A financial expert, Dr Olutayo Obadina, on Friday, advised President Bola Tinubu to intensify effort in strengthening the Naira, through taking conscious steps to uphold exports and minimise importation.
Obadina, a PHD holder in Credit and Financial Management, gave the advice during a news conference in Lagos on Friday.
He spoke on “The Mathematics of Fuel Subsidy: A Critical Look at the Problem and Solution in Nigeria Today”.
He said that the only way out of the economic hardship in Nigeria was for the Federal Government to strengthen the Naira.
He noted that Nigeria’s economic hardship was not occasioned by the removal of the fuel subsidy but the constant devaluation of Naira.
Analysing the dollar rate to Naira right from time, as well as fuel landing cost, pump price per litre and purchase price, Obadina noted that the dollar cost of importing fuel had been the same over the years, even when other costs changed.
He, however, said this pointed to the fact that the Naira should be strengthened in view of the fact that fuel transactions were made in dollar.
He canvassed for the dollar to be reduced from the current status of N1600 to $1, to N460 to $1, a situation that would witness a drastic reduction in fuel price to N450 per litre.
“I have been listening to a lot of interviews and lectures by learned and experienced persons for a while. I am surprised that almost everyone is complaining of removal of oil subsidy as the major issue causing inflation.
“Subsidy removal is not the problem, it is a good thing that President Tinubu removed the fuel subsidy. I advise efforts should be made to strengthen the Naira.
“I will also advise the President to tell the country that it was a mistake to have floated the Naira.
“Also, I want to tell the Nigeria Labour Congress President to stop fighting for reduction in fuel price, they should rather fight for reduction in naira to dollar rate.
“To me, the Tinubu government has made a big mistake by floating the Naira. The effect is that it has brought subsidy of petrol price after he has announced its removal. The honourable thing for this government is to return the rate back to N460 as soon as possible,” he said.
Speaking further on strengthening the Naira, Obadina said “To stabilise Naira at say N460/$1 or any other figure the Central Bank of Nigeria (CBN) Governor will estimate the amount of dollar required.
“That is how much does he need so that the dollar coming in is greater than dollar going out of the system.
“Having calculated how much dollar is needed to stabilise Naira, the President will request the 36 states and the Federal Capital Territory to share the amount, export goods through their marketing boards which should be set up immediately.
“The Minister for Commerce will assist the states. She should take and observe obstacles and report to the President for legislation. The new laws will clear the road to achieving the targets.
“Presently, there are so many obstacles on the exporters way. Only the President can clear them. Individuals cannot produce the dollar from exports in good quantity.”
Obadina said the devaluation of the Naira was because of round tripping, that is when people cannot get dollar from bank they go to “Aboki”.
He noted that the marketing boards of each state would have to send marketing ambassadors overseas to acquire international purchase orders which would trigger the production of the local exportable items.
He said products that should be considered for export include cocoa, groundnuts, palm oil, solid minerals and more.
“The state marketing boards must within one to three years sell 51 per cent of its shares to Nigerians so that the marketing boards will not become another ministry.
“It should eventually be private sector driven. The state will, however, start with 10 per cent of their annual budget and stabilise the company first, then the public can buy its shares.
“I cannot forget to mention that our medical school products are exportable, we need to mass produce them.
“Out of every three doctors produced, two are willing to travel abroad. Nigeria should supervise their exportation and repatriation of home remittance to Nigeria,” he said.
Obadina advised that the dollar needed to be supplied in the right quantity.
He also advised Nigerians to keep hope alive as they begin to invest their resources on domestic farming, which would go a long way in addressing the challenge of food deficit.