Most of the comments and analyses I have read on this agreement reveal a general lack of understanding of what the ‘agreement’ is and is not. And this development stems from the federal government’s and the Central Bank of Nigeria’s very poor communication habits. Infact, this government has the worst communication/information team of all the administrations this country has had in the last three decades….
On this yuan issue, I have not read anywhere, the government has made efforts to educate Nigerians on what the agreement is all about. I mean breaking it down to forestall the negative impacts of all the beers parlour and peppersoup joints analyses may have…….
As I said sometime ago, the worst thing a government whose economy is facing recession will do is to keep quiet.The silence of this government on very important issues is deafening. There seem to be an internal conspiracy within its cycle to sabotage its efforts by failing to inform, better inform, and carry the governed along, on what it is doing and what it is not doing…….
Back to the Nigeria-China currency agreement….
I think this is a right move in the right direction, it will also help reduce pressures on demand for dollars, as Christine Largade mentioned yesterday in one of the sessions, governments should look for the right ‘potent policy mix’ in times like this. This in my opinion is a right step in the right direction.It will help the efforts of the CBN in curbing excess demands for dollars in the face of dollars scarcity……
If the business people who will be needing the Chinese yuan will have to source it through same systems as those who source dollars from the same Nigerian banks, then I am afraid the aim of this is already defeated. And in the next few months, these business people will not be able to get the said yuan from the banks at official rates. They will be frustrated by the banks and will be forced to source the yuan at the parallel markets where these same banks through their agents will move the yuan to, so as to make higher profits, to the detriment of the business people.
If you have ever traveled out of Nigeria to even some African countries we regard as smaller countries, and you need currency exchange, is there any other protocol aside walking into a banking hall, have your passport or ID card scanned, you fill a teller, and pronto, you have your cash.
The best way to kill black markets in virtually every product is to ensure such product is readily available. Economics say that scarcity increases value, and scarcity fuels desperate efforts at hoarding. So if it is possible to walk into any Nigerian bank, fill a teller, and walk out with your foreign exchange, black market will die. Same way if there is fuel in every fuel station,such that you drive in, and in less than 5 minutes, you have your tank filled, black market will die. No economy grows with leeches feeding off its loopholes and smiling to the bank as we have it in Nigeria.
Why must our own things always be differently difficult…..??????