IMF Persuades Nigeria to Speed Up Naira Exchange Rate Unification.
The International Monetary Fund (IMF), on Tuesday, April 28, 2020, approved the sum of $3.4 billion, as emergency financial support for Nigeria, as a result of the adverse effects of COVID-19.
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The emergency financial support, is meant for the Rapid Financing Instrument (RFI) programme, to help mitigate the impact of the coronavirus pandemic on the Nigerian economy.
From the highlights of the IMF statement, the Deputy Managing Director/Acting Chair of the Bretton Woods Institution, Mitsuhiro Furusawa, expressed special interest in getting Nigeria to work on the unification of the multiple exchange rates.
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In his words, the IMF Chief said, ‘’Steps taken towards a more unified and flexible exchange rate are also important and unification of the exchange rate should be expedited.’’
However, the Central Bank of Nigeria (CBN), pointed out that it operates multiple windows, rather than multiple exchange rates.
And due to the crash in crude oil prices globally and the gradual depletion of the country’s external reserve. CBN moved towards the unification of the exchange rate, following the correction of the rate for Bureau de Change operators from N360 per dollar to N380 per dollar.
Moreso, the investors and exporters window has been adjusted from N366 per dollar to about N380 per dollar.
The Economic Recovery and Growth Plan (ERGP) released by IMF had earlier acknowledged the adjustments made by CBN stressing that unifying the exchange rate will impact the economy more positively than the multiple exchange rates.
With the new adjustments, the uncertainties in the public and private sector decisions will be limited.