THE EFFECT OF CONSISTENT FALL IN NAIRA
By Oluwatimilehin Folarin
Could you believe that a Medical student that saved N100,000 in a Nigerian bank when he got admitted into the University of Ibadan 7 years ago, can only boast of having a worth of about N30,000 now? If you are planning to save your next scholarship fund or grant in naira over a couple of years, I will advise that you give it a second thought.
It is so exasperating that the Nigerian currency has been consistently dwindling in value, making survival an achievement, rather than a norm to an average citizen of the nation. The dysfunctional Naira’s value compared with most countries’ is disheartening.
Since Nigeria became independent in 1960, the monetary system has progressed through a number of transformational stages, and on January 1st, 1973, the nation moved from spending Nigerian Pound to making Nigerian Naira her official legal tender.
Of course, the new currency had a dominant value over the US Dollars until the year 1986 when Naira was devalued from N0.895: $1 to N2.02 against $1 in the space of a year during General Ibrahim Badamasi Babangida’s tenure. The exchange rate further dropped to N22.05 against $1 by the time he left office in 1993. Since then, the value has steadily reduced.
The Nigerian economy is now faced with a foreign exchange mess, accompanied by the continued rate of depreciation of the naira note which has generated worry among all. The Central Bank of Nigeria (CBN) recently placed a ban on the sales of foreign exchange to Bureau de Change (BDC) operators, causing the exchange rate to speedily depreciate from N505/$1 to about N570/$1 at the black market. This sudden fall was reminiscent of the one in early 2017.
I am still recovering from the shock that gala sausage roll that was sold for a fixed price of N50 for some couple of months if not years, is now swiftly sold at the rate of 2 for N150. So many goods have spiked up, thereby making them unaffordable by a larger percentage of the masses. In fact, eating 3 times a day can be considered a luxury for the common man.
Although Nigeria is the largest producer of crude oil in Africa, she is yet to get things right in the foreign exchange market. This frequent rise in inflation and subsequent hike in the cost of production and prices of goods have cost many their means of livelihood and has forced many to engage in illegal activities just to survive. No wonder, poverty rate has grossly increased in the nation.
Amidst all these, all we can hope for is for all to be well