Nigeria Considering Currency Devaluation

Nigeria Considering Currency Devaluation

Nigerian authorities are under increasing pressure to devalue the national currency, the naira, as oil prices have declined, Bloomberg reports.

Restrictions in place to maintain the value of the naira are harming economic growth, analysts say, adding that the Central Bank of Nigeria may revise its target for the naira by more than 20% to 240-250 per dollar, as oil prices saw a decline by more than 70% since June 2014. Oil accounts for around two-thirds of Nigerian government’s revenue and almost all exports. Currently, importers face a number of restrictions on dollars available and has promoted smuggling and other activities which further undermine economic growth.

Bloomberg quoted a London-based Africa economist at Capital Economics,  John Ashbourne, as saying that “cumbersome foreign-exchange restrictions are strangling economic growth… The authorities will be forced to devalue the naira in the first half of 2016.” A currency devaluation would be the third since November 2014.

Login

Welcome! Login in to your account

Remember me Lost your password?

Lost Password