The Special Adviser President Bola Tinubu on Monetary Policies, Wale Edun, has said the real value of the naira is about N700 to a dollar.
The Nigerian currency has depreciated since the government of President Tinubu removed arbitrage in the foreign exchange market and collapsed all tiers into Import and Export window. The naira has sunk as low as N820 per dollar even at the official rate while it sold at N860/$ in the parallel market.
However, Edun who is a ministerial nominee likely to be named the Finance Minister insisted that over N860/$ it currently sells at the parallel market was not backed up by market fundamentals.
Edun, stated this while answering questions from Senators, when he appeared for screening as a ministerial nominee before the Senate.
Responding to a question on the exchange rate, Edun said: “This is clearly uppermost in the minds of the monitoring authorities. For a country that has a revenue flows from oil revenue, from remittances, and from other exports and financing of over N100 billion a year, there is no reason that there should be no stable exchange rate, all other things been equal and provided that inflation is kept under control.
“The N860 to $1 we are seeing is not backed up by any fundamentals. The fact that these are as a result of the foreign exchange practice of the past with the inefficiency and the corruption involved, these are putting pressure on the exchange rate.
“Night and day, the monitoring authorities and the monitoring team of the president are trying to resolve the situation by raising revenue, other sources of investment funding and by attracting the investment funds, equity funds from those around the world that are interested in the Nigerian economy.
“Take for instance, Turkey has attracted $50 billion in investment funding from the United Arab Emirates. It is in such direction that the solution to the shortage of liquidity in the foreign exchange market is being sought including increased in oil production as a result of better security.
“It is difficult to predict because the capital markets take all the liquidity of their own. I want to say that the fundamental value of the naira should be somewhere around N700/$1.”
Furthermore, the nominee while answering questions posed to him by Senators, called for the split of the OAGF in order to create the OAGFG, which would be handling strictly the accounting records of the federal government.
He said, “I Support the idea that there should be a separation of power from the Office of the Accountant General of the Federation and the Accountant General of the Federal Government.
“This would reduce the frequent friction between the federal government and the government at the sub-national levels in terms of revenues sharing formula”
Edun, also recommended digital capturing of all beneficiaries of the cash transfer, ahead of the plan to share the $800 million World Bank loan to vulnerable Nigerians.
He said, “Statements have been made on derogatory terms. It is not good to throw the baby away with the bath water.
“The provisions and conditions surrounding the $800 million World Bank financing is that every beneficiary must have a biometric verification, otherwise they will not be eligible for the N8,000 cash.
“Clearly there is a register that have the biometric of Nigerians to some extent, but we need to do more to reach people outside the formal financial system and that is the goal of the government.
“On the N500 billion Supplementary Budget, I think that is an appropriated sum and it is part of the current budget.”
Edun maintained that Nigeria was blessed with human and natural resources and expressed optimism that the nation would come out of its current economic quagmire with Tinubu as president.
He said, “Lagos success story was as a result of heavy commitment and investment in technology which was used to generate resources.
“We relied on the private sector investments to generate resources. Lagos economy was well positioned to an enviable position where it could source for funds domestically to meet the basic needs of its residents.”
He lamented that the nation’s economy was being challenged by insecurity and inflation because no deliberate efforts were made to harness the contributions of the private and the informal sectors.
He expressed the hope that there would be an improvement in the nation’s economy if enough revenue could be generated to carry out government obligation and service debts.
He said the end of subsidy regime and multiple exchange rate window has positioned the country for the economic growth.
He urged Nigerians, especially those in the private sector to embrace the policies and programmes of the Tinubu’s administration because the government cannot do it alone.
Edun also said Nigerians would soon be experiencing an improvement in electricity supply.