CBN Gives Details on What To Do To Benefit From Weak Naira
- CBN has encouraged businesses to look at export opportunities by utilizing the weak naira
- According to CBN, Nigeria's competitive exchange rate can drive export-led growth.
- It added that a weakened naira makes Nigerian goods more accessible and appealing internationally
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The Central Bank of Nigeria (CBN) has urged companies to investigate export prospects by taking advantage of the weak naira.
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At the 11th National Economic Outlook: Implications for Businesses in Nigeria 2025, which was hosted by the Lagos State-based Chartered Institute of Bankers of Nigeria Centre for Financial Studies, the CBN made this announcement.
“The unification of exchange rates, coupled with a focus on exchange rate stability, presents transformative opportunities for businesses,” Muhammad Abdullahi, deputy governor, economic policy at CBN, said while highlighting the benefits of a weakened naira for businesses.
“Drawing from China’s economic strategy, Nigeria’s competitive exchange rate can drive export-led growth.
“While a depreciated naira may increase import costs, it makes Nigerian goods more affordable and attractive globally,” he said.
“To harness this potential, businesses should adopt export-oriented strategies by targeting sectors with strong export potential such as agriculture, manufacturing and creative industries; implement import-substitution models by strengthening domestic production capabilities and reducing reliance on costly imports; and focus on value addition by shifting from exporting raw materials to processed goods, thereby boosting foreign exchange earnings.”
He also discuss the unrealized potential in Nigeria's growing creative industry, which includes digital exports, crafts, music, and movies, BusinessDay reported.
“This sector holds immense potential. Businesses should explore international markets, digital platforms, and global tours to increase revenue,” he said.
He pointed out that the agriculture industry is well-positioned for expansion due to continuous reforms, falling inflation, and better financing.
“Emphasising processed agricultural exports can significantly enhance foreign exchange earnings. Similarly, the fintech sector, supported by rising mobile money adoption and financial inclusion initiatives, will continue to drive economic development.”
Pius Olanrewaju, president/chairman of Council at CIBN, during his opening remark reflected on the state of the economy in 2024, describing it as a year marked by significant challenges and opportunities.
The value of Nigerian currency depreciated further against the US dollar in the foreign exchange markets. New data from FMDQ securities showed that at the close of business on Tuesday, January 21, the naira exchange rate to the dollar shrunk to N1,552.78/$1.
Tuesday's rate represents a 0.18% or N2.73 drop in value compared to Monday’s closing price of N1,550.05/1.
It was a similar outcome for the naira against the dollar in the unofficial market, also known as the black market.
CBN Highlights Top Non-Oil Exporters
Legit.ng reported that the Central Bank of Nigeria reported that the top non-oil exporters in October 2024 were Dangote Fertilizer Ltd. and Indorama Eleme Fertilizer & Chemical Ltd.
Its most recent monthly economic report, which gives a summary of the Nigerian economy, revealed this.
To increase its revenue base, The Punch reported that Nigeria has been working to increase its non-oil exports. `
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Source: Legit.ng
