Cardoso’s Cards, Naira’s Gain, Enemies’ Pain, by Abdulrahman Abdulraheem
In Williams Shakespeare’s iconic piece, “All is Well that Ends Well,” Helena was intensely in love with the Prince, Betram, who had no iota of feelings for her due to her poor and inferior background. She devised all manners of ways to make the Prince love her and even risked her life in the process.
In her determination to win the Prince’s heart, she turned to what in Nigerian parlance is called “Gbogbo Nise.” She assumed all professions and competences. Philosopher, strategist, political scientist, doctor, healer everything. She even offered to heal the King and staked her life on the potency of her charm. She was supposed to be betrothed to her beloved Prince if the King was successfully healed. She triumphed.
The recalcitrant Prince stood his ground and gave more stringent and improbable conditions that she must wear the family ring and miraculously carry his child before she could be allowed to have her way. The determined Helena devised a very good strategy to switch his heart towards her. She befriended Diana, the Prince’s beloved, and planned to swap with her in ‘the other room,’ the Prince was fooled and Helena was able to fulfil his seeming impossible condition.
The day of reckoning came and rather than continue his hatred towards Helena, the shocked Prince was moved by her resilience, perseverance and her determination to get her wish as well as how far she could go just to win his love. So, he embraced her and they lived together happily forever. All is well that ends well.
So, all is well that ends well is a metaphor for the fact that it doesn’t matter what a man has to go through to get to his destination in life – the rejection, the abuses, unfair criticisms, unkind cuts, the doubts etc will always be there. What matters is the results at the end of the day. One must therefore learn to stay the course and not buckle under pressure as far as one is convinced that this is the best route that will serve the long-term interest of all, not the narrow cravings of a selfish few.
While CBN Governors’ battle against sadists, doubting Thomases, currency speculators, Shylock investors aka forex bandits (apologies to social media sensation, Sunday Wale Adeniran) is not over yet, the story so far is that the Naira is pounding the Dollar in a serious way due to the government’s robust and comprehensive policies meant to strengthen the national currency.
When this administration floated the Naira and the national currency started a free fall, impatient and armchair critics were on the prowl, attacking the CBN, it’s leadership and entire administration. But President Bola Ahmed Tinubu and Central Bank of Nigeria (CBN) Governor, Olayemi Cardoso, stayed the course and ignored the ignoramuses who were displaying their emptiness by saying the Naira should not have been floated.
But it was obvious to the discerning that aside from the first step of floating the Naira, the policies the CBN was coming up with were going to address the issues and it was only a matter of time before the system was flooded with dollars that will make it to lose some value in comparison with the Naira.
Cardoso’s Cards
One remarkable fact about the CBN governor’s approach is that it is part of the concerted efforts and multi-faceted approach aimed at not only ridding the nation’s foreign exchange market of malign actors who perpetrate sharp practices and steadying the Naira but also addressing inflation and restoring people’s purchasing power.
Cardoso’s key reforms have so far encompassed the unification of exchange rate windows, liberalisation of the FX market, clearance of FX backlog obligations for banks and airlines, implementation of a Price Verification System, imposition of limits on banks’ Net Open Position, removal of the daily cap of N2bn on remunerable Standing Deposit Facility, overhaul of the Bureau De Change (BDC) segment among several others.
In an effort to rectify distortions in the retail segment of Nigeria’s foreign exchange market and bridge the widening gap in the exchange rate, Cardoso’s CBN began the sale of FX to BDC operators at lower rates. In March, the apex bank sold $10,000 to BDCs at a rate of N1,251/$ and directed the BDCs to sell to eligible customers at a rate not exceeding 1.5 per cent above the purchase price (N1,269/$1). In April, it sold $10,000 to each BDCs at N1101/$ and directed the operators to sell at a spread not more than 1.5 per cent above the CBN rate. The apex bank also directed all eligible BDCs to commence payment of naira deposit into the designated CBN accounts from April 8, 2024.
