By Fisayo Akinduro,
Jimoh Ahmed &
Alarmed by the tumbling value of the Naira, experts have called for a redenomination of the country’s currency.
They also called for increase in local goods and crude oil production and less depedent on foreign products and services.
In the last one year, the Naira has consistently depreciated as one dollar is exchange for N575, one pound Sterlings N745 and European Euro is N655.
The experts, who spoke in separate interviews with The Hope suggested that for Nigeria to strengthen the value of the Naira against foreign currencies, urgent redenomination of the national currency is necessary.
Sub Dean, Faculty of Education, Adekunle Ajasin University, Akungba Akoko, Dr Sunday Adegboro, said the devastating effect of naira devaluation by government to meet the conditions of obtaining loans from the western world in the eighties drastically reduced the value of naira.
According him, when such happened, the nation’s currency lost significant value over time such that basic domestic supplies and transport are paid with large sums of money and the inflationary pressure is high in such nations.
Adegboro explained that redenomination will improve the value of the naira, reduce inflation, increase people’s confidence in their currency, restore sanity, credibility and facilitate transactions with smaller denomination that have increased value and lowers inflationary pressure.
He also suggested aggressive agricultural revolution by the government which could be achieved by giving low interest loans, subsidies and providing the enabling environment to those who want to go into agriculture in order to aid the production of raw materials for manufacturers.
He also called for a favourable policy aimed at encouraging local manufacturing of the imported products and aggressive export to earn the much needed foreign exchange.
Professor of Plant Science, Adekunle Ajasin University, Akungba Akoko, Victor Olumekun recommended a uniform currency for the ECOWAS sub region.
His words: “The economies of neighbouring African countries are stable, why can’t ours be stable as well? If need be, why can’t we have a uniform currency that will be stable in the ECOWAS region, like we have Euro for the Eurozone?
He said, “I want to be as civil as possible. But for me, the problem is poor leadership. When I wanted to travel to the United States as a young man in 1977, one dollar was 67 kobo. Now, one dollar is about N575 naira. What is the percentage increase? Almost a thousand times. Few years ago, I was buying dollar for N350, now it is N570.
Why? Why is it that other economies are doing well and ours is not? It means that we have poor leadership.
What do Singapore and Japan produce? What raw materials do they have? Even the one we have we don’t manage them well. We have to send our crude oil to other countries that will refine and sell them to us. Even garri, okra soup and some other local delicacies are now being packaged and imported to Nigeria from China?
Also speaking, an economic expert, Dr Adetunji Ogunyemi said in order to strengthen the naira from losing its purchasing power, Nigeria should start producing goods and as well refine her own crude oil.
He said the exchange rate of a currency which may also need a good management system, comes essentially from productivity, not an artificially fixed regime.
“Just check the value of Nigeria’s export relative to her import; you will see that we do not produce high networth goods and services that will be sufficient enough to guarantee a high exchange rate for the Naira.
“Have you noticed that we import all manners of goods and services into this country for which we have to pay in foreign currencies? Examples are our food imports; poultry, rice, stock and iced fish, wine; clothes, cars, refined petroleum products etc.
“All these imports will have to be paid for in hard earned foreign exchange, so, when you do not export enough (except crude oil) to earn the foreign exchange it means huge amounts of your naira will be chasing fewer dollars or euro.”
The Central Bank of Nigeria, CBN, he stated, cannot decree or impose a higher value on the Naira than she currently has, as the naira can only be strengthened through the production of high networth goods.
On his part, Isaac Gbadebo said the only thing that can strengthen the naira is for the country to increase its production rate and be less dependent on foreign goods and services.
He noted that Nigerians as well should start appreciating their products which in return will have market value to make the naira appreciate.
“Indirectly, we are spending foreign currencies in Nigeria because every product is being sold according to the exchange rate which shouldn’t be so.
“Nigeria used to be one of the leading countries in the exportation of agricultural produce until we switched to oil and neglect our root,” he explained.
In order to strengthen the naira, Gbadebo stressed that every sector of the country must be positively impacted to stop patronizing foreign services.
“If our healthcare services are reliable and dependable, it will stop citizens from seeking healthcare from foreign countries and this goes to the education sector as well.
“We must be productive in order to scale through the present hurdle the country finds itself.”