Naira is crashing and the Association of Bureau De Change Operators of Nigeria (ABCON) is blaming Binance. Its president, Alhaji Aminu Gwadebe, wants Binance banned in Nigeria. Right now, the disparity between the official and parallel market rates has widened; the I&E window hovers around N782/$1 while the black market has hit N930/$.

“If you know about Binance, you will know that Binance trading is becoming the anchorage of both the investors and exporters window and the parallel market, which is unfortunate.

So, we have to do something that can stop? Binance. It’s a competition; we need to ban Binance and the only way to do so is if you have liquidity.

As I speak, Binance is the most liquid market; they do 1.2 million transactions per second. So it’s a very liquid market but that is not a scary status, we can break it through our local content and peculiarities.” Alhaji Aminu Gwadebe

This remains my position: “Nigeria will either pause the full floating of its currency or return back to fuel subsidy within 6 months. Nigeria’s weakest currency stability point remains that it has to continue importing petrol since it does not have any working refinery. That creates a vicious circle since those importing fuel will mark up prices, to cushion for the next round of import, working to stay ahead of currency deterioration, in a system with no official benchmark.”

Binance is not Nigeria’s problem. Our challenge is that we do not have parity on the demand and supply of Naira, and using basic economics, Naira will keep losing value since more people are looking for USD than supplying it in Nigeria. 

Floating or swimming Naira does not remove the play of fundamental economics in markets, and until Nigeria can have more USD, Naira will continue to lose value. But I expect the government to put a pedal very soon!

More so, according to the African Development Bank, in its  “Africa Economic Outlook 2023”, “Currency weaknesses in some of Africa’s more globally integrated economies (Kenya, Nigeria, and South Africa) are expected to persist in 2023, largely due to potential capital outflows as investors search for safe assets in advanced economies”.

Yet, with great policies, Nigeria can rise. The young people are very creative and can deliver great results if they are supported. For example, they continue to rake in revenue on Spotify and other ecosystems, demonstrating new potential sources of earning US dollars besides hydrocarbons.

“The number of Nigerian artists who generated more than 5 million NGN and 10 million NGN in royalties from Spotify alone has increased by nearly 25% over the last year. This figure represents revenue generated from Spotify alone and does not consider earnings from other services and recorded revenue streams, concert tickets, or merch.

“In 2022, revenues generated by Nigerian artists from Spotify alone reached over 11,000,000,000 NGN. While Nigerian music industry revenues overall have grown 63% from 2021 to 2022 (according to IFPI), revenues generated by Nigerian artists – from Spotify alone – grew 74% over this same period,” Spotify stated in the report. 

Meanwhile, the apex bank thinks the reason Naira is crashing is due to “the diversion of diaspora remittances to the black market.”

The acting central bank governor stated this amid the naira’s fall to N930 per dollar at the parallel market on Thursday, which marks its worst performance since the CBN floated the FX market in June.

“With those remittances, the dollars have come in, we know the dollars have come in but we don’t see them in the official system. So, they must be going somewhere and somewhere,” he said.

“And the challenge with the black market, unofficial market or parallel market or whatever name you want to call it, it is as a result that it is not regulated, and it becomes an easy place to have criminal activities.

“We investigate bankers, not just bankers, anybody who has committed an offense, the first thing they want to do is to run to the black markets, change it to the dollars because it is less money to carry around.

“Some of the funding in the black markets are actually from diaspora remittances. That’s why it is important we need to know a lot of what’s going on there. We can’t play the sentiment game. If we don’t understand the dynamics, we usually go with the literature which does not necessarily work for us,” Shonubi said.

The Japa syndrome and the high demand for foreign items makes the demand for the dollar more than the naira . Student paying school fees, Importation of raw materials and finished products are also keys factors driven this narrative.

— Keny David (@KennyNuga) August 11, 2023

The Economic Community of West African States (ECOWAS) has directed the deployment of troops against the Niger Republic junta. Following the summit held on Thursday in Abuja by its members, the regional bloc has decided to use force to reinstate the ousted President Mohamed Bazoum

The Extraordinary Summit on the political situation in Niger Republic was attended by eight leaders from member countries, along with the Foreign Ministers of Liberia and the Gambia.

President Mohamed Ould Ghazouani of Mauritania and his Burundian counterpart, Everiste Ndayishimiye, who were invited by their fellow leaders, participated in the second ECOWAS extraordinary summit.

The communiqué, which was read by the President of ECOWAS Commission, Omar Alieu Touray, reads partly: “Direct the committee and its Chief of Defence Staff to activate the ECOWAS standby force with all its elements immediately.

“Order the deployment of the ECOWAS standby force to restore constitutional order in the Republic of Niger.”

The bloc, which had earlier adopted diplomacy over war, said all efforts made to dialogue with the junta have been defiantly rejected by the coup leaders.

The military junta, led by Gen. Abdourahamane Tchiani, has begun to form a transitional government, defying warnings and threats from the ECOWAS leaders and Western governments.

On Wednesday, Tchiani signed the decree for an interim government made up of 21 ministers, according to the ActuNiger news portal.

The junta had on Monday appointed a former Minister of Economy and Finance Ali Mahaman Lamine Zeine, Niger Republic‘s new Prime Minister.

In addition, the junta has designated Amadou Didilli to lead the nation’s High Authority for Peace Consolidation (HACP), while Abou Tague Mahamadou has been selected as the inspector-general overseeing the army and national gendarmerie.

Ibro Amadou Bachirou takes on the role of the Chief of Staff for the junta leader’s private office, and Habibou Assoumane is appointed as the commander of the presidential guard.

