Home News Emefiele explains why the CBN is unable to float the exchange rate.

Emefiele explains why the CBN is unable to float the exchange rate.

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Despite guidance from the World Bank and other global financial institutions, Nigeria’s Central Bank Governor, Godwin Emefiele, declared on Saturday that the country can’t afford to run a floating currency rate system.
This was revealed by the CBN Governor during his speech at the IMF/World Bank Spring Meetings in Washington, DC.

This was expressed by Emefiele in response to World Bank Group President David Malpass’s plea for Nigeria to adhere to a single currency rate policy.

According to the CBN Governor, different countries confront distinct economic challenges and will approach them in different ways.

“, he explained.

“Both the IMF and the World Bank are our primary development banks, and they have aided us in the past in resolving some of our economic problems, particularly those involving finance.”

“Nigeria’s position is unique, which is why we’ve continued to work with the IMF and World Bank to demonstrate that we understand our country’s challenges.”

“Yes, they want us to freely float the exchange rate, and you do realize that this will have an influence on the exchange rate itself, in the sense that if you allow that to happen, the country’s exchange rate will spiral out of control.”

In his remarks, Emefiele explained why there is a strong demand for forex on particular items, which have sucked up a large portion of Nigeria’s foreign money.

He said that this influenced the Federal Government’s decision to halt FX access for rice, wheat, and other consumer goods imports.

He went on to say,

“Through some of the measures that we have put in place to deepen the production of commodities in Nigeria, we are doing all necessary to reorganize the economy’s base.”

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