Peter Obi, the Labour Party’s (LP) nominee for president, has pledged that if elected in 2023, his administration will ensure that Nigeria has just one foreign currency (FX) market.
Nigeria now has two foreign exchange markets.
There is a parallel market known as the black market that operates in addition to the investors and exporters (I&E) window that is used on the official foreign currency rate market.
The naira trades at N433 to $1 on the official market and at N740 to $1 on the black market.
However, given that it benefits many Nigerians, many people think the parallel market is an accurate representation of the real worth of the local currency.
The existing exchange rate regime discourages investors who are concerned about currency risks, according to Obi, who was speaking on the prospects of revolutionary governance on Wednesday at Harvard University in America.
Additionally, he declared that his administration will do away with limitations on foreign exchange policy. As part of our monetary policy, we will work to restore the CBN’s independence and commit to a transparent, credible strategy to normalize the exchange rate and reduce inflation to single digits, according to Obi.
“We insist on a unified forex market and will lift import and foreign exchange limitations. The existing system penalizes exporters who bring in foreign exchange by making them sell at a rate that they are unable to obtain when they need to buy foreign exchange.
He said, “This multiple exchange rate framework promotes capital flight and discourages investment, which has further exacerbated Nigeria’s forex predicament.
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