When the IMF Managing Director, Ms. Christine Lagarde, visited Nigeria earlier in the year, she said only Nigeria can help herself out of her economic quagmire, because of her reliance on proceeds from crude oil.
She also advised Nigeria to address some structural defects observed in the economy if naira devaluation was not an option.
President Muhammadu Buhari has also used every opportunity, created though his foreign trips, to explain that the naira cannot be devalued further. Even when the local neo-colonialist sharks in concert with their foreign partners campaigned for further devaluation of the naira, the President snubbed them.
Consequently, they embarked on destructive campaigns – ‘Emefiele Must Be Sacked,’ adducing every manner of reasons. Yet, the President stood solidly behind the CBN and its economic recovery initiatives.
So fascinating, bold and reassuring is the statement credited to our Finance Minister, Mrs. Kemi Adeosun, at the just concluded annual Spring Meetings of the IMF and the World Bank in Washington D.C. where she was quoted to have told the IMF boldly that “IMF could be a doctor, but Nigeria is not sick, and even if we are, we have our own local remedy.”
In medical science at times there can be a critical choice between going with a doctor that will worsen your case or seek self-help. In the context of the current economic situation, it’s obvious that Nigeria has rightly settled for the latter.
This is not to say that Nigeria can live in isolation of faithful and sincere economic partners, but we have thus decided to develop our home grown initiatives to get us out of the woods.
Similar stance taken by the Nigeria’s apex bank – the Central Bank of Nigeria – few months back incurred the ire of agents of these devaluation and neo-colonialists. Shortly after the Bank’s initial devaluation of the local currency, about 41 items were withdrawn from accessing its forex. This was a decision taken by the CBN to rescue the currency from its free fall, and preserve the nation’s foreign reserves which was fast depleting.
They found Emefiele’s action as an affront.
These sharks have been so enmeshed in their illicit trade of round tripping at the detriment of the national interest, thus attempting to harm the Naira and the economy. The message was that Nigerians should drop their appetite for foreign goods, and patronise home-made products: this will create jobs for Nigeria’s teeming youth rather than growing other nations’ economy.
Before the composition of President Buhari’s cabinet, the CBN was managing the economy alone, neither was there in place an economic roadmap. For the economy not to collapse, the CBN took some bold steps which some cynics believed were inimical to the interest of Nigeria.
The apex bank had seen that if Nigeria was to continue the way it was going, we might not have a Nigeria standing today.
Neither was President Buhari a fool not to have seen through the economic recovery and self-sustaining initiatives of the CBN – the more reason he has not faulted any of the Bank’s monetary policies since coming to power. Gladdening enough is the cohesion and synergy of purpose between the Federal Government and the CBN after the inauguration of the federal cabinet to rescue Nigeria. This is what Nigeria needs at this critical time.
What happened in China recently when President Buhari visited and signed an investment deal with the Asian giant and attracted US $6 billion investments to the country was a master stroke to finally nail the coffin of the economic saboteurs, who had been feeding fat on foreign exchange at the parallel market, thus holding the nation’s economy to ransom.
When some few months back the CBN mooted the idea of diversifying its foreign exchange reserves from the US dollar, switching a reasonable portion of it into Yuan, the cynics never believed the President will heed the CBN advice.
The decision was taken to strengthen the Naira and weaken the inordinate appetite for the US dollar and foreign goods in the country.
With the swap agreement, the Yuan will flow freely within the Nigeria banking industry and ultimately make trading seamless. More so, with China as the second largest economy in the world and a country where the vast majority of Nigerians transact businesses, the pact will greatly reduce the craze and bottleneck of procuring the US dollars, and ultimately sack the currency speculators from business.
The take away from the trip in my view is that Nigeria will now be the designated trading hub of China businesses in the sub-region, particularly for people who want Yuan as a currency denomination, and at the same time boost trade between the two nations.
The pact started bearing fruits shortly after the swap agreement was signed. The US dollar started crashing against the Naira some few days past, and it is expected to continue. It is also heart- support to this deal.
Surprising was the support and commendation by the Lagos Chambers of Commerce and Industry (LCCI) and the Association of Small Business Owners of Nigeria (ABCON) over the deal which they all agreed will greatly boost the economy and create employment. Even the President Association of Bureau de Change Operators of Nigeria (ABCON) have attested to the fact that the pact will force the US dollar to beat a retreat.
However, if Emefiele had not acted decisively on some of the Bank’s policies aimed at redirecting the economy, Nigeria would still have been at the mercy of the IMF facilities with its attendant stringent conditionality. For the first time in our history, Nigeria stood up to tell the IMF that we have home-grown solutions to our problems.
Nigeria’s message to the world is that she is not sick; the sickness hitherto known with us that we have identified is the lack of political will to push through what we feel is good for us as a nation. Moreover, the current regime in Nigeria rode on the Change mantra to power, so it is expected that things will be done differently than it was, and fortunately, they found an uncompromising, astute and determined partner in the CBN governor whom I will tag as the proverbial cat with nine lives.