THE naira is hopelessly crashing against the dollar. And currently trading at over N194 to the US currency, there are fears it might hit the N200 to dollar mark this festive period.
The last few days would witness the influx of Nigerians living abroad. This category of people would flood the market with foreign currencies which ordinarily would have impacted positively on the naira. But not now the local currency has lost its value, a situation where many might continue to pay in dollar might raise the value while further depreciating the naira to the predicted N200 to one dollar.
Multiple factors have been attributed to the dwindling fortunes of the naira.
The major issue is the recent devaluation of the Nigerian currency. With the currency officially losing N15.00, economists were quick to observe that it could even lose more, given the instability rocking the economy. They specifically pointed at the all-time low oil price which directly affects the foreign reserve that protects the naira, the depleting national revenue and total loss of confidence in naira as a store of value.
Other than the Central Bank of Nigeria (CBN) devaluation policy, the scramble for foreign currencies, especially the US dollar is getting crazier. From politicians to other heavy spenders, the US dollar has since become their preferred means of payment. It is this uncontrollable ‘thirst’ for the dollar that is crashing the naira. The fate of the naira is also tied to the worsening economy. Critics of the Nigerian economy are blaming it all on poor economic management and corruption.
“Corruption and rent economy, where consumption is greater than production, is the reason we are where we are today,” an economist and public affairs analyst, Miss Akudo Nwagbara opined in an interview with ENCOMIUM Weekly.
Nigeria’s current economic woes have also been blamed on over dependence on oil.
From political economist, Prof. Pat Utomi to Dr. Bismark Rewane (another renowned economist), the need to diversify the economy has been constantly emphasized.
But the current administration is still claiming that diversification of the economy has witnessed greater impetus now than before.
President Goodluck Jonathan’s men are telling whoever cares to listen that the agriculture sector is contributing largely to the economy. We have also been told that the rebased Nigeria which is now the largest in Africa, also accounted for hitherto untapped economic sectors which has largely benefitted the nation.
However, many Nigerians who do not believe that things are getting better are calling on the Federal Government and particularly the economic team to restructure the economy in the interest of the common man, being the most vulnerable in this era of hyper inflation and crashing naira.
– UCHE OLEHI