Finance Minister of Nigeria Blames Naira Dive on Overdue Payments

Nigeria’s finance minister Adebayo Olawale Edun said up to $6.8 billion of overdue forward payments in the foreign exchange market need to be addressed before the naira stabilizes.

The currency of Africa’s largest economy extended a months-long slide and hurtled toward the 1000-per-dollar mark in street trading on Thursday, as the central bank held back from supplying dollars to a panic-stricken market.

Read more: Naira Plunges Toward 1,000 on Street Amid ‘Stampede’ for Dollars

Edun, who was named to his role last month, said resolving the overdue contracts would allow the naira to strengthen and “pave the way for additional foreign exchange flows.

“The issue we have now is that the market is not liquid enough,” Edun saif in an interview in New York. “We are committed to encouraging liquidity based on reforms that have been made at the moment, on the fiscal side and the monetary side. And together with the restoration of trust and confidence we think the FX flows will return.”

Nigeria’s central bank on Thursday postponed a rate-setting meeting scheduled for Sept 25-26. Its new governor, former Citigroup executive Olayemi Cardoso, is yet to be confirmed in his role, while the acting governor and four deputy governors have resigned, effectively leaving a policy-making vacuum at the top.

The central bank has mostly been on the sidelines this month, according to market players, with one person saying it has barely supplied dollars to the official window. That has helped accelerate the naira’s slide, pushing it down from around 900 per dollar at the start of September.

Shrinking dollar supply from the central bank is forcing buyers onto the streets for hard currency. Inflation in Africa’s biggest economy is also at the highest in more than 18 years, prompting economists to predict that the central bank would raise interest rates again at its next meeting, which for now has been deferred to an unknown future date.

“The commitment is to maintain the existing reforms and improving them. Improving the FX market further so the gap narrows,” the finance minister said. “Looking at all options for boosting supply so the one-way bet of speculators that we are seeing at the moment is reversed.”

By Henry Meyer and Ezra Fieser, Reuters

Video - Saving history of Nigeria through the News

Newspapers that once delivered news big and small are invaluable windows into our past. They risk being lost forever if not properly preserved and archived. Meenakshi Ravi reports on a project in Nigeria started by journalist Fu’ad Lawal - to rescue old newspapers from dust and decay and digitise decades worth of the country’s front pages in a freely accessible online archive. 

Al Jazeera

Video - President Tinubu Address At The 78th Session Of The UN General Assembly

Bola Ahmed Tinubu, President of the Federal Republic of Nigeria, addresses the general debate of the 78th Session of the General Assembly of the United Nations (New York, 19 - 26 September 2023). 

The UN General Assembly (UNGA) is the main policy-making organ of the Organization. Comprising all Member States, it provides a unique forum for multilateral discussion of the full spectrum of international issues covered by the Charter of the United Nations. 

Each of the 193 Member States of the United Nations has an equal vote. The United Nations is an international organization founded in 1945. Currently made up of 193 Member States, the UN and its work are guided by the purposes and principles contained in its founding Charter. 

The UN has evolved over the years to keep pace with a rapidly changing world. But one thing has stayed the same: it remains the one place on Earth where all the world’s nations can gather together, discuss common problems, and find shared solutions that benefit all of humanity.

Naira falls to a record 980 on black market

Nigeria's naira fell to a record low on the black market on Wednesday, driven mostly by speculative demand as individuals turn to the dollar as a store of value, traders said.

The unit was quoted at 980 naira to the U.S. dollar on abokiFx, a firm that publishes online black market exchange rates for the currency, compared with 965 on Tuesday.

The naira was quoted at 773.50 on the official market at 1349 GMT, swinging between a range of 738 naira and 789 naira this month.

"The current free fall of the naira is mostly driven from speculation as the black market premium has reached 23.3%," one trader said.

"The pressure also shows that liquidity in the official market is unable to support about $400 million petroleum importers need monthly to import refined fuels, given their 70% control of the market," he said.

The currency of Africa's largest economy has been weakening on the black market due to speculative activities and as excess demand is funnelled to the informal market, widening the gap with the official market, where restrictions on trading the currency was lifted in June.

One of the key challenges for newly nominated central bank governor Olayemi Cardoso will be to boost dollar liquidity to help stabilize the currency. 

By Elisha Bala-Gbogbo, Reuters

Kano state declares curfew after election tribunal sacks governor

Nigeria's northern Kano state declared a 24-hour curfew on Wednesday after a tribunal overturned the election of an opposition candidate as governor and declared a member of President Bola Tinubu's party the rightful winner.

Police in Kano, which has the highest number of registered voters, said in a statement that violators of the curfew "will be arrested and made to face the full wrath of the law."

Ahead of the election tribunal ruling, security forces occupied major roads in the capital of Kano, which shares the same name.

Governors wield wide influence in Nigeria, presiding over budgets bigger than some small African countries and their support often influences who becomes president.

Wednesday's ruling by a panel of five judges had sparked fears of unrest in the largely Muslim state.

The March gubernatorial vote had seen Abba Yusuf of the New Nigerian Peoples Party, a regional party, defeating ruling All Progressives Congress party candidate Nasiru Gawuna, who alleged fraud.

Yusuf can appeal the tribunal decision at the Supreme Court.

It is not unusual for governorship election results to be overturned in Nigeria, which has 36 states that are presided over by state governments.

By Hamza Ibrahim, Reuters