During the last campaign, the then All Progressives Congress presidential aspirant, Muhammadu Buhari, was alleged to have made a remark that he would make the naira at par with the dollar. It was clear that this was the handiwork of mischief makers as the General never stood by that statement. Since his assumption of office, the naira has fallen three times and this calls for concern as this was a currency that was once stronger than the dollar and on the same page with the pound sterling.
The naira sadly has been destroyed by speculators, rent-seekers, rogue importers and highly corrupt government officials. The Central Bank of Nigeria shares greatly in the blame as the confidence level in it has been badly obliterated. It now pays phoney obeisance to the dollar as the latter is now the currency of choice even within the domicile of the “Giant of Africa”. The dollar is now being used to purchase choice real estate, luxury goods and services.
Corrupt businessmen and government officials have the nauseating practice of giving black market operators massive Ghana-must-go bags in exchange for dollars which they stow away in financial havens like the Cayman Islands and Dubai. The CBN turns a blind eye to these atrocities. The black market has now emerged as the major headache in the financial sector. The key players in this racket are the bureau de change operators, itinerant street traders, unlicensed forex traders who buy and sell cash and currency transfers and the round tripping activities of banks. The irony of the whole charade is that the Central Bank is the major source of their dollar or foreign exchange supply.
The origin of the black market funding is the practice of the CBN doling out thousands of BDC licences under the ruse of bringing sanity into the market. The licences kept increasing by the subsequent regimes. About $30,000 is sold to 300 BDCs on a weekly basis which is a whopping $90m. That is $360m a month and billions a year.
Globally, it is not the best practice for the central bank to directly fund the BDCs but the International Monetary Fund prescription is responsible for this as it was one of the conditions for the debt exit in 2005/6. The market has been further abused by corruption-infested politicians who use it as a market of choice to convert pilfered funds into it to be parcelled abroad to the detriment of the naira as the transaction is done in dollars.
The wild swing in the naira exchange rate has baffled Nigerians. The CBN boss, Godwin Emefiele, has devalued the naira from N155 to $1 and N197 to $1 in his first year in office. The denial of access to official foreign exchange of 41 imported items made the exchange rate balloon to N240 to $1 in the parallel market. The pricing model of the black market has greatly undermined the naira and exposed it to an imminent collapse.
Is it valid constitutionally for the CBN to deliberately sustain the practice that is inimical to economic growth which has worsened the already terrible state of massive unemployment? This practice is contrary to Sections 14(2B) and 16(1 and 2) of the 1999 constitution which define the primary role of government to be the provision of security and improve the social and economic welfare of the people.
The Buhari government needs to stem this tide if we want to avoid an ugly trend of hyperinflation similar to what Zimbabwe is passing through where a loaf of bread is of more value than millions of their local currency.
It should destroy totally the black market. The street traders should be made to bite the bullet and the use of force should apply where necessary.
Besides, the CBN should desist from funding the BDCs every week. The operators should make their bids to the CBN proving why they need funds for tourists and travellers.
The CBN should put in place fiscal policies to curb our forex supply, block leakages within the porous system and prudently manage the resources of the nation which has suffered from the locusts since independence.
No other currency should be openly traded in Nigeria. There should be massive public enlightenment campaigns through the National Orientation Agency, the Public Affairs Department of the CBN and the Federal Radio Corporation of Nigeria with heavy sanctions for violations. Pride should be restored to our naira powered by nationalistic sentiments.
Buhari must rise up to the challenge of flushing out these heartless economic saboteurs and providing uncommon leadership at this great time of anguish.
The duty of the protection of the naira which is our collective jewel should be a matter of concern to all and sundry and should be imbued in our toddlers so as to save the forthcoming generation from the woes of the long-term concomitant effect of the activities of the buccaneers masquerading as leaders of economic thought.