The Nigerian Economic Summit Group (NESG) has advised the Central Bank of Nigeria (CBN) to address the multiple exchange rate regime in the country’s forex management, to improve the inflow of foreign investments and diaspora remittances.
The group said this was important as international investors are unlikely to put their money where there are real risks to their ability to access and repatriate investment proceeds or when the functional currency was in a sporadic depreciation.
“Multiple foreign exchange (FX) markets with significant price differentials create room for speculation, round-tripping, cronyism, and outright graft – with an attendant adverse effect on the economy. There is no better time to harmonise the FX rates than now,” NESG counselled.
In a communiqué from a meeting of its board of directors held on July 26, 2022, the NESG said that Nigeria must take decisive action to tackle the government’s revenue challenges which could not be separated from leakages through the large-scale crude oil theft, difficult operating environment for businesses, and lack of innovation in tax collection/administration, among others.
“We strongly believe these leakages have continued unabated because of the absence of sanctions and ineffective tax systems.”