The Lagos Chamber of Commerce and Industry, the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture and the Association of National Accountants of Nigeria on Friday canvassed the need to stop the continued depreciation of the value of the Naira by reviewing the country’s foreign exchange policy.
They said as long the country failed to review the current policy, the scenario would continue because it would not help liquidity in the foreign exchange market.
According to them, the current fall of the Naira in relation to international currencies such as the dollar has led to hyper-inflation in the country.
Naira had fallen to N391 to $1 at the parallel forex market as of Thursday.
Speaking in Ilorin, Kwara State, on Friday, the President, Association of National Accountants of Nigeria, Mr. Chukwuemeka Nzom, said the fall of the Naira had negatively affected financial and economic activities in Nigeria including the fortunes of financial institutions and other organisations.
Nzom called on the government and Nigerians to encourage more local production and patronise locally-made products to reduce the country’s reliance on forex for business transactions.
He said, “The current crash of Naira is affecting everybody and institutions including banks and accountants because it is leading to galloping and hyper-inflation. Prices of goods and services have gone up.”
LCCI Director-General, Mr. Muda Yusuf, also expressed fear that Naira would exchange for N700 to a dollar if the foreign exchange policy was not reviewed.
He said, “The current policy is concentrating only on the management of demand; it is not addressing the issue of supply. I am not talking about supply from the sale of crude oil because there is not much we can do about that. But there is a lot we can do about supply from other sources, from export proceeds, from our people in the Diaspora, from multinational companies that need to bring forex here, from donor agencies that have projects here that they need to execute in Naira.”
These are other channels of supply, but if our policy is not right, the supply from those sources will not come.
“The only way to encourage supply from the other sources is to liberalise the influence in those areas. If people bring the money in, let them exchange it at the market rate and not at the rate that the Central Bank of Nigeria has fixed.”
Also, NACCIMA National President, Chief Bassey Edem, sought further review of monetary policy rate downwards to enhance foreign direct investments.
Edem, who referred one of our correspondents to a paper he presented recently during the NACCIMA’s review of the state of the economy, said unless the nation’s manufacturing sector was encouraged to source for raw materials locally, the Naira would continue to be under pressure.
He said the value of the Naira would continue to fall unless the apex bank further reviewed downwards its monetary policy and enforced adequate policies to empower the real sector and also ease access to low-interest funds.