NAIRA DEPRECIATION: EXPERTS WARN THAT TINUBU MUST DEAL WITH FOREX GUIDELINES VIOLATORS

In an interview with reporters, the expert made this claim and stressed that the government needed to provide new regulations, rules, and changes for the country's foreign exchange market right away.

President Bola Tinubu has been encouraged by capital market executive Samuel Showunmi to confront the depreciation of the naira and take firm action against those who violate the foreign exchange policy guidelines and framework.

In an interview with reporters, the expert made this claim and stressed that the government needed to provide new regulations, rules, and changes for the country's foreign exchange market right away.

According to Showunmi, an executive at Iron Global Markets Limited, a division of Iron Capital, an investment banking firm with a focus on Africa and offices in London, there should be both immediate and long-term fixes for the naira's decline.

“What we have to realize is that political will is required, and the President must make a stand,” he stated. The value of the local currency is affected by everyone's actions and inactions. For those of us in the private sector who placed a great deal of faith in imported goods, we are also contributing to the devaluation of the local currency. Every Nigerian who doesn't buy from local producers is encouraging poverty by devaluing local currency and forcing the impoverished masses to make do with less since the continued gap between the naira and other currencies would only make things worse.

There aren't any easy or fast fixes. The actions need to be a combination of several policies and methods. The Central Bank of Nigeria (CBN) is working on a new regulatory framework for the FX market, and I know that the government must swiftly release an FX reforms policy. However, I would want to caution against overly delaying as this can be problematic.

As there are currently no FX regulatory guidelines in place, people are essentially enforcing their own rules and acting anyway they choose. anyway, if regulations are implemented, people will be aware of the dos and don'ts when it comes to their market-related actions. CBN will also begin doing its monitoring, enforcement, and surveillance.

CBN has announced in the past few weeks that it is relocating several of its important departments to Lagos. It's a calculated move, and market participants should be aware of it, in my opinion, as it indicates that CBN is attempting to get closer to the market and that reforms and guidelines will likely follow shortly. Once the guidelines are released, CBN will be closer to the market, and monitoring and surveillance will follow, followed by enforcement.

That's a wise move, but let me suggest that we move quickly to complete the regulatory framework. It should be released on schedule, particularly now that they have relocated to the theater of operations and are making excellent efforts to organize things. This indicates that CBN is ready and knows what to do, which will help to short-term solve some of the problems we are now facing, according to Showunmi.