Nigeria and Nigerians alike face gloomy days ahead as the country’s national currency consistently loses its strength against the dollar. On Wednesday, the exchange rate at the parallel market closed at N562/$1, with palpable fear that it might hit N600/$1 in the weeks ahead.
Naira has weakened against the dollar by 40 per cent in the last one year as COVID-19, fluctuations in the oil price and scarcity of dollar continue to hurt the economy. For an import dependent economy like Nigeria, the situation can only get worse.
Analysts predict that at the rate the Naira is crumbling, owing to the insatiable quest for foreign goods, which has subsequently increased the demand for the dollar, the much in demand greenback will in no time be far beyond the reach of the average Nigerian. This can only change when Nigerians begin to look inward and change their taste for foreign made goods to locally produced ones.
Some Bureau De Change Operators have blamed the scarcity of the dollar to the attitude of Nigerians who prefer to hoard the dollars in anticipation of higher prices. This practice, they claim, has become common place and has exacerbated the plight of genuine businessmen .
In order to survive this hardship, most manufacturers of locally produced goods are looking for ways to be more competitive, even though the competitive edge is threatened by their over reliance on foreign inputs which sucks out more foreign exchange than they can muster. They are constantly faced with the unenviable task of making their products cheaper and better amid foreign exchange scarcity and biting inflation.
As the Naira further depreciates against the dollar, industry watchers are calling for a change in attitude and taste, if the local manufacturers are to be relevant and the nation’s economy is to pick up again. According to analyst this calls for a concerted and collective effort by all; government and citizens alike.