Exchange rate: Prof Segun Ajibola, former President of the Chartered Institute of Bankers of Nigeria, has stated that the naira is still strong in the Nigerian economy, adding that an average Nigerian can still feed with N500.
The Babcock University Professor of Economics stated this when he featured on NTA’s “Good Morning Nigeria” breakfast show on Wednesday, which The PUNCH monitored.
“The national currency is a reflection of the state of any economy,” Ajibola stated. It encapsulates the economy’s strengths and weaknesses.
“We have seen a decline in the value of our national currency over the years. In the 1970s and 1980s, almost two dollars were equal to one Nigerian Naira (N1); today, it is more than N500 (per dollar).”
Despite the downward trend, he stated, “our naira is still very strong locally.” An average Nigerian can still feed himself or herself with N500 today, but in terms of a dollar or pound sterling equivalent, you cannot do anything with one pound on the streets of London, and you cannot buy anything meaningful with one dollar on the streets of New York.
“As a result, there is (a) disconnect between what the true value of our naira commands in Nigeria and what it commands elsewhere.
“In economic parlance, we speak of purchasing power parity, or what the real value of the currency is in comparison to the value of currencies outside that jurisdiction. We discover that our local currency, the naira, can still command some value within the country, but we have a problem outside the country”, he said.
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