Okonjo-Iweala to meet with CBN governor as WTO members complain of multiple exchange rate

Okonjo-Iweala to meet with CBN governor as WTO members complain of multiple exchange rate

- Okonjo-Iweala to meet with the governor of the Central Bank of Nigeria, Godwin Emefiele during her one-week visit

- Okonjo-Iweala said WTO members are complaining of Nigeria's multiple exchange rates

- The WTO DG says she can't speak for Nigeria as WTO DG, so the country's representatives must explain why multiple exchange rates exist

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The Director-General of the World Trade Organisation (WTO), Ngozi Okonjo-Iweala, said she will meet with the governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, to discuss the country's multiple exchange rate regime.

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Okonjo-Iweala said members of WTO are complaining of Nigeria's multiple exchange rates regime, which has split foreign exchange in three different ways, as the CBN rate, investors window rate, and the parallel market have different price exchanges.

Okonjo-Iweala is in Nigeria for a one-week visit. Her recent visit is the first since she was declared the director-general of the world trade body. Her first visit was to President Muhammadu Buhari on Monday.

After her meeting with President Buhari, she told the press of the concern raised by other countries regarding a change in the forex policy of Nigeria:

"WTO has one of the agreements of balance of payments, and Nigeria certainly invoked this to be able to conserve foreign exchange. But some other members have brought a complaint against us (Nigeria) that we shouldn’t have used this article in that way.
“Yes, the WTO is concerned about foreign exchange, the way we manage it, the way we use it, and how we use it to support manufacturing or imports and exports in our economy.”

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Okonjo-Iweala to meet with CBN governor as WTO members complain of multiple exchange rate
Okonjo-Iweala to meet with CBN governor as WTO members complain of multiple exchange rate. Photo: Bastien INZAURRALDE AFP, Chris J. Ratcliffe Bloomberg
Source: Getty Images

She said Nigeria must explain to WTO members why it is engaging in multiple foreign exchanges. According to Okonjo-Iweala, the discussion had previously been held, but she won't be speaking on behalf of Nigeria this time, as she's the head of WTO:

“I think that we had that discussion with them, they complaints about the exchange rate regime and we (Nigeria) try to explain. I shouldn’t say we because I’m now DG WTO, it is for Nigeria’s representative to explain to the WTO, to those members complaining why we’re doing this.
“But eventually, I think having a strong exchange rate and being able to phase out of this, I think we’ll be heading in that direction. We’re also going to see the governor of the central bank, and will undoubtedly discuss some of these issues.”

Emefiele had started the process of unifying Nigeria's multiple exchange rates, but the apex governor said he won't be unifying the rates in line with the black market price, as only illegal businesses conduct forex transactions in the parallel market.

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Meanwhile, Legit.ng had earlier reported that the countries unemployment rate had risen to 33% as of ending of 2020. This reflects the economic condition in the country.

According to NSE data, the number of unemployed Nigerians as of December last year is 23 million.

Fakoyejo Olalekan is a Business and Financial Journalist with over three years of experience in covering finance and business activities within Nigeria and offshore. Prior to joining Legit.ng, he worked at Nairametrics where he wrote financial and investment analysis articles. Olalekan is a resourceful and result-driven journalist with a track record for conducting extensive research and interviews to produce articles that provide different perspectives to market activities.

Source: Legit.ng

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