Some Nigerians have opined that the Central Bank of Nigeria (CBN) should not have relied on Dangote Refinery for its exchange crisis. Nigeria has had democracy for 22 years and 40% of our Forex earning goes to petrol import every year. We have only 3 options.
1 - Ask petroleum products importers to go source for Forex anywhere. The implication of this is suicidal as;
i - Petrol pump price per liter will be above $1, the Naira value will depend on how much the exchange rate will be, my guess? No less than ₦700
ii - If Marketers gets forex at an autonomous rate, nothing in this world will make PMS sell for less than ₦700/ltr
iii - The search for Forex will drive the exchange rate above whatever it is currently sold, as there will be no control at all.
2 - Build new refineries or refurbish the existing ones, that will never happen in another 10 years owing to our infrastructural deficiency and low oil price. The Dangote Refinery is $19bn, that's our annual budget for 2018. Given the competition for funds by capital projects, there's no way we can allocate more than $1bn per year from our budget, and that means at $19bn, it will take at least 19 years assuming every government decides to not stop funding the project
3 - Licence private investors to build Refineries. This is the cheapest, easiest and fastest solution to our problem
This is the only viable option since 1999, reason Obasanjo government signed over 20 proposals for Refineries in his 8 years tenure, but not a single one could commence building Refinery because, there was no political will from the government, as all of them benefit from oil subsidy, and with private Refineries, Subsidy will die permanently.
After Obasanjo, Yar'Adua and Jonathan also signed many proposals including that of Dangote, whose proposal dates back to 2009 and in 2013, Jonathan govt granted Dangote Refinery another Licence, which was equally frustrated.
Content created and supplied by: Mrliman (via Opera News )
Opera News is a free to use platform and the views and opinions expressed herein are solely those of the author and do not represent, reflect or express the views of Opera News. Any/all written content and images displayed are provided by the blogger/author, appear herein as submitted by the blogger/author and are unedited by Opera News. Opera News does not consent to nor does it condone the posting of any content that violates the rights (including the copyrights) of any third party, nor content that may malign, inter alia, any religion, ethnic group, organization, gender, company, or individual. Opera News furthermore does not condone the use of our platform for the purposes encouraging/endorsing hate speech, violation of human rights and/or utterances of a defamatory nature. If the content contained herein violates any of your rights, including those of copyright, and/or violates any the above mentioned factors, you are requested to immediately notify us using via the following email address operanews-external(at)opera.com and/or report the article using the available reporting functionality built into our Platform See More