Naira Devaluation: Issues and Way Forward

Abstract

Naira is the currency denomination of Nigeria and currently the country is said to be a net importer of product as opposed to a net exporter. This paper explores that available way forward to the controversial debate on the effect of Naira devaluation and justification for either of the sides of the coin in this discuss. This study found that while devaluating a currency can seem like an attractive option, it can have negative consequences. By making imports more expensive, it protects domestic industries that may then become less efficient without the pressure of competition. Higher exports relative to imports can also increase aggregate demand, which can lead to inflation, it is a reality that devaluation seems more doom than good.

Keywords: Naira, Devaluation, Nigeria, Economic Development

JEL Classification: M41, M47, M49