If you are expecting Naira to be N400 to Dollar, you are living in dream world – Moghalu

If you are expecting Naira to be N400 to Dollar, you are  living in dream world – Moghalu

Former Deputy Governor of the Central Bank of Nigeria, Kingsley Moghalu, has unequivocally stated that those anticipating the Naira’s value to plummet to N400 against the Dollar are deluding themselves. Moghalu conveyed this sentiment through a statement shared on his social media platform on Sunday.

Highlighting the significance of the exchange rate accurately reflecting its market value, Moghalu lambasted the Central Bank for perpetuating an artificial exchange rate to appease economically uninformed political figures of the time. He asserted that this artificiality had provided fertile ground for speculators to engage in rampant arbitrage, resulting in detrimental consequences for the nation’s economy.

Furthermore, Moghalu underscored the urgent necessity for Nigeria to pivot towards establishing a value-added manufacturing export economy capable of generating substantial foreign exchange revenues beyond the oil sector. He emphasized that Nigeria’s current lack of a robust productive export economy lay at the core of its economic challenges.

Moghalu also debunked the notion of Nigeria possessing $100 billion in foreign reserves, questioning the basis for the Naira’s exchange rate to miraculously return to a desirable level. He emphasized the imperative of rebuilding investor confidence, drawing comparisons to a time when Nigeria’s exchange rate stood at a more favorable N150-165 to the Dollar.

The economist stressed the critical role of addressing Nigeria’s longstanding electricity deficit, which has persisted at less than 4,000 megawatts of generation capacity for a population exceeding 200 million. He asserted that resolving this energy conundrum, by significantly increasing power generation to levels comparable to countries like South Africa and Brazil, would unleash Nigeria’s latent entrepreneurial prowess and spur economic growth.

In summary, Moghalu’s comprehensive statement highlights the intricacies of Nigeria’s economic challenges and the imperative for bold reforms to address fundamental issues such as exchange rate stability, export diversification, and energy infrastructure development.

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