Naira: Why FG Must Ban All Goods With Local Substitute -NASS

Amid frequent falls in the Naira, the House of Representatives committee on finance, loans, and debt management has recommended that the FG ban all goods with local substitutes from importation.

The house gave the recommendation while considering a report on the 2024–2026 medium-term expenditure framework and fiscal strategy paper (MTEF/FSP).

Ban All Goods with Local Substitutes from Importation

Recall that the Naira fell against the US Dollar ($) on Tuesday and Wednesday at both the official and parallel markets.

According to the data from the Nigerian Autonomous Foreign Exchange Fixing (NAFEX), the country’s official exchange rate window, the Naira fell from N750.14 on Monday to N830.97 and N840.53 on Tuesday and Wednesday.

Also, on the parallel market, the Naira depreciates from N1,140 on Monday to N1,145 and N1,160 on Tuesday and Wednesday.

To this end, the lawmakers said that despite the unification of the foreign exchange market, there is still pressure on the naira.

This, the house said, is “due to the lack of a stable foreign reserve as a result of the lack of exports of locally produced goods”.

The lawmakers, therefore, recommended that “all items locally produced should be outrightly banned from importation and customs tariffs amended accordingly.”

Supporting the reps call, an exporter, Ikechi Okonkwo, disclosed that the fall in Naira was a result of over-reliance on importation.

He, however, called for diversification of the economy, saying the refinery must also begin refining petroleum products if we want to stem the fall in the Naira.

“The rise in the dollar rate is telling on Nigerians because the Nigerian economy is import-based. As you may know, we practically import almost everything, including toothpicks, and as such, any time the dollar rises against the Naira, the effect is immediately noticed, as we can see on the prices of petroleum, rice, and other essential commodities.

“President Tinubu’s economic team should initiate policies that could lead to the diversification of the economy from oil. It is sad that after 60 years of independence, Nigeria fell from an agro-based economy to a nation that could barely feed its citizens.

“It is also appalling that, despite the fact that the country falls among the leading petroleum-producing nations in Africa, it can’t boast of any functional refinery. All these obstacles must be overturned if we are to truly become the giant of Africa,” Okonkwo said.

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