The CBN finally stood up yesterday. It was clear that they could not continue to watch as the national currency continued to disgrace itself in the markets.
The pound sterling as at last I checked had crossed the N700 mark with the Dollar moving close to the N500 mark. The attendant effect on prices and goods and services can only be imagined as this has fueled very seriously inflation making life much more torrid for an already harried populace.
In trying to mute this, the CBN has decided to stop selling forex through the over 5,000 Bureau De Changes up from less than 500 a few years ago. The idea according to them is to stop the criminal arbitraging that is going on in that space.
Now whether the banks would be able to live up to the expectation is another thing. It was the same inefficiency and inherent corruption within the Banking system evidenced in what was known as round-tripping that led to the middle-of-the-road solution that the BDCs brought.
But in my mind’s eye, what we really need to do is to ramp up the supply side. As long as we still have the demand pressure, there will be dislocations leading to inefficiency and the inevitable corruption.
The lowest hanging fruit here for me is to export low-level skilled work, especially in the domestic, hospitality, and medicare areas.
The Philippines readily comes to mind. Last year, they were reported to receive a mind-boggling $34b from these receipts. We have a bigger population and a deep pool of unemployed that will make this figure a joke.
The Country can set up a structure that would screen, train, and prepare our Human Capital exports towards the first world.
Recently our diaspora receipts hit a historic $25b before flattening out at about $17b. I am not aware of any drill-down of these figures to show what percentage is from low-skilled labor as against highly skilled Nigerian expatriates. But if I were to hazard a guess, I would say over 70% of these would be from the lowly skilled category.
So if we aggressively pushed this policy. Moving into the 32.75% unemployed out of our 40m youths eligible to work according to the NBS and push them into the labor markets in the outside world, we just may begin to flatten this crisis in the short term.
National agencies that will be equipped with international HR consultants, Legal experts, and other such allied groupings can fashion out policies that will not only place them but protect them from exploitation and other vices while providing them with an efficient repatriation model.
They will be branded as Economic Ambassadors and will be feted as such so that there will be no stigma because, in the real sense of the word, they will be our saviors.
Go ask Mexico, the Philippines, and maybe Thailand and you will see the impact of these on their economy.