World Bank has advised President Muhammadu Buhari to unify Nigeria’s exchange rates. This, he said would significantly improve the business-enabling environment of the country, amongst others.
In a statement cited by BizWatch Nigeria, the President of World Bank, David Malpass said aside from the fact that business operators in Nigeria would stop to function under unfavourable conditions, unified exchange rates would attract foreign direct investment into the country, and at the same time, reduce her inflation.
“President Malpass emphasized the importance of integrating climate and development, as well as the need for an enabling policy and regulatory environment alongside strengthened institutions in the energy sector’’, the statement read.
In the statement, in which Malpass also gave insight into the meeting between him and Vice President Yemi Osinbajo, the World Bank chief stressed that the financial institution is prepared to assist Nigeria in phasing off regressive fuel subsidies while enhancing social assistance for the poor and vulnerable.
Continuing, Malpass added that the Nigerian government needs to prioritise the importance of increasing domestic revenues through broadening Nigeria’s tax base and increasing the efficiency of tax administration.
What you should know about Nigeria’s multiple exchange rates
Nigeria maintains a number of exchange rates, which include the official one used mainly for budgeting and government transactions.
Investors and exports also have their rate known as Nafex. This acts as a spot rate for the naira.
Aside from the aforementioned rates, there is another one for Bureau de Change operators (BDCs), which allow Nigerians to access foreign currency like the dollar and pounds, to pay their school fees for their wards abroad, or for travel. Note that the Federal Government (FG) introduced this rate as it stopped selling foreign currency to (BDC) operators.
Also in this currency stratification is the black market rates, where the dollar to naira is currently selling for N705 and has been bought for N700
