness.
That's my point.If not,let them do it so we see how it ends

LordAdam16:


Na.

At the moment, the CBN is perfectly okay with $ in the 400 range in the black market. However, 450/460 is their limit and over the weekend and early next week, there'd be some strategic pressure to lift the rate. But just short of enough to take it back over the 400 mark. At least for now.

Here's the reality. The CBN can crash the rate to 380 if they so choose. It'd take 3 days tops. They have the ammunition. Reserves is circa $37b. I&E rate is 390 or thereabout. The worst for oil is in the past.

That said, to the CBN top-brass, it is moronic to spend $2-3b (about a trillion naira) per month holding a 380/390 rate, when we just cut Universal Basic Education budget from 111b to 51b yesterday. It's bad optics, reeks of absurd priorities, and goes against the sermon that there's no money.

A 10-15% rate surcharge for those who want to import toothpick is perfectly acceptable during a global downturn.
Those with a more fiscally responsible need can go through the banks to access the CBN $400m per month sale facility to small businesses/individuals that was recently restarted.
Those who recently made online purchases at 390 through GTBank used this facility.

PS: Part of the reason for the steep drop today is the release of a CBN Report for May where respondents firms expected the naira to "depreciate in the current month, next month, next two months and appreciate in the next six months." https://punchng.com/firms-expect-further-naira-depreciation-dollar-sells-for-n440/

TL;DR: The depreciation of the naira in the parallel market is controlled and deliberate. It may change soon, but for now, that's the state of things.

The CBN is okay with the dollar in the 450 range?
If so,why didn't they just devalue to 450 then and save everyone the stress?
Where has this top-brass been from 2017-2020 till coronavirus came and expose their 3 year stupidity?
The CBN has just learnt it's lesson,there is nothing deliberate about it.
Also,they aren't so sure about their income source which is oil so everyone is waiting for now till stability returns.
Like what if you start interventions today and after 2 weeks oil comes up with another story?
Emefiele and his artificial naira team are handicapped,not that it is what they want.
Manufacturers don't have dollars and you are saying they can go to the bank?which bank?
People accessing dollars through banks are people with very minute needs that is super limited to chicken change amounts,asides that better find your way to your aboki.
Is there anything more fiscal than someone who wants to import raw materials for local production?
Whose demand do you think is putting this much pressure on naira?toothpick importers?
It is manufacturers and foreign investors repatriating their funds that is heating up the markets like this.
They've seen how vulnerable they were and have decided to give themselves brain.

Now that subsidy and regulations have been removed,traffickers are now free to operate in Nigeria.
Even if fuel is sold for 200-250 naira a litre,they will still buy because of the current weak Naira.
You now see why I am advising this shithole to devalue their currency and own both west Africa and Central africa sub region.
Nigeria will prosper with weak naira but the elites that are benefiting from artificial strong naira don't want it.
They know all these but refuse to apply them for personal gains and emotional reasons.

ahiboilandgas:
A station in yusufari yobe state near boader was reported to have sold 15 trucks of 60000 litres of pms daily for 7 years ...the owner a current billionaires used it to build several mega station across Nigeria ....if u know u know ..if u dont try to ask questions ....

This one is simple na,he is selling to traffickers that divert it to northern Cameroon.
I know other places like that littered all over the country.
Abonche in Taraba and co...
There are even some places they use as loading points for barges attached to tug boats and sea going small tankers that move products to Benin republic.This field is dominated by bunkerers
There is nothing so peculiar or difficult about any business,just use the strategy that works for you and make your bread.

