TonyeBarcanista:

1. A devalued naira makes it attracts hoarders of the dollar to bring out the currency since they know that they would make more.

2. We have the capacity to export products like cement and few other items, especially some agricultural items. However, it doesnt stop our government from empowering local manufacturers and producers so as to enable us meet local demand, thereby reduced reliance on import.

3. it isn't every time that one should be political in decision making.

1) Hoarders would bring relief for at most a month then we are back to scarcity.
2) Can't you see the irony there? How do you empower local manufacturers by making imports cheaper and easier?
3) This is not a political decision, I don't belong to any political party, it's strictly business. China manipulates it's currency and the West complains but they don't give a f**k. We have to stop exporting jobs to other countries.

AZeD1:

You don't get it. We don't have the dollars to go around. Even if you devalue, we still won't have enough and you know want happens when plenty money chases fewer goods.

Truly it has the prospect of leading to inflation but that would happen if the government failed to play their own part by pursuing sound fiscal policy.


Beside, aren't we suffering from inflation already?

[s]

dustmalik:
It's now evident that the west is furious over our deal with China.

[/s]keep blaiming the west. Shebi na the west told your dullardic president not to assemble sound economic team,as well as constituting his carbinet on time?. Tell your dullardino to keep appointing media team instead of economic gurus.

AZeD1:

1) Hoarders would bring relief for at most a month then we are back to scarcity.
2) Can't you see the irony there? How do you empower local manufacturers by making imports cheaper and easier?
3) This is not a political decision, I don't belong to any political party, it's strictly business. China manipulates it's currency and the West complains but they don't give a f**k. We have to stop exporting jobs to other countries.

1. Trust me no hoarder would want to miss the opportunity of legitimately earning more than they would.

2. Devaluation technically discourage import but encourage local production since it will become more expensive to import but cheaper to export.

3. China maintains a low value currency so as to make their goods attractive wet price in the international market.

AZeD1:

You don't get it. We don't have the dollars to go around. Even if you devalue, we still won't have enough and you know want happens when plenty money chases fewer goods.

Sorry, you don't seems to understand it. We are losing more dollar by selling bellow realistic exchange rate, whereas majority of people buy it at black market rate. Forex policy need to be adjusted before we lose more jobs due to foreign companies leaving the economy.

Current scarcity is what is pushing the exchange rate up on the parallel market, inflation at 4 years high, FDI low, etc. I am sure FG don't want to add more unemployment to all that.

Truth234:


1) Devaluing would not pushed black market rate up but normalize it. It means instead of majority of us buying it at speculators' price we will be buying at official rate or something closer.

2) By fixing naira at 197 -199, we are losing money because the major means from which we generate foreign reserves is not fixed and has fell more than 70% so far, but we refused to make realistic adjustment to contain such changes. Saudi Arabia is enjoying the Riyal fixed because her foreign reserves is huge, $744,440,558,276 and can cover over $200 billion deficit created by the current oil glut.

3) Not for their own interest but a more conducive working environment.

Note: I am not favouring devaluation at this stage because of current oil price appreciation, but forex policy need to be adjusted to accommodate these foreign companies, if not we will lose jobs and unemployment rate will surge with scaring inflation rate. Our Foreign Direct Investment that is nosediving, will plunge even more, so what is the essence of a policy that can create jobs, yet losing the ones already created.

God bless you.

TonyeBarcanista:

My brother blame the leaders since 1980s that mismanaged the economy and not the policy itself. Naira is N200 against the dollar officially but how many businesses trade on that?

If the Naira is already devalued on the streets, so what is the fuss all about?... As far as I'm concerned, these so called foreign investors exploiters are just out to make mega profits from the misfortunes of Nigerians, hence their continuous frustration over the stubbornness of the CBN/PMB to devalue the currency. They keep leaving Nigeria, not because they make no profits, but rather as a form of blackmail to frustrate and arm-twist CBN/PMB to devalue.

