President Bola Tinubu Affirms Commitment to New Forex Policy, Paving the Way for a Stronger Nigerian Economy.


By Gladwell Stone

President Bola Tinubu's unwavering commitment to Nigeria's progress has been reinforced by the recent introduction of a new Forex policy. Under this policy, commercial banks have been granted the authority to trade foreign exchange (forex) at open market prices.

 This development is a significant step towards fostering a more robust economy and addressing the challenges that have hindered Nigeria's growth. This paper aims to explore why this new Central Bank of Nigeria (CBN) policy is beneficial and discuss its implications for the Nigerian economy.

Enhancing Market Efficiency

The new Forex policy introduces a more market-driven approach to forex trading, empowering commercial entities to participate actively in the market. By allowing businesses to access forex at open market prices, the CBN is removing the limitations that previously constrained economic activities. This move promotes efficiency by reducing bureaucratic bottlenecks and facilitating smoother transactions. As a result, businesses can more effectively plan and allocate resources, leading to increased productivity and improved competitiveness in both local and international markets.

This new forex policy will encourage Foreign Investments:

A stable and transparent forex market is crucial for attracting foreign direct investments (FDIs) into the country. The CBN's new policy creates an environment that is favorable for potential investors, as it eliminates artificial exchange rate disparities and restrictions. Foreign investors will be more inclined to invest in Nigeria when they can confidently access forex at open market rates. This influx of FDIs will spur economic growth, create job opportunities, and stimulate various sectors, thereby diversifying the Nigerian economy.

Boosting Non-Oil Exports

Nigeria has long relied heavily on oil exports as its primary source of revenue. However, this over-reliance leaves the economy vulnerable to global oil price fluctuations. The new Forex policy is a step towards reducing this dependence by promoting non-oil exports. Businesses engaged in agriculture, manufacturing, and other non-oil sectors will benefit from better access to forex, enabling them to import necessary raw materials, machinery, and technology. This, in turn, will enhance their production capacity and competitiveness, leading to increased export earnings and a more balanced trade portfolio.

Curbing Forex Black Market

The previous forex regime inadvertently fueled the growth of a parallel black market, where forex transactions occurred at exorbitant rates. This black market not only eroded the value of the local currency but also hindered economic stability. The new policy aims to address this issue by allowing commercial entities to obtain forex at open market rates, thereby narrowing the gap between the official and black market exchange rates. Consequently, the attractiveness of the black market will diminish, discouraging illegal forex activities and fostering a more transparent and stable forex market.

Mitigating Inflationary Pressures

The new Forex policy holds the potential to mitigate inflationary pressures in the Nigerian economy. By allowing commercial entities to source forex at open market prices, there will be improved access to essential imported goods, such as machinery, spare parts, and raw materials. This enhanced access will reduce production costs and improve the overall supply chain efficiency. As businesses become more competitive and productive, the price of goods and services is likely to stabilize, easing the burden on consumers and reducing inflationary pressures.

President Bola Tinubu's commitment to making Nigeria work has been bolstered by the implementation of the new Forex policy, granting commercial entities the authority to trade forex at open market prices. This forward-looking approach introduces market efficiency, encourages foreign investments, boosts non-oil exports, curbs the forex black market, and mitigates inflationary pressures. These positive implications on the Nigerian economy will contribute to a stronger and more sustainable path of growth, ultimately improving the lives of millions of Nigerians across the country.





Comments

Post a Comment

Popular posts from this blog

Indigenes of Edo Express Deep Dissatisfaction with Retired General Charles Airhiavbere's Treatment

Image
By Gladwell Stone In a resounding declaration of unity, the indigenes of Edo State have stood firm against the actions of Retired General Charles Airhiavbere, expressing their profound disappointment and anger over his treatment of their people during his tenure as the Executive Director of Finance on the Board of the Niger Delta Development Commission (NDDC). At the center of the storm is the stark reality that General Airhiavbere, while in a position of significant influence, allegedly chose to withhold support and assistance from the Edo people. His reported vow to deny aid to the very people he was appointed to serve has ignited a wave of resentment, painting a picture of political vindictiveness that has marred his tenure. It is suggested that this stance stems from the perceived lack of support from the Edo community during his bid for the position, though this claim is yet to be substantiated. Even more disheartening is the purported treatment of Edo individuals working within t
Read more

Aketch Joy Winnie: African Model Whose Heart Never Left Home

Image
  Written By Paul Ikemba Okeke Photo& Video Credit: Aketch Joy  Aketch  Joy Winnie is an international model who has modeled and still models for high-end brands like Gucci, Dolce Gabbana, Giorgio Armani, and others. However, there is one striking characteristic that sets her apart from other African models who have achieved success in Paris and other major fashion centers around the world: she still fully identifies with her Ugandan rural roots. In several online videos, she visits the farm, cooks in a typical African setting, and educates people.    She has made the world aware of her traditional way of life, and through her social media handles, she has brought visitors to her Ugandan small town. Aketch has not allowed global stardom to overwrite her identity. Rather, her success has highlighted her passion for her community and her people’s way of life. Aketch is extremely proud of her village and the family that brought her into this world. Aketch is an English and Literatu
Read more

Upholding The Law When A Criminal is the President: Lessons from Historical Examples

Image
Upholding The Law When A Criminal Is The President Cover? When a criminal becomes the President of a nation and disobeys the Constitution, the people must uphold the law where the justice system has failed to do so. This article examines the actions citizens can take to stall the imposition of illegality on them. Historical examples are used to demonstrate how people have risen against the illegality of their President. The importance of civil disobedience and peaceful protests is highlighted, as well as the need for citizens to remain vigilant and informed to protect their democratic rights. ...........  When a criminal becomes the President of a nation, it poses a grave threat to the rule of law and democratic governance. The President is expected to uphold the Constitution and protect the rights of citizens, but when they become the very person violating those rights, the people must take action to protect themselves and their democratic institutions. This article examines the actio
Read more