Naira redesign: What CBN must do urgently (II)
Somehow the naira redesign move now has multiple implications and is not only about operational counterfeiting issues but also a window to establish a better trajectory for the naira in terms of its value. The Central Bank must seize this opportunity and I also advise President Buhari to do the same. In economics we always […]
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Somehow the naira redesign move now has multiple implications and is not only about operational counterfeiting issues but also a window to establish a better trajectory for the naira in terms of its value. The Central Bank must seize this opportunity and I also advise President Buhari to do the same.
In economics we always talk about unintended consequences. The first phase was the slump in the value of the naira as people moved money from their soak-aways to buy foreign currency, especially those who are too criminal to put same in a bank. A second phase could be marked by the strengthening of the naira in that same black market. A third phase may be precipitated by the CBN if it acts quickly and decisively to take the narrative away from speculators and currency saboteurs. Already, those who never wish well for Nigeria are gloating that the currency will fall to N1,000 now that the N650=$1 cannot be held firm.
Below is what I think the CBN should do now. Some of these steps will require political backing. Only Buhari can get the ‘Mallams’ off the streets. And anyone trading dollar on the streets must be arrested. With a little incentivization these guys can get off the streets and that will be a new vista for this country and its financial markets. The BDC subsector must also be urgently reorganized:
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