They say that the human species is so self absorbed that when trouble arises to an individual being, he/she points their ten fingers at everyone else but themselves. This is the same thing that a lot of people have struggled with in the face of Nigeria’s depreciating currency value and its failing economy.
Like every patriotic Nigerian now living out West, I can attest and band with my brothers and sisters all over the globe that the problems of our country, no matter where we go always affect us the most. Perhaps it’s because we are looking from the outside, or perhaps it’s because of guilt from leaving. Nonetheless, we feel and this is why I need to write about the hot topic of Nigeria right now; our currency. By no means am I an expert, but from the outside looking in, there are a few things to blame.
First, please note that it is because I now live in North America, that this article will reference a lot of USD and CAD, but Nigeria’s currency in relation to others is just as affected.
I want to travel back in time for a minute, to a period in the 70s and early 80s when Nigeria’s currency, naira, exchanged at something around 90 kobo to $1. Oh those where the times, when our schools had prominence abroad, our football clubs were prestigious, our resources were booming with cash returns, our foreign reserves were high, our textile industry was growing, we had several car assembly plants, our refineries were functional, and in fact our country’s natural wonders (i.e. Yankari games reserve, Obudu Cattle ranch, Ikogosi Springs, Mambilla Platueau etc) attracted major tourism.
Of course, everything you could expect happened to make this turn for the worst, and I want to start with a foreign cultural influence and shift. First, Nigerians have this saying “monkey see; monkey do”. Maybe it’s not just Nigerians but nonetheless, the influx of tourists and foreigners to the country came with a yearn to own what they had; the light coloured skin, the designer bags, the advanced tools, the gadgets, …and everything else you could possibly think of that we didn’t have, we wanted. This desire led to the importation boom, and now our current president, Muhammadu Buhari has since mentioned in a recent interview that Nigeria now imports everything we have including toothpicks. A lot of people will argue this importation boom was a strategy implemented to maintain a strong currency abroad and others have argued and asked, why the need to import anything? We have the man power and resources to grow and produce everything right in our own backyard.
But you can’t blame the country’s economy solely on its people but also on the leaders elected to direct the ship. I previously mentioned that back in the days, Naira exchanged very well to a dollar but by 1993, something happened and this is the period a lot of Economists have referenced as the time Naira began its erratic journey towards depreciation against other currencies. Apart from this, everyone can agree that Nigeria’s economy is completely fragile and weak because it operates on a one commodity based economy, which is oil. So when oil prices drop, the country lands in trouble.
I read a great article by Feyi Fawenhimi titled, A (not so) brief history of the fall and fall of the Nigerian naira in Quartz Africa, he writes, “Nigeria has never quite figured out how to spend oil money. When prices are high, you save as much as you can. When prices fall, you open the tap and increase your spending. The point of this is to keep things going and avoid wild shocks in the economy. What Nigeria does instead is to increase spending once oil prices go up ….so, Nigeria is never ready when oil prices drop. And yet oil prices dropping is as sure to happen as night following day”. This is the perfect description of the lethargic and procrastinative nature of the leaders and bureaucrats that run the country in a system of spending too much when the going gets great and running for shelter when the going gets rough.
It is also the result of the falling of oil prices that has now led to the higher drop in revenue available to the country, and since our foreign reserves aren’t that great, this is a dangerous time for the Nation’s economy and currency. In my opinion, the politicians, business community, and bureaucrats will always say they are trying and doing their best for the country, but what can we as Nigerians do?
First we know that the country exports crude oil to developed Nations, who refines the oil and Nigeria in turn buys back the refined oil for local consumption. This backwardness when we have three major oil refineries in Kaduna, Port Harcourt and Warri is appalling. What can young engineers do? – Offer sustainable and rehabilitative solutions to the government to re-power and restart these oil refineries to avoid the extra cost we spend on buying back refined oil we exported out in the first place.
Then, we continue to implore for diversification of the economy, why do we need to import rice when we can grow it here? This type of question gets asked a lot by other Nigerians too especially politicians as if asking the question alone will provide a solution. But the truth is, what happened to our farmers and agriculture? What happened to funding education, research and development? What about reinstating our textile industries? Funding and sponsoring our soccer clubs (i.e. the Nigerian Enyimba International F.C.)? and many others. All these will no doubt help enrich our economy.
Some economists have also mentioned that withdrawing naira from war chests, increasing foreign reserves and liquefying financial and banking markets should help the Nation temporary but I believe that this is not the panacea to a healthy and sustainable currency & economy, we need better strategies to help boost the economy.
As a people, no matter how absurd, erratic and unpredictable both our currency and economy may appear, I believe we can agree that if the leaders choose not to control the economy at a macro level what we can do at a micro level is go back to the country with the right skills and knowledge we’ve acquired abroad, support schools in Nigeria, invest in the youth of Nigeria by partnering up and building a strong network of intellectual community, and once and for all, appreciate being Nigerian, no matter how chaotic the country may seem and offer the best resources we can.
Ultimately, let’s begin to peel back those ten fingers and point them at ourselves, and finally wake up from our limbo because the future is near, and we need a healthy Nigeria in it.