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A former Deputy Governor of the Central Bank of Nigeria (CBN), Kingsley Moghalu, has rubbished the optimism in some quarters that the US dollar could still be exchanged for N400.
In a series of posts via his X account on Sunday, March 24, the former presidential candidate said, ‘Those who want the naira to be N400 to the $ (US dollar) are living in a dream world. Even discounting for the negative impact of speculative attacks on the value of the naira, the exchange rate will (and should) reflect its market value in reality, not the artificiality that the Emefiele era Central Bank sought to maintain to please economic illiterates in political power at the time.
“That artificiality created room for massive arbitrage by speculators, which bled the economy. Nigeria does not (yet) have a productive export economy. That’s the heart of the matter.
He further stated that the country’s foreign reserve was not up to $100 billion, so the forex rate wouldn’t return to normalcy soon as it would take time to regain investors’ confidence in the forex market as in the past.
Moghalu argued that efforts should be made to build a manufacturing export economy that would generate genuine and substantial foreign exchange earnings apart from oil while noting that the stumbling block was the epileptic power supply in the country.
‘The sooner we focus on a painstaking creation of value-added manufacturing export economy that earns forex beyond oil in real and significant terms, the better. Key to this is the electricity conundrum in which we are at less than 4,000 megawatts of generation for a population of 200 million for decades now.
“Take power to even 20,000 megawatts, and you will see what the Nigerian entrepreneurial spirit is capable of. ‘Moghalu stated.
On Thursday, the naira gained N18 to close at 1,382/$ at the official market, continuing its consistent upward trend against the US dollar.
The local currency saw significant gains at the official and unofficial foreign exchange exchanges the day before the naira’s advance. On Wednesday, it closed at N1,400 per dollar on the black market.
Until recently, the naira’s continuous plunge since President Bola Tinubu took over power on May 29, 2023, had seen prices of commodities skyrocket and many citizens unable to afford basic needs of life, including foods.
