THE newly-appointed Director-General of the Lagos Chamber of Commerce and Industry Chinyere Almona has said that Nigeria needs modern and workable policies that will boost financial inflows into the country.
In an interview with The ICIR Almona said the country needed consistent monetary policies that would instil confidence in investors to boost inflows.
“ We need to leverage the huge opportunities for investment in the balance sheet by repositioning viable businesses and government securities, making them appealing to attracting foreign capital and investment,” she said.
Almona noted that flexibility in FX management would allow naira exchange rate to adjust to equilibrium dynamically.
She said that measures that would spur confidence in the Nigerian economy would also boost foreign exchange supply and help the naira get its market value.
The DG further stated that there was a need for the diversification of the economy, allowing other sectors to be productive while incentivising export-oriented sectors.
“Nigeria also needs to diversify the sources of foreign earnings, adopt import substitution strategy and open up other sectors that have export potentials (such as health and tourism),” Almona advised.
She said whenever there was a free fall of the naira exchange rate at the parallel market segment, the CBN would always apply demand containment and/or price control measures as seen from the 43 items ban and quest to peg the exchange rate of the naira.
Naira exchanges at N411/$ in the official market and N570-N570 at the parallel market. Dollar supply to the economy has slowed owing to oil price and supply volatilities and low non-oil exports, experts say.
As a result, many manufacturers are struggling to get foreign exchange with which to import inputs.
The CBN has adopted demand management strategy, where it focuses on monitoring demand for dollars, rather than seeking ways of increasing the greenback.
Almona said tightening measures had always failed to stabilise the exchange rate in Nigeria but only redirected FX transactions to the underground arrangement, with unintended consequences of increased pressure on the exchange rate and creation of wide premium between the official and parallel market exchange rate.