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Continued injection of forex by CBN stressing oil earnings, foreign reserves—Don
A senior lecturer at the Pubic Administration Department, of Nassarawa State University, Lafia, Professor Charles Nwaekeaku has raised fresh alarm on the continued intervention in the foreign exchange by the Central Bank of Nigeria (CBN), saying even though it is a temporary relief, it is stressing the rising capacity of foreign reserve on rising oil price.
He said “That means that anytime the price of oil falls again, the money will vanish and we do not have much reserve and that means the measure is temporal”.
Nwaekeaku argued that what should actually be done was for the government to ensure a good business environment in the country and diversify the economy, noting that “if we go into manufacturing, productivity will increase and when that is done, the pressure on the foreign exchange will reduce”.
“This is because we will not be asking for foreign exchange for goods and services that we can produce locally.
“The problem is that the demand for foreign exchange is very high and the money from oil is what is being used to supply and it is temporal, it is not sustainable.
“Therefore, government should make efforts to diversify the economy and ensure that we reduce the demand for foreign exchange.
“When we reduce the demand for foreign exchange and then increase productivity, even prices of things will come down and then you will have sustained foreign exchange regime,” Nwaekeaku said.