The Central Bank of Nigeria (CBN) has reaffirmed its dedication to ensuring stability in the naira/dollar exchange rate. During a discussion with the Senate Joint Committee on Banking and Insurance in Abuja, CBN Governor Olayemi Cardoso emphasized the use of various tools to achieve exchange rate stability in the near future.
Cardoso highlighted the importance of supply and demand moderation, stating that efforts are underway to address the supply side while calling for a collective responsibility to manage the demand for dollars for personal use. He stressed the need for Nigerians to reduce their frequent demand for dollars and look inward to enhance local institutions, thereby decreasing reliance on foreign exchange.
Asserting that the CBN does not possess a “magic word” to stabilize foreign exchange, Cardoso urged collaboration to mitigate excessive demand for dollars. He proposed fostering local alternatives, particularly in the areas of education and healthcare, to reduce the inclination to spend abroad.
Moreover, Cardoso noted that the CBN has endeavored to alleviate the crisis of confidence in the bank, leading to increased international investor confidence and a surge in trading volume in the foreign exchange market, signifying a resurgence of faith in the Nigerian economy.
Meanwhile, Minister of Finance Wale Edun revealed plans for significant tax reforms to bolster non-oil revenue and emphasized prudent government expenditures. The minister assured that monetary and fiscal policies will focus on enhancing production and funding.
In response, the Committee Chairman, Sen. Yahaya Abdullahi, urged the economic team to collaborate in devising solutions to alleviate the challenges faced by Nigerians, calling for innovative and creative strategies to address the current hardships.
In summary, the CBN’s commitment to exchange rate stability, coupled with the government’s fiscal and monetary policies, aims to instill confidence, increase production, and mitigate financial challenges faced by Nigerians.