C300 AMG
There is nothing special about this particular car,just after market quad pipes and black grill.
I dey see m272 you dey call AMG

Ghen ghen ghen......
Dollar 463 right now on hopes of OPEC+ fallout and unclarity of cuts continuity.
#Emefielemustdevalue

Upon say na weekend dollar price still dey go up and aboki dey buy 448,to tell you say that thing weh dey give them confidence too huge.
Nigeria is broke
Na em be say monday na 470 dem go use begin market,afternoon fit reach 475

ahiboilandgas:
am sure u have never read any of end of year Agm booklets of any oil marketing company....companies are not emotional being....they invest on products that return the most profits ...Mrs sold 50m litres of pms to make 400m litres profits and sold 18m litres of jet fuels over 500m naira profits ,pms contributed the least profit ratio..so where did u can your 100 times ...in which firms total,cooil or where ...or u like living based on wrong and unverified assumptions ....have u studied the p/l accounts of start beer and cognac to reach conclusions

How profited got into the picture is what I still don't understand.
Also,anybody will know that "100 times" was a figure of speech,not necessarily Y×100.
Star producers might be more more profitable than champagne,but who has more competition?
At every corner,you see beer selling bars but you have to go to selected places to see champagne.
Same with petrol and jet fuel.
Filling stations litter every corner and all of these people want to sell,this should tell anyone that the moment depot reduce price,this people will follow suit.
Big players might try to make stunts but it will be temporary.
That Is what I'm talking about.

ahiboilandgas:
yes nah monan is total ,11plc,Forte oil ,Mrs ,conoil....they owned the stations and they appoint you dealer on a margin....their business consultants and depot rep is in the state ....reconsiling sale...your contract will be canceled and dealerships revorked..

There are a lot of people that own their own stations and tanker.Will IPMAN go and stop them from buying and selling in stations they built with their own money?
All they have to do is buy from marketer and sell.
Na man weh no get money to build station dey go hire major player station to sell or person weh dey look for site
When NNPC reduces their price at their stations,what happens to independent station owners that are neighbours to this NNPC stations?
They won't sell if their price is high.
They will be the first to reduce their price and their neighbours will follow suit like domino

NL1960:


With unions, i still barb my hair at old rate at my barber's shop and still patch my car tyre at old rate at my vulcanizers.

lol the union don tire money

ahiboilandgas:
like which bigger one ?

Telecoms was very competitive before competition reshaped it.
Why them no dey do per minute billing again?
I'm guessing the union got less greedy.
All those money they spend on advert and marketing,I'm sure they do it for formality sake and the cartel just want waste money.

ahiboilandgas:
u don start ...do u know the consumption of atk by planes ....delta airways Lagos -new York consumes 40000 litres .....do u know the consumption of cooking gas in Nigeria and kerosene....who told u fuel is selling 100 times ...last year total sold 50m litres of pms and 24 m litres of atk ...do u know how much is a litre of jet fuel compared to petrol..

We are not talking of price of the commodity or how expensive it is but volume.
The bigger the volume,the bigger the fight for market share.
Armand de Brignac Ace of spades sells at 150k a bottle.
Star beer sells for 250 naira a bottle.
Which amongst the 2 products have more outlets where they sell the produce?
You want compare petrol and jet fuel in demand?

ahiboilandgas:
the tom and dick must registered and dpr approved to build this a regulated products not some cement or icecream shop

We have seen bigger businesses succumb to competition,let alone petrol station
I ask again,what will the unions do when filling station owners default?

ahiboilandgas:
Ago,dpk,atk ,gas is already deregulated what happened ?.....petrol na only 1 item...

Only 1 item that outsells the others 100 times.
Huge demand always brings huge competition.
E go happen for your eye like film,just watch...

ahiboilandgas:
each station is under an organisation is not like a babers shop...u must be under an association...ipman moman...dapma .....so all the stations are under this 3 groups ipman has 10000 ....they have a union like Nlc with head office in Abuja and branch chairman in State depots...their an article of association...with an elected chairman and union dues ....

This ipman,moman and co,what do they do for the filling stations?
Are they the ones who supply these stations?
If a station defaults in pricing,what will ipman do to the station?burn it?

ahiboilandgas:
read more on oligopoly...Dapma is Dapma ....this why we have anti trust agency in europe ...giving fines ....moman is 8 members with 2500 stations ....and a sectariates...presenting a uniform front....this cartel.....

