Moghalu backs Tinubu’s FX policies, says stronger naira’ll discourage exports

The former Deputy Governor of the Central Bank of Nigeria (CBN), Kingsley Moghalu, says having a stronger currency would make exports expensive, which could affect competition between local and foreign products.

Moghalu, during an interview with Arise TV on Thursday, stated that the forex reform is one of a series of reforms that should be carried out in the Nigerian economy to avoid Nigerians bearing the brunt of the policies, while businesses profit from the government’s decisions.

“In fact, it is the beginning of a series of reforms that have to take place in the Nigerian economy. The forex reforms must also be accompanied by trade reforms, otherwise, it is just the people absorbing the shocks and the businesses getting the profits.

“We need to move to trade policies. How do we make Nigeria’s economy competitive, how can we make it productive, how can we then export value-added goods so that we attract foreign exchange,” he explained.

Moghalu also touched on the drive to ensure the naira is stronger than ever. He said there must be a balance, as a stronger naira could make Nigeria import dependent.

The former presidential aspirant advised that the government should engage in competitive devaluation like China does to make Nigeria’s economy productive.

“I also need to say that we have this fixation on having a strong naira. Having a strong naira when you are not a productive economy, all it does is that it makes you an import-dependent economy.

“China does this, so that their goods are cheaper for foreigners to buy, and therefore, they get more money into their country, rather than wanting their currency to be very strong,” Moghalu said.