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What happened to my Naira on a day of #500 to £1?

February 24, 2016

A social piece that educates the Nigerian market and others who needs it on the main reasons why the Naira will continue to fall and what we can do.

What happened to my Naira on a day of #500 to £1?

So a couple of years ago when i was about to leave the shores of my beloved country Nigeria for my MBA in the United Kingdom, like every other Nigerian going abroad for the first time there are a couple checks you need to do; first,Visa check (ensure you have the right Visa for the right country i.e. your Visa is genuine), Second and most important 'Money', O Yes! When you arrive at your destination, you need money to go to your intended location like in my case - School, and some other things that we might discuss in another article.

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But anyways I can remember making my way to a 'Bureau de Change' with the 1 million Naira my Dad and My Mum had just given me after the usual advise of you are going abroad you need to remember the son of whom you are, you need to excel at your studies and in my case you need to run away from women even if they say 'hi'; as they might be 'devil's children' trying to distract you (LoL). Back to my story, i remember beckoning on the Mallam with my 'Kadan Kadan' Hausa; Sanu de zowa, Yaya dai Mallam? (Weldone, How are you?) Nawa ne Pounds? (what is the exchange rate to pounds), you know although i was born in Kano in my head i was thinking the more i speak my forced Hausa, the better the rates the Mallam will give me (I was deceiving myself), He replied 225 Naira but because i spoke hausa to him he will give me for 222 Naira (it was the same rates as the market - a hausa man doesn't joke with his 'hard' currency). With the transaction done i proceeded with my journey definitely with my pocket swollen with £4,500 pounds and as the say they rest is history.....

Fast forward to this present day as i briskly made my way to the platform to catch a train taking me out of London, my phone rings and a voice comes on 'Chika you go buy Naira?', i replied as a true Nigerian answering the question with another question, 'Why? Wetin happen?', He replied 'Mehn, my brotha money way i change at 300 naira to a Pound has now dropped to #500 to 1 pound and at this rate i go need change this money back to pounds to reduce my further loss, i replied with sarcasm you no well, how Naira go be 500 to a Pound? My brother I beg no dey joke o!, and went ahead to end the call, but because i was still bothered i placed another call to a friend who works in the financial industry to confirm the sad news and Alas i goofed! Apparently the rate at which the Naira has fallen, if the Naira isn't careful it will soon discover its own oil!

So with a huge sigh, i started to make my way to my seat on the train, but the situation kept on bothering me, so as an intellectual i began to analyse - How did we get here? What can we do to help ourselves? Who is to blame? What lessons can be learnt? With all of the pondering, one thing stood out - one cannot blame the present administration as we are all victims of the actions that have been taken in the last decade or so, which has led to this hullabaloo of a situation! After all if we aren't all victims, just over a year ago crude oil - our main income sold for over 140 dollars a barrel but today we are struggling to sell same barrel at 35 dollars and the difference made between 140 and 35 has been stolen. So sadly there's nothing to even pad the economy with!

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For you to understand the fall of the Naira, you must first understand how economies of Nations work; you see in layman's terms every nation's currency is like their report card, people would look at it based on obvious results in 'red and blue' which tells you the value of that currency. For example when you present a Dollar, what you see is a strong economy with unemployment at 4.9%, triple A rating by Fitch, with over 90% of the world's top 10 most valuable companies resident in that country. Let's look at the Chinese Yuan; all time fastest growing economy in the world, with a GDP of over 9.4 trillion dollars, and has an expectation to overtake the US economy by 2026 (in just 11 years time). How about my dearest UK; i suggest we shouldn't go there, as there is one word that comes to mind when you hold the Pound in your hands - 'Consistency'; ooh she is a master at economic strategy and political positioning that will make her and her people forever eat at the table! Do you know what this countries have in common? They are all exporting Nations and have one of the strongest technology and innovation industries in the World!

So with the above i humbly ask my fellow Nigerians and other readers 'What do you see when you look at the Naira'? As the famous Fela Anikulapo would say 'Oro pesi je oro di hun!' (one is short of words). Your answer is as good as mine - NOTHING! how will one not be short of words when what we do is to bury millions of dollars in sewers or ferry stolen money to different nooks and crannies of the world! errm Se oro o pesi e ni, when money that was meant to feed your pensioners was shared amongst by a small group of people! Se oro o pesi je ni, when a former 1st lady who retired as a permanent secretary in the civil service now owns an Airline?

Hmmm, as i round up for those that haven't made the mathematical comparison yet. Do you realise that my 1million Naira of a couple of years ago that stood at £4,500 at #222 to a pound has now become a mere £2,000 at #500 to 1 pound! Hmmmm, So as i alight this train at my destination, i alight as a better man because i now know what is happening to my Naira that is in free fall. The question is do you know what we can do to help the Naira on this economic watershed day?

Post your answers and below and feel free to share!


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