A former Emir of Kano, Muhammadu Sanusi II, has warned that the US Dollar to Naira could fall to N1,500, “if the CBN printed more naira” the way it did during the administration of former President Muhammadu Buhari.
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Sanusi, who berated how Buhari’s government managed the economy, said experts’ advice was ignored while it borrowed about NGN30 trillion from the CBN.
“All the revenue the country generated in the last few years couldn’t service debt. Debt service exceeded 100 per cent,” he said.
FX Racketeers Bought Dollar At N400, Sold At N540 Under Buhari
The former Kano Emir also revealed how some sycophants bought dollars at the official rate of N400 and sold at the black market rate of N540 under Buhari while Godwin Emefiele was the CBN governor.
The vocal Economist described one of the beneficiaries of FX racketeering as a boy who had no history of service but had his way under Buhari’s government by simply buying dollars from CBN and selling it at the black market rate.
The former CBN governor while speaking at a virtual religious summit said the inexperienced boy “who has no record of service has a private jet and owns houses in Dubai and England just because he is buying dollars at such a rate and selling them.”
FX rate during Sanusi
While in office as the CBN governor between June 2009 to February 2014, Dollar/Naira exchange rate was NGN150.
He was succeeded by a former MD of Zenith Bank, Emefiele. It was during Emefiele that FX became an issue, with racketeers in the FX market making billions as profits by buying at CBN at the official rate and selling it at the parallel rate.
Emefiele who is now in DSS custody pegged the naira in what could be described as FX subsidy and hurt many businesses such as foreign airline operators who couldn’t repatriate their profits back to their headquarters.
FX Unification
But a month after assuming office, infomediang.com reported that Bola Tinubu announced the unification of the foreign exchange rate. The apex bank aborted the peg rate, allowing the market forces to determine the rate at the Importers’ and Exporters’ Window and floated the Naira.
On Monday, September 4, 2023, USD/NGN closed at 912 at the parallel market while I&E rate closed at $/747.87. The parallel market is the most accessible.
Tough time ahead
Sanusi said Tinubu didn’t push Nigerians into difficulty, “We will speak when he goes astray. The government can’t pay subsidies since it doesn’t have the means.”
Recalled that the Buhari-led government paid subsidies on fuel for eight years. At some points, the former administration was borrowing money to service debts and pay the salaries of civil servants.
Edo State Governor Godwin Obaseki once accused the Buhari’s government of directing Emefiele-led CBN to print Naira which it used to fund the budget, shared as monthly allocation to state governments and pay salary, an allegation the government refuted several times.
In his inauguration speech, Tinubu announced the removal of the fuel subsidy, which immediately pushed the prices of consumables and other goods to the sky.
But two months after taking what international bodies and analysts described as the boldest reform in decades, Tinubu disclosed that his government had saved over NGN1 trillion ($1.32 billion).