{"id":19911,"date":"2023-04-16T10:01:51","date_gmt":"2023-04-16T10:01:51","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/nigeria-china-currency-swap-agreement-fails-to-ease-pressure-on-the-naira-africa-bitcoin-news\/"},"modified":"2023-04-16T10:01:51","modified_gmt":"2023-04-16T10:01:51","slug":"nigeria-china-currency-swap-agreement-fails-to-ease-pressure-on-the-naira-africa-bitcoin-news","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/nigeria-china-currency-swap-agreement-fails-to-ease-pressure-on-the-naira-africa-bitcoin-news\/","title":{"rendered":"Nigeria-China Currency Swap Agreement Fails to Ease Pressure on the Naira \u2013 Africa Bitcoin News"},"content":{"rendered":"

(Originally posted on : Bitcoin News )<\/b>
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Nigerian economic experts have said the country\u2019s five-year-old currency swap agreement with China has not eased the pressure against the Nigerian currency. According to one expert, implementation of the swap arrangement is being held back by the size of the trade imbalance between Nigeria and China<\/strong><\/p>\n

Easing Pressure on the Naira<\/h2>\n

According to experts on the Nigerian economy, the country\u2019s five-year-old currency swap agreement with China has failed to ease the pressure on the naira. Signed between the Central Bank of Nigeria (CBN) and the People\u2019s Bank of China (PBOC), the agreement was also intended to reduce pressure on Nigeria\u2019s external reserves and to ensure foreign exchange stability.<\/p>\n

However, since the signing of the swap arrangement in 2018, the Nigerian currency has depreciated versus the dollar from N305:$1 in 2018 to over N460:$1 in the first week of April 2023. Against the yuan, the Nigerian currency slid from the 2018 exchange rate of N48:CNY1 to N66.70:CNY1 on April 6, 2023. On the foreign exchange parallel market, a key source of the greenback for many Nigerian businesses and individuals, the naira\/dollar exchange rate reportedly stood at over N730:$1.<\/p>\n

Reports of the currency swap arrangement\u2019s failures came at a time when several countries have or are seeking to establish similar arrangements with China.<\/p>\n

Explaining why the currency swap arrangement with China is seemingly failing to halt the naira\u2019s decline, Taiwo Oyedele, the head of tax and corporate advisory services at PWC Nigeria, pointed to the trade imbalance between the two nations.<\/p>\n

\u201cThe implementation has so far been a challenge due essentially to the trade imbalance between Nigeria and China. While we import so much from China, we do not export nearly as much, which in fact has been on the decline in addition to the relative instability in the value of the naira,\u201d Oyedele reportedly said.<\/p>\n

According to Oyedele, Nigeria can still remedy this situation by substituting or promoting locally produced alternatives to imports.<\/p>\n

What are your thoughts on this story? Let us know what you think in the comments section below. <\/strong><\/em><\/p>\n

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\nTerence Zimwara <\/h6>\n

\nTerence Zimwara is a Zimbabwe award-winning journalist, author and writer. He has written extensively about the economic troubles of some African countries as well as how digital currencies can provide Africans with an escape route.

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Image Credits<\/b>: Shutterstock, Pixabay, Wiki Commons<\/em><\/p>\n

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