Opinion by OluwamayowaTJ: Here’s how officialABAT’s unified exchange rate and naira devaluation can affect you via thecableng
So local and foreign businesses who needed dollar and could not get from the CBN, where the rate was N305 per dollar, simply went to the banks and requested dollar at N360 and they got it. In no time, the banks became the major dealers in forex again. So businesses did not need to go to the black market to buy at N520. Demand at the parallel market dropped drastically, leading to a glut in the market.
Caveat: Unification was not totally achieved because major oil marketers still got dollars at the CBN rate of N305 per dollar — to keep the pump price of petrol artificially low for Nigerians. Win-win?It is absurd that the president is now dictating or strongly suggesting monetary policy. But as former president Muhammadu Buhari said the CBN is followingan alternative economic model that “puts people at the heart of policy”. I digressed.
I did not mention it earlier, but in 2017, Nigeria was able to keep forex rates steady because we also had great FX inflow. Transactions at the I&E window were in excess of $5 billion in just a few months. Our Eurobond offers were— we needed $1 billion, but investors brought $7.8 billion. Not sure we have that luck in 2023.
For the ordinary Nigerian, not much will change — most goods and services are currently priced at the parallel market rate. If anything, prices should come down, but it’s Nigeria, and this is unlikely to happen.
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