The CBN’s efforts also included investigation of entities whose actions it believed were undermining the economic reforms of the Tinubu administration. In late March, Cardoso revealed that security agencies including the Economic and Financial Crimes Commission (EFCC) were investigating questionable foreign exchange allocations and forward contracts previously estimated at $2.4bn. The CBN had engaged a global firm, Deloitte, to carry out an audit of the $7bn debts. Cardoso had earlier said about $2.4bn FX allocations from the $7bn backlogs were invalid. The development came as two executives of the global cryptocurrency trading platform, Binance, were arrested and investigated for tax evasion and other offences.
On April 8, 2024, the CBN directed all banks in Nigeria to stop the use of foreign currencies as collateral for naira loans within 90 days. Due to the CBN’s regulations, schools, hospitals, hotels, supermarkets , property agents etc can no longer ask their customers to make payments in dollars except those who are visiting Nigeria. In fact, since Cardoso initiated the robust inter-agency cooperation with the EFCC, ONSA and other strategic stakeholders, security agencies have been arresting those involved in sharp practices among the BDC operators.
Naira’s Gain
Due to the above cards that have been brilliantly played by Cardoso, Dollar is now rated higher at the official market than the parallel market. As I type this, unlike the nearly 2000 Naira value of two months ago, the Dollar has fallen to less than 1000 Naira.
The Naira rallied 12% against the Dollar in April, adding to its 1% surge in March. This remarkable performance in a space of two weeks has made the world-renowned investment banking firm, Goldman Sachs, to declare it the best performing currency in the world in the month of April.
Enemies’ Pain
While basking in the euphoria of this seeming triumph of good over evil, one must acknowledge the fact that some Nigerians have actually been contributing significantly to the slump of the Naira by their constant speculation, exaggeration, fake news and propaganda. The same Nigerians are always the first to post anything negative about their country. They are as well not interested in seeing anything good about the system just because their favourite candidates lost election or the fact that the man they said will not go near the Villa is the one calling the shots today.
Unlike Betram who gave up on his hatred for Helena when he saw how committed the lady was, these unpatriotic elements are not willing to let go of their bitterness and unjustifiable hatred for Nigeria.
Meanwhile, to show how evil these people are, some of them sought to take advantage of the country’s misfortune and bought Dollar at N1800 with a view to selling it at N2500 when the currency rises further at the expense of the Naira. Yet, the same unpatriotic characters will come on social media to attack President Tinubu and CBN Governor for the free fall of the Naira. They didn’t know the Naira was about to fight back to make them record massive losses.
Some of them even borrowed money to do this kind of obnoxious investment but now that Nigeria has triumphed against them, they are gnashing their teeth in regret. They deserve their pain. Nigeria has to rise if it means a few selfish individuals will fall.
While some of these enemies of the country are Shylock investors whose modus operandi has been explained above, some are just Internally Displaced Politicians (IDPs) whose candidates lost election to President Tinubu and who are now using their large following on social media to exhibit intolerance, bitterness and hatred for their own country. Some are both.
After using their social media pages to announce gleefully that Naira was falling and sadistically predicting that it will soon crash to N2500 to a Dollar, sellers responded and jerked up the prices of their wares. Now that the Naira has gained significantly against the Dollar to become the world’s best performing currency, they have kept quiet as if they are not aware. So, the sellers who rely on these armchair critics have refused to reduce their prices. Yet, these same people are claiming that the so-called Naira gains cannot be celebrated since it is not affecting the prices of stuff in the market. How can it affect the prices of goods and services when you have not used the same platform you used to announce bad news to announce good news.
These IDPs have now graduated from being mischievous to being ridiculous with their latest wild claim that the country’s foreign reserves dropped because the Tinubu administration has abandoned the flotation of the Naira and is now defending it, like previous administrations, and that is why the Naira is rising.
Any adult with minimal education should know that foreign reserves dropped because the CBN recently cleared the backlog of foreign exchange allocations owed to foreign companies seeking to repatriate their profits from Nigeria, with the highest amounts going to foreign airlines, which gulped over a billion dollars.
Last Line
I have bad news for these enemies of Nigeria: President Tinubu and Governor Cardoso will double down on their policies both on the fiscal and the monetary side, and intensify the pain bad people are going through right now. It is not out of any agenda or personal vendetta. It is for God and Country.
Abdulrahman Abdulraheem is the author of “eNaira Revolution: A Peep into Nigeria’s Cashless Future”
