As Nigeria embarks on the liberalization of Foreign Exchange (FX), the Trade Union Congress of Nigeria (TUC) has warned the Federal Government, urging caution in dealing with speculators who could undermine the policy.
During the ongoing 111th Session of the International Labour Conference (ILC) in Geneva, Switzerland, the TUC addressed Nigerian journalists and advised the government against completely privatizing the public refineries, particularly to individuals close to government officials.
Festus Osifo, the President of TUC and also the President of the Petroleum and Natural Gas Senior Staff Association (PENGASSAN), commended President Ahmed Tinubu for demonstrating the political determination to unify the FX, emphasizing that the government’s actions would contribute to the revitalization of the nation’s economy.
Osifo stated, “We have consistently opposed the existence of multiple exchange rates due to its detrimental impact on our economy. For the past eight years, it has been the only issue that has profoundly affected our monetary and fiscal policies as a country. It has plagued us from all angles.”
To ensure the success of the new FX policy, Osifo stressed the importance of establishing specific fundamental measures to prevent speculators from taking advantage of the situation.
He explained, “If the unification of the FX on a single day causes the exchange rate to soar to N750 per dollar in banks, it becomes imperative for the government to implement effective mechanisms; otherwise, speculators will seize the opportunity and push it to N900 within a few days.”
Osifo emphasized that no country allows its currency to be subjected to random fluctuations and that the government must not allow speculators to dictate exchange rates. He warned that speculators would exploit the situation without proper monitoring and firm action.
The TUC President lamented the fact that the existence of multiple exchange rates had allowed overnight millionaires to emerge. He insisted that the new unified FX policy be allowed to succeed by preventing speculators from manipulating it.
He asserted, “No country achieves overnight development. The mismanagement of our currency over the years has been deplorable. Development does not occur in such a manner that people manipulate money and exploit the system. We oppose situations where individuals amass substantial wealth overnight. It is unacceptable for someone to profit from N300 to N400 per dollar by simply shifting to another window and becoming a billionaire overnight.”
“We believe that wealth creation requires hard work. Hence, certain fundamental measures and parameters need to be implemented, ” the TUC President added.
Regarding the currency crisis, Osifo pointed out that Nigeria would not have faced such problems if the refineries were functioning properly. He emphasized the importance of the government utilizing the local refineries to generate the necessary FX for the nation.
“Our advocacy is centered around ensuring the functionality of the refineries, and the government should adopt a model similar to the Nigerian Liquefied Natural Gas (NLNG), where the government holds a minority stake of 49 percent while the private sector owns the majority stake of 51 percent. Rather than selling the refineries to their associates and cronies, we strongly oppose such actions,” Osifo concluded.