The state of naira
A friend called me today and expressed regret about not taking my advice from a few months ago. I suggested that he should convert all his Naira into USDT because of the current state of our currency. I explained that keeping money in Naira was not advisable as its value was decreasing rapidly. Instead, I urged him to save his money in USD T to maintain its value over time. Unfortunately, my friend chose to ignore my advice due to his stubbornness. He called me today to sincerely apologize for not listening to me as the Naira has decreased in value from 800 per dollar to 1400 per dollar at the time of writing this post.
I would advise my friend to convert his hand money into USD as it is a safer option. The Nigerian currency has been constantly devaluing against the USD due to various reasons, including the poor governance of our previous president. His tenure was characterized by a lack of progress, and the economy suffered greatly during his time in office. This led to many investors leaving the country. Unfortunately, the current president has not been able to change the situation, and we are still facing economic instability. Last month, there was a sudden drop in the value of Nera, and it seems like this trend will continue. Therefore, converting to USD seems like the most sensible option for now.
Naira pump and dump game to continue
I saw the news yesterday that the NNPC of Niger added a scoop of $9 billion to pump into the forest to stabilize the naira But the fact is, we can direct this money into something meaningful instead of using it to stabilize the Naira in the forest. Now, we don't have anything that brings money to the economy. Most people are taking their money out, even our little investors in Nigeria are taking their money out. You can use this money actually to build plants and do some other things that will benefit the economy but we choose to continue our pump-and-dump game.
The value of the Naira on Binance seems to be diminishing, and the Federal government's efforts to pump and dump the currency have not been successful. The proposed injection of 9 billion Naira into the forests will only serve as a temporary boost, as there is no plan in place to stabilize the price. This is similar to the pump-and-dump strategy used in the crypto market. Without a sustainable solution, the value of Naira will continue to decline until a new source of income is generated.
There is not much hope for the naira
It is projected that by the end of 2025, the trading rate for USD in Nigeria will be around 5000. However, there is still hope as economists suggest that opening the government and private refineries would generate more US currency, which could help stabilize the Naira. Although there is no definite timeline for when the refineries will begin operating at full capacity, it is anticipated that this will regulate the Naira's price by increasing the amount of US dollars earned from neighboring and foreign countries. Historically, Nigeria has relied on selling crude oil to gain dollars, which are then used to purchase petroleum products from other countries. By producing petrol locally, the reliance on US dollars will be reduced, which will increase reserves and benefit the economy. Let's see how this progresses.
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This is a big reason for concern and the effect of this is hitting hard in the Country. The value of Naira is dropping like crazy and the honest truth about the current situation is that things can only get worse for Naira.
Your friend will surely be feeling at loss for holding Naira instead of USDT. However, even the Naira he has now are still better off being stored in USDT despite the current price. The more he delays, the worse things will likely get for the Naira he's holding.
The government have the power to turn this around but because we are a failed country we will not still do anything about it
5000?
That’s really wild
In Ghana,having a dollar account is 50/50
I remember how people went running for dollars to convert them to cedis because of what happened.
It’s a reason I’m still thinking about the whole dollar account
But this Nigeria issue is serious.
The issue is very serious, you should be thankful that your government turn things around but for here is not getting better at all
I think the best thing is to save in hbd, it's a stable coin like usdt and you will get 20% Apr check my post I talk about it
https://hive.blog/leofinance/@zeezee25/how-to-maximize-your-earning
I know about HBD, it is a great opportunity for most Africans and for everyone in finance
In Nigeria we are not fully taping into opportunity hive offers us
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I also think it's better for the government to use that money more productively for the economy over trying to support the price of the foreign market. After all, the price of a currency depends on its value. I just wonder what will happen as the naira deprecates even further.
Pump and dump will always have short term effects and can sometimes create long term consequences. I think focusing on creating products to export to foreign countries is a great way to stabilise the naira and prevent it from depreciating further against the USD. 5000 by 2025 is really wild considering that's just next year!