Exploring the Undermining Forces Against the Naira: A Call for Accountability
By Abayomi Odunowo
The Nigerian economy has long been a topic of intense discussion, particularly when it comes to the Naira’s exchange rates. Recent statements from key economic figures suggest an alarming consensus: the Naira is undervalued. Yemi Cardoso, the governor of the Central Bank of Nigeria (CBN), boldly declared that the Naira is mispriced, a sentiment echoed by financial analyst Bismarck Rewane, who estimates the Naira’s undervaluation at a staggering 26.56 percent at the official market. With contrasting figures surfacing from prominent experts, the question remains—what truly went wrong, and who is undermining our currency and, consequently, our lives?
The Naira’s devaluation isn’t just an economic statistic; it has a profound impact on the daily lives of Nigerians. When the currency weakens, the cost of imported goods skyrockets, exacerbating inflation and eroding purchasing power. This situation is compounded when indicators suggest that the current exchange rates are significantly misaligned with the foundational value of the currency. Just two weeks ago, Taiwo Oyedele, chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, indicated that the government believes a fair price for the dollar should settle between “N650 to N750.” Meanwhile, the freshly minted Finance Minister Wale Edun placed the Naira’s fair value at 700/$1 during his screening. What do these figures signify? They point towards a systemic issue where consensus on a fair valuation seems elusive at best and manipulated at worst.
As economic uncertainty mounts, fear and frustration are palpable among the population. Citizens are not only wrestling with rising prices but also struggling to understand why the Naira continues to falter even when expert analyses highlight its undervaluation. The Bank of America’s recent assessment, which suggests a fair value of 680 Naira to the dollar but predicts trading above this level, raises red flags. Are foreign investors manipulating the Naira’s value, or are local players in the financial system undermining a currency they should uphold? With food prices soaring, families find it increasingly challenging to meet their basic needs. The emotional toll is evident—disillusionment with a system that appears to prioritize profit over people’s livelihoods breeds skepticism and erodes trust in leadership.
It is evident that merely discussing the Naira’s undervaluation without decisive action will do little to alleviate the financial strain on Nigerians. What is required is a robust investigation into the factors leading to the Naira’s depreciation. Who exactly is benefiting from the current state of affairs? Speculators within the forex market likely play a nefarious role, manipulating the currency for their gain at the expense of the average citizen. A transparent investigation into these market players, possibly through new regulatory frameworks and stringent oversight, could help address these concerns.
Moreover, the government should prioritize economic reforms that stabilize the currency without resorting to temporary solutions that would ultimately prove ineffective. This includes investing in local production to reduce dependency on imports, thus curbing inflation and stabilizing the economy.
Furthermore, open dialogue among policymakers, financial experts, and the general public is vital. Establishing forums for discussion, where Nigerians can voice their concerns and suggestions, could engender a cooperative atmosphere aimed at fostering economic resilience.
The question of who is undermining the Naira is not a simple one. It intertwines issues of governance, economic literacy, and individual accountability. As Nigerians grapple with the erosion of their currency’s value, the imperative remains clear: we must hold accountable those who have placed short-term gains over long-term stability. By advocating for transparency, embracing economic reforms, and fostering dialogue, we can reclaim the Naira’s true value. The Naira’s fate will ultimately determine not only economic stability but also the dignity and livelihoods of ordinary Nigerians. It is time for all stakeholders to band together and work towards a monetary system that reflects the strength and potential of our nation—free from the shadows of manipulation and neglect.
Otunba Abdulfalil Abayomi Odunowo
National Chairman AATSG
Mobile: +2349053535322
Tuesday 15th October 2024.
