By Elizabeth Chukwuma
When information filtered out some few months ago that President Bola Ahmed Tinubu’s Administration was using Nigerian’s lean external reserves to defend the naira, which Olayemi Michael Cardoso governor of Central Bank of Nigeria, CBN, had declared that that it was not the objective of the government., described as ‘’moderate’’
The apex Bank governor had said while giving report of ’the Bank’s Macroeconomic Outlook : Discovery for Economic Stabilization’’, that the drop in Nigeria’s external reserves in the last one year was caused by payments of inherited foreign debt which insiders had put at the North American country o the United States, US, $43.2 billion from former President Muhammadu Buhari’s Administration.
Cardoso, the CBN, governor, had revealed that the country’s external reserves was used to service the country’s huge foreign debt owed the creditor nations including the Multi-lateral Financial Institutions comprising of the World Bank, International Monetary Fund, Paris Club and London club and payments of matured foreign exchanged swaps obligations and other outstanding foreign exchange obligations.
He had said that increased borrowing by the then Buhari’s Administration had worsened the country’s foreign debt levels which was said ‘’to have greatly restricted country’s fiscal space and limited opportunities for concessional finance’’
The apex bank governor was emphatic that that a country, like Nigeria and other third world countries where foreign debts payments are due and certain payments are made are made as part of keeping their credibility, there is no way there I no way heir eternal reserves would remain the same as obtained in the case of Nigeria.
He may have tried to douse tension in the country over the present Government management of the country’s external reserves when he stated that ‘’the improvement in the country’s foreign exchange earnings from crude oil sales, together with the recent reforms in the foreign exchange market that allow international money transfers operators to pay beneficiaries at market- determined foreign exchange rates, and the energy sector, would cushion the drop in the external reserves but that was how far he could go.
The CBN governor, may have gladdened the heart of Nigerians whens when he disclosed that the projected a marginal increase to $19.4 billion from $19.1 billion in 202 for diaspora remittances.
Cardoso, the CBN, governor, who had repeatedly said that the Bank’s ongoing efforts at boosting the country’s eternal reserves had resulted to improve efficiency , transparency, and confidence in the foreign exchange market expected to encourage Nigerians in diaspora to increase their remittances through the usual external channels into the country this 2024.
Rcall tha Nuhu Ribadu, National Security Adviser, NSA, who incidentally was a retired Assistant Inspector General of Police, AIG and former Chairman of the Economic and Financial Cries Commission, EFCC, during Olusegun Obasanjo’s Administration had said that the Tinubu’s Administration inherited much debt, both domestic and foreign from the former Buhari’s Administration.
Meanwhile the apex Bank, has made available the sum of $20,000 to be sold to each of the Burau De’Change , BDC, outfits at the rate of N1,450.00, at the National Autonomous Foreign exchange market, NAFEM. Aliyu Mahdi, CBN’S acting Director of Trae and Exchange Departments had said that took the bold decision because it had observed continued distortion s in the retail end of the forex market., which is feeding in the Parallel, popular, black market exchange t and further widening the exchange rate premium.
In spite of the fact that the present Tinubu’s government have been alive servicing the country’s foreign debt obligations, over the last one year and making forex available to traders to buy to carry out their international transactions and may payments, , the IMF, has cut its forecast for the country’s economic growth this 2024 , 3.1% , which many believe has sent a wrong signal to the people.
The IMF Authorities were said to have cited a weaker growth in the economy that was said to have recorded in the first quarter of the year, an indications that he downgrade followed weaker –than expected Gross Domestic Product, GDP, and growth recorded by the country in the first quarter of 2023, under the Buhari’s Administration in 2023.
The National Bureau of Statistics, NBS, under the close watch of Semiu Adeyemi Adeniran, had repeatedly said during the Buhari’s era that the country’s GDP, had dropped, quarter to quarter but was not taken serious by the Authorities. The situation was so bad that it was said to have dropped in the first quarter of 2024 to 2.98% from .4% inn the fourth quarter of 2023.
Many believe that the Nigerian economy would have been on the brink of total collapse if the Nigerian Labour Congress, NLC, had agreed to the Federal Government proposed payment of N250,000.00 as the nation’s new minimum wage and increase petrol prices.
President Tinubu’s Administration had increased the pump price of Petrol, several times with the removal of subsidy, since assuming power on May 29, 2023. At present, the pump price of a litre of petrol had jumped from N184 .00 during the Buhari’s regime to the N10.00 per litre, depending on the filling station and part of the country ,which is reflected on the prices of food items across the country and the rising inflation.
The Labour Leaders may have read the handwriting on the wall that of the dangers ahead: severe hardships, that they were said to have rejected and accepted N70, 000.00 to save Nigerian economy from total collapse.
Given thatJoe Ajaero led Nigerian La bour Congress, NLC, has agreed to go with the President‘s proposed N70,000.00 as the country’s new minimum wage as it could no longer be reviewed every five years but every three years , may have informed why the Nigerian President had set the machinery in motion to send an executive bill to the National Assembly to approve the agreed for approval.