The problem facing Nigeria today is a forex scarcity, devaluing will not fill in the gap in forex supply. The so called foreign investors who are leafing, how much of forex can they possibly introduce into NIgeria to balance the forex gap?.... Again, if you agree that bad leadership since the 80's mismanaged the potential economic benefits of devaluation, why are you so confident that we have better leaders today who would not also mismanage things if we devalue?... In terms of the calibre of our leaders, what has really changed since the 80's till date?

AZeD1:

You don't get it. We don't have the dollars to go around. Even if you devalue, we still won't have enough and you know want happens when plenty money chases fewer goods.

This is a typical example of penny wise,pounds foolish!. You said their won't be enough dollars to go round,but at the same time closing our doors against other sources of forex.How you ask?. May i remind that,crude oil though our chief source forex,but not the ONLY source. If you are looking to strengthen our sources of forex,you don't scare away investors and FDIs,which are other sources of earning forex,with useless economic policy of pegging dollar against naira!. Many foreign investors are already gone,and its attendant job loss. This will create more pressure on the economy.

TonyeBarcanista:

1. Trust me no hoarder would want to miss the opportunity of legitimately earning more than they would.

2. Devaluation technically discourage import but encourage local production since it will become more expensive to import but cheaper to export.

3. China maintains a low value currency so as to make their goods attractive wet price in the international market.

The answer to Nigeria's problem as regards currency right now is not devaluation.
We have serious infrastructure debit which hinders local production so we really have nothing to gain from devaluation.
The answer is not also pegging it at the current rate.

NDPVF:
This is a typical example of penny wise,pounds foolish!. You said their won't be enough dollars to go round,but at the same time closing our doors against other sources of forex.How you ask?. May i remind that,crude oil though our chief source forex,but not the ONLY source. If you are looking to strengthen our sources of forex,you don't scare away investors and FDIs,which are other sources of earning forex,with useless economic policy of pegging dollar against naira!. Many foreign investors are already gone,and its attendant job loss. This will create more pressure on the economy.

Devaluation is only scaring portfolio investors not people who have long term plans for Nigeria.

buari's daura economics will cripple nigeria - which to me is a good development. anytin to send d daura man packing come 2019 is good news.

AZeD1:

You don't get it. We don't have the dollars to go around. Even if you devalue, we still won't have enough and you know want happens when plenty money chases fewer goods.

The value of the naira by purchasing power parity is determine by a simple Concept thus; if the cost ccommoditiy A in USA is 3$ and same commodity A in nigeria cost 1000naira, the naira to dollar value is 1$/333naira. QED

Any official control/pegging only ensure poor economic performance and rent seeking. The premium of the naira via control is what is driving inflation.

It is not poor economy if 400naira goes for 1$, no it is not! What is wrong is creating incentives for black-market via subsidy on Forex thereby impeding economic activities.

By this false valuation of naira, we officially are losing about 35% in naira what it should be. If we earn 1bn$ and value it at 197bn naira instead of 320bn, the 123bn subsidy is reflected in cost to manufacturers, inflation to consumers and rent to round trippers. It helps only the round trippers who gain only currency transaction value without economic value backing!

Buhari simply doesn't get! Let himm continue to romance the Yuan thinking two peggers of their currency (China n nigeria) live in isolation of global economy.


Bottom line, the naira is already devalued with the sustained depreciation and the continue insistence by buhari not to yield to reality has created reality in job losses, inflation and overall recession. A govt that mouths diversification on one breath and stifle it On the other promoting dumping and importation!


May God help us.

NavierStokes:


I had added a text to the original piece up there. A lot of Nigerians sorry Africans have this paranoia about anything west or IMF . The west have their humanitarian sides and their business sides, and in all they understand one thing that they do what is best for them self and for the group. Nigerians expect the IMF to do the job of the UNO or UNICEF, they are all set up for different reasons.

In all they protect themselves by giving us earnings because when we flip, we will still come to them to borrow or send refugees across or ask for hand outs you see either ways we are their problem.

