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Buhari’s Forex Policy Deters Investment – Peter Obi Pledges Harmonized Exchange Rates

The Labour Party presidential candidate, Peter Obi, has condemned the forex policy of the President Muhammadu Buhari-led administration, saying the multiple exchange rate system has particularly worsened Nigeria’s economic situation.

The LP candidate who said this while speaking on the Prospects of Transformative Governance in Nigeria at Harvard University, USA on Thursday reeled out his economic plans for the country if elected.

Obi noted that the multiple exchange rate regime being operated by the Central Bank of Nigeria (CBN) encourages capital flight and deters investment.

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The LP presidential hopeful promised to re-establish the independence of the Central Bank of Nigeria while removing forex restrictions, harmonising exchange rates and bringing inflation to single digits.

“We will explore ways of cushioning the forex demands by mainstreaming those components of Diaspora remittances that remain opaque and informal.

“We will enforce the legal framework protecting foreign investors and their indigenous partners. This is the only way to tamper with monopoly and capital flight.

“As part of our monetary policy, we will seek to re-establish the independence of the CBN; and commit to a credible and transparent plan to normalize the exchange rate and bring inflation to single digits.

“We will remove import and forex restrictions and insist on a single forex market. The current system penalizes exporters who bring in forex by forcing them to sell at a rate that they are unable to source for forex when they need to purchase forex.

“This multiple exchange rate regime encourages capital flight and deters investment, which has further worsened Nigeria’s forex situation,” the LP candidate added.

THE WHISTLER reports that since the announcement of forex restrictions and the introduction of multiple exchange rates by the CBN in 2016, Foreign Direct Investment in Nigeria fell from 3.45 billion dollars in 2016 to 2.39 billion dollars in 2021, according to data obtained from the World Bank.

The restrictions also prevented foreign businesses operating in Nigeria from repatriating their funds abroad. In August, Emirates Airlines threatened to cease operations in Nigeria over its inability to access forex and repatriate funds amounting to over eighty-five million dollars ($85m) to the United Arab Emirates where it is domiciled.

CBNCENTRAL BANK OF NIGERIAforeign exchangeFOREXMUHAMMADU BUHARIpeter obi
Comments (3)
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  • mickykarim

    AND GOOGLE FACEBOOK TWITTER AND MICROSOFT ARE STRUGGLING DYING TO STAY HERE IN NIGERIA.

    Not excluding all other new international and multinationals trooping back into the country.

    THIS Peter Obi GUY IS AN EMPTY BRAIN. CLUELESS AND IDEALESS. GIVES FAKE NEWS WITH FALSE STATISTIC AT EVERY OPPORTUNITY. THEREBRY PUTTING HIMSELF INTO ABSURD RIDICULES.

    Nigeria does not deserve this DULLARD, please!

  • Prince John

    Obi is right.Forex restriction have caused havoc to Nigeria Economy and Buhari administration think that they are doing Nigerian Good.For instance, you force exporters to sell their export proceed to CBN at official rate and that is what causes the FX crisis as exporters have devise means of countering the policies.An exporter who export goods what USD5million because of the policy that he must sell to CBN will Undeclare his Invoice and put the value at USD200,000 as customs dont care about Export ,they only care about Imports Value ,anything Exporter declare is ok.Now an exporter declare USD200,000 against USD5million .What he will do is that the USD200,000 will come into Nigeria economy and will be sold to CBN as official rate while the balance USD4.8 million will stay offshore and he will sell it at black market rate but if this policies are not there and exporters have Unrestricted access to their proceed ie sell as u want, many exporters will bring in those fund that usually sit outside the country and when you have for instance 10 exporters or more with 5 million dollars or more each in one day having unfettered access to their fund in Nigeria banks, the exchange rate will definitely crash as there will be more money available for sell and with my experience this fund they usually keep outside ,they pay a lot to the regulatory authorities of such country before they can be allowed to operate and that is why the put all those cost into it and that is why the rate is usually high but they are allow to have unrestricted access to their fund , no one force you to sell ur money to CBN at official rate, more dollars will come in here and exchange rate will crash. I think Obi is very very right. He will make a good President next year.Open Market Economy is what is Good for Nigeria as it is still a growing Economy .

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