“For most of this year, the naira will be highly volatile, leading to regulatory erraticism that can affect businesses, especially those holding foreign currency. The CBN lacks the liquidity to support the naira itself; out of US$33bn in foreign reserves, a large share (estimated at nearly US$20bn), is committed to various derivative* deals,” – Economist Intelligence Unit (EIU)
You see the reason why I wrote that people should forget those Wall Street banks which are predicting how the Naira will appreciate. All of them are conflicted because they’re managing Nigeria’s funds while also consulting for Nigeria, dropping mindless opinions. The implication is that they can never write anything that will offend Nigeria as those funds could be moved. In other words, how can you write a bad opinion on a client you are keeping his/her $5 billion?
I will only believe Wall Street banks when they posit and also help Nigeria improve our FDI (foreign direct investment). With that, I will then believe that they’re very confident of the Naira to convince their investing clients to make Nigeria an investment destination. Today, that is not happening and that says it all.
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When I was a kid in primary school, then Imo State Governor, Sam Mbakwe, used to show a piece of paper on the television (I was later told that he was explaining the economic status of the state, and why people needed to donate funds to the state for projects). Nigeria’s President should come clean on where things stand in Nigeria. Until he does, he may struggle to fix things. I do hope he does so that from ASUU to NLC, everyone will get the memo.
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