Nigeria’s newly inaugurated President, Bola Ahmed Tinubu, has promised to unify Nigeria’s multiple exchange rates, replacing the previous multiple exchange rate regime implemented during the administration of former President Buhari by the Central Bank of Nigeria.
President Bola Ahmed Tinubu’s decision to unify the exchange rate and also force interest rates down in Nigeria carries potential implications for the independence of the Central Bank of Nigeria (CBN).
Tinubu, who disclosed this during his inaugural speech on May 29, highlighted the importance of a unified exchange rate and emphasized the need to redirect funds from arbitrage toward meaningful investments.
He also called for a reduction in interest rates, describing the current rates as detrimental to both the people and businesses in Nigeria.
“The central bank must work towards a unified exchange rate…they should direct the fund from arbitrage to meaningful investment. Interest rates need to come down, currently too high, anti-people, anti-business, we have to work on all of those”
President Tinubu’s decision to unify the exchange rate reflects a departure from the multiple exchange rate system that was in place during the previous administration.
By implementing a unified exchange rate, President Tinubu aims to streamline the foreign exchange market and reduce distortions, thereby attracting more investments and boosting economic stability.
He also asserted that the subsidy can no longer justify its use in the wake of dwindling resources stating that we will instead channel it to better investment such as public infrastructure, healthcare, and jobs which will improve the lives of Nigerians.
“On fuel subsidy, unfortunately, the budget that exist before I assumed office and what I have heard is that no provision is there for fuel subsidy, so Fuel subsidy is gone“ Tinubu
