Nigerian Naira Devaluations Pushed by Economists, Not President Buhari

Summary: Nigeria’s Central Bank and Finance Ministry agree with President Buhari, and disagree with non-Nigerian economists, over Nigerian naira devaluations.

Central Bank of Nigeria's headquarters in Abuja, Federal Capital Territory (FCT), central Nigeria: chippla at English Wikipedia, Public Domain, via Wikimedia Commons

Neither the Federal Republic nor Nigeria’s people are going to derive any benefit from Nigerian naira devaluations, according to statements Jan. 27, 2016, by Muhammadu Buhari, 7th and 15th President of Nigeria.

President Buhari based his statements upon previous experiences during his two-year appointment as Federal Commissioner of Petroleum and Natural Resources from March 1976 to June 1978. He also can call upon similarly relevant experiences during his year-long appointment as Chairman of the Nigerian National Petroleum Corporation from June 1978 to June 1979. He draws upon ongoing experiences as the incumbent Federal Minister of Petroleum Resources since Nov. 11, 2015, and as the incumbent president since May 29, 2015.

President Buhari emphasized that Nigerian naira devaluations will not benefit the Republic, as an import-dependent, not export-driven, economy.

President Buhari’s statements form part of an interactive meeting relating to recent currency controls and foreign exchange measures Jan. 28, 2016, with Nigerians in Nairobi, Kenya. He gave as disadvantages of Nigerian naira devaluations inflationary impacts of low-valued currency and rising prices upon middle-class and poor Nigerians who “have suffered enough already.” He harbors misgivings about selling foreign exchange since “We had just 74 of the bureaux [de change] in 2005, now they have grown to about 2,800.” He identifies the proliferation as the result of bank and government officials selling foreign exchange at far higher rates than that received at official governmental rates.

President Buhari judges that “I won’t kill the naira” and “We don’t have the dollars to give to the BDCs.”

Petroleum subsidy payment procedures from Goodluck Jonathan’s presidency keep impacting the current administration since President Buhari says, “They just stamped papers and collected our foreign exchange.”

President Buhari lists as priorities for his administration in 2016: “We will use our foreign exchange for industry, spare parts and the development of needed infrastructure.” He mentions that regarding currency exchangers in banks and government offices “Let them go and get it from wherever they can, other than the Central Bank.”

Godwin Emefiele, Governor of the Central Bank of Nigeria since June 3, 2014, notes that a “unanimous vote to retain monetary policy” keeps exchange rates unchanged. The website Abokifx offers CBN, Lagos black-market buy/sell and Western Union rates at 197, 193.83, and 304/307 naira per dollar.

John Ashbourne, London-based Africologist at Capital Economics, predicts Nigerian naira devaluations in “the first half of 2016” despite Monetary Policy Committee votes Jan. 26, 2016.

Mike Nwanolue, currency analyst at Lagos-based Greenwich Trust Group Ltd., questions “the restriction in dollar sales” for imports other than glass, toothpicks, wheelbarrows and 37 others. He reveals that curbed foreign-exchange trading and imports are “promoting smuggling and causing loss of revenue to the government, which the authorities will want to correct.”

Alan Cameron, London-based economist at Exotix Partners LLP, states that Nigerian naira devaluations are overdue, “all the more so after the latest drop in oil prices.”

Finance Minister Kemi Adeosun turns to anticipated, imminent billion-dollar sales in Eurobonds to address $30-per-barrel oil exports and 3-trillion-naira deficits.

President Uhuru Kenyatta of Kenya (left) with President Muhammadu Buhari of Nigeria (right): Narametrics @Nairametrics, via Facebook Jan. 28, 2016

Acknowledgment

My special thanks to talented artists and photographers/concerned organizations who make their fine images available on the internet.

Image credits:

Central Bank of Nigeria's headquarters in Abuja, Federal Capital Territory (FCT), central Nigeria: chippla at English Wikipedia, Public Domain, via Wikimedia Commons @ https://commons.wikimedia.org/wiki/File:Central_bank_nigeria.jpg

President Uhuru Kenyatta of Kenya (left) with President Muhammadu of Nigeria (right): Nairametrics @Nairametrics, via Facebook  Jan. 28, 2016, @ https://www.facebook.com/Nairametrics/posts/1168517009826728

For further information:

“Buhari Rejects Devaluation, Says ‘I Won’t Kill the Naira’ – P.M. News.” Abokifx.
Available @ http://abokifx.com/buhari-rejects-devaluation-says-i-wont-kill-the-naira-p-m-news/

“Falling Naira Prompts Nigerian Currency Controls.” BBC > News > Business > 22 Jan. 2016.
Available @ http://www.bbc.com/news/business-35380549

“Here Is a Perfect Example of How Western Media Is Promoting Naira Devaluation.” Nairametrics > Investing > Analysis > Jan. 7, 2016.
Available @ http://nairametrics.com/here-is-a-perfect-example-of-how-western-media-is-promoting-for-naira-devaluation/

“Lagos Black Market Rates.” Abokifx.
Available @ http://abokifx.com

Marriner, Derdriu. 28 January 2016. "Over $200 Billion in Missing Nigerian Public Funds May Be in Dubai." Earth and Space News. Thursday.
Available @ https://earth-and-space-news.blogspot.com/2016/01/over-200-billion-in-missing-nigerian.html

Nairametrics @Nairametrics. 28 January 2016. "Buhari Sends Message to Devaluation Seeks 'I Won't Kill the Naira.'" Facebook.
Available @ https://www.facebook.com/Nairametrics/posts/1168517009826728

Nairametrics @Nairametrics. 28 January 2016. "Buhari Sends Message To Devaluation Seekers 'I Won't Kill The Naira.'" Twitter.
Available @ https://twitter.com/Nairametrics/status/692720574791946241

Njoku, Ihechukwu. 8 January 2016. “Pressures Grows on Buhari to Devalue Naira.” Nigeria Films > News.
Available @ http://www.nigeriafilms.com/news/37850/52/pressure-grows-on-buhari-to-devalue-naira.html

Onu, Emele. 6 January 2016. Updated 7 Jan. 2016. “Pressure Mounts for Nigeria Naira Devaluation on Oil Plunge.” Bloomberg > Business > News.
Available @ http://www.bloomberg.com/news/articles/2016-01-06/pressure-mounts-for-nigeria-naira-devaluation-on-oil-plunge

Reuters. 26 January 2016. "Tough choices for Nigeria's central bank." YouTube.
Available @ https://www.youtube.com/watch?v=luk2b4tLLo0

“Tough Choices for Nigeria’s Central Bank – Reuters.” Abokifx > Market News.
Available @ http://abokifx.com/tough-choices-for-nigerias-central-bank-reuters/

Wallace, Paul; and Onu, Emele. 28 January 2016. “Nigeria’s Buhari Rejects Devaluation, ‘Won’t Kill’ the Naira.” Bloomberg > Business > News.
Available @ http://www.bloomberg.com/news/articles/2016-01-28/nigeria-s-buhari-rejects-devaluation-says-he-won-t-kill-naira