Central Bank Governor Emi Cardoso said the plunge in the value of the naira was an opportunity for the country to increase exports to other countries.
Cardoso said this at the Nigeria Economic Summit in Abuja on Wednesday.
The CBN Governor noted that the devaluation of the Naira will make export trade more competitive and many investors are already seizing this opportunity.
Cardoso acknowledged that while the situation is not ideal, the current situation provides an opportunity for individuals to identify and pursue investment opportunities.
“In terms of persuasion, what we need now is to make sure that the investment will take place. For example, now it may seem like a threat in the sense that the exchange rate is very low. No. But it’s also an opportunity because it means it could help boost exports.
“This will make Nigeria even more competitive in the export trade. I just want people to say, here is the opportunity. Things are realigning in a certain direction. It’s not perfect. But there is no doubt that there are opportunities that people can choose to invest in.
“By the time you export to other countries with the import costs here and the relatively low naira, you will be in a situation where the demand for your goods is much higher. And you see that happening, and other people are doing it too. We're doing it, and interest is growing exponentially,” Cardoso said.
Central bank policy is on track
Furthermore, Mr. Cardoso reiterated the World Bank’s position and said that the CBN’s policies are on the right track.
He further revealed that the World Bank as well as other financial institutions and rating agencies have praised the apex bank's efforts in economic transformation.
Cardoso therefore said banks need to stay on track to reap the full benefits of the policies introduced.
“The problem with the World Bank’s chief economist. I wasn’t here. But I read the speech. To be honest, my interpretation is not how others interpreted it. I think he was fundamentally misunderstood.
“My understanding of his statement is that the policies that the central bank is taking are putting Nigeria on the right track.
“Frankly, I said earlier that if you look at the rating agencies and other international financial institutions, they all say the same thing, but you didn’t mention the World Bank. And they all say the same thing. And I don’t think they’re all wrong,” Cardoso added.
What you need to know
With the Naira devalued by more than 170% in the past year, trading between 1,685/$ and 1,700/$ in the foreign exchange market, Nigeria has recorded a significant trade surplus and is expected to enter the second quarter of 2024. amounted to 6.95 trillion naira. .
This trade surplus is primarily driven by the weak naira and a sharp decline in imports, with foreign products becoming increasingly expensive due to rising costs of importing goods and services. Many see the weaker naira as an opportunity to increase exports of Nigerian products. The CBN Governor stressed that a weaker naira will strengthen export competitiveness and give Nigerian exporters a significant advantage in international trade. Follow breaking news and market intelligence.
