As the crisis in the foreign exchange market in Nigeria continues, a 2016 interview by former President Muhammadu Buhari, has shown him explaining to Aljazeera why he declined to implement a free-float of the Naira despite international pressure.
The ex-Nigerian leader who was asked why in spite of a “chorus of voices” calling on him to devalue the naira to allow market forces to prevail, he refused to, said he wasn’t willing to reconsider his position because of the huge negative impact it would have on the country.
As a largely import-dependent nation, Buhari explained that floating the very fragile naira against other currencies will do the country no good.
The Nigerian currency has been under immense pressure since President Bola Tinubu took the decision to collapse the FX market into one and enforce a free-floating regime. It has since then traded for as much as N1,400 to a dollar in recent times.
“I have explained that countries that play around with their currencies are countries that have enormous production capacity. They have factories in place. Their infrastructure in terms of power, communications and security are virtually perfect.
“Nigeria virtually imports everything, from rice to toothpick. Now, if we don’t have the money to import those things, what is the value of further devaluing the Naira?,” he asked.
On whether, he wasn’t going against the advice of the International Monetary Fund (IMF) by failing to devalue the Naira, Buhari told his interviewer that it wasn’t a big deal to go against the IMF advice if it goes against the interest of Nigeria.
“Why not? If it’s against our national interest, why can’t we go against the IMF advice,” he queried.
On why he banned certain imports, Buhari said that Nigeria wasn’t viable enough economically to afford those items, stressing that the country was supporting in the area of pharmaceuticals and others.
“Yes, that’s the theory of it. Nigeria can only afford to live within its means. We don’t have the money to back the naira, for people to buy the dollars and then import toothpick, chocolate rice and glamorous dresses…,” he noted.
He admitted, however, that the policy was prone to corruption, but said he was ready to polic the system and ensure that sanctions were meted to anyone who committed any infractions.
Some Nigerians have accused Tinubu of caving in to foreign pressure in the early days of his administration to consolidate power and gain the validation of the West.(THIS DAY)