Top StoryTrending Story

Osinbajo at Ministerial retreat, decries dearth of synergy in fiscal, monetary policies

245

Lack of synergy between fiscal and monetary policies is the major cause of unnecessary drawbacks in the nation’s economic performance and planning, Vice-President Yemi Osinbajo (SAN) has said.

According to him, controlling the demand and supply chain of the foreign exchange has also impacted negatively on the economy.

“There are three areas of concern. The first is the synergy between fiscal and monetary policy. The failure of that synergy has led to unnecessary drawbacks in our economic performance and planning.

“What imports are eligible for foreign exchange must agree with the fiscal ambitions for manufacturing and industry,” Osinbajo said on Monday in his presentation at the opening of the 3rd Ministerial Performance Review Retreat in Abuja chaired by President Muhammadu Buhari.

“The second is that our exchange rate management continues to be an issue. The exchange rate of the naira to convertible currencies continues to face significant downward pressure because demand substantially outstrips supply. That is just the reality.

“On one hand we have tried demand management and rationing, which has not really worked because fixing the price while the parallel market reveals a massive arbitrage merely creates the opportunity for massive rents.”

Prof. Osinbajo pointed out that the situation would also compound the backlog of remittances for foreign businesses who want to repatriate their earnings.

He said:”The discussion that we must now have and going forward is how best to manage the situation by finding a mechanism for increasing supply and moderating demand which will be transparent and will boost confidence.

“A more market driven approach will be best, some price discovery within the context of a managed float is certainly required.

“Some efforts at controlled price discovery that had been made in the past include the Foreign Exchange Market (FEM), interbank Foreign Exchange Market (IFEM), various iterations of the  Dutch Auction System. (DAS), Wholesale Dutch Auction System (W-DAS), Retail Dutch Auction System (R-DAS).”

Stating that while they may not have been perfect, Osinbajo said it would appear as if the rules were clear and there was relative stability.

“When  people know how they can access foreign exchange competitively, this will boost confidence and inward flows will increase,” he said.

Leave a comment

Related Articles

Just in: Senate confirms Omolola Oloworaran as DG PENCOM

The Senate on Thursday confirmed the nomination of Omolola Oloworaran for appointment...

Just in: Senate approves Tinubu’s $2.2 bln loan request

The Senate on Thursday approved President Bola Tinubu’s loan request of $2.2...

Just in: Reps reject bill for six-year single tenure for president, governors

The House of Representatives rejected a constitutional amendment bill on Thursday seeking...

Just in: Simon Ekpa, four others arrested in Finland over terror-related activities

Finnish-Nigerian separatist agitator, Simon Ekpa, and four others have been arrested in...

Just in: FG sacks Nnamdi Azikiwe University VC

The Vice-Chancellor of Nnamdi Azikiwe University, Awka, Anambra State, Prof. Bernard Odoh,...

Senate raises alarm over fresh terrorists’ invasion from Mali, Burkina Faso, urges FG’s action 

Upset by the invasion of terrorists known as Lakurawa into Northern Nigeria...

Boko Haram/ISWAP terrorists’ ambush: Defence HQ confirms killing of 5 soldiers in Borno

The Defence Headquarters has confirmed that Boko Haram/ISWAP terrorists ambushed troops conducting...

Tinubu writes NASS for approval of $2.2bln fresh external loan

President Bola Tinubu has written to the National Assembly, seeking the approval...

NNPC Ltd’s spokesman, Soneye, explains delay in Port Harcourt Refinery rehabilitation, assures of imminent completion

The Nigerian National Petroleum Company Limited (NNPC Ltd.) has acknowledged the challenges...

AFCON Qualifier: Nigeria’s Super Eagles Suffer Shocking 2-1 Loss to Rwanda

Nigeria’s Super Eagles concluded their Africa Cup of Nations Group D qualifiers...

Tax reform bills: Nigeria struggling with tax-to-GDP ratio below World Bank’s 15 % benchmark – Speaker Abbas

Mr. Tajudeen Abbas, the Speaker of the House of Representatives, has expressed...

Just in: Again, Anambra sit-at-home claims four vigilance operatives, motorcyclist

Gunmen enforcing Monday’s sit-at-home order in Anambra State launched a deadly attack,...

Tinubu departs Abuja for G20 leaders’ summit in Brazil

President Bola Tinubu will depart Abuja for Rio de Janeiro, Brazil, on...

Breaking: APC’s Aiyedatiwa in landslide victory, wins all 18 LGAs in Ondo guber poll

The All Progressives Congress Candidate, Gov. Lucky Aiyedatiwa, has swept the 2024...

Ondo guber poll: Aiyedatiwa votes, says exercise peaceful, PDP raises alarm over thugs invasion

As the Ondo State governorship election kicks off on Saturday, Gov. Lucky...

Late COAS Lagbaja buried in Abuja amid tears, tributes

Amid tears and tributes, the body of the late Chief of Army...

Tinubu appoints Daniel Bwala, Atiku’s ex-spokesman as Special Adviser on Media, three DGs

President Bola Tinubu has appointed Daniel Bwala, the Special Adviser on Media...

Just in: Body of late COAS Lagbaja arrives in Abuja ahead of Friday burial

The body of the late Chief of Army Staff, Lt.-Gen. Taoreed Lagbaja,...

Tinubu Presides Over Crucial FEC Meeting to Unveil 2025 Budget Plans

The much-anticipated meeting of the Federal Executive Council (FEC) is underway with...

Breaking: NNPC Ltd. achieves milestone oil production of 1.8 mbpd

The Nigerian National Petroleum Company Limited (NNPC Ltd.) has announced a significant...