A financial analyst Kalu Aja has proffered solutions to the lingering FOREX crisis in Nigeria, saying it is possible for the country to achieve a $/N500 exchange rate.
At the time of publication, the US dollar was exchanging at N1,165, EURO at N1,168, while British Pound was N1,350 at the parallel market.
At the I & E window on FMDQ website, it closed at $/N782.68 on Thursday.
But tweeting @FinPlanKaluAja1, the financial expert believed that it is possible for Nigeria to solve the crisis in its foreign exchange market.
His 6-point solution to Nigeria’s FX crisis
- Sell 10% of NLNG
- Sell 100% of NNPC
- Use sales proceeds & clear CBN outstanding
- Destroy bandits
- Destroy crude oil thieves
- Export more oil & gas
Why sell the NNPC?
Over the years, the state-controlled NNPC has been a conduit of corruption for top government officials.
For instance, former Minister of Petroleum, Diezani Alison-Madueke, whose ministry oversaw NNPC from 2011 to 2015 was accused of diverting $28 billion from the Nigerian treasury, according to some American and British officials.
After leaving office, the financial malfeasance in the oil sector continued, depriving Nigeria the crude oil revenues.
As such, experts have advised that the government hands off the management of NNPC and create an enabling environment and favorable regulation for private investors to come in.
Destroy bandits
There are many economic activities that have been destroyed by the activities of bandits and terrorists across the self-acclaimed Africa’s economic giants.
One, the country has been unable to make economic gains from its rich tourism sector.
Who wants to visit a country where bandits and terrorists operate with such impunity in broad daylight?
In the agro sector, bandits, gunmen, Boko Haram, and other non-state actors in some northern states such as Niger, Sokoto, Zamfara, Katsina, and Benue have taken over farmlands.
How does a country export its agricultural produce when farmers are either killed or made to pay heavy tax to criminals before accessing their farmlands?
Apart from export, the destruction of the food value chain by these criminals has also caused a food crisis in Nigeria, which has triggered hyperinflation of food products.
Destroy crude oil theft
On the issue of crude oil theft, an average Nigerian who is conversant with the operation of the oil sector knows that it isn’t possible for oil cargo to spend days or weeks on Nigeria’s waters loading crude oil illegally without official involvement.
According to them, Nigeria would continue to lose revenue if oil theft doesn’t stop.
Export more crude oil gas
The ability of Nigeria to export crude oil and gas is tied to its capability to tackle crude oil theft.
Without (5) and (6), Naira can’t gain value in the short to medium term. Do all 6 items well and $1 becomes N500″, Kalu Aja advised.
