The Central Bank of Nigeria’s sustainability of its intervention in the forex market would reinforce the confidence of the Nigerian investors and the International community in the improvement in the nation’s economy.
A fellow of the Institute of Chartered Accountants of Nigeria (ICAN), Mr Joseph Babayemi has noted that the forex window recently created by the CBN for investors and exporters (Investors’ & Exporters’ FX Window) has not only succeeded in boosting liquidity in the forex market, but has equally ensured timely execution and settlement for eligible transactions.
He lauded the CBN for not only been able to curb excesses and supply shortfalls since its intervention policy, but also for its ability to prevent volatility in the forex market and reduce the gap between the official and parallel markets’ exchange rates of the naira, stressing that this strongly indicated that the apex bank was on track.
The financial expert noted that with the opening of the special window, Small and Medium Enterprises (SMEs) operators would no longer have to patronize or source forex through unofficial windows and there won’t be any more pressure on either the Bureau De Change operators or any other unofficial source.
Babayemi, who attributed the slum in the naira to depletion of foreign reserves by successive administrations, drop in oil price at the international market and attacks on oil facilities by militants, however, stressed that the CBN’s intervention policy in the forex market had enabled the apex bank to be gradually winning the battle to give the naira its value against major international currencies.
He therefore urged the government to checkmate the trend of inflation in the country by not only ensuring the reduction of the people’s dependence on imported goods, but by also creating an enabling environment that will be attractive to investors and small scale business owners in order to have positive effects on the naira, provide job opportunities and bring down inflation to an acceptable limit.
While lamenting the state of the nation’s economy, he stressed the urgent need for the diversification of the economy with massive investment in agriculture and in improving the infrastructure like steel, rail transportation and power, while the government should take bold steps in blocking all tax related loopholes of avoiding tax and ensuring that effective systems were on ground for strict compliance.
The financial expert, who noted that the country was blessed with enormous human, material and natural resources, counseled the government to give urgent attention to the raging unemployment situation in the country by encouraging entrepreneurship and innovations as a way of creating new products and market demand, as well as give necessary support to small and medium business owners in the areas of funding, accessibility to raw materials and technical training.