They like to flex their muscles to exercise their independence, but true freedom comes with greater responsibility not abject poverty.

Imagine Mugabe hatred is so much, he forgets winning the West means achieving more for Zimbabwe and not when inflation rate reached 79,600,000,000%.

[s]

AZeD1:

Devaluation is only scaring portfolio investors not people who have long term plans for Nigeria.

[/s]I av' been hearing this rubbish from Liar mohammad,and now you are regurgitating it. May i ask you, the investors and businesses that are running away from Nigeria now,(am not talking about those that are skeptical of investing here,the ones that were here before now that are folding up,as well as retrenching their workers),are they also portfolio investors?. Why is it hard for you people to understand that you are av' killed Nigerian economic already,and that their is widespread unemployment and poverty in the land already?.

tuniski:


The value of the naira by purchasing power parity is determine by a simple Concept thus; if the cost ccommoditiy A in USA is 3$ and same commodity A in nigeria cost 1000naira, the naira to dollar value is 1$/333naira. QED

Any official control/pegging only ensure poor economic performance and rent seeking. The premium of the naira via control is what is driving inflation.

It is not poor economy if 400naira goes for 1$, no it is not! What is wrong is creating incentives for black-market via subsidy on Forex thereby impeding economic activities.

By this false valuation of naira, we officially are losing about 35% in naira what it should be. If we earn 1bn$ and value it at 197bn naira instead of 320bn, the 123bn subsidy is reflected in cost to manufacturers, inflation to consumers and rent to round trippers. It helps only the round trippers who gain only currency transaction value without economic value backing!

Buhari simply doesn't get! Let himm continue to romance the Yuan thinking two peggers of their currency (China n nigeria) live in isolation of global economy.


Bottom line, the naira is already devalued with the sustained depreciation and the continue insistence by buhari not to yield to reality has created reality in job losses, inflation and overall recession. A govt that mouths diversification on one breath and stifle it On the other promoting dumping and importation!


May God help us.

God bless. Will they ever learn?. No!. They are zombies led an iliterate president and clueless finance minister.

Truth234:


They like to flex their muscles to exercise their independence, but true freedom comes with greater responsibility not abject poverty.

Imagine Mugabe hatred is so much, he forgets winning the West means achieving more for Zimbabwe and not when inflation rate reached 79,600,000,000%.

The same west that was instrumental to his getting into power in the 80's. Africans should blame their useless leaders and leave the west alone. They are not perfect but still, one to one, the average western leader still has an accommodating heart than the average African leader. Imagine vexing for a country that they refuse to give you their own Ebola Vaccine. Na wa Oh na Thief you be ?, the same Paranoia that allowed HIV/AIDS to spread to the level it currently is, when African Leaders refused to heed to all the warnings of experts at the time, only for us to still till date be managing it with free vaccines they donate to us. The same way they selectively implemented the SAP and corruptly administered the whole process, today every one has forgotten IBB, but still remember the IMF.

My Woman studied at Oxford, and she had these views of the average Nigerian but when she got in there she had no option than to shake her head in pity at her earlier ignorance and stance,because most times they try to give advice to these African or third world leaders, one well fed ignoramus will be the one stifling implementation not based on any fundamentals other than his miserable opinion. Truth is they look out for their interests, like everyone else, but good thing about them is they also have enough to spare looking out for those who have repeatedly not been able to look out for themselves.

NDPVF:
[s][/s]I av' been hearing this rubbish from Liar mohammad,and now you are regurgitating it. May i ask you, the investors and businesses that are running away from Nigeria now,(am not talking about those that are skeptical of investing here,the ones that were here before now that are folding up,as well as retrenching their workers),are they also portfolio investors?. Why is it hard for you people to understand that you are av' killed Nigerian economic already,and that their is widespread unemployment and poverty in the land already?.

