The strategic management of the naira exchange rate by the country’s financial experts and managers of the economy at this point in Nigeria’s history, to attain stability, could be the required joker to positively turn the economy around, by encouraging massive exports of non-oil goods; and attracting the much needed foreign direct investments (FDI). This will not only help raise the country’s gross domestic product (GDP) through high productivity performances within the economy, it shall directly favour an import substitution policy, once the real sector is injected with fresh entrants in the local production of consumer items that are most frequently sought after, and also the “cost-centres” of Nigeria’s foreign exchange demands. Applying this strategy would reduce the pressure on foreign currency needs and demands and, of course, ease the stress that often piles up against the naira.
With the attractive large market that Nigeria is, and the economic strength of Nigerian consumers (based on their huge aggregate disposable income indices) and their large cumulative expenditure profiles, it would be advisable for the government, through the instrumentality of the existing investment promotion organs (both at federal and state levels), to initiate an aggressive campaign; where private sector operators or the indigenous global merchants are persuaded to market their foreign business partners to come in and open production bases. With very irresistible minimal investment capital that will be brought into the country at such a very low naira exchange rate, they will also enjoy cheap labour cost for production at the same time. The attractive export trade assurance, which the weak exchange rate of the local currency competitively offers against expensive exports from economies with stronger currencies, stands as an advantage. This innovative strategy (if insecurity can be effectively checked) will not only reduce unemployment within the economy; it shall greatly improve the volume of the disposable incomes of the working class within the economy. It shall, also, ultimately reduce crime rate among unemployed youths, as well improve the standard of living of all employable adults within the economy.
The African Continental Free Trade initiative, AfCFTA, is a trade scheme that the 54 African economies are poised to effectively utilise as a trade tool in checkmating the excesses of neocolonialism within the continent. The continent, being the power-house of natural resources that are carted away in their raw forms for pittance and at almost meaningless revenue generated values by the developed world, would have a chance to be recreated through value addition by indigenous manufacturers, before being exported as finished goods to other continents. Such innovative schemes under the integrated market for trade in goods and services (including movement of capital and people within the continent), will conserve enormous wealth within the continent. A successfully unleashed continental free trade scheme (with a combined GDP estimated at $3.4 trillion) will definitely check imperialist exploitations. For Nigeria alone, numerous businesses would be provided the opportunities to access a wider market, to increase their export competitiveness and profitability, leveraging and taking the advantage of the low naira exchange rate to penetrate external market frontiers. The AfCFTA initiative, no doubt, will tremendously beef up the volume of the continent’s international trade performances globally. It shall also create and conserve wealth to the benefits of African countries. Its challenges, particularly in Nigeria, at the same time, should not be ignored – like the absence of deliberate and timely incentive offers, and also, the regulatory bottlenecks within the economy.
The Aba electricity plant, an independent power project that will produce 188 megawatts, built by Geometrics Power, that is pioneering in the power sector, to light up the economy with uninterrupted power supply for home consumption and, more importantly, for manufacturers, is a great testimony as it is the first independent Power transmission station in Nigeria. Energy deficiency is actually one major impediment that slows down economic growth because, without productivity there would be no chance for any meaningful economic prosperity. Geometrics Power has skillfully demonstrated a very good example of the key economic drivers needed to unlock the growth potentials and economic opportunities through application of the right infrastructure that drives the economy to enviable heights with a brighter future for the country. Professor Bath Nnaji, who proclaimed that dead businesses will come alive again, has done well by showing the way (as an indigenous private sector driven power solutions provider) the country needs to go to economic stardom. A company from Taiwan, the manufacturers of Maxxis tyres, has already come to Aba to open shop, and has signed a deal with the Abia State governor, to establish Africa’s biggest tyre factory there. This is the kind of template (for a backward integration strategy) and the good news that the economy needs in this time the economy is passing through hard times.
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