By Nwafor, Sunday
Mr. Doyin Okupe, former aide of ex-president Goodluck Jonathan has said on Thursday, 9 march 2017, in an open letter to Osinbajo, that Buhari’s administration through the acting president Yemi Osinbajo can save Naira by adopting a crude oil-swap initiated by Jonathan during his regime. This initiative he said, saw government exchanging crude oil for refined petroleum products, through third party traders.
Furthering his speech, the former aide said, that Buharis’s government has replaced this to adopt a direct-sale-direct-purchase of crude oil initiative, that has removed middlemen. This he said has affected the value of Naira in the international market. Okupe urged the goverment to return to the crude -oil-swap. In his words, “Nigeria is nearly totally an import dependent economy, we earned about N4.6 trillion from export of crude oil in 2015, while our total import bill was in the region of about N6 trillion; 30 percent of which was dedicated to the import of petroleum products. Actual figure was about N1.8 trillion or $5bn,” he wrote.
“It is obvious that if we can remove or substantially decrease this demand of $5bn from our forex pull, the value of naira will significantly appreciate further.
“Your Excellency, I want to submit that this is achievable through a responsibly and transparently organised crude swap scheme.
“I am not unaware that this administration has undertaken a limited crude oil swap arrangement, but this will not suffice. We need to carry it to the level at which we will not commit any significant amount of forex to import of petroleum products anymore.
“No doubt this option was also tried and to a large extent poorly executed and abused by the previous NNPC leadership. The errors in its manner of implementation can be corrected to give a major relief to the demand for dollar in our economy.
“The statutory allocation of 450,000 barrels of crude oil daily for domestic consumption which has been on for several decades needs to be readdressed for better productivity.
“In this dispensation, the government can start by committing the seven oil majors to the new scheme and after a period of about one year of successful implementation, qualified indigenous companies can be brought in, to join and participate.”
“Your Excellency, with all humility, I submit that while the above may not exactly represent the actual details in the suggested transactions, I strongly believe that this proposition of mine, if fine-tuned by experts, will give results with much commendation to your administration and more importantly, improve the strength of our national currency further and relieve some of the current hardship in the nation.”