BEFORE Sobia (Guinea Worm infection) becomes a sore, Oluganbe (the Physician) should be summoned to attend to it. The rising rate of Dollar exchange to the Naira had created a lot of fears as well as galloping inflation in Nigeria. However, the government’s present policy of floating the naira, as well as the regulations put in place by the Central Bank of Nigeria, seemed to have given wind to the wings of escalating exchange rate. Since the announcement of the fuel subsidy removal, and unification of the various forex market segments, the naira had consistently and drastically fallen from around N451 to about N800 to a dollar. The effect of this on the Nigeria peoples, is beyond the expectation of government.
THEREFORE, the $3 billion dollars procured by the Nigerian National Petroleum Company Limited, (NNPCL), which had halted the free fall of the naira against the dollar and has also prevented the insensitive increase in fuel price increases, is not only commendable but also a necessary step at the niche of time. It is also pertinent to note that in times past that the NNPCL intervention had unlocked 30,000bpd of oil from Egina and Akpo fields, and as well played vital mediating roles in the events that led to the suspension of the PENGASSAN’s strike which could have troubled the nation severely. Thus, we respect the efforts of NNPCL in saving Nigeria in the time(s) of need.
WHILE we observe that the rate of the Naira to the dollar had refrained from hitting the 800 Naira mark since the intervention, we are being careful to raise the roof with applause because the Naira had not also been strengthened to President Bola Ahmed Tinubu’s pre-inauguration rate of less than 500 Naira to a Dollar. Given the volatility of Crude Oil prices and of course the dynamics of fuel pricing in the international market vis-a-vis the nationals’ dependence on PMS for power, transportation and living, this intervention may not be the ultimate solution to Nigeria’s currency devaluation.
FURTHERMORE, irrespective of the fact that cash re-payment has been substituted with crude oil (details of which are unknown to Nigerians), Nigeria’s crude oil revenue has been reduced, while the nation’s debt burden has been increased. We ask, is this loan not a fuel subsidy by another means? Even if the oil marketers are given first line priority access to these funds to keep the price of the imported products at a controlled level, what of those importers who are engaged in other products; the students who have to pay tuition abroad, and Nigerians who need the foreign currency to travel out of the country? With the floating of the Naira, it would be a short while before the Dollar begins to rise again.
THE Hope insists that paucity of foreign currency in simple economics implies that the nation(als) spends more than she earns. In the area of crude oil productions and sales, Nigeria has not been able to produce even her allotted quota from OPEC. Technology backwardness, theft of crude oil, oil pipeline vandalisation as well as isolated but effective activities of bunkers and bandits have ensured that the Nigeria produces below her capacity and expectations. While efforts to address these issues are ongoing, we insist that time is too short, and the need is so urgent for handling these issues with kids gloves and lack of political will.
ASIDE these, other sectors that can earn forex must be strengthened and exploited in times like this. There are many mineral deposits that are crying for attention, while the nation is fixated on crude oil. The agricultural sector which can cure hunger and generate forex also needs urgent government assistance while the comatose industrial sector needs economic assistance and revival in order to bring the nation out of this economic crunch. While we have addressed this issue in the past, it is not out of place to strongly insist that robust discussions and decisions should be taken in the nation, sub-regions and at the level of the African Union to break the monopoly and Dollarisation of the continent.
GIVEN that commerce remains the lifeblood of any nation, every form of intervention in the economy must revolve round the enhancement of the productive capacity and capability of the people. To help one another, THE HOPE appeals to Nigerians to abstain from speculative purchases and deliberate increases in the prices of goods and services. While this loan intervention can enhance political stability for a while, debts are avoidable if infrastructures are in place and various sectors of the economy live up to their names.