Dr. Onuoha Nnachi, an economist, blames the foreign exchange crisis in Nigeria on dollarized corruption. He says that politicians are competing to spend dollars on luxury items, which is driving up demand for the currency and causing the Naira to depreciate. He urges the government to tackle the cost of governance and carry out forensic investigations of public spending to reduce corruption and address the forex crisis.
Nnachi says that the demand for dollars increases in Nigeria at the end of every month due to political pressures. He notes that politicians are competing to spend dollars on luxury items, such as houses and long convoys. This competitive corruption is putting pressure on the Naira and causing it to depreciate.
Nnachi says that the government can address the forex crisis by tackling the cost of governance and reducing corruption. He urges the government to carry out forensic investigations of public spending to identify and prosecute corrupt individuals. He also says that the government should reduce its own spending on unnecessary items.
Nnachi’s comments come as the Nigerian currency, the Naira, continues to depreciate against the US dollar. The Naira is currently trading at around N980/$1 at the parallel market.