 You're welcome back. Right now we're going to x-ray what the new policy, the new monetary policy, is the effect it is having on our economy and all that. We understood yesterday that the Naira closed at 756 Naira per dollar as the rate convergence takes root. In fact, this morning we woke up to the fact that Naira even closed at about 815 Naira to the dollar. Well, let's get someone who will help us make sense to this policy. And we're lucky to have in the studio here with us, Mr. Bolajon or Lodje Dey. Welcome to the program. Thanks for having me. First of all, when they collapsed all the windows to the I and E window, they collapsed a lot of things and converged so many things. People applauded. Did you also applaud that policy of convergence? The policy in itself, yes. I had a bit of concern with the approach, which is to say if I were to approach this, I probably would approach it in a different way. My fear then was the supply side of things, because we have not really done anything, there have been no change to the supply side of things. If we collapse everything now, what will be the implication? How will the market react? Well, I have no doubt in my mind that it is so clear that the right policy direction is to converge all those rates, remove the issue of multiplicity of rates within the system, let the arbitrage opportunity of about 300 Naira, take it out of the table, totally. I have no doubt about that. But as to when or what should be the approach, the approach wasn't exactly how I would have approached it. Okay, we'll come to the approach that you were talking about, but right now, the concern for every Nigerian who may not know what the future holds, but just judges by what is happening right now is that the Naira officially or unofficially is 800 and something to the dollar. Yeah, but when you also look at it, you will see that it was 800 yesterday, it was 750, 60 days before. Monday it was 770. On Friday it was 660. So what we have right now, you can't say this is the rate of Naira. All you have is extreme volatility. So today it is this amount, it goes up. The next day it may come down. The next day it goes up. So it's a period of when the Naira is trying to find where to settle. And that period may extend for a while because of the shock to the system by virtue of the fact that nothing has really changed from the supply side of things, but all these rates have been converged. In fact, the unmet obligations that were at the window, at the forex window before this convergence is still there. So the question is, maybe we have about $10 billion including, for example, the 800 or something million for IATA alone, for IATA members alone is still there. So the question is, where is the supply that was meant to meet all those demands and also take care of the additional demand or new demands from the market? So I don't think that supply side of things has picked up. So we are likely to continue to see this volatility as Naira is struggling to find where exactly do I belong. Hopefully, things don't get out of hand, but if it does, then CBN will also have to come back into the market. Okay. Well, you did say something about implementation. You did say something about the process. You did say something about approach that you could have taken a different approach because you've mentioned some things that maybe should have been put in place before this policy came up the way it came up. So let's get back to that approach. What would you have done if you were to be the one to bring the policy? Okay. I would have considered that pending obligation. We have a huge pending obligation of foreign demand and foreign demand that we have not been able to meet over the period. Some people have put it that maybe it could be up to 10 billion US dollars. So I need to determine how exactly I will approach meeting that demand. Number two is that at the heart of our foreign exchange problem is the fact that we don't have enough supply. So Nigeria is not making enough foreign exchange. And that is why all this problem even emerged in the first instance. About 90% or over 90% of our foreign exchange comes from crude. So historically, when crude is doing well, Nigeria tends to do well with foreign exchange. When crude goes down, we go down with crude. Things change a little bit in recent time. When crude oil is now even doing well in the market, but we are not doing well because we are unable to even meet our own quota as given to us by OPEC. Our production has crashed dramatically. So one of the things I expected we were going to do is to step up on the pedal to get our production to increase. We are a country that has moved from 2.5 million barrels per day to 9.31 at some point. That is a dramatic fall. So revving up our production, get more rigs into the space, whatever encouragement we need to put in that space to ensure that we are able to rev it up. However, we need to deal with oil theft. Let's put it there. What that would do for us, don't forget where I was coming from was the fact that crude oil is about over 90% of our foreign exchange source. So it is obvious that if we are able to step it up, we can amass a bit more of foreign exchange and be able to meet some of this supply that I was talking about, that we are pending right there. If we improve our stock, then it makes things a bit easier for us. However, the government has decided to take it in another way. I want to believe because the people who are also doing it are very knowledgeable people. Maybe they have some other provision for how to deal with the supply shock that is