Exchange rate graph
*Says USD 1 may equal NGN 2000
By Lamai Cassius
A University Don, Prof. David Osikhena Umoru has called on the Federal Government to put an end to devaluation of the Naira, in the country.
Prof. Umoru made the call while delivering the 4th Inaugural Lecture series of the Edo State University, Uzairue titled: ‘Devaluation of Naira, Shocks, and Realities: Evidence Disciplining Strength.’
Umoru, a professor of Applied Monetary and Financial Economics in the department of Art, Management and Social Sciences of the University, said there has to be production for export before contemplating devaluing the Naira.
The Nigerian government must put an end to the Naira devaluation which is anchored on the fact; that the Naira exchange rate management is not a topic of probability, he stated.
According to him, the International Monetary Fund (IMF) and the World Bank ought to be cognisant of the fact that the economics which underlie the empiricism of Naira exchange rates; in relation to foreign currencies reveals the economic growth and development of Nigeria is being short changed so shamefully; as we have the valueless Naira note as the only medium of exchange in our possession.
“There has to be production for export before contemplating devaluing Naira, hence, the Nigerian government must disagree with the conditionalities of the IMF authorities and insists on non devaluation of the Naira.
“The central monetary authority must not forget that the exchange rate is basically a price and in view of the collapse of oil price at the global market; auxiliary devaluation of the Naira would only lower the purchasing power of the final consumers and afterwards exacerbate economic life of Nigerians.”
Umoru noted that the Nigerian economy is fiscally overriding not withstanding money being an integral part of all macroeconomic variables.
He added; that inconsistent macroeconomic policies are detriment to the real effective Naira-Dollar exchange rate and to employment generation.
As he urged the Central Bank of Nigeria to ensure that fiscal and monetary policies do cooperate; rather than entering into a conflict with each other in the short run.
“Nigerian political forces, illicit forex traders and collaborators with foreign interests would not totally give way to market forces when it comes to Naira/Dollar exchange rate determination; as they continually hype the market by manipulating the parallel rate.
“I have regard for the totality of the prevailing macroeconomic and financial outlooks of the Nigerian economy. And this have made me to foresee a Nigerian state of affairs; where the Naira would be exchanged at N2,000 for one US Dollar.
“Should the apex monetary authority with all its enabling laws fail to defeat the unlawful activities of currency traders; who gather effortlessly to cause forex scarcity in the country.
“To save the value of the Naira, the Federal Government has to tenaciously work against a build up of the underlying fundamentals of the Nigerian economy. This entails managing unfriendly economic indicators in a downward direction.
“These indicators include; inflation rate, interest rate, debt stock and unemployment,” he said.
The Don, however, called on the government to strengthen non oil production and rejuvenate the power sector in order to arrest the ugly Nigerian economic scenario.
“To save the soul of Nigerian economy through the worth of her Naira, Nigeria as a country must strengthen production of non-oil export commodities: ranging from agricultural production to industrial production that covers manufacturing, product assembly, conversion of raw materials into components, as well as construction.
“This would broaden the horizon of non-oil export and make Nigeria’s export highly competitive for a devaluation policy, to improve the country’s current account trade balance.
“In this regard, sectoral diversification policies that favour industrialisation, construction activities, solid minerals and agriculture were recommended, this would in addition diversify the Nigerian economy away from oil export.”
Earlier in his welcome address, the Vice Chancellor, Engr. Prof. Emmanuel Aluyor said that Edo State University has consistently set the pace in the delivery of quality education; with state of the arts educational tools and providing the needed solution in a country whose educational infrastructure has been bedeviled by a plethora of problems.
As an emerging world-class University in Nigeria, it has continued to bridge the gap and do all within its capacity to curb education tourism in the country.
Further, he asserts that the University is a full member of the Association of African Universities (AAU); Full member of the International Association of Universities (IAU); and Admitted into the Consortium of New Sub-Saharan Medical Schools (CONSAMS).
Congratulating Prof Umoru, the VC described him as a highly experienced economist and scientific researcher, whose focus is to find solutions to socio-economic challenges; through effective contributions to knowledge, execution of demand-driven, globally competitive researches with relevance to the economic development of nations.
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