Wide spread poverty and unemployment did start today and won't end today.
Companies leave everyday for various reasons e.g Virgin Atlantic but don't tell me companies are leaving because we refused to devalue. That's crap.
Venezuela has devalued it's currency but that hasn't helped their economy, same with Russia and most Oil dependent economies.

You'd have to convince me with an Oil dependent country which has been helped by devaluation.

PS: Companies are still leaving Venezuela after their devaluation.

http://www.reuters.com/article/us-venezuela-economy-currency-analysis-idUSKBN0LI00W20150214

obailala:
If the Naira is already devalued on the streets, so what is the fuss all about?... As far as I'm concerned, these so called foreign investors exploiters are just out to make mega profits from the misfortunes of Nigerians, hence their continuous frustration over the stubbornness of the CBN/PMB to devalue the currency. They keep leaving Nigeria, not because they make no profits, but rather as a form of blackmail to frustrate and arm-twist CBN/PMB to devalue.

The problem facing Nigeria today is a forex scarcity, devaluing will not fill in the gap in forex supply. The so called foreign investors who are leafing, how much of forex can they possibly introduce into NIgeria to balance the forex gap?.... Again, if you agree that bad leadership since the 80's mismanaged the potential economic benefits of devaluation, why are you so confident that we have better leaders today who would not also mismanage things if we devalue?... In terms of the calibre of our leaders, what has really changed since the 80's till date?

let the naira be officially devalued.

imagine your brother sending you $2000 from USA through Western Union, you go to the bank and you are paid a naira equivalent at the rate of N199 to the Dollar and you are given N398,000.00. A week later you decide to order a watch from Dubai at the rate of $1000, you go to an aboki who changes your naira to dollar Ay N350, and made you part with N350,000.00. Do you think you are at loss or gain?

if the Naira was officially devalued to N350, you wouldn't have been at great loss like you were before.



Think....

AZeD1:

Wide spread poverty and unemployment did start today and won't end today.
Companies leave everyday for various reasons e.g Virgin Atlantic but don't tell me companies are leaving because we refused to devalue. That's crap.
Venezuela has devalued it's currency but that hasn't helped their economy, same with Russia and most Oil dependent economies.

You'd have to convince me with an Oil dependent country which has been helped by devaluation.

Venezuela devalued as at when? When things are already gone awry, Buhari could have devalued much earlier he stubbornly refused.

Jonathan and Okonjo devalued twice in a period of falling oil prices, with Oil price and production below budget benchmark, still there was no noticeable effect in the price of goods in the market, inflation was single digit etc. Buhari refuses to officially devalue and inflation is at double digit, pure water is selling at a price of *** (to be honest i don't know).

The paragraph above tells us that someone isn't doing something right, and someone in the past was managing something right.

Having delayed (like in everything this government does - which to me is based on fear) to devalue, our gains are already reduced, but there are gains all the same as things will begin to move on once again. Whats the point of going out to look for investors, when you haven't swept the house clean, They Like Hitler, will agree to everything but will not even honour those agreements. After all the travels which investor has put any money on ground in Nigeria? I cant remember any, all we hear is we will invest X and Y billion pounds into Nigeria, but nothing on ground.

Thing is all investors, speculators etc including Yours truly, are patiently waiting for the Naira to find a floor, before anything form of investment, can be done.


This is from the article you posted:

"PepsiCo recently started valuing some of its assets in Venezuela at that rate, after being unable to repatriate money at the 6.3 rate for years"

TonyeBarcanista, Navierstokes, AzeD1, jmichlins can you guys enumerates with specifics the pros and cons of devaluation.

Please tell us whether we will be worse-off or better-off for it. This is the best way to analyse this issue without emotions.

AZeD1:

Wide spread poverty and unemployment did start today and won't end today.
Companies leave everyday for various reasons e.g Virgin Atlantic but don't tell me companies are leaving because we refused to devalue. That's crap.
Venezuela has devalued it's currency but that hasn't helped their economy, same with Russia and most Oil dependent economies.

