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Popular Nigerian presidential election candidate of the country’s labour party, Peter Obi, said that the local currency’s exchange rate against the dollar must not be fixed but must be determined “by the forces of demand and supply.” Pointing to the success of the Nigerian fintech Flutterwave, the candidate said if elected, his government will create an enabling environment for other startups to similarly thrive and succeed.

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Mr Peter Obi stated that the local currency’s official exchange rate currently pegged at just under N450 for every dollar must be determined by market forces. Obi, who is one of three main candidates who are seeking to replace outgoing President Muhammadu Buhari, also attacked the two-tier exchange rate regime currently in use.

The commentary from the Labour Party candidate come just over a month after the naira fall to its worst exchange rate ever against the US dollar. As reported by News in late July, the naira had reached an all-time low of N710 for every dollar. In response to the naira’s then quick-fire depreciation, the Central Bank of Nigeria (CBN), which last devalued the naira in May 2021, blamed speculators.

Posted in a tweet thread, which outlined his plans for the country should he win the presidency, Obi suggested a solution that he said can end the naira’s woes. He explained:

“The truth is that for long market forces have not determined the exchange rate of the naira. The two-tier foreign exchange regime is a fluke. It has to end. Let the exchange rate be determined by the forces of demand and supply. It is that simple.”

Aside the suggestion of abandoning the fixed exchange system, the Labour Party candidate said when elected his government will not fight inflation using price and wage controls. Instead, it will “pursue a contractionary monetary policy.”

Meanwhile, in the same thread, Obi also touted the Nigerian fintech startup Flutterwave, which has since become a billion-dollar company. To ensure that more startups similarly succeed, Obi said his government “will create an enabling environment for our startups to thrive.” This will be done by enforcing a legal framework that protects both “foreign investors and their indigenous partners.”

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