A financial expert, Mr. Victor Owonifari, has described the intervention of the Central Bank of Nigeria (CBN) in the interbank forex as a step in the right direction for the nation’s financial system.
He said the move would go a long way in putting the naira in a vantage position when compared with other currencies of the world.
Owonifari, a chartered accountant and the Principal Partner/CEO of Victor Owonifari & Co., spoke during an interactive session with journalists at Ikeja, Lagos, and noted that the market should be allowed to operate freely and find its equilibrium, but as the regulatory body, the CBN should intervene once in a while to curb excesses and supply shortfalls, thereby protecting the naira.
He further stressed that as the apex bank had repeatedly informed Nigerians that it allowed for flexibility to come into play and was prepared to intervene only when necessary to prevent volatility in the forex market; the new system was expected to operate as a single market structure through the interbank and autonomous methods.
The financial expert, however, added that the recent devaluation of the naira to the US dollar increased the cost of imported goods, thereby making Nigerians pay more for imported goods without a corresponding increase in quality and quantity.
Owonifari also noted that the increase in the pump price of petroleum products and prices of household commodities earlier in the year was partly responsible for the sudden rise in inflation rate by 16.05 percent, which was above what it was the same period in 2015.
He urged the government to checkmate the trend of inflation in the country by not only ensuring the reduction of the people’s dependence on imported goods, but by also creating an enabling environment that will be attractive to investors and small scale business owners in order to have positive effects on the naira, provide job opportunities for Nigerians, reduce capital flight and bring down inflation to an acceptable limit.
The expert lamented the state of the nation’s economy, stressing the urgent need for the diversification of the economy with government’s support for SMEs and investments in agriculture.
Owonifari, who stated that the country was blessed with enormous human, material and natural resources, counseled the state governments to look inwards for revenue generation Instead of depending on monthly allocations from the federation account for survival.
While commending President Muhammadu Buhari’s anti-corruption crusade, he said the government was setting a precedent that would reduce corrupt practices in the country, adding that the war against graft should, however, not be a way of settling political scores or an avenue to witch hunt political enemies.
“The fight against corruption must be total and not selective as some Nigerians have cried out loud and clear that there are also corrupt politicians within the other political parties that the EFCC considers untouchable”, Owonifari said.