You'd have to convince me with an Oil dependent country which has been helped by devaluation.

PS: Companies are still leaving Venezuela after their devaluation.

http://www.reuters.com/article/us-venezuela-economy-currency-analysis-idUSKBN0LI00W20150214

Thank goodness you said it yourself that Coys leaves due to various reasons. You can use your google,the massive exit of coys from Nigeria as currently being witnessed,is not unconnected to the unhealthy fiscal and monetary policies of this administration. Earlier today,i read how Iberia Airways has pulled out of the country citing their inability to repartriate their over $500million trapped in Nigeria Banks,courtsey of CBN forex policy. Many other coys both foreign and local are going moribund. Of course,poverty and unemployment has been there,but hey,it's has trippled under Buhari/Adesola cluelessness,coupled with inflation.

NavierStokes:



Venezuela devalued as at when? When things are already gone awry, Buhari could have devalued much earlier he stubbornly refused.

Jonathan and Okonjo devalued twice in a period of falling oil prices, with Oil price and production below budget benchmark, still there was no noticeable effect in the price of goods in the market, inflation was single digit etc. Buhari refuses to officially devalue and inflation is at double digit, pure water is selling at a price of *** (to be honest i don't know).

The paragraph above tells us that someone isn't doing something right, and someone in the past was managing something right.

Having delayed (like in everything this government does - which to me is based on fear) to devalue, our gains are already reduced, but there are gains all the same as things will begin to move on once again. Whats the point of going out to look for investors, when you haven't swept the house clean, They Like Hitler, will agree to everything but will not even honour those agreements. After all the travels which investor has put any money on ground in Nigeria? I cant remember any, all we hear is we will invest X and Y billion pounds into Nigeria, but nothing on ground.

Thing is all investors, speculators etc including Yours truly, are patiently waiting for the Naira to find a floor, before anything form of investment, can be done.

Don't mind them.

tuniski:


The value of the naira by purchasing power parity is determine by a simple Concept thus; if the cost ccommoditiy A in USA is 3$ and same commodity A in nigeria cost 1000naira, the naira to dollar value is 1$/333naira. QED

May God help us.

This is probably one of the most stupi.d things i have read on here.

My 3 bedroom flat in the UK cost £600 a month which is £7200 a year, I have a 3 bedroom in Yaba for N600,000 a year use your formula there and give me the purchasing power of the Naira to the pound.

IBB devalued Naira and accepted IMF loans but the outcome was disastrous. Each country has it's own peculiarities.

Intrepid01:
TonyeBarcanista, Navierstokes, AzeD1, jmichlins can you guys enumerates with specifics the pros and cons of devaluation.

Please tell us whether we will be worse-off or better-off for it. This is the best way to analyse this issue without emotions.

We would be worse off if we devalue.

Intrepid01:
TonyeBarcanista, Navierstokes, AzeD1, jmichlins can you guys enumerates with specifics the pros and cons of devaluation.

Please tell us whether we will be worse-off or better-off for it. This is the best way to analyse this issue without emotions.

Check my last post on this thread

NavierStokes:


The same west that was instrumental to his getting into power in the 80's. Africans should blame their useless leaders and leave the west alone. They are not perfect but still, one to one, the average western leader still has an accommodating heart than the average African leader. Imagine vexing for a country that they refuse to give you their own Ebola Vaccine. Na wa Oh na Thief you be ?, the same Paranoia that allowed HIV/AIDS to spread to the level it currently is, when African Leaders refused to heed to all the warnings of experts at the time, only for us to still till date be managing it with free vaccines they donate to us. The same way they selectively implemented the SAP and corruptly administered the whole process, today every one has forgotten IBB, but still remember the IMF.

My Woman studied at Oxford, and she had these views of the average Nigerian but when she got in there she had no option than to shake her head in pity at her earlier ignorance and stance,because most times they try to give advice to these African or third world leaders, one well fed ignoramus will be the one stifling implementation not based on any fundamentals other than his miserable opinion. Truth is they look out for their interests, like everyone else, but good thing about them is they also have enough to spare looking out for those who have repeatedly not been able to look out for themselves.

