Financial Derivatives Company has said that the increasing uncertainty in the foreign exchange market has turned the naira into a ‘banana republic’ currency.

The Federal Government of Nigeria is doing a wonderful job fighting corruption. The last time this monster was tackled, head-on in this country, was in 1984, by the same Head of State Buhari. Then as now, the price of crude oil created the havoc. Then, as now, there were discordant views about whether or not the government should devalue the currency or not. Those on the left wing of Nigerian politics, the Nigerian Labour Congress and socialists who arrogated to themselves the love of the masses, were against devaluation of the currency.

The crisis rocking the financial sector has deepened as exchange rate rose to over N370 per dollar. The foreign reserve also declined by $1.14billion. Non-Performing Loans (NPLs) in commercial banks, according to statistics averaged 4.7 percent last year and may increase to 10 percent in the medium term by 2016, due to the banks exposure to oil and gas sector. At present, NPLs in 17 banks are estimated at over N9.9trillion, even as the World Bank’s loan to Nigeria stands at over $6.29billion.

In what is becoming increasingly clearer, a cocktail of bad choices, incoherent policies made worse by instability in the markets, as well as a fastidious clinging to antiquated ideas, the fate of the Naira hangs in the balance as it continues its downward slide. This report will show why the Muhammadu Buhari administration’s misplaced belief that hope is best served for dinner, at a time when there may be no one at the table because the prognoses for the Naira and the economy, do not inspire confidence and growth.

The Naira yesterday suffered its biggest daily depreciation against the dollar as the exchange rate rose to N345 per dollar in the parallel market.