The Nigerian Government has been adviced to utilise other currencies other than the dollar in its international trade transactions to save the economy from its reliance on the US dollar and ease the impact of a high exchange rate on the economy and the Nigerian people.
This advice was given by Professor AbdulGafar Ijaiya of the Economics Department, University of Ilorin, while speaking with Newsmen in Ilorin, Kwara State capital, North Central, Nigeria.
The Expert, while noting that the country can no longer blame the economic situation of the country on the exchange rate due to its over reliance on the US dollar, suggested that the country should bypass the US dollar since the majority of its international trade transactions are done with China and other Asian countries.
He said, “You cannot continue to blame the exchange rate, no, Nigeria has been turned into a US dollar economy, so, we’re at the mercy of the US Dollar and the question is, why continue to rely on the US dollar while more than 90% of what we import into this country come from the Asian countries.
“Since more than 70% of our imports come from China, why not bypass the US dollar, do we have to go through the dollar market before we change our money to Chinese Yuan before buying things from China?
“Now, some Muslims are preparing to go to Makkah, (on pilgrimage) the National Pilgrims Board has said Muslims should begin to pay part of the money as a down payment and a deadline has been given to pay almost Five million Naira. Can’t we bypass the US dollar and go straight to Saudi Riyal?”he queried.
Ijaiya maintained that Nigeria can take cue from other countries who are already doing this.
“Bypassing the US dollar is possible, other countries are doing it. During the Buhari administration, there was an arrangement for a currency swap with China but the political will and commitment to implement it was not there …
“The leadership of the country needs to have that strong political and independent mind to make decisions just like other countries have done in recent times.
“Just a month or two ago, Saudi Arabia and China had a bilateral currency swap agreement worth about $ 6 billion to bypass the US dollar. The United States could not do anything about it.
“When we were removing subsidies from petrol, Kenya did the same thing, there were demonstrations in Kenya and before you know it, the Kenyan President approached the Saudi Arabian Government to accept their Kenyan shillings for payment for petrol. That solves the problem of a hike in petroleum prices in Kenya.
“The newly formed international body called BRICS, -Brazil, Russia, India, China and South Africa – are now trading amongst themselves bypassing the US dollar; Egypt has joined as well as other African countries. Nigeria is yet to join BRICS. The last time members of this organisation met in South Africa, Nigeria, represented by our Vice President went there as an observer…”
The Economist recalled the use of counter trade (not different from barter trade) as a means of international trade transactions by the military administration of General Muhammadu Buhari and General Tunde Idiagbon, which bypassed the US dollar and set Nigeria on a path to prosperity.
“Unfortunately, the policy was abandoned by the succeeding administration of General Babangida, who went on to introduce the Structural Adjustment Programme (SAP). An IMF and World Bank programme with devaluation, privatisation of government enterprises and removal of oil subsidy as some of its conditions.
“That began the sojourn of our nation’s economic challenges, which to date we found difficult to get out of.”
Strengthen other sectors
The Offa-born Economist also stated that the country’s economy can be strengthened when the real sector which includes agriculture, mining and manufacturing are revived.
He also stressed the need to revive manufacturing industries in the country.
Ijaiya also advocated the need for State and local governments to oversee the mining sector, noting that the sector would perform better if it is not solely under the exclusive list of the Federal Government.
He added that every state in the country could cater for its needs with the natural resources they have if it had the power to control the resources in its States and create more industries.
“The mining industry, for instance, unfortunately, states, and local governments can’t access it, but why? In the 1960s, I was born and bred in a tin mining company in Jos, the regions then took charge of the mining sector…
“There is no state that doesn’t have enough mineral resources to curtail itself; for instance, the material used for making batteries (Lithium) has been in Kwara for ages but who is in charge? The Federal Government gives licenses to individuals to mine the minerals, but unfortunately, there is no industry to process the minerals, or even to turn the mineral resources into final goods. We have to take them outside the country for processing,”he said.
The Professor of Economics also called for improved security to help boost the agriculture sector.
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