Buhari, Osinbajo disagree on naira devaluation

Posted by News Express | 12 May 2016 | 3,133 times

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Nigeria needs a “substantial review” of its foreign exchange policies, including further consideration about devaluing the naira, Vice President Yemi Osinbajo has been quoted as saying.

This is the direct contradiction of the position of President Muhammadu Buhari, who has resisted calls from investors and the International Monetary Fund (IMF) to devalue the naira, which at the official rate has been pegged at 197-199 per dollar since March 2015. The black market exchange rate, which most businesses have been forced to use, is roughly 320 per dollar.

Whereas Buhari continues to insist that he is not yet convinced about the benefits of further devaluation of the naira, Bloomberg quotes Osinbajo as saying on Wednesday at a conference in Lagos: “It’s clear that a strategy of demand management alone won’t take us far,” adding: “We need to address the issue of supply. We think a review is necessary. But I can’t give a time.”

The Nigerian Government is in talks about managing foreign exchange supplies with the central bank, which is entirely responsible for monetary policy, Osinbajo reportedly said. “Devaluation may feature” in the discussions with the bank, Bloomberg quoted him as saying.

The report further quoted him as saying that “there has to be a substantial re-evaluation of the foreign exchange policy especially with the view to increasing FX supply and capital importation,” adding that he’s “confident” that measures can be put in place to “attract FX.”

•Photo shows Buhari and Osinbajo.

Source: News Express

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