The presidency has refuted claims that Vice President, Yemi Osinbajo called for the devaluation of the naira amid the current travails of the currency.
Senior special assistant on media and publicity to the Vice President, Mr Laolu Akande, in a statement issued on Tuesday clarified that his principal rather advocated for implementation of forex policy to curb corruption and restore the value of naira against dollar and not devaluation as it’s being circulated.
Osinbajo who spoke on Monday at the opening of a two-day Mid-Term Ministerial Performance Review Retreat had called on the Central Bank of Nigeria (CBN) to allow the naira to reflect the realities of the market. The Vice President lamented the value of naira, adding that the exchange rate which is artificially low deters investors from bringing foreign exchange into the country.
Following the widespread criticism his speech had generated, Akande explained that the Vice President never called for devaluation of naira. He further added that Osinbajo only advocated a need to stop the excesses of the black market traders.
The statement reads, “Our attention has been drawn to statements and reports in the media mischaracterizing as a call for devaluation, the view of Vice President Yemi Osinbajo, SAN that the Naira exchange rate was being kept artificially low.
“Prof. Osinbajo is not calling for the devaluation of the Naira. He has at all times argued against a willy-nilly devaluation of the Naira.
“For context, the Vice President’s point was that currently, the Naira exchange rate benefits only those who can obtain the dollar at N410, some of whom simply turn round and sell to the parallel market at N570.
“It is stopping this huge arbitrage of over N160 per dollar that the Vice President was talking about. Such a massive difference discourages doing proper business, when selling the dollar can bring in 40 per cent profit!”
“This was why the Vice President called for measures that would increase the supply of foreign exchange in the market rather than simply managing demand, which opens up irresistible opportunities for arbitrage and corruption.
“It is a well-known fact that foreign investors and exporters have been complaining that they could not bring foreign exchange in at N410 and then have to purchase foreign exchange in the parallel market at N570 to meet their various needs on account of unavailability of foreign exchange.
“Only a more market reflective exchange rate would ameliorate this. With an increase in the supply of dollars the rates will drop and the value of the Naira will improve.
“The real issue confronting the economy on this matter is how to improve the supply of foreign exchange, but this will not happen if we do not allow mechanisms like the Importers and Exporters window to work.
“If we allow this market mechanism to work as intended, we will find that the Naira will appreciate against the dollar as we restore confidence in the system.”