Multiple exchange rates fueling illiquidity, round tripping – Industrialist

The Chief Executive Officer, Erisco Foods Ltd., Chief Eric Umeofia, has noted that the multiple foreign exchange rates in the country has caused economic disruptions, illiquidity and round tripping which had affected operations of many businesses.

Umeofia, who made the appeal during the company’s Product Unveiling and Distributors Reward event on Tuesday in Lagos, appealed to the Central Bank of Nigeria (CBN) to unify the country’s exchange rate to aid economic stability and recovery.

“If the country wants to rid itself of unstable foreign exchange rates, we should remove different exchange rates, parallel market is about N770 while the official rate is around N440.

“The reality is that many businesses source their foreign exchange from the parallel market as access to foreign exchange from the official market is hard. Since I came into the country 10 years ago, the value of my investment has reduced by 40 per cent in dollar terms.

“Last Monday, I lost N74 million to exchange rate differentials. I exchanged naira to a dollar at N900 for a good I wanted to purchase, the next day, it crashed to about N800, I lost N74 on each dollar,” he said.

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Umeofia noted that the apex bank should evolve a clear strategy and timeline on how it intends to achieve full unification of the country’s multiple exchange rates.

According to him, this will enhance the naira strength, boost liquidity, promote both domestic and foreign investment and stimulate economic growth.

He noted that many companies were shutting down because of wrong actions and inefficiencies of Ministries, Departments and Agencies (MDAs).

Also, Mr Nnamdi Umeofia, the Managing Director, Erisco Foods, appealed to the Lagos State Government to ensure an enabling business environment, saying that activities of some of its personnel was inimical to business growth.

Umeofia noted that business operations in the state were frustrating due to constant harassment by agents of the state government in the guise of sourcing for Internally Generated Revenue.

Besides, Umeofia said that to enhance nutrition and quest for Nigerians to consume healthy foods, the company unveiled seven new products for the wellbeing of the populace.