The Nigeria Employers’ Consultative Association (NECA) has urged the Federal Government to urgently increase crude oil production to, at the very least, OPEC’s 1.8 million barrel per day quota in order to relieve the pressure of foreign exchange (FX) and other economic challenges related to it.
The employers’ group encouraged the government to pursue and end crude oil theft, restart local refining so that foreign exchange can be used for other economic purposes, and practice fiscal restraint in its dollar dealings.
The continual incorrect channeling and misuse of foreign exchange on organized enterprises, according to NECA Director-General Adewale-Smatt Oyerinde, has become excruciating.
The working capital, output, capacity utilization, investment, and sales of businesses, among other metrics, have all decreased dramatically, according to him, and businesses are being forced to shrink.
If not immediately addressed, the grey trajectory, in his opinion, portends calamity for the economy.
As a result, he asserted, stricter measures must be taken in order to drastically lessen the impact of economic saboteurs along the currency value chain.
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“We believe that if the parallel market is not legal, then it is illegal and should be treated as such. We believe that as long as the “black market” with the institutionalized name, “parallel market” persists, unruly banks in the country will continue to round-trip, notwithstanding the implication on the economy,” he said.
Noting that the goal of the unification of exchange rate policy was to bring the exchange rates into convergence, he claimed that while the strategy first seemed to be taking off, it has since evolved into something that is undesired.
While the official currency rate was approximately N781.64 to $1, the parallel market was roughly N900 to $1, as observed by the CBN. According to him, the difference indicated a premium of about 21%.