Gom Mirian
The Chartered Institute of Bankers of Nigeria (CIBN) expressed skepticism about the Naira free float policy implemented by the Central Bank of Nigeria (CBN) in the foreign exchange market.
The chairman of CIBN, Mr. Adeyemo Adeoye warned that this policy, which allows the Naira to fluctuate based on demand and supply, might impede economic growth rather than spur it forward.
Proposing an alternative approach, the chairman on Thursday advocated for a “managed floating” system instead. He argued that this model would be more effective in maintaining the stability of the Naira, as opposed to the speculative nature of the free-floating model.
According to him, before the unification policy, the difference between the official and parallel market was about N20 which has risen to over N200.
“In other climes, they reduce the supply of currency in the nation, by increasing the reserve ratio of banks. Naturally, you will see the impact on the value of the currency, but we have a peculiar economy here where the rate between the parallel market and the official market is about five per cent in other developed economies, but it is about 80 per cent in Nigeria.”
He urged the Tinubu -led administration to look inward by prioritising investment to boost the nation’s productive sectors.
Speaking on the Bankers ‘Nite, he said, the annual event has over the years, been an epitome of social gathering for high-profile Bankers in Lagos state, financial industry leaders, key stakeholders in the Nigerian economy, captains of industries and topmost opinion leaders in the society.
“It is an annual event where major financial policies are reviewed and, new focus articulated. With well over 500 high-profile banking/financial practitioners and other Institutions in attendance, the 2023 Lagos Bankers’ Nite provides an ample avenue for effective networking and a platform for collating and aggregating ideas that could form key inputs that can help the government navigate the prevailing exchange rate management process,” he said
