Osinbajo, Sani fault call for further devaluation of naira
Osinbajo
VICE President Yemi Osinbajo has said devaluation of the Naira was not an appropriate option in the current economic realities in the country.
It offers no solutions as far as President Muhammadu Buhari’s administration is concerned, Osinbajo said yesterday.
He spoke as a civil rights activist, Senator Shehu Sani, cautioned against accepting the recent suggestion by the Emir of Kano and former governor of Central Bank of Nigeria (CBN), Alhaji Sanusi Lamido Sanusi, that the Federal Government should further devalue the naira.
President Buhari had earlier expressed his view that a further devaluation of the Nigerian currency is not healthy for the Nigerian economy. And speaking earlier today when he received ambassadors from Italy and Canada, among other callers in his office, Osinbajo said: “I don’t agree on devaluation and it is not that I am doctrinaire about it. In the first place, it is not a solution – we are not exporting significantly. And the way things are, devaluation will not help the local economy. What we need to do is to start spending more on the economy and then things will ease up a bit.”
He observed that the issues around the economy are no exact sciences, stressing that what is important is to be reasonably flexible in dealing with them.
Osinbajo outlined Federal Government’s plans to set-up a $25billion Infrastructural Fund which would be sourced from local and international sources, including Nigeria’s Sovereign Wealth Fund and the pension funds.
Osinbajo restated that the current foreign exchange restriction is a temporary measure to ensure that “we don’t deplete our foreign exchange substantially,” at a time when the prices of oil in the international market are dropping. He added that the restriction is also to bring some stability to the country’s foreign reserves without which Foreign Direct Investment, (FDI) might be affected.
Sani, who is the senator representing Kaduna Central District, said: “The recent call by the Emir of Kano for devaluation of the Naira and removal of subsidy is unnecessary and I stand opposed to it”.
In a statement yesterday, Sani pointed out that “devaluation and removal of subsidy will simply worsen inflation and make life more unbearable for the masses of our people”, noting that “life is everyday becoming more unbearable for the poor masses, removing subsidy and devaluing our national currency will simply ignite social tension and spark up a national uprising.
According to him, “the recommendation by the Emir will only lead us to national upheaval. Devaluing our currency will as usual generate paper figures of economic growth, phantom economic statistics but in reality, spread misery and penury in the land.
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9 Comments
Further devaluation of Naira may not be a solution or an option to the current economic down turn in the country. However, one of the ways to stop the devaluation of Naira is to practically address the National very weak economy. Nigeria lacks technology and industrial developments, lacks manufacturing base economy and hi-tech industries. As observed, most of the industries in the country are poverty industries. The Nation also lacks infrastructural development in all sector and very low or none economic productivity (unemployment is all time high) coupled with other social problems, all of which make the Naira to be very weak against the Dollar. As noted, the economy depends solely on the stability of oil price; economic diversification/implementation is highly suggested. Therefore, there is no magic bullet to make the Naira stronger but
economic and social developments including good governance (including – the importance of fiscal discipline, of structural change, and of monetary policy rigorously maintained), high GDP, job creation and low inflation. Thank you.
So, what is the option? When Sanusi made the suggestion, he gave his reasons. Those opposing it should also state their reasons AND show why their suggestion is better. Moreover, the people speaking now have nothing to prove that they actually know what they are saying. It just seems they are echoing PMB’s ‘decree’. Why can’t these guys be humble enough to form a proper economic team that will fashion a comprehensive economic blueprint for the country? Why does PMB and Osinbajo think that the combination of their dubious certificate and selection victory is enough to decree economic growth?
THE MAN WHO MADE SUGGESTION LOOTED THIS COUNTRY BLIND THROUGH CBN, SO HE CAN AFFORD TO ENSLAVE THIS COUNTRY PERPETUALLY BECAUSE HE WILL NOT LACK ANYTHING IN FUTURE.
They are completely right on the devaluation stands. we don’t need to devalue our currency, because we are not a major exporting country. however we absolutely need to end the subsidy, because that is the major drain on FOREX. There are various ways to end it that wouldn’t make it extremely hard on the people. first of all, the subsidy is for the rich, the masses don’t really benefit from it. secondly, the official price of fuel is not accurate, and could be increase slightly to reflect actual price that the people are paying. finally, just by cleaning up the system of subsidy, we would be saving a lot of money prior to the actual thing that needs to happen, deregulation of the sector. cleaning the system means, we need to have only 5 marketers, and NNPC. Then we can truly have some accountability of what is imported and what is used. we could deregulate the system, and have NNPC be a higher importer of the fuel, which would be sold at a small profit margin. what this would do is force other importers to sell at the price, and by deregulating the sector, we would allow investor to invest in refineries across the country. two things are stopping investors from investing. regulation of prices both the fuel price and the crude oil price. guarantee of feed stock to the refineries.
1. Is there still a subsidy with crude oil selling at such a low price?
2. How can we have only 5 marketers to sell fuel to 150 million people? Is that not the creation of a cabal?
3. How will u attract investors to do capital intensive and long term projects when the economy lacks clear policies and when people don’t know what the government will do tomorrow?
I wd appreciate some answers.
1, are not still paying for subsidy now. The system is designed to pay no matter the cost of crude.
2. Having that few means less people hold accountable. Right we have so many. Yet we don’t know who importing and how much they are importing.
3. A lot of investors don’t like price control especially if it is not accurate. And that what a lot of them say the problem is. We have being doing subsidy for years, yet no one single refinery has being built.
NIGERIANS WILL BENEFIT AT LARGE NOT FOREIGN COUNTRIES AND THE WORLD BANK. YEMI OSINBAJO IS NOT AN ECONOMIC EXPERT. AN ECONOMIC EXPERT IS HE OR SHE WHO INVENT AN IDEOLOGY OR SOLUTION UNCOMMONLY, UNSIMILARLY.(NOT IDENTICAL). NIGERIA MUST TRY THAT IDEA. I CAN ACHIEVE THE SAME RESULT BY COOLNESS, ARROGANTNESS, IMPOSING ON SELF ENCOURAGEMENT, WAR, AND STRICT INTELLIGENCE. I BELIEVE THAT IS ALSO HUMAN KNOWING WHEN TO ACCURATELY APPLY THEM. OSINBAJO LACK ONE AS A VICE PRESIDENT EVEN THOUGH HE IS A PROFESSOR. DEVALUATION OF NAIRA IS THE BEST WHILE ATTEMPTING TO PUSH THE ECONOMY UP IN NIGERIA. REMOVE THOSE ZEROS AT THE BACK OF THAT NAIRA AND KOBOS NOW! INFACT, DO THAT REGULARLY. DO NOT ALLOW A ONE MONEY OF ANY FOREIGN COUNTRY EQUIVALENT TO 2 NAIRA NIGERIAN MONEY BEFORE NIGERIA CBN DEVALUATION. THAT IS AN OVER GENIUS UNDERGROUND.. PROBLEM OF A CENTURY SOLVE IN ONE HOUR FOREVER.
I do not believe that devalue or not to devalue should be decided by public opinion. As an import heavy country with a mono-economy , we may not have a choice on the long run.
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