The Central Bank of Nigeria on Friday disclosed that its monetary tools aimed at reining-in inflation and stabilizing foreign exchange are already yielding fruits resulting in over $1 billion in the economy in the last few weeks and foreign portfolios showing interest to invest in Nigeria.
Briefing a Joint Committee of the Senate on the State of the Nigerian Economy, CBN Governor Olayemi Cardoso said while the apex bank will continue to do all it can on the monetary side, it has no “magic wand“ to turn around the fortunes of the economy and the country’s currency, the naira.
How Nigeria’s currency, the naira has drastically fallen compared to the dollar – from N750 last May to a staggering N1,555 in eight months, the galloping food inflation that came with it, and attendant hardship in the country – prompted the engagement between the Joint Senate Committee and top managers of Nigeria’s economy.
The federal lawmakers wasted no time to fire all the tough questions – most of them hauled at the CBN Governor Cardoso on the fate of the naira against the dollar.
The CBN Governor didn’t mince words when he said the apex bank has no magic wand to fix the falling NAIRA and the economy.
On the Forex market, Cardoso said much depends on the forces of demand and supply even as he advised citizens to reduce their appetite for dollar and foreign goods and services.
Even when Cardoso could not tell in specific terms when the naira will pick up against the dollar, he said the monetary tools aimed at curbing inflation and volatility in the exchange rate market is already yielding results with over $1 billion coming into the economy in recent weeks, while foreign investors are showing greater interest in investing in the country.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said there is the need to ensure that government expenditure is wisely spent and agreed with the CBN boss that
fiscal and monetary policies of government should complement each other.
Boosting agriculture seems the quickest way out for Nigeria to feed itself and also shore up foreign exchange earnings with 70 million hectares of arable soil.
The country must however be able to secure and support its farmers and address the problem of food smuggling across its borders to neighboring countries.
At the end of the blunt conversation, many of the lawmakers expressed belief in the current reforms as steps in the right direction and long overdue.
It is however hoped that the stakeholder opinions would be harnessed to ease the current economic hardship in the country.