By Benjamin Umuteme
Abuja with agencies
The President, Association of Bureau De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe fears the stability of the naira is under threat as 2019 general elections draws closer.
Gwadabe, noted that the propensity of politicians to hoard dollars and spend during political campaigns, was not new to the nation’s political history.
According to him, “Political spending may affect exchange rate stability in 2018. Electioneering starts early this time and the tendency for people to hoard the dollar now, to be spent during the campaigns, is not new.”
Gwadabe called on the regulatory authorities and security operatives to ensure that currency hoarders and speculators do not leverage on the 2019 elections to erode the gains recorded in the nation’s foreign exchange market.
The ABCON president noted that the Central Bank of Nigeria (CBN) had spent about eight billion dollars in a series of interventions at the FOREX market, leading to the flattening of rates across board.
He assured that BDC operators, as critical stakeholders in the FOREX market, are committed to playing by the rules in ensuring that the Naira remained stable. Since February, when the Naira exchanged at N520 to the dollar, the CBN had intervened aggressively to ensure it remained stable at about N360 to the dollar.
Efforts by the CBN and critical stakeholders like the BDCs led to the convergence of rates between the parallel market and the BDC segment.
IMF pushes for more reforms globally
Head of International Monetary Fund (IMF), Christine Lagarde has urged France and other countries to push through reforms “while the sun is shining” on the global economy.
According to Lagarde said the strength of the global economic recovery had taken the IMF by surprise.
In 2017, for the first time in a long time, we revised our growth forecasts upwards whereas previously we used to lower them,” she said.
Global growth of 3.6 percent was both “stronger and more widely shared” in 2017, she said, noting that developed economies were now growing again under their own steam and no longer merely being pulled along by demand in emerging markets.
Lagarde said the favourable climate lent itself to implementing reforms.
“When the sun is shining you should take advantage to fix the roof,” she said, using one of her favourite maxims.
This year’s global growth is on a par with the average of the two decades leading up to the global financial crisis of 2007-2008.
The IMF has forecast a further slight improvement in 2018, to 3.7 percent.
In Lagarde’s native France, seen for years as one of Europe’s weak links, the recovery kicked in in earnest this year.
From 1.1 percent in 2016, growth is expected to rise to 1.9 percent in 2017 — still short of the 2.4 percent forecast for the eurozone as a whole but better than the 1.6 percent initially forecast in the eurozone’s second-largest economy.
Lagarde said the changes were key to boosting France’s credibility at a time when Macron is pushing for reforms at the European level, including closer integration among eurozone members.
Lagarde was France’s finance minister in 2008, when the euro looked to be in serious jeopardy, nearly 10 years later, the currency is out of the woods.
But, Lagarde warned, “the mission has not been accomplished — and maybe never will — because Europe is not united on moving towards greater integration while maintaining national sovereignty.”
