Monday, May 30, 2016

Experts warn against round tripping with new forex policy

Some financial experts yesterday advised the Federal Government to ensure that the new flexible exchange rate regime would not encourage round tripping. They gave the advice in Lagos, while reacting to President Muhammad Buhari's Democracy Day speech. They said government should avoid a foreign exchange system that would encourage corruption and worsen the current foreign exchange situation.

BiA former President, Chartered Institute of Bankers of Nigeria, CIBN, Mr. Okechukwu Unegbu, said government should particularly check round tripping. Unegbu said government should tackle social dislocations to reduce unemployment, high inflation and the depressed economy to achieve the desired growth. He advised government to pursue economic diversification to strengthen other sectors of the economy in line with the current realities. Unegbu said government at all levels should embrace cost efficiency strategies, noting that business should no longer be as usual. According to him, state governors should look inwards to boost internally generated revenue and stop depending on federal allocations. Unegbu said ministers and members of the National Assembly should stop living as if nothing was wrong with the economy, but should face economic realities and cut costs. He expressed dissatisfaction with government's failure to tell Nigerians the amount of funds recovered so far and the names of the looters as promised.

Unegbu, a lawyer, said the president would have given more confidence to Nigerians and foreign investors with such pronouncements. An Associate Professor in Banking and Finance and Head of Finance Department, Nasarawa State University, Lafia, Prof. Uche Uwaleke, said that economic activities would likely recover with strict implementation of the 2016 budget and the flexible foreign exchange rate policy. Uwaleke said deregulation of the downstream sector, appreciation of crude oil price, the likely improvement in electricity supply and good business environment were things that would shape the economy. He said power failure, petrol scarcity and foreign exchange shortages impacted negatively on corporate performance, the stock market and the economy in general in the past one year. Uwaleke said delay in budget implementation affected investor confidence and the exit of foreign investors from the local capital market. Meanwhile, some residents of Oyo State yesterday gave the administ ration of President Muhammadu Buhari a pass mark in his first year in office. A civil servant in Oyo West Local Government Area, Alalade Ismail, said the administration had laid solid foundation for the future.

"So much challenges when the government assumed office, but it has been able to stabilise and lay solid foundation on many fronts. "I have no doubt that things will get better with time especially with this solid ground that has been laid by the government," he said. Seun Olokode, a business centre operator from Saki East, said "past administrations had done so much injustice to this country and it will take time to heal." A retired civil servant, Mrs Kahdijat Mikail, urged Nigerians to be patient with the new administration, adding that "it will take time to re-build what was destroyed for 16 years. "I have taken my time to study the present situation of things and compared with past governments, you will see that this is the best in recent years. "Looted funds are been recovered and things are being done in a very transparent way and manner, that is what we expect from a listening-government. "I'm convinced that the administration started well," she said. View Point[1]
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