The economic crisis facing the country will worsen if the current dollar scarcity rocking the financial sector continues, experts have said.
The naira plunged to 400 against the dollar at the parallel market on Thursday after sinking to 390 a day earlier due to demand by manufacturers and the summer rush by Nigerians.
This, analysts explained, would likely result in an increase in the country’s inflation rate, which hit 16.5 per cent in June.
“If the naira keeps falling at the parallel market, then we should prepare for further increase in the prices of goods and services. And this will continue to give us more trouble as a nation,” A professor of Economists at the Olabisi Onabanjo University, Sherrifdeen Tella said.
The Chief Executive Officer, Cowry Asset Management Limited, Mr. Johnson Chukwu, shared a similar view, warning that sustained fall by the naira meant that Nigerians would need to brace themselves for higher inflation and further contraction of the economy.
The Minister of Finance, Mrs. Kemi Adeosun, had said recently that Nigeria was “technically’ in recession, confirming claims by experts that the country’s economy was deteriorating rather than improve.
“The fundamental thing needed to diversify the economy is infrastructure and we are attacking the infrastructural deficits,” she had said while speaking at the Senate about the state of the nation’s economy and the implementation of the 2016 Appropriation Act.
Experts have, however, said that for the economy to be diversified, the foreign exchange challenges needed to be addressed to encourage investment and to check inflation, which has hit Nigerians hard.