- Femi Falana criticizes floating naira, blames IMF, World Bank prescriptions, fuel subsidy removal for harsh economic conditions, calls for change
- Falana suggests CBN responsible for exchange rate, urges naira trading with China to alleviate pressure on dollar demand
Femi Falana (SAN), a human rights lawyer, has maintained that it is wrong for the federal government to allow the international market to determine the country’s exchange rate through the Central Bank of Nigeria (CBN).
Experts have criticized President Bola Tinubu’s decision to float the naira, which caused it to fall from 462 to a dollar to 920, as Nigeria’s economy remains unproductive.
According to Falana, exposing the currency to market forces and the prescriptions of the International Monetary Fund (IMF) and the World Bank, as well as the removal of fuel subsidies, have all contributed significantly to Nigerians’ harsh economic situation.
Falana told the gathering of lawyers at the 2023 Annual General Conference of the Nigerian Bar Association (NBA) on Monday in Abuja that the CBN is solely responsible for determining the exchange rate.
Section 16 of the CBN Act gives no room for market forces to fix the exchange rate, he said.
Falana also urged the government to begin trading in naira with countries such as the People’s Republic of China as part of efforts to improve the country’s dire economic situation.
He argued that if the approximately $22 billion import from China is transacted in naira, the high demand for dollars, which is putting pressure on Nigeria’s economy, would be reduced, if not eliminated.
Falana had requested that the CBN disclose the details of the currency swap agreement through a FOI request.
In response to Falana’s request, the apex bank stated that the swap agreement, which began in July 2018, is renewable every three years, and that it was renewed after it expired in April 2021.
The CBN stated that the “amount usable within the year” was 15 billion Chinese yuan renminbi (CNY).