The Debate on Naira Devaluation Continues… Here’s What The United States Thinks

The United States said it would advise Nigeria in talks this week to adopt a more flexible foreign exchange rate in order to boost growth and investment in the country. The Central Bank of Nigeria (CBN), backed by President Muhammadu Buhari had insisted on keeping the naira pegged at 197 – 199 to a dollar despite growing calls for devaluation. The naira exchanges at N320 on the parallel market despite the official rate still being held at N197. Most Nigerians accessing forex do so at the parallel market rates leading job cuts in several industries relying on foreign sourced services or raw materials for their activities. Nigeria, Africa’s largest economy faces its worst economic crisis in decades as the slump in prices of oil hurt revenues. As foreign exchange reserves (over 80 percent of which is gotten from oil) depleted to an 11-year low, the CBN pegged the currency and introduced restrictions aimed at protecting the vanishing reserves. Continue reading