Government should raise funds to boost FX supply -Teriba – The Sun Nigeria

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By Chinwendu Obienyi

the The Federal Government and the Central Bank of Nigeria (CBN) have been urged to seek ways to raise equity capital to alleviate the current scarcity of foreign exchange (FX) in the country.

That was the view of Economic Associates chief executive Dr. Ayo Teriba on a recently watched TV show.

Teriba, while reacting to the decision of the CBN’s Monetary Policy Committee (MPC) to retain all parameters, said the variables CBN perceives cannot be limited to inflation at a time of global uncertainty. renewed sparked by Russia’s invasion of Ukraine.

He said that as Nigeria continues to struggle with growth, exchange rate stability, liquidity and inflation, it is important that the FG prioritize the exchange rate over inflation.

Teriba said, “I didn’t expect the CBN to pretend to do anything against inflation, because cost inflation would die out after a while. If it was demand-driven inflation, we would talk about the CBN rate hike to reduce inflation. However, you cannot raise rates when growth remains weak or lower rates when demand is under pressure in the forex market. What the CBN must consider is not to limit itself to several meetings where it comes to explain why it cannot act, but to take strategic measures to stimulate the supply of foreign currencies in the country”.

He lamented that the government continued to borrow to complement expenditure and cash management, adding that the Ministry of Finance, CBN and Debt Management Office (DMO) should seek ways to attract direct investment. (FDI) in the country to fund some of the things the government is currently borrowing money for.

“So Eurobonds are debt and FDI is equity but Nigeria only issues debt domestically and abroad and can issue equity assets which we are trying to borrow for financing and offering equity participation.This is perhaps the most reliable way for countries around the world to reduce liquidity, boost currencies and stabilize the exchange rate.So it shouldn’t be difficult for the CBN to work with the Ministry of Finance and the DMO to reflect on opportunities for equity.

We have a lot of assets but we don’t have the money to fund them and therefore issue shares which could be 1% or 5% which will bring currency liquidity into the country and put the CBN in a position where she can act. If they stay cautious all the time, then I’m not sure about their decisions because it will look like we’re barking when we have to bite,” he said.


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