Fiscal Policy Partner and Africa Tax Leader at PriceWaterhouseCoopers, Mr. Taiwo Oyedele, says the lack of confidence foreign investors have in Nigeria is contributing greatly to the foreign exchange scarcity.
Oyedele said this during an interview on The PUNCH Roundtable on Thursday.
The forex scarcity in recent times has weakened the naira especially in the parallel market where the dollar is being sold for about N570.
Responding to a question, Oyedele said, “There is a big component of the dollar scarcity that is attributable to a lack of investor confidence. So, we have somewhere around $17tn of investible funds around the world today that are attracting either 0 per cent returns or even negative returns and yet they are not coming in our direction. Why?
“Because the risk premium that investors see in Nigeria is too high for them to justify the returns they will earn in this country. And that is created mostly because of the uncertainty. So, what we have to do is to think very carefully about monetary policy as well as other policies including fiscal policy so that we can put out a very clear message to the investor community whether they are domestic or foreign investors.”
The PWC partner said Nigeria was also doing poorly in the ease of doing business.
Oyedele noted that clearing imported goods at the ports or even exporting goods had become difficult.