The controversy as to whether to devalue the naira or not has taken the centre stage in the national discourse. One can pardon illiterates in economics especially primitive accumulators who are shouting for further devaluation of the naira.
But when some professors of Economics and Ex CBN Governor and IMF have joined the chorus to continue to devalue the naira, then, something serious is amiss. The single reason they all gave is because the rate of Naira in the paralleled market has worsened.
In the first place, Nigerians must know that the Dollar is not a legal tender in Nigeria. Only the Naira is our legal tender which facilitates the exchange of goods and services among Nigerian citizenry.
I beat my chest that my former students who are now professors of Economics who went through my courses on theories and strategies of Economic Development at Ife can never make the mistake of joining the neoclassical scholars on this fundamental issue which is central to the economic developments of Nigeria.
The history of nations that have developed shows that nations during their development process concentrated on the internal organization of productive sector and not the exchange of their national currencies against any foreign currencies. It was only during the gold standard that every country was legally compelled to relate their currencies to the value of gold which was like a legal tender in all countries.
But since it was discovered that the expansion of different economies was put in straitjacket by gold standard and so it was abandoned. Every country was allowed to have its national legal tender and therefore no compulsion or pressure to fix any national currency to any external currency. Thus when Japan embarked on its historic strategic economic development, the Japanese Yen was about 1,000 to the Dollar. Today it is 112.86 to the dollar.
It is the growing strength of the Japanese economy that has moved its currency to its present exchange rate level. Japan was not under pressure to devalue its currency, it ignored all external rates of the Yen and concentrated on increasing its productivity and productive capacity.
China also ignored any exchange rate, devised visible and invisible walls round its economy in complete autarky. The Yuan that was unknown some years ago is now gradually becoming international currency. In fact, most big countries that have attained meaningful economic development, used autarky or semi-closed economy as strategic device during their infant years on the race to accomplish fundamental economic development. What is important is development.
Countries which have developed models and strategies of economic Development have no time to be panicking about the exchange rate of their national currency to any other foreign currency. The concentration is on expanding the productivity and productive capacity of their country.
It is the primitive accumulators coupled with neoclassical esoteric scholars that want to derail President Buhari from concentrating on how to get Nigeria started on the path to fast-track the development of Nigeria.
Therefore, President Buhari is right for insisting that the Naira will not be officially devalued any further. It has been devalued twice or thrice from N150 to the dollar to its present official rate of N196 to the dollar. Despite this, the rate at the parallel or black market widens. It is above N300 to the dollar now. If the Government should start running after closing the gap between parallel markets, it will develop into run away rate and this will be a disaster because the naira will soon become an object of rejection.
The reason some people advance is because of round tripping by banks. It is a pity that President Buhari has not yet put radical economic revolutionary policies in place. Why must the CBN continue to distribute US Dollars monthly or weekly? Is that how Malaysia, Brazil, Ghana, South Africa, Hong Kong, Singapore, Turkey etc allocate Dollars weekly or monthly? It is this allocation that breeds corruption which destroys and distorts the productive apparatus of Nigeria economy.
As part of President Buhari’s economic policy, let a Commission be put in place with a mandate to diversify, increase the industrial capacity of Nigeria. A list of industries that can directly manifest the mission statement of the Commission be put in place. The dollar allocation should go to such industries and under the watchful eyes of the Security Agencies. Part of the dollar earned from oil should be used to boost our foreign reserve. Any other establishment that cannot operate within the confine of Nigeria development goals and targets can ship out.
Those industries that have large employment absorptive capacity, and or export orientation must be adequately catered for in the allocation of the dollar whose value to naira will be determined to deliver the political economy of Nigeria from the shackles of underdevelopment. The only vacuum in President Buhari policy is that he has not unfolded meaningful economic policy vision that can refocus the psyche of Nigerians to an inevitable future that is full of reaping the benefits of the sacrifice being made now.
Buhari cannot rule in a visionless vacuum. He needs economic vision which can get the citizenry to fast-track the development of Nigeria. National Conference cannot fix this for President Buhari. Economic Development is not costless, it has pains incorporated. But if the Government unfolds an Economic Policy that can make Nigeria know that soon, it will be comfort and happiness, Nigerians are willing to sacrifice.
Only the elitist primitive accumulators who have stolen Nigerian wealth in a big way can almost go to war because Nigerians are being asked to sacrifice. They are the enemies who inflict injuries on the common man. If President Buhari must be the Messiah as countries which have developed have their messiahs at critical period of their development, therefore President Buhari must engage knowledgeable Nigerians to draw up economic development programme.
The Budget is just a fiscal layout of revenue and expenditure of government. It is at best an exercise in infrastructural guide of the nation. What we are talking in Economic Development is an integrated holistic program of total mobilization of the citizenry and remodelling their psyche to diversify and increase the production and productivity of the entire citizenry. To achieve this, all the Nigerian economy must be organized on Systemic Models, sector by sector with different academies that will outreach all programmes into the entire citizenry.
Economic Development is not an esoteric theme of the neoclassical theory rather it is an empirical policy drawing and blending from similar historic and recent successful experiments. President Buhari must sit down and act fast so that detractors and scholars of neoclassical theory (which IMF represents) do not overwhelm him into permanent derailment. Because oil price dropped, therefore major source of dollar accumulation dropped and the value of naira to dollar inevitably dropped therefore some well-placed Nigerians shout that there is economic crisis.
But if there is shortage of water, cassava, yams, maize, there is no talk of economic crisis. The total foreign sector of Nigeria that must use Dollar as their Legal tender is not more than 15% (or less) of the Nigerian economy. It is in the interest of long run development of Nigeria to reduce the 15% for now until Nigerian Economy has grown the structures and capacity to export and compete in the World Market as Japan, China, India etc has done and as Britain did when it was trying to industrialize. It is not in the interest of Nigeria to leave gold standard and move to dollar standard.