I know what cartel is and in my experience,it always fails when the members are too large.
Every tom,dick and harry is building stations all over,so how do you control and enforce this crowd?
Who is going to fund it?
It will only work If depot owners get involved and stop selling to people that are selling low price.
It is very expensive and hard to control this kind of cartel with large number of people.
Let me ask you,what will the cartel do to uncomplying filling station owners?
I'm guessing blocking their supply abi?
Now how do you do this if the depot owner is not involved?

The only people that can control petrol pricing is depot owners.
Reason is;
They are few in number and can easily come to an understanding to hike the selling price to stations.
But they have a very big threat now;
DANGOTE
So the clock is ticking for them

ahiboilandgas:
nnpc retail ltd control 17 percent market share ....they have about 36 station called mega 1 ....funny enough the remaining 300 are privately owned (affiliates)...so Ahib oil and gas will be selling in it station in Asokoro ...same Ahib oil and gas will be selling in wuse...under Nnpc franchise...All na me ......so i will dirvert Nnpc wuse allocations to my stations in Asokoro to sell at 130 (no queues).....while i sell at 121.5 in my nnpc franchises...using only 1 pump and 2 staffs ....and lond painful lines and disorganised......

Competition and individual reasons always drive prices down so long as prices have dropped from the source.
It's only a matter of time before it collapses and the petrol station union falls out of order..Everyone knows this.
They succeeded in hiking diesel prices this long because demand for it is low.
You can't have a fast moving commodity like petrol run under a cartel scheme,where everyone is looking for a piece of the action.
Unless the cartel is ready to spend good money to enforce this,I give it 9months and prices start falling apart
Will you people also stop the building of new filling stations?because this ones in their quest for customers will start selling low price

XiaoLi:
I think we don't need jokers here who mislead people, i just called my Aboki now and he said there is nothing like 397 for 1$

397 is a pipe dream honestly.
It might never get to that again,even with resumption of sales to BDCs.
What we might get is 400-410 range with CBN injections.

XiaoLi:
Is this real?

If it was real he won't tell you.

NL1960:


Once NNPC filing stations maintain a lower price, people will flock there thereby forcing others to reduce theirs. Why will i buy fuel at a higher price from other stations when NNPC filling stations that are all over the place are selling at a lower price?.

I wonder ooo

Tobex4realTobex234:


Good to know but I think this one is too stretched. You start at what age and cash out when?

Na to carry the 1.4B along with you to the spirit realm ooo...
So that you go fit oppress Angel Gabriel for heaven and snatch e banny(girl)
That kind 1b web you go cash out after 76 years ehn...
When your organs are failing,penis is dead,sight is failing,etc...
Let's just consider it as life insurance,since a bulk of it will be spent on hospital beds.
You go dey change hospitals like benz because of the investment you made 76 years ago.
See balling na

Tobex4realTobex234:


That's why I said for personal use. I'm not sure people on Nairaland here needs $100k. And no it's not 20-100 USD that people send via worldremit. I don't know the max but I've done $4,000 before.

This yarn get as e be ooo

GonFreecss1:


Glad to see you like this man.

Makes me happy.

Tobex4realTobex234:


It's not a scalable approach.

But here is it:

Find a friend of yours who is abroad or works remotely and earns USD. Most of the apps they use to do remittance (Boss Revolution, Transferwise e.t.c) all give them at 380 for NGN. If you offer them 400 na them go they beg you.

You for ask am how much she want first na.
What If she wants to buy $100k.Will her friend give her that?
Besides there are black market exchangers in the US littered everywhere offering just 5-10 naira less what your aboki in Nigeria is offering and all the people sending bulk money knows this.
Na people weh dey send 20-100 dollars dey use world remit
Niggas weh dey send major block(what Nigeria buyers want) know where to go for yankee