Human rights activist Femi Falana, a Senior Advocate of Nigeria (SAN), has asked the federal government to clear the confusion arising from figures surrounding the nation’s foreign reserve by disclosing its actual status. Also Read: https://legalattorneyblog.com/2023/08/12/falana-sues-cbn-says-floating-of-naira-illegal/
He also said the Central Bank of Nigeria (CBN) has no basis to regulate the foreign exchange is illegal while adding that it has become pertinent for Nigerians to know the amount of money accruing to the sub-national government due to the recent increase in their monthly allocation from the Federation account.
Falana spoke on Monday, August 28, during a plenary session on Getting the Economy Right: Decoding Nigeria’s Strategy for Growth, Diversification, Inclusivity, and Sustainability at the 63rd annual conference of the Nigerian Bar Association (NBA) held in Abuja.
With the new prevailing economic realities where the federal government is saving monies from the removal of fuel subsidies, Falana said the NBA must hold the government accountable by being involved and proactive.
He said: “The CBN maintained that our foreign reserve is $38b, but JP Morgan says it is $3.7b, which explains why our foreign aid has decreased.
“I suggest the NBA called on the Federal government to give us an accurate picture of our foreign reserves.
“By Section 16 of the CBN Act, ‘The Central Bank of Nigeria Shall determine and fix the exchange of the Naira Viz other currencies’, there’s no room for market forces to fix the exchange rate of the Naira. So, it is not for IMF and World Bank or market forces to fix it”.
He also noted that the dollarization of the Nigerian economy has continued to create problems for the Naira.
Falana also wondered why Nigeria has not been able to benefit from the Currency Swap arrangement to the tune of N750b with China five years after, which would have resulted in Nigerians transacting their businesses in China ought to use Naira.
He said: “In other words, any Nigerian that wants to transact business you pay in Naira, all the goods we want to bring from China we pay in Naira.
“But what happened, the IMF and the World Bank said no, Mr Emefiele don’t allow it.
“So, under the Freedom of Information Act, I wrote to the CBN about what has happened to the Swap arrangement. They first told me they were checking their records.
“When I threatened to go to court, they wrote me that the arrangement was still on and would not be due for renewal until next year.
“So why are we not allowing Nigerians to transact business in China to spend in Naira while Chinese companies in Nigeria pay in yuan?
“Unless the government addresses dollarization of our economy, we will be in trouble in perpetuity.”
He, however, implored the leadership of the NBA to monitor the movement of government spending while also suggesting ways to strengthen the naira.
He said: “I have a message for the bar; the Federal government earmarked $1.5b to fix the Port Harcourt refinery; the Port Harcourt branch of the NBA must please monitor that work. Otherwise, the money will fly.
“For Warri and Kaduna refineries, $1.4b was earmarked by the Federal government; our branches must monitor as directed by the NBA.
“On import from China, we have just been told it is about $22b a year. Here I’m saying, and I will make the letter available to the NBA, which the CBN has now written that Nigerians transacting business in China can pay in Naira.
“That would save and strengthen the naira, and the rush, rat race for the dollar would stop”.
He also tasked the NBA with recovering some funds due to the Federal government from the Nigeria Liquidised Natural Gas (NLNG) that the Nigerian National Petroleum Corporation Ltd (NNPCL) has refused to release.
He said the NLNG, in the last 20 years, has contributed $18b, $15b for gas and $9b as tax, which the NNPCL has refused to release to the Federation account.
2023 NBA-AGC: Falana Urges FG To Disclose Foreign Reserve Status.
Accordingly, he tasked the NBA with recovering the money from the oil company for the Federal government.
He also urged the NBA to call on the Federal government to resume the publication of the details of monthly allocation from the Federal account to the sub-national governments.
While faulting the Nigerian Governor Forum (NGF) for prevailing on the Account General of the Federation (AoGF) to discontinue the tradition set by former Finance Minister Ngozi Okonjo-Iweala, Falana said Nigerians need to know how the increasing monthly allocations are being used by their Governors and Local government chairmen.
Falana also disclosed his willingness to assist Nigerian airlines in accessing the London route, stating that it is a gross injustice for British airlines to ply the Nigerian way. In contrast, Nigerian airlines could not ply the British routes.
Noting that it is a Bilateral Air Service System issue, he said, “I have a formula to make it happen. If they don’t allow you (AirPeace) to fly to London, we will not allow BA and Virgin to fly to Nigeria.”
In his lead presentation on Getting the Economy Right: Decoding Nigeria’s Strategy for Growth, Diversification, Inclusivity, and Sustainability, Adetilewa said the population of the country should be an asset rather than a liability considering a report that says 130 million Nigerians are multidimensionally poor.
He said the economy is diversified already as agriculture drives the economy despite oil being the most significant contributor to the national income.
According to him, investment in other critical sectors of the economy is vital, the youths and small and medium-sized businesses, while cutting debt and addressing corruption.
He also stressed that it is incumbent on the citizenry, including the NBA, to hold the government accountable over fuel subsidy removal that has saved the government between $10b to $15b.
In response to Falana’s position on the currency swap arrangement, he said Nigeria, with about $22b of import from China, would have to raise its reserve with China, which currently stands at 14% of our national foreign reserve, to about 50% before the use of Naira in Chinese transactions could be possible.
In his presentation, the Chairman of Air Peace, Allen Onyema, said a significant challenge confronting the nation is a fragmented unity where ethnic or tribal allegiance seems stronger than national allegiance.
He said unless and until Nigerians recognize the need to fight for one another irrespective of primordial sentiments, the nationhood we desire would remain a dream.
He also said that Nigerians and the government must be ready to identify challenges mitigating against its unity, growth, and development and be determined to address them truthfully, dismantle corruption and vested interests and be committed to good governance.
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