Reasons Behind the Naira's Weakness Explained by Former Finance Minister, Aganga
Olusegun Aganga, a former Minister of Finance, has emphasized that the naira will persist in its depreciation if Nigeria continues to rely heavily on imports. He stated that defending the naira by pouring vast sums into it, without making substantial investments in the manufacturing sector to boost the country's exports, is an unwise course of action.
Aganga conveyed this information on Thursday during the 3rd Adeola Odutola lecture, held as part of the 51st Annual General Meeting of the Manufacturers Association of Nigeria.
He stressed that for the naira to regain its strength, Nigeria needs to focus on domestic production and, more importantly, on boosting exports.
The local currency, which had declined from approximately 450 per dollar to an average of 760 per dollar following President Bola Tinubu's exchange reforms, further weakened to 1045 per dollar in the parallel market on Thursday.
When discussing the state of the local currency, Aganga remarked, "What is the rationale for expending vast sums to defend the naira when it continues to depreciate, rather than investing in genuine manufacturers and exporters of high-value products that can generate foreign income for Nigeria?"
The former Minister urged the government to designate the industrial sector as a national priority and support it with comprehensive plans, policies, and financial resources.
"Unlike the trillions spent on subsidies, bailouts, the Agric Anchor Borrowers Programme, and the refineries, I can assure you that every naira, regardless of the amount, invested wisely in the strategic industrial sectors can be recouped and will bring substantial benefits to the economy and the nation," he added.
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