Amidst growing concerns over the plummeting value of the Nigerian naira, prominent labor unions and business associations have called on the Federal Government to take immediate action to stabilize the national currency. The Nigeria Labour Congress (NLC), the Trade Union Congress of Nigeria (TUC), and the Nigeria Employers’ Consultative Association (NECA) have raised the alarm regarding the ongoing depreciation of the naira and its adverse impact on the economy.
NLC President Joe Ajaero expressed deep concern over the rapid devaluation of the naira against major world currencies, particularly the United States Dollar. The labor union warned that if swift and concrete measures were not taken, they might be compelled to take action to push authorities to prioritize the rescue of the naira, the economy, and the nation as a whole. The naira’s weakening threatens to trigger devastating consequences, particularly for workers and the general population, as inflation rates surge to unbearable levels.
The labor unions also criticized public officials for their preference for foreign products, which exacerbates the depreciation of the naira. They stressed the need for a more patriotic approach, advocating for the use of locally manufactured goods. The unions emphasized that supporting domestic products can boost employment, raise income levels, reduce poverty, and alleviate pressure on the naira by encouraging local manufacturers to increase production and meet export demands.
TUC’s Deputy President, Dr. Tommy Okon, alleged that international financial institutions like the International Monetary Fund (IMF) and the World Bank are manipulating Nigerian leaders to serve their own economic interests, at the expense of the country’s industries. The unions criticized the Central Bank of Nigeria’s decision to lift restrictions on 43 items from accessing foreign exchange, which has harmed local industries.
NECA’s Director-General, Adewale Smatt-Oyerinde, highlighted the challenges faced by businesses as the cost of doing business increases due to the falling naira. Many organizations still rely on imported materials and machinery, which are traded in dollars. As the naira’s value decreases, the cost of these imports rises, impacting businesses’ ability to create wealth and employment.
Analyst David Adonri, Executive Vice Chairman at HIGHCAP Securities Limited, argued that the foreign exchange market is now deregulated, with supply and demand dictating the naira’s value. Adonri encouraged businesses to become less dependent on imports and boost their capacity to earn foreign currency. He noted that the government should not intervene to defend the naira, as it should participate in the forex market like any other economic entity.
Tajudeen Olayinka, Analyst and CEO of Wyoming Capital and Partners, emphasized that the free fall of the naira will continue to affect the economy, causing inflation, unemployment, and growth challenges. He urged the government to address the issue of forex liquidity to stabilize the naira.
In response to the concerns raised by the labor unions and business associations, it is essential for all stakeholders to collaborate and work towards a lasting solution to address the depreciation of the naira. Protecting the naira and supporting domestic industries can lead to stability and prosperity for Nigeria.
Source: [Vanguard]
