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Recognizing the severe foreign exchange challenges facing the Nigerian economy, the Manufacturers Association of Nigeria (MAN) has urged the Federal Government to explore new avenues for maximizing diaspora remittances.
With remittances from the Nigerian diaspora serving as a major source of inflows, MAN suggests that better management of these funds could help offset the depletion of foreign reserves.
The association recommends the creation of specific financial instruments or investment channels aimed at directing these remittances toward long-term development projects, which could, in turn, strengthen the naira’s position in global markets.
The value of the naira has plummeted dramatically, with its exchange rate now hovering around N1,700 to the US dollar. This severe devaluation reflects the ongoing challenges Nigeria faces in managing its currency amidst global economic uncertainties and domestic fiscal strains, contributing to inflationary pressures and increased costs for imported goods.
This depreciation has driven up the cost of products, particularly imported goods, putting them out of reach for millions of Nigerians. With a weaker naira, everyday essentials are becoming increasingly unaffordable, intensifying the economic strain on households across the country.
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To mitigate the foreign exchange crisis, Segun Ajayi-Kadir, the Director-General of MAN, has emphasized the need for the Nigerian government to capitalize on the $20 billion in diaspora remittances recorded in 2023, as highlighted by the World Bank.
“First, we must realise all the incomes we can get from oil and we should not have any impediment whether human, structural, or system imposed,” the MAN DG said on Tuesday during Channels Television’s Independence Day special event which was tagged, “Nigeria’s Challenging Economy: Strategies For Recovery”.
“We need to address the issue of diaspora remittance that has a very great potential of bringing in far more forex than Nigeria is receiving. Those can help address the foreign exchange challenges that we have.”
He pointed out that if the country actively engages with these strategies and more, it stands a good chance of mitigating the foreign exchange crisis that is adversely affecting production in Nigeria.
Ajayi-Kadir expressed that Nigeria should not have to endure suffering indefinitely.
