Nigeria’s Central Bank Governor, Godwin Emefiele, has appealed to the International Monetary Fund, IMF, and the World Bank and other global financial institutions to understand why Nigeria cannot adopt their recommendations to operate a floated exchange rate system, saying it would lead to an uncontrollable spiral exchange rate.
Emefiele made this known at the IMF/World Bank Spring Meetings in Washington DC, United States.
He spoke in reaction to calls by the President of the World Bank Group, David Malpass, for Nigeria to do away with its multiple exchange rate systems and maintain a single exchange rate policy.
Emefiele said that different jurisdictions were facing diverse economic challenges and must develop a framework peculiar to their economic situation.
“Both the IMF and World Bank are our prime development banks, and we have received support from them at different times in resolving some of our economic challenges, particularly bordering on finance.” he said.
“Nigeria’s situation is very peculiar and that is why we have continued to engage the IMF and World Bank to show understanding of our local problems.
“Yes, they want us to freely float the exchange rate and you do know that this will have some impact on the exchange rate itself in the sense that when you allow that to happen, you will have some uncontrollable spiral in the country’s exchange rate.”