Nigerian govt benefiting from Dollar-to-Naira rise – Ndume

Senator Ali Ndume has stated that the depreciation of the naira against the dollar is not causing losses to the federal government, but rather, it is resulting in increased revenue to fund the 2024 budget.

Ndume explained that the budget, presented by President Bola Ahmed Tinubu in November, is primarily reliant on dollar-denominated income, as a significant portion of the government’s revenue is derived from crude oil exports, priced in dollars.

During an interview with Channels Television, Ndume emphasized that as the value of the dollar rises, the government will have more naira at its disposal for expenditure, which is denominated in naira.

He noted that Nigeria’s main export, crude oil, continues to enjoy high demand in the global market, indicating that the country stands to benefit from the current dollar-to-naira exchange rate.

Ndume said, “Don’t forget that this budget is a ‘dollarized’ budget, especially in terms of income. And when it comes to expenditure, it’s in naira. So if we are getting our money in dollars and the value of the dollar is up, that means we will have more naira in terms of what we spend because we are not spending in dollars, we are spending in naira, while we are getting our revenue in dollars.”

He further reasoned, “Truly, the value of naira against the dollar has fallen, but we are selling our major product that we generate income in dollars. And that means any dollar we get now will also be valued at the current dollar-to-naira exchange rate. So if you do the analysis critically, it may mean if you balance it up, we may have more money to fund our budget. So technically, Nigeria is even benefiting from the dollar-to-naira hike.”