The ongoing turbulence in Nigeria’s currency exchange market saw the local currency, the Naira, continue to depreciate across all market segments.
Checks by Vanguard revealed that Naira went down from N1,100 to USD1.0 mid-day in the parallel market before settling at N1,060 in the major trading hubs in Lagos. It had hovered around N1,025 in the past month in the parallel market.
However, the official Nigerian Forex Market, the Investors & Exporters (I&E) window, experienced a slight respite as it hovered around N790.61/$1, after a significant dip to N848/$1 the previous day.
Despite this recovery, the exchange rate remained considerably higher than the levels observed in the previous week, and market dealers anticipated further depreciation from today.
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This currency depreciation coincides with calls from manufacturers for the Central Bank of Nigeria (CBN) to reconsider its decision to reinstate the 43 items it had previously banned from its foreign exchange window.
Manufacturers argue that this ban is essential to prevent a job crisis, insecurity, and an economic collapse in the nation.
They said the ban was necessary in order to save the nation from looming job crisis, insecurity and collapse of the nation’s economy.
Meanwhile, the Vice Chairman of the Basic Metal, Iron and Steel Products sector of the Manufacturers Association of Nigeria (MAN), Mr Lekan Adewoye, while speaking on a TVC Business Programme, said: “For items that can be produced in Nigeria, such manufacturer ought to be encouraged. This directive will further kill the manufacturing industry that is already struggling to survive. The problem is about policy somersaults, some of our members who have outrightly invested in backward integration will now start to regret this move because everyone who can assess FOREX will claim to be an importer, forcing sincere manufacturers to close shop and increasing the numbers of jobless persons.”
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“Nigerian manufacturers don’t really have any competitive advantage over those in other developing countries, at best, what you have is competitive parity, because something has to be an advantage if your competitors don’t have it. And the little incentive that government has provided now it has been removed by the directive from the Central Bank of Nigeria.”
Speaking further on why manufacturers are leaving the country, Adewoye said: “Lack of consultation, I can speak for manufacturers because we always try our best to engage the government on some critical issues and decisions, but when some of these decisions are being taken, manufacturers are not being consulted.