Like the committed and desperate team of medical doctors, desirous of reviving a critically ill patient, the federal government and its agencies are set to bring the nation’s economy back on its legs. The Naira has suffered its worst misfortunes in recent time, plunging to N1,750 to a dollar at the parallel market on Tuesday.

It would appear that Tinubu’s economic policies and experiment with a floating Naira have boomeraged big time and the Naira is worse off with no visible rescue solution in sight.

Vice President Kashim Shettima

The government, through Vice President Kashim Shettima, has blamed this on the actions of certain forces in Nigeria whose interest is to disrupt the country’s stability and plunge it into anarchy. Government agents are now all over town arresting perceived economic saboteurs. Aren’t they shadow-chasing?

Delivering the keynote address on behalf of President Bola Ahmed Tinubu at the Public Wealth Management Conference organized by the Ministry of Finance and the Ministry of Finance Incorporated (MoFI) in Abuja on Tuesday, Vice President Shettima noted that these forces failed to attain power through legitimate means and are willing to see Nigeria fall apart for their own interests.

He tried to justify his assertion saying: “Just a few nights ago, 45 trucks of maize were caught being transported into a neighbouring country. There are 32 illegal routes on that axis. At the moment when they were intercepted, the price of maize fell by N10,000, from N60,000 to N50,000. So there are forces that are hell bent on undermining our nation but this is the time for us to come together.”

The Vice President stressed the importance of unity during these challenging times. He called on citizens to: “rally round our President, rally round our governors, and rally round each other. We have the resources, we have the intellect, and we have the resources. I am assuring you that we have crossed the Rubicon.”

Shettima stated that steps are already being taken to improve economic performance. “We are not altogether in a very bad shape than the FX challenge. All hands are on deck to address the FX challenge”, he said”.

The battle to save the Naira has been on for a while. In January, the Central Bank of Nigeria (CBN) rolled out some measures to strengthen the national currency. The measures included restrictions on the overall foreign currency assets and liabilities and instructions for banks not to exceed 20 per cent short or 0 per cent long of shareholders’ funds unimpaired by losses using the Gross Aggregate Method.

The CBN said banks found to exceed these limits are mandated to rectify their positions by February 1.

It added that the banks must calculate their daily and monthly Net Open Positions (NOP) and Foreign Currency Trading Positions (FCT) using the templates provided by the apex bank. Adequate stock of high-quality liquid foreign assets is mandatory to cover maturing foreign currency obligations, it added. The CBN also mandated banks to establish foreign exchange contingency funding arrangements with other financial institutions.

Other requirements according to the statement, the CBN also directed banks to adopt a natural hedging strategy by borrowing and lending in the same currency to avoid potential currency mismatches and associated foreign currency risks.

The multiplicity of directives, it would appear may have added to the plight of the Naira as the exchange rate has continued its downward trend unabated.

Vice President Shettima said the federal government has set a target of raising a minimum of $10 billion to bolster foreign exchange liquidity, a crucial factor in stabilizing the Naira and fostering economic growth.

President Tinubu he said, inherited an economy in which nearly 100 per cent of revenue was used to service debt, on the same loans that were used to pay an average of N6 trillion annually for a fraudulent fuel subsidy regime and also $1.5 billion to defend the naira on a monthly basis and give it a false value, in an economy that produces nothing and consumes everything from abroad.

Nigerians spend an annual average of $200 million on imported hair, £25 million on Scotch Whiskey, $75 million on French Champagne, as well as $20 million daily on MTN and Airtel.

Clampdown on Bureau De Change Operators

On Monday, the Economic and Financial Crimes Commission (EFCC) once again raided the popular Bureau De Change (BDC) market located in Zone 4, Abuja targeting the operators and accusing dealers of supporting naira speculators.

The anti-graft agency descended on the market complex, resorting to the use of firearms to disperse BDC operators and halt their trading activities.

This could be linked to the pressing need of the administration to utilize all possible strategies in stabilizing the naira, which has experienced a drastic decline to historically low levels.

The parallel foreign exchange market on Monday experienced another low point as the Naira continued its depreciation, hitting a notable N1,730 per dollar. This represents a concerning 8.13 percent drop from the rate of N1,600/$ observed on February 16, 2024.

When the dust raised by the invasion of the BDC market cooled down, 50 persons were arrested by the EFCC operatives.

In the wake of the floating of the naira and return of market forces, some of the variables shaping the value of the national currency are obviously beyond Mr. Olayemi Cardoso CBN governor’s control.

These factors include limited production in the country, which insecurity worsened; the high taste of Nigerians for imported products and disdain for local goods and services; dwindling exports; poor dollar remittances; humongous school fees of Nigerian students abroad and medical tourism. These factors promote excessive demand for dollars.

The CBN governor, with the support of other relevant agencies, has been reining in all underhand dealings like round-tripping that affects the value of the naira. He has also sent a circular to ensure that all diaspora remittances are received in naira by the Nigeria-based beneficiaries, among other measures to regulate the activities of the International Money Transfer Operators (IMTOs).