Market News
NECA Applauds Fiscal, Monetary Authorities Broader Push To Stabilise Naira, Economic Framework. - INDEPENDENT
LAGOS – The Nigeria Employers’ Consultative Association (NECA), has commended the Federal Government’s recent $2.2 billion Eurobond issuance aims to finance the 2024 fiscal deficit, fund critical infrastructure projects, diversify funding sources to stabilisethe naira and strengthen the nation’s economy.
Mr. Adewale Oyerinde, NECA’s Director General, in chats with Daily Independent, stated that the combined efforts of the fiscal and monetary authorities reflect a broader push to stabilise Nigeria’s currency and economic framework.
According to Oyerinde, Nigeria’s financial landscape has seen significant developments with the Central Bank of Nigeria (CBN) introducing revised guidelines to enhance transparency and governance in the foreign exchange market.
These guidelines emphasise ethical practices, real-time reporting, and regulated interbank trading while mandating compliance from banks, dealers, and BDC operators.
“As a result of the combined efforts, the naira has appreciated steadily, supported by increased dollar inflows and the launch of the Electronic Foreign Exchange Matching System (EFEMS), which has boosted market confidence by facilitating transparent and efficient FX transactions.
“The recent appreciation in the Naira exchange rate, particularly in the last one week, standing at N1533.76/US$ on Friday December 6, 2024, which indicated an appreciation of over 8% is a welcome development.
“It is particularly welcomed by the private sector that is facing acute forex challenge for importation of raw-materials and machines that are not produced in the country presently”, he said.
The NECA’s Director General, specifically said: “While we recognised and appreciate the recent improvements, it is, however, difficult to definitively pin-point the reasons for the improvement except the recent $2.2 billion Eurobond loan secured by the Federal Government or the upsurge in diaspora remittances as a result of the festive season
“However, to sustain and improve the appreciation in the Naira value, which is what the private sector desires, we urged the Federal Government to strengthen existing measures to upscale crude oil production for export, entrench a better monetary and exchange rate management through judicious and productive allocation of available forex, promote non-oil export and further encourage domestic refining of crude oil by private individuals and of course, the Port Harcourt refinery to end importation of refined fuels, and improve Government patronage on made in Nigeria goods and services to lower Dollar movement outside the country”, he said.
He, however, recalled that data from FMDQ, total inflows into the Nigerian Autonomous Foreign Exchange Market (NAFEM) rose by 32.9% m/m to USD4.05 billion in November (October: USD3.04 billion).
“This was driven by a broad-based increase across local (57.8% of total transaction value) and foreign (42.2% of total transaction value) inflows as a result of the combined efforts initiated by both fiscal and monetary authoriesto stabilise Nigeria’s currency and economic framework”, he said.
