The Federal Government, according to Senate Chief Whip Senator Ali Ndume, is profiting from the naira’s decline in value relative to the dollar.
Ndume was discussing the reasons behind the naira’s ongoing devaluation in relation to the dollar.
Ndume stated that the Federal Government is getting more revenue to support its 2024 budget, rather than losing out on the naira’s fall against the dollar.
In an interview with Channels Television on Wednesday, he made this claim.
The Chief Whip said that when the value of the dollar rose, the government would have more naira to spend on its expenses.
Ndume claims that the 2024 budget, which was revealed in November, is significantly dependent on dollars for revenue because the government receives a large amount of its money from the export of dollars-priced crude oil.
He also emphasized that crude oil, Nigeria’s principal export, is still in great demand abroad and that the country benefits from the current exchange rate between the dollar and the naira.
Remember that this budget is “dollarized,” particularly in terms of income, he stated. Furthermore, the payment terms are expressed in naira.
Because we are spending naira rather than dollars and receiving our earnings in dollars, if we receive our money in dollars and the value of the currency rises, we would have more naira available for expenditure.
“In actuality, the naira’s value in relation to the dollar has decreased, but we are still selling our main product, which brings in dollars. Therefore, each dollar we get today will also be priced according to the current exchange rate between dollars and naira.
Therefore, if you perform a thorough study, it can indicate that if you balance things out, we might have more money to cover our budget. Technically speaking, Nigeria is even profiting from the increase in the dollar to naira.
The country has been facing a chronic lack of foreign currency, which is linked to lower oil production and foreign inflows.
Before closing at N1,551/$ on Tuesday, the local currency saw intraday trading hit a high of 1,701/$ and a low of N1,100, according to data from FMDQ Securities, a platform that monitors forex trading in Nigeria.
Therefore, if you perform a thorough study, it can indicate that if you balance things out, we might have more money to cover our budget. Technically speaking, Nigeria is even profiting from the increase in the dollar to naira.
The country has been facing a chronic lack of foreign currency, which is linked to lower oil production and foreign inflows.
Before closing at N1,551/$ on Tuesday, the local currency saw intraday trading hit a high of 1,701/$ and a low of N1,100, according to data from FMDQ Securities, a platform that monitors forex trading in Nigeria.
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