Former Director General of Lagos Chamber of Commerce and Industry (LCCI) Dr Muda Yusuf called on Nigerian authorities to create an enabling environment that will encourage exports and attract foreign exchange (forex).
According to him, the Nigerian economy has the capacity to attract a lot of foreign exchange due to its size, with potentials and opportunities still hidden.
Speaking at the Association of Financial Correspondents of Nigeria (FICAN) monthly forum yesterday in Lagos, Yusuf said the currency gains are about creating an environment for more entries to come in the form of shipments of diaspora funds, foreign direct investment inflows, foreign portfolio. investments, export earnings, among others.
The theme of the forum was: âPost COVID-19 economy in the first half of 2021 and outlook for the financial services industryâ.
Specifically, the former GM observed that exporters go through a lot of hardships, adding that the way to attract foreign currency is to export but âif you go to the ports and see what the exporters are going through, you feel sorry for them and the Nigerian economy in general.
âWe say we don’t have foreign currency, but the way to attract foreign currency is to export. However, exporting is almost a nightmare in Nigeria.
âFor example, the export process cannot begin until an exporter has loaded the truck and paid the owner of the truck.
âAfter paying the owner of the truck, he will undergo about two weeks of inspection and documentation. After which it will also be faced with the bottling and before they can complete the inspection and documentation, some of the products must have gone wrong, especially those that are perishable, âYusuf said.
He also said that the policy of swapping export earnings at the Nigerian Autonomous Exchange Rate (NAFEX) is not fair to exporters due to the gap between official and unofficial exchange rate windows.
He pointed out that this was one of the reasons why some of the exporters were hiding their export earnings.
“Exporters should have free access to their export earnings and be given incentives, just as the Nigerian diaspora has been encouraged by the Central Bank of Nigeria’s 4 naira exchange rate policy for remittances,” Yusuf said.
Yusuf further said that over the past six months, monetary policy makers have held back policy parameters as the committee tries to strike a balance between boosting growth and reducing the monetary component of pressures. inflationary.
The CBN, he said, supported its development finance intervention in the first half of the year as part of efforts to boost local production.
Likewise, âthe bank used administrative measures, including Open Market Operation (OMO) auctions, loan-to-deposit (LDR) / cash reserve requirement (CRR) debit and special invoice auctions for control excess liquidity in the banking system in order to combat the drivers of monetary inflation.
“The banking sector has shown resilience amid the disruptions associated with the pandemic, attributable to the political intervention of the CBN,” he said.
Based on the key ratios, Yusuf added that the banking sector is financially stable and sound with the sector’s capital adequacy and liquidity ratios above the regulatory threshold, while the non-performing loan ratios are slightly above. to the prudential guideline of five percent.