Sunday, 26 May, 2024

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Naira strengthens at parallel market as demand for dollars wanes


THE naira appreciated by N166 to the dollar in the parallel market on Friday afternoon, as currency traders reevaluate their strategies.

Some dealers in Lagos said the naira, which peaked at N1,279/$1 on Thursday evening, settled at N1,113/$1 as of the time of filing this report on Friday.

According to reports from the markets, the gains may be due to a lack of buyers as many declined to pay around N1,300/$1, sensing a potential strengthening of the local currency.

This may not be unconnected with the information that the Federal Government has decided to convert about $7 billion of Nigeria’s dividends from the Nigerian Liquefied Natural Gas (NLNG) to a loan to boost foreign currency liquidity in the Nigerian economy and strengthen the troubled forex market.

A top government official was quoted on Thursday to have said that as the Federal Government expedited action to securitise the NLNG dividends, it was also expecting about $7 billion from a consortium led by Standard Chartered Bank.

Meanwhile, the Minister of Finance, Wale Edun, said the country was set to receive $10 billion in foreign currency inflows over the next several weeks to help improve liquidity in the foreign exchange market, which has stifled growth in Africa’s largest economy.

In addition, Edun said President Bola Tinubu signed two executive orders permitting the issuance of domestic financial instruments denominated in foreign currencies as well as the transfer of all cash outside the banking system into banks.

This created an impression among traders, speculators, that the exchange rate could gain against the dollar in the coming days.

The minister’s remarks were made just after President Tinubu gave the assurance that he would clear the backlog and that he had taken action to address liquidity in the foreign exchange market.

He added that every transaction in the foreign exchange market, from the official to the money changers, where large amounts of arbitrage have regularly happened, would be closely watched and those who transgress would be found out and dealt with.

According to FMDQ, the naira exchanged at N837/$1 on Thursday, a marginal increase from the N802/$1 traded on Wednesday.

Meanwhile, leaders and elders of the South East, South West, South South, and Middle Belt have tasked the Federal Government to urgently do something to salvage the fast depreciating naira and arrest the dwindling living conditions of Nigerians.

Rising from a meeting in Abuja under the Southern, Middle Belt Leadership Forum (SMBLF) and attended by Ohanaeze Ndigbo Worldwide, Afenifere, Pan Niger Delta Forum (PANDEF) and the Middle Belt Forum, the regional leaders also implored the government to call to order individuals who are trying to arrogate the administration of the Federal Capital Territory (FCT) to themselves to the exclusion of other Nigerians.

The SMBLF leaders, in a communique issued on Friday said the meeting, chaired by their leader, Chief Edwin Clark, said they deliberated on the state of the nation and resolved that the government should, as a matter of urgency, and priority, work towards the restructuring of the country and enthrone true federalism as was originally entrenched in the 1960 and 1963 constitutions.

The meeting, therefore, resolved to set up a committee on restructuring and expressed readiness to interface with the Federal Government, the National Assembly and all other stakeholders on the enunciated issues.

While lamenting what they see as the marginalisation of Nigerians from different parts of the country in appointments, the communique noted that without restructuring, the future of Nigeria and democracy will remain bleak.

The leaders expressed concern and rejection of the trend where certain sections of the country are continually marginalised in the number of states, local governments and even appointments into the Federal Executive Council.

They particularly requested that the South East be appropriately represented on the Federal Executive Council, similar to other geopolitical zones.

They insisted that Nigeria must remain a country where all citizens and sections enjoy a full sense of belonging and equality.

The leaders urged the government to rein in individuals who are trying to arrogate the Federal Capital Territory (FCT) to their region and faith to the exclusion of others from its administration, saying that the nation’s capital remains the national patrimony of all Nigerians.

The communique commended the political class, especially the leading presidential candidates in the 2023 presidential election, for their recourse to constitutional means in redressing their grievances.

It also urged the government to take urgent steps to release the leader of the Indigenous Peoples of Biafra (IPOB), Nnamdi Kanu, since a court of competent jurisdiction has ordered so.

“We believe that doing so will promote peace and security in the South East,” they said.

The leaders said President Tinubu should take an urgent look at the 2014 national conference report.

The communique was signed by Clark, Chief Ayo Adebanjo (Leader, Afenifere); Chief Emmanuel Iwuanyanwu (President-General, Ohanaeze Ndigbo Worldwide); General Zamani Lekwot retd (Chairman, Middle Belt Elders Council and former Military Governor, Rivers State); Dr Pogu Bitrus (President, Middle Belt Forum) and Senator Emmanuel Ibok-Essien (National Chairman, PANDEF).

Credit: Nigerian Tribune

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