Former Deputy Governor of the Central Bank of Nigeria (CBN), Kingsley Moghalu 9, on Sunday, expressed skepticism regarding expectations for the Naira to stabilise at N400 to the US Dollar.
Moghalu, who stated this in a series of posts on his X account on Sunday, described such hopes as unrealistic.
He stated, “They are living in a world full of fear who want the naira pegged at N400 to a dollar”
Moghalu stated that the exchange rate will reflect be value of the naira in the market, rather than the artificial rates that were practiced during the tenure of Godwin Emefiele as the Governor of CBN.
He accused past government of pegging value of the naira with the help of artificial means for political reasons.
He emphasised the urgency of developing a meticulous, value-added manufacturing export sector that generates foreign exchange beyond oil revenues.
He continued: “However, using manufactured goods made it easier for the currency to stabilize. This has caused massive speculation thereby shriveling Nigerian economy.
“Pointedly, Nigeria’s economy is not yet oriented toward major export production which explains why this matter is at the crux of it all.”
Moghalu questioned: “How does it make sense to bring back immediately the exchange rate of naira to an idealistic value when Nigeria does not have $100 billion in foreign reserves? It will take time to rebuild or regain that confidence among investors as exemplified before (rates around 150 -165/$).”
He stressed on the need for urgent establishment of a meticulous value added manufacturing sector that generates foreign exchange beyond crude oil earnings.
The most important thing now, he said, was resolving Nigeria’s age-long electricity problem where we have been generating no more than 4,000MW for about 200 million people; “take power generation up to 20,000 megawatts even without comparing with South Africa’s having 50,000MW for a population of less than sixty million or Brazil’s existing capacity of over181,000MW serving slightly less number of people compared with what we are today,” he concluded.
The naira recently bounced back from N1600 to N1200 to the dollar after the CBN cleared its backlog of around $7 billion.