The devaluation of the naira will worsen poverty and unemployment in Nigeria – Expert

A professor and financial expert, Uche Uwaleke, has bluntly stated that the constant devaluation of the naira will worsen poverty and unemployment in Nigeria.

 

Uwaleke made the disclosure in reaction to Vice President Yemi Osinbajo’s call on the Central Bank of Nigeria (CBN) to allow the naira to reflect the realities of the market.

At the official market, the naira is changing at N411 to $1 and N570/$1 at the parallel market.

Many believe the parallel market rate is a reflection of its true value.

“As for the exchange rate, I think we need to move our rates to [be] as reflective of the market as possible. This, in my own respective view, is the only way to improve supply,” Osinbajo said.

“We can’t get new dollars into the system, where the exchange rate is artificially low. And everyone knows by how much our reserves can grow. I’m convinced that the demand management strategy currently being adopted by the CBN needs a rethink, and that is just my view.”

 

But Uwaleke, in a statement, said the implications of devaluing the naira now were quite scary.

 

“The first casualty will be the 2022 Appropriation Bill. It means the 2022 budget, which is predicated on N410.15 per dollar is dead on arrival,” he said.

 

“The Vice President obviously means well. But this statement is capable of triggering panic buying and speculation in the forex market (official and parallel) and further complicating things for the CBN.