Two Economist knows as M. Amuchie and G. Otobor do not really see any advantage in the deal President Buhari was able to make with the China Leaders, They blame the current government administration for not being smart.
M. Amuchie and G. Otobor Writes
I don’t blame Chinese leaders for trying to scam us, I blame our leaders for not being smart enough. What do you expect when you have political hacks negotiating on behalf of Nigeria against smart professionals from China. I was thinking Nigeria political leaders will do research about Chinese lobbyists in Washington and understand the interest they are protecting before believing in the Chinese version of Trojan horse.
We are the only one that can help ourselves, let’s implement true federalism system and a free market. Development is a culture and not a product; we can’t buy it no matter how much money we have or borrow..
You must be living in a PARALLEL world if you think that Nigeria’s intention of being a clearing house for the Yuan in Africa means the naira will now hold steady.
If you like to tie your currency with Thailand Baht or Ghanaian Cedi, the value of your currency will always have the value it deserves.
Hong Kong, for instance, is an administrative region of China, but guess what, its currency is firmly tied to the US dollar!
The Yuan is not automatically going to be operating independently of the dollar to boost the naira in any way.
The only thing that has happened here is that the Yuan becomes an accepted currency of exchange to facilitate direct business with Chinese people. This will not in any way strengthen the naira, but the gains will be for the avoidance of double exchange from Dollar to Yuan.
The Yuan will swing with the wind depending on what happens to the world’s controlling currency, the dollar.
The naira will continue its natural slide as you produce and export very little and even your trade with China becomes very expensive as the world’s comparative exchange rate will not wait for the Naira/Yuan pretend marriage. The value of the naira will continue to be subject to the international exchange rate, which is controlled by and inextricably linked to (you guessed it?) the DOLLAR!
The silly idea that this arrangement could crash the dollar is only palatable to people living in a cocoon, in a cuckoo land (Nigeria), with an entirely warped sense of reality.
The real winners here are the Chinese who have found another place to ship their milling population to recolonise on the cheap.
Nigeria has taken the path of double parallel which will be unsustainable in the medium term as a consumer nation.
The naira will continue to fall unless you can sell more oil or start exporting something the rest of the world would pay you for.
My projection for the naira is 500 to $1 by year end if the oil price does not improve drastically and we sell oil, the only thing we ‘produce’.
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