The Chief Executive Officer of Cedrus Group, Olubusayo Adeniyi, said the reforms and policies of the Central Bank of Nigeria (CBN) would start yielding results from next quarter .
Speaking in a press conference in Lagos at the weekend, Cedrus CEO said the apex bank was working to ensure that some of the loopholes in the financial sector were blocked.
“The issue is that we are not being patient enough in Nigeria. We want to see results immediately but it doesn’t work like that. Many of the reforms rolled out by the CBN in 2023 will start to yield results in the two to three months or the second quarter,” he said.
According to the investment banker, some of the agents in the financial sector were exploiting these loopholes, the major reason of the continued depreciation of the value of naira.
To stabilise the volatile exchange rate, the apex bank in a recent circular ordered deposit money banks to sell their excess net open position (NOP) FX effective February 1.
The financial regulator believes some commercial banks hold long-term foreign exchange positions to enable them to profit from the volatile movement of exchange rates. Adeniyi expressed optimism that naira would regain value in the coming weeks as the CBN continues to block loopholes.
“What is causing the rise in the exchange rate is that certain people are taking advantage of the exposure of the government. That is why the CBN is charged with the responsibility of rolling out reforms and policies that will reduce that and that’s what we are seeing on banks.
“And in a couple of weeks, we will start seeing the capacity of the naira coming out and truly is not driven by economic forces. It is not a situation that calls for panicking. People should just do their business and those who have nothing to do with the forex should leave the dollar,” he said.
The chief executive explained that the major problem was not scarcity of forex but the challenge of kow production across all s sectors of the economy.
“Our focus should be on economic drivers. Production is the driver of every economy, when we’re not producing and we are consuming definitely will be on the other side. So, the capacity of our production is what we should focus on. And that’s what I did, I should think about what to walk daily.
“If we have more production, there will be more supply and there will be exports. And then if we have exports it will boost our external reserves and our local currency will rebound,” he said.
Source: The Guardian