Look at what they did with South Africa, Australia, Israel, etc but look at what our man did with Zimbabwe, even Papua New Guinea, Melanesia after Dutch left. The problem is not the West, all deals have agreement, we have the right to review and make adjustments according to our needs but our issue is lack of knowledgeable leaders.

For instance, UK wants a new deal to continue to be part of EU, the draft was completed since 24 Feb for a June 23 referendum. Currently being reviewed by experts, our FG signed a deal same week in China, if in few years something is wrong with that deal. Nigerians will blame China.

Abagworo:
IBB devalued Naira and accepted IMF loans but the outcome was disastrous. Each country has it's own peculiarities.

IBB saw the loan as free money to chop, and chop he did, he and his boys ate the money like there was no tomorrow, without following through with the structural adjustments that were recommended, in essence it was a half and half implementation.

SAP was for about 34 African countries at the time, and sadly till date only one example is told of a country that followed through, Ghana. Thats the reason why there was a shift by the 1990's from Ghana must go to Nigerian's need visa to visit Ghana(which has been flatly denied by the Ghanaians though), but truth is we travel there for vacations, send our kids to school and even the US called them a country committed to growth some time ago, and people like you and me, roundly celebrated that call, at the detriment of our own government of the day.

TonyeBarcanista:

let the naira be officially devalued.

imagine your brother sending you $2000 from USA through Western Union, you go to the bank and you are paid a naira equivalent at the rate of N199 to the Dollar and you are given N398,000.00. A week later you decide to order a watch from Dubai at the rate of $1000, you go to an aboki who changes your naira to dollar Ay N350, and made you part with N350,000.00. Do you think you are at loss or gain?

[b]if the Naira was officially devalued to N350, [/b]you wouldn't have been at great loss like you were before.



Think....

By the time the official value is N350 the mallam would sell to you at N450 so you would still lose.

AZeD1:

By the time the official value is N350 the mallam would sell to you at N450 so you would still lose.

Nope at 350, only he who needs foreign stuff will go for it, a good deal of the demand will drop, and the government can to a much larger extent satisfy the then demand

NavierStokes:



IBB saw the loan as free money to chop, and chop he did, he and his boys ate the money like there was no tomorrow, without following through with the structural adjustments that were recommended, in essence it was a half and half implementation.

SAP was for about 34 African countries at the time, and sadly till date only one example is told of a country that followed through, Ghana. Thats the reason why there was a shift by the 1990's from Ghana must go to Nigerian's need visa to visit Ghana(which has been flatly denied by the Ghanaians though), but truth is we travel there for vacations, send our kids to school and even the US called them a country committed to growth some time ago, and people like you and me, roundly celebrated that call, at the detriment of our own government of the day.

Do you think Ghana is better than Nigeria? I doubt that assertion. Is there history of any economic success of an African country linked to IMF policy? Libya during Ghaddafi, Egypt during Mubarak or South Africa during apartheid.

Truth234:


Look at what they did with South Africa, Australia, Israel, etc but look at what our man did with Zimbabwe, even Papua New Guinea, Melanesia after Dutch left. The problem is not the West, all deals have agreement, we have the right to review and make adjustments according to our needs but our issues is lack of knowledgeable leaders.

For instance, UK wants a new deal to continue to be part of EU, the draft was completed since 24 Feb for a June 23 referendum. Currently being review by experts, our FG sign deal same week in China, if in few years something is wrong with that deal. Nigerians will blame China.

Zimbabwe was a progressing society, The original plan of the West was to live side by side with the locals, but that old comedian single handedly based on pride and to the detriment of his country changed all of that. We as followers can cheer them on that we have a man giving it to the west, but at the end of the day who suffers inflation on the streets, Mugabe? or the common zimb, who has to carry trillions to buy bread.lol