Great article.

To be sure I understand you correctly, the crux of your argument is that FG should let the Naira float as that guarantees a market that keeps commerce flowing. Right now, because of CBN’s unwillingness to float the naira, there are parallel markets and roundtripping. So, let it float and settle on a market-clearing price. This will keep some version of the economy chugging along especially as growth has slowed in recent quarters.

If I got that right, then let me play devil’s advocate.

What happens then? What does a Nigerian economy with a free-floating currency look like?

More foreign investment? Not really — there’s an implicit assumption that price of currency is the only reason there’s less investment. Like you implied, there’s no way to build an export economy overnight. The high cost of our exports is not why there is only one Dangote.

2 open questions / alternatives -

>> Can CBN address the ‘access to forex’ problem differently, for instance making forex more widely available, say at a further devalued but controlled rate? Does a more ‘realistic’ but controlled rate achieve the same goals without free-floating? Or does that just kick the can down the road…

>> Any idea if the “belt-tightening” through this lack of forex is worse than the speculation / “belt-tightening” in a Nigerian economy with a free-floating devalued Naira? It sounds to me like Nigeria is between a rock and a hard place.

Would be fascinating to know what you think! Thanks for sharing your thoughts!