ECOWAS deploys standby force to restore constitutional order in Niger pic.twitter.com/8qSuHw6VOe

— Vanguard Newspapers (@vanguardngrnews) August 10, 2023

Following the coup on July 26, ECOWAS, backed by Western leaders issued a 7-day ultimatum to the junta to reinstate Bazoum or risk sanctions with potential military action.

However, the coup plotters disregarded ECOWAS’ warnings and asserted their determination to oppose any external interference within their borders.

They also cut diplomatic relations with Nigeria, Togo, France, and the United States, while imposing an indefinite closure of the Nigerien airspace.

However, ECOWAS’ decision to use military force to restore the democratic government of Bazoum is expected to result in escalated conflict. Nigeria’s President, Bola Tinubu, has been advised to explore other options, including sanctions, but war.

With seven Nigerian states sharing a border with Niger, there is concern that a military conflict will exacerbate the fragile security of the two countries. The neighbors have had to deal with the impact of the activities of Islamic terrorists.

Although it has suspended its early plan to deploy troops to Niger, ECOWAS seems determined this time to use what it had described as a last resort. The bloc has called on the African Union (AU), partner countries, and institutions to support its resolution.

Tinubu’s speech at the ECOWAS Extraordinary Summit on Niger Junta

Distinguished Ladies and Gentlemen,

1. Let me commence by welcoming you all to the Second Extraordinary Summit on the Socio-Political Situation in the Republic of Niger, within the space of ten days.

Your presence here, despite the short notice, demonstrates the unwavering dedication of our esteemed community to finding a lasting solution to the political situation in the Republic of Niger.

2. Today, we gather with a profound sense of urgency and firm determination, building upon the commitments made during our first Extraordinary Summit, on the grave political crisis befalling our sister nation.

During that initial meeting, we voiced our solidarity with the people of Niger and their democratically elected President, H.E Mohamed Bazoum, by condemning the military takeover and the unjust detention of their democratically elected President.

Your Excellencies, Distinguished Ladies and Gentlemen,

3. As you may recall, we called on the junta to rescind its decision of toppling a legitimate government. We proceeded to impose sanctions with the hope that this resolute measure would catalyze the restoration of the constitutional order in Niger.

Regrettably, the seven-day ultimatum we issued during the first Summit has not yielded the desired outcome. We have also made diligent efforts through the deployment of various ECOWAS mediation teams, to engage the military junta for a peaceful resolution of the political situation.

One of the facilitators, former Head of State of Nigeria, General Abdulsalami Abubakar, would update us on the outcome of his mission to Niamey.

4. Similarly, as part of coherent diplomatic initiatives, Special Envoys were dispatched to non-ECOWAS nations, particularly Libya and Algeria.

During these engagements, the Envoy designated for Libya had the privilege of an audience with the President of Libya.

This discourse resulted in an unequivocal expression of support for the resolutions adopted by ECOWAS aimed at restoring constitutional governance in Niger.

In Algeria, the Envoy was received by the Minister of Foreign Affairs on behalf of the President of the country.

These initiatives are aimed at presenting a cohesive and united stance regarding the ongoing circumstances in Niger, thus showing a collaborative and concerted approach among African nations.

5. Following the resolution of our previous Extraordinary Summit to initiate a meeting of the ECOWAS Chiefs of Defense Staff, the meeting of the Chiefs of Staff Committee was duly held from 2nd to 4th August 2023.

The outcome of that meeting, as well as a Memorandum by the President of the ECOWAS Commission on current socio-political developments in Niger, will be presented during this Summit.

These will offer critical insights that will inform our collective decision-making process at this meeting.

6. Today’s Summit provides a significant opportunity to meticulously review and assess the progress made since our last gathering.

It is essential to evaluate the effectiveness of our interventions and identify any gaps or challenges that may have hindered progress.

Only through this comprehensive assessment can we collectively chart a sustainable path towards lasting peace, stability, and prosperity in Niger.

7. Moreso, in reaffirming our relentless commitment to democracy, human rights, and the well-being of the people of Niger, it is crucial that we prioritize diplomatic negotiations and dialogue as the bedrock of our approach.

We must engage all parties involved, including the coup leaders, in earnest discussions to convince them to relinquish power and reinstate President Bazoum.

We must exhaust all avenues of engagement to ensure a swift return to constitutional governance in Niger. 

8. More specifically, as leaders of our respective nations, we must recognize that the political crisis in Niger not only poses a threat to the stability of the nation but also has far-reaching implications for the entire West African region.

By remaining steadfast in our adherence to the principles of democracy, good governance, and the rule of law, we can restore peace, stability, and prosperity in the Republic of Niger, thereby fostering an environment conducive to growth and development for all.

Esteemed Excellencies, Distinguished Ladies and Gentlemen,

9. I am confident that this 2nd ECOWAS Extraordinary Summit on the Socio-Political Situation in the Republic of Niger will be a defining moment in our journey towards a stronger, more resilient, and integrated West Africa.

Let us seize this opportunity to make a lasting impact on the lives of our fellow Africans as we strive to build a future defined by peace, progress, and prosperity.

10. In conclusion, I extend my gratitude to each of you for your attention to this critical issue. I trust that our deliberations will be productive and fruitful, leading us to find an amicable solution to the political crisis in Niger.

As we continue to work together in solidarity and harmony, we can ensure a prosperous future for the entire West African region.

With these remarks, I hereby declare this Extraordinary Summit open.

Thank you all, for your attention.