The federal government is proposing that the Nigerian Maritime Administration and Safety Agency (NIMASA) and the Nigerian Port Authority (NPA) to begin collecting charges, fees, fines and others in Naira rather than in foreign currencies.
The Special Adviser to the President on Information and Strategy, Bayo Onanuga disclosed this during a briefing at the state house, Abuja where he noted that it is part of the economic stabilisation bill to be presented by the President to the National Assembly (NASS).
According to him, the proposal is part of effort from the federal government to prioritise the use of local currencies in Nigeria and reduce pressure on the foreign exchange market.
He stated, “the second one has to do with the operating laws guiding NIMASA and Nigerian Port Authority (NPA), the amendment under that in the economic stabilisation bills is that all their fees, charges, levies, fines and other monies accruing to them and payable to those agencies will now be paid in Naira at the applicable exchange rate.”
“Hitherto, those agencies were charging in Dollars but now collect it in Naira. This government wants to put a lot of emphasis on our national currency instead of everything being dollarised in our economy.”
What this means
The proposal reflects the federal government’s effort to decouple the Nigerian economy from the vagaries of the foreign exchange market vis-a-vis the exchange rate of the Naira to the USD. Such proposal will also reduce the demand for foreign exchange among players in that sector which will ease the pressures on the forex market in Nigeria.
- Similar initiatives to this proposal include the approval by the Federal Executive Council (FEC) to allow the Nigerian National Petroleum Company (NNPC) LTD sell crude oil to the Dangote refinery and other local refineries in the country in Naira rather than the USD- the currency for settling trade of international commodities like crude oil.
- The Naira has seen its worst volatility and depreciation in recent times in the past 14 months following the unification of the foreign exchange market and tacit devaluation. Following the unification of the forex market in June, the exchange stabilised at around N750/$ but closed the year 2023 at N907/$.
- In 2024 so far, the Naira has seen one of the wildest volatilities in recent times being the worst performing currency between February and March and reversing the situation to being the best performing currency in the world in April 2024. However, it has lost that steam and has been gradually depreciating to just around N1,600/$.
