FG Unveils Robust Strategy To Strengthen Economy Amid Inflation Surge

In a decisive move to fortify the nation’s economic resilience and counter the escalating inflationary pressures, the federal government has launched a comprehensive strategy focused on enhancing foreign exchange inflow. At the forefront of these efforts is a concerted push for the repatriation of proceeds from Nigeria’s crucial oil and gas exports.

During a high-profile meeting with stakeholders in the oil and gas sector in Abuja over the weekend, the Minister of Industry, Trade, and Investment, Dr. Doris Uzoka Anite, underscored the legal imperative of remitting export proceeds to the country of origin.

Dr. Anite emphasised her focus on regulating trade activities within the oil and gas sector, rather than delving into production processes.

“Export proceeds are by law to be remitted to the country of origin. We have three guiding legal statuses requiring that export proceeds be repatriated. My job is to promote trade; oil and gas trading falls under my purview. I don’t regulate how operators produce their products, but I regulate how they trade. Export and import is my job; maintaining the balance of payment to the country is my job. Balance of payment is so important; if we have export proceeds coming back, we will have dollars, and the economy of the country will grow,” said Dr. Anite.

Anite further explained that by repatriating proceeds from oil and gas export, it will be easy to manage the exchange rate volatility. “The President declared a state of emergency on revenue, including foreign exchange revenue, so this is the time to support the economy and reverse the downward trend that we are heading,” she charged.

Highlighting the broader economic impact, she noted, “By bringing back export proceeds, we inject dollars into our economy, crucial for maintaining a stable exchange rate and addressing the challenges posed by inflation.”
Director of trade and exchange at the Central Bank of Nigeria (CBN), Dr. Hassan Mahmud, affirmed the pivotal role of the oil and gas sector in achieving the Bank’s mandate of ensuring price stability.

“Our major role is price stability and the major driver of that price stability is the exchange rate. Inflation is what we are supposed to curtail; if you are unable to moderate the excessive depreciation, we will not be able to achieve the taming of inflation.”

He said the only way “we can achieve moderating the volatility of foreign exchange is from the supply side.
We can’t print dollars, but we can create an environment for dollars to come into the country.”
Mahmud commended the move of the stakeholders’ engagement, stating that, “oil and gas are the highest sources of foreign exchange that Nigeria has, and there is a need for us to provide that platform for operators to be able to bring in those inflows. “Export proceeds repatriation is very critical, as well as the backward integration programme in the sustainability of the nation’s economy,” he stated.

On his part, the Nigerian Customs Controller on Import and Export, Oloyede Adekunle, emphasised the importance of automating export permit processes. “Having the permit in dispatch delay time, you cannot take these permits straight to the command, so if we automate the command and control, the process will be faster,” he said.

The meeting concluded with a consensus to form a technical committee tasked with drafting Service Level Agreements (SLA) and addressing technical integration challenges. Recommendations included involving the Ministry of Industry, Trade, and Investment in the Export Proceeds Repatriation Reconciliation Committee and implementing self-regulatory mechanisms through industry associations.

As part of the comprehensive approach, measures such as introducing fees on export permit approvals and extending compliance deadlines for oil exporters were discussed. These steps are seen as integral to the collaborative endeavour aimed at fortifying Nigeria’s economic sustainability in the face of current challenges.