Financial experts have called on the Federal Government to adjust it foreign exchange and monetary policies, if it is serious about transforming the economy in 2017.
This was just as financial experts were however divided over the performance of the foreign exchange regime in the New Year. While some of them expect the local currency, the naira, to depreciate further in 2017, others are optimistic that the naira will rebound.
A financial analyst, Mr. Gbenga Ajayi, told The Point that foreign exchange will dropped further, considering the fact that the basic fundamentals that can propel growth of the market have not been addressed by the Federal Government.
“The first and second quarters will be challenging for all operators and the nation, because the market still lacks proper focus and policy to drive the expected growth. The Central Bank of Nigeria appears confused on the management of the market, as it is busy with its trial and error approach,” he said. Like Ajayi, another analyst, Mrs. Kunmi Shobo, blamed the dwindling fortunes of the money market on the negligence displayed by the management of the apex bank.
According to her, unless the CBN and stakeholders explore all opportunities and growth policies, the naira and the economy would be thrown into deeper misfortune.
“If the government does not implement stricter regulations to monitor the activities of the banks and Bureaux de Change and block leakages in the money market, the economy will crash further.
We must take advantage of the upward movement of crude oil prices in the global market to grow the economy in the New Year,” she said. An economist, Mr. Henry Boyo, argued that the excess funds in the system must be mopped up if the government is determined to grow the economy in 2017.
According to him, the fund, which came through allocations to the three tiers of government, and the intervention funds being thrown around by government in various sectors of the economy, were wrong steps in wrong directions.
He expected the finance ministry and the CBN to fashion out policies that will bring interest rates down from double digits, increase employment, reduce inflation, as well as checkmate wastage.
Boyo added that CBN must mop up the idle funds in the market, as the banks are quoting higher bids than they are willing to pay for the treasury bills and reduce the influx of dollars converted into naira in order to reduce the monetary policy rate.
“Until this is done, anybody who says there will be transformation in the economy is only winking in the dark. And if the economy does not grow, investors will not come into the country, because they won’t see the signs to tell them where to invest. For now, there is no conscious realistic arrangement to get us to that point,” he said.
