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Obaseki urges end to multiple exchange rates to grow nation’s economy

The Edo State Governor, Mr. Godwin Obaseki, has called for an end to multiple exchange rates to achieve sustainable economic growth and development in the country.

The governor reiterated the need for the government to relax capital control measures and promote exchange rate uniformity to create more incentives for investors in the domestic market.

Obaseki spoke at the 25th yearly conference of the Chartered Institute of Stockbrokers (CIS) in Lagos.

He further urged governments at all levels to invest massively in infrastructure, and improve on the ease of doing business to shore up the country’s weak economic indices and make it more competitive in the global market.

Obaseki said while multiple exchange rates could hinder capital inflows into the country, a stable rate would boost domestic production and attract more investment.

According to him, countries like the U.S., Europe and Asia have exchange rate stability, necessitating free movement of capital and developed capital markets.

The governor situated a nexus between the development of a country’s capital market and the economy, as reflected in the percentage of market capitalisation to the Gross Domestic Products (GDP) of developed economies.

He stated: “In the U.S., the market capitalisation is 143 percent of the GDP; Canada’s is 24 per cent, while Japan is 92 percent. But that cannot be said of Nigeria or most emerging countries. We need a well-developed capital market so that we can attract long-term development and achieve financing development.

“Capital markets can help the government achieve rapid development and globalization. It is a significant contributor to our economic development, and so for Nigeria to become part of the league of countries with strong economies, it must have a well-developed capital market.”

The governor further charged the stockbrokers to do everything within their powers to eliminate barriers, which have been inhibiting the development of the nation’s capital market over the last decade.

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