Too late to devalue Naira – Zinox boss

Chairman of Zinox Group, Nigeria’s foremost integrated Information and Communication Technology (ICT) conglomerate, Mr. Leo Stan Ekeh, has lent his voice to the on-going debate over the calls for the devaluation of the local currency, noting that prevailing circumstances in the nation’s fiscal and monetary framework aligned to developments in the global oil market makes devaluation a needless venture at this material time.

Since the turn of the year, the country has had to contend with reduced government earnings from the sale of crude oil, with the current administration especially hard-hit by the dwindling prices of the commodity in the global market, prompting the Central Bank of Nigeria (CBN) to impose strict foreign exchange rules to save its reserves while battling the pressure from various quarters to devalue the naira.

Speaking at a reception organized in honour of his 60th birthday by a select group of ICT media entrepreneurs in Lagos, Ekeh noted that it was too late to devalue the naira as the move will only serve to further impoverish the masses and plunge the country into a state of hyper-inflation.

“What do you think would happen to already stretched wage earners? Would their salaries be linked to rate of inflation as is the standard globally? As I speak a lot of states cannot pay the minimum monthly salary.
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“If devaluation happened mid-last year it would have made sense and encouraged in-flows from investors but devaluing now would compound our already difficult situation and investors will only wait in anticipation of a further devaluation. It will rubbish our currency forever and strengthen the purchasing power of our trading partners,” he said.

Ekeh, who claimed that his company is one of the casualties of the current forex scarcity with increasing difficulty to meet overseas business obligations, believes Nigerians and Nigerian corporates have reasonably adjusted to the realities of the hard times with pains as most people are now prioritizing critical needs which should be the case most times. In his view, the dire situation has most importantly impacted common sense which is not too common in many Nigerians.

“It’s too late to devalue the naira at this point in time. I can see reason behind the refusal of the President to consider devaluation as it is a move that will certainly erode the buying power of the middle class and push millions of Nigeria already living below the poverty line into abject penury,” surmised Ekeh, who is also a renowned Third World Economist.
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