The Presidency has issued a stern warning to forex speculators, urging them to divest their holdings in dollars. The call comes amidst promising indicators suggesting that the Naira is poised to appreciate in value in the near future.
Bayo Onanuga, the Special Adviser on Information and Strategy to President Bola Tinubu, delivered the cautionary message via a statement posted on his official X handle on Thursday. Onanuga emphasized that with the resolution of the backlog of foreign exchange (FX) transactions, the stage is set for a significant appreciation of the Naira. He urged speculators to liquidate their dollar holdings promptly to avoid potential losses.
“With backlog FX settled, Naira is set to appreciate further, faster. Currency speculators should quickly dump their stock of dollars to avoid sorrows and tears,” Onanuga asserted, underscoring the urgency of the situation.
The statement was prompted by recent developments at the Central Bank of Nigeria (CBN), which disclosed that it had successfully cleared a $7 billion backlog of foreign exchange transactions inherited by Governor Yemi Cardoso. In a statement released on Wednesday, Mrs. Hakama Sidi Ali, the Acting Director of Corporate Communications at the CBN, confirmed the settlement of all valid FX backlog claims.
Ali revealed that the CBN engaged the services of Deloitte Consulting, an independent auditing firm, to conduct a thorough assessment of the transactions. The aim was to ensure that only legitimate claims were honored, with any invalid transactions referred to relevant authorities for further investigation.
The commitment of the CBN to addressing the FX backlog has yielded tangible results, with the nation’s external reserves witnessing a significant increase. As of March 7, 2024, external reserves stood at $34.11 billion, marking the highest level in eight months. This surge in reserves underscores the effectiveness of the CBN’s interventions and the resilience of the Nigerian economy amidst challenging global economic conditions.
The news of the impending appreciation of the Naira has been met with cautious optimism by market observers and stakeholders. A stronger Naira is expected to enhance purchasing power, reduce import costs, and boost investor confidence, ultimately driving economic growth and development.
However, analysts have warned against complacency, emphasizing the need for sustained efforts to address underlying structural challenges and vulnerabilities in the economy. While the resolution of the FX backlog is a positive step, policymakers must remain vigilant to prevent a resurgence of speculative activities and maintain stability in the foreign exchange market.
In light of these developments, stakeholders across various sectors are eagerly awaiting further updates and policy directives from the Presidency and the CBN. The timely implementation of appropriate measures will be crucial in harnessing the potential benefits of a stronger Naira and ensuring sustained economic progress for Nigeria.
