THE NAIRA-DOLLAR DEBATE: WHERE DO YOU STAND?

Although, I cannot pride myself professional economist, perhaps, because i dropped the idea of becoming one 13 years ago. However, the recent situation in our dear country call for a rethink of the government present economic policy, otherwise, we may be harming more than helping.

Basically, from my secondary school knowledge to my acquired knowledge from borrowed courses in Economics at the university, a country either goes for a fixed exchange rate system or a floating exchange rate system. When it is the former, it means it is the government that determines the rate at which a country currency will be exchange with other countries currencies. On the other hand, a floating or flexible exchange rate system means the exchange of a country currency with others is based on the allocation and interaction of the forces of demand and supply. The government has decided to stick to the former.

The question now is how workable is the present decision of the CBN and the Federal Government to hold on to a fixed exchange rate system is hurting or helping the Nigerian economy. To me, the present government policy may not be the best in interest of Nigerians at the moment.

My position is that the present exchange policy is not in the best interest of the masses on certain grounds. One, Nigeria does not have the sufficient foreign reserve to cushion the effect of scarcity of dollar, all thanks to the mismanagement of the previous nation handlers led by Present Jonathan. this is because if our common wealth were not maliciously plundered and looters at least we should be able to boast of enough reserve to undertake whatever fixed exchange policy we wan t to pursue.

Relatedly, our economy is an import-driven economy with over 90% of our export being crude oil which at present the price has been dropping profusely. It is little wonder, the naira has been on declined at an extreme rate because the manufacturing sector of the economy is not helping matter. As if this is not enough, the present fixed exchange rate policy is stifling the investment that would ordinarily comes from the outside.

Another reason why the government may have to jettisoned the current policy is because it is allowing the banks to manipulate the common man as most banks are diverting their allocation to bureau de exchange who latter showed to people at the black market above the stipulated price of #197/1$.

Hence, methink the government has a responsibility to re-evaluate the policy to safe the Nigerian masses from continuous untold hardship arising from desire to prevent money laundering. Unfortunately, the present CBN governor seems to lack requisite will or skill to advise the government appropriately or he is on a mission to sabotage the President effort to revamp the economy and the Nigeria State as a whole. I may be wrong, but Mr Emefile may be the worst CBN Governor we have had in recent history; or what do you think?