More economic woes for Nigeria as naira hits N380 to a dollar

Four confirmed dead in CBN Calabar office explosion
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. Ghana restricts certain goods from Nigeria

By Odunewu Segun

 The value of the naira has continue with his descent in recent times against the United States dollar and the British pounds which as at 17th of February stood at N380 and N505 respectively while the euro goes for N395 at the parallel market.

Speaking on the situation, a financial analyst and accountant, Ms Amina Ado, said the official and unofficial rates had diverged significantly, encouraging round tripping and other corrupt practices. According to her, this huge incentive will continue to undermine CBN’s efforts at managing the exchange rate, and raises questions about its capacity to do so.

“It is also the reason why no one, except those compelled by foreign exchange control rules (usually exporters such as oil/gas and commodities exporters) will sell their dollars to Nigerian banks and accept such a huge discount further tightening supply.”

A former member of the House of Representatives, Hassan El-Badawy, said the decision not to devalue the naira was a wise one. “No sensible country will expose its currency to fear weather and external forces without adequate protection. It is unfortunate that we found ourselves in this situation, but what is clear is that no country will allow its national currency to flow around and be determined by market forces. It is always jealously protected,’’ he said.

ALSO SEE: Nigerian naira hits record low of 345 per dollar

Meanwhile, Ghana has announced a round of measures to protect its economy, one of the measures, National Daily gathered is the prohibition of some items from entering the country from Nigeria. It was also gathered that recent decision by the government of Ghana might not be unconnected with Nigeria’s decision to restrict 41 items from access to foreign exchange.

Ghanaian Minister of Trade and Industry, Mr. Ekwow Spio-Garbrah stated that Ghana and Nigeria are said to account for some 68 per cent of the ECOWAS region’s Gross Domestic Product. Nigeria accounts for almost 10 per cent of Ghana’s foreign trade volume, whereas Ghana is listed as the 9th largest trade partner to Nigeria.

The Chief Executive Officer of Ghanaian Association of Ghana Industries stated that there should be a clear letter written to the Nigerians complaining about this, and then also try and use some diplomatic means to quickly resolve it,” “If it does not work then we must also look at countervailing measures…it could be product targeting,” he said. “