The value of Naira has plunged and the economy is plummeting but the president is unperturbed and the supporters of the president and their party are still singing the song of victory. So, when are we going to begin to get it, that this economy is dying away and our national currency is beginning to be worthless? Does it require further devaluation or should it be pegged by force as the president has done?
By Chinelo Obogo
Professor of political economy, Pat Utomi, has faulted President Muhammadu Buhari for insisting that he would not approve the further devaluation of the naira.
He told journalists during the inaugural conference of the Ibadan School of Government and Public Policy held in Ibadan, Oyo State recently, Utomi said the President has no knowledge of the economy and should allow those who do, to speak on the matter.
He said: “President Buhari who was in Kenya recently said he would not devalue the Naira. The fact is someone like him should not be talking about such things. Whatever his sentiments are, he should keep quiet so that people who know about these things, should be allowed to talk about them. He has created a major problem for the economy by that statement.”
On the economy, he said: “The economic situation is a very big issue and there are many problems that have converged. We are just paying for our sins. We are paying for not having done what we should have done. Who gets a windfall for a very long time? Oil is a very volatile commodity and we had a big boom. We used to have quick spikes and the cycles kept going, but because of India and China, we squandered everything. It is not a surprise that we have gotten into this situation. When we should have diversified the economy, we did not. When we should have saved, we went on a spending spree. What we need is a disciplined and focused leadership at this time, but unfortunately, I do not think he said that we are quite there.”
President Buhari has stood firm in rejecting calls for further devaluation, saying that he wouldn’t “kill the naira.”
According to a statement signed by his aide, Garba Shehu, the President said letting the currency fall would only result in higher inflation and cause hardship. He also said proponents of devaluation will have to work much harder to convince him what ordinary Nigerians will gain anything from it.
The Central Bank has pegged the naira value at 197- 199 per dollar since March 2015 as a result of the fall in oil prices. The policy has led to a shortage of foreign exchange, and inflation as well as making investors blame the restrictions for exacerbating the economic slump.
As at Tuesday, February 2, the naira traded at N307 to one US dollar