Don canvasses use of Chinese currency to benchmark Nigeria’s budget

Chinese yuan and U.S. dollars are arranged for a photograph in Beijing, China, on Friday, April 2, 2010. Yuan forwards were poised for the biggest weekly gain in almost three months on mounting speculation China will loosen its grip on the currency after data showed an economic recovery is gathering pace. Photographer: Nelson Ching/Bloomberg

By Fatima Mohammed-Lawal
Ilorin, Jan. 11, 2020 Prof. Gafar Ijaiya, the Director of the Ilorin Business School (IBS), University of Ilorin, has advocated the use of the Chinese currency, Yuan, to benchmark Nigeria’s budget.

Ijaiya, who made the call on Monday while speaking with newsmen in Ilorin, explained that, “China now seems to be our major trading partner; at the levels of government and individuals.

“More than 80 per cent of goods you see in the market today are made in China. So if that’s the country that forms the bulk of our import, why continue to benchmark our budget using the American dollar?.

“This is the reason for the high cost of goods and services in the country.”

According to him, if it were to be the Yuan in use, these goods will not be as expensive as they are.

He said that Nigeria is more of a consumer nation that no longer produces unlike in the ’70s and ’80s when the country had over 30, 000 industries with over 200 in Kwara State alone.

Ijaiya added that at that time, the exchange rate was about 60 kobo per dollar because Nigeria was producing.

The expert in Economics explained that there is a lot of pressure on the dollar and also on the government not to jettison the dollar, so people go for the dollar at every point in time to get goods.

He, however, opined that the dollar should be bypassed because even China does not accept the dollar during transactions, but in order to achieve this, the country needs the political will.

Ijaiya highlighted the various benchmarks or parameters used to prepare the national budget, which include the price of oil, the daily production of oil, which is about 1.86 million barrels per day.

Others, he explained were the exchange rate of N379 to the dollar as well as the parameter projecting that Gross Domestic Product (GDP) by three per cent and the inflation rate being projected at 11.95 per cent.

“These parameters have always been reoccurring and are becoming obsolete, therefore, the need to look further and extend them,” he said.

Ijaiya therefore, recommended the exploitation of the solid mineral sector such as ‘Tantalite’ used in building the silencers of aircrafts, bullet-proof cars, bullet-proof vests.

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