out there, that is playing out. So we are with how they want to approach that side of things. But for now, we will continue to see that volatility goes up today, it comes down the next day, it comes up, it comes down, and at some point maybe it will settle. The problem with the Nigerian person right now is that we don't trust the government that much, because those knowledgeable people are there and we buy fuel, for instance. That is as simple as it could be. We produce the crude and then sell it and then buy fuel. It is not done. We seem to be like the only country that produces crude oil but does not have a functional refinery that will refine the fuel for us. So there are no knowledgeable people there, so we can't marry that. So that's why we try to at least say out the things that we feel should be done. But you were talking about foreign exchange coming 90% from crude and I was wondering, crude in the next 10, 15 years may not be as relevant as it is right now, the world over, not just in Nigeria. Shouldn't we be looking about diversification? Because Nigeria used to be a very rich country without the crude. We abandoned everything. Yeah, we abandoned everything. It was a case of, we have the money is how to spend it that we don't know according to one of the heads of states. So shouldn't we be diversifying? When we talk about trying to meet the target, the target of the, not just opaque, how to get the foreign exchange that will supply the demand. So shouldn't we be diversifying? And if we should, what sectors do you think will earn us this foreign exchange more than or at least as much as the crude? Okay, I will start from the crude. When I made an allusion to the fact that crude, we should step it up and all the rest. I was conscious of the fact that in some couple of decades to this time, things might have changed totally about the crude space. But you see, as of today, I would say in the immediate or in the short term, revving up that crude is actually a low hanging fruit for us. It will help us to stabilize part of this problem. But we need to, in the medium term, we need to now go beyond issue of crude, which is diversification that you spoke about. Industrialization is a key part of what the new administration has been talking about. Look, of course, we will do agriculture, but no country ever got rich by selling primary commodities, which is how it used to be in the 60s that we were proud of. Even that 60s, if you bring it today, it still will not make us a rich country any longer because dynamics have changed totally. So the days of I want to export cocoa, I want to export kola nut is gone. Those years are gone for good. Today, if you want to make money from agriq, you must add value. Let me give you a typical example. In cocoa, cocoa production, Africa produces about 75% of the entire world cocoa. But guess how much profit we make? 5% of the profit. 5% because all we are doing largely is producing cocoa and sending it abroad. Then where you send it to, they will process, they will add value. And then the companies that are at your own backyard will go there and import those valuable products into their own economy and make much more profit than you have made by exporting primary products. As a matter of fact, it is that same mentality that we see even in the crude and refined products. Crude is a primary product. You just take it from the ground and you export. Then you go to those places and import the refined product, which is a valuable product. So industrialization will help us to diversify, which means being able to add value to a primary product and sell it. If dengute refinery, for example, were to be commercial today, it means that Nigeria can start any products, effects, not just from crude, but now from refined products. It will also save us from spending our hard-earned foreign exchange, importing those refined products. So you see those two ways. Number one, you are not spending your money importing it now because it is now at your backyard. Number two, you are now able to even earn by selling to other countries who don't have those refined products. So industrialization will help us. Technology is another area that the current government is talking about. If you Google today the most valuable companies in the world, you will be amazed at how many technology companies are in the top 10. These companies are as rich as in they have more cash than countries. So it shows that we need to play in that segment, create the right environment and revoke the activities that are already brewing in that space. It's another critical part where we can diversify this economy. Okay, we've run out of time, so let's just assume that you are a special advisor to the president right now and you want to tell him how these things could move, how this policy could work. Remember we're talking about the fact that the dollar convergence has taken root, but the Naira is volatile as you put it now. Just a few words to the relevant authorities who are watching or who might be watching right now as a final word. I would say we should look at those low hanging fruits that could help with our supply in the immediate and make all efforts to make them deliver for us. It will help to stabilize the current volatility level that we are seeing. Okay, thank you very much. Mr. Ologe Dey for coming on the show and being a part of this program. Thanks for having me. We've been talking with Mr. Ologe Dey, a public policy analyst who resides here in Lagos and we're glad that we have him live in the studio. When we take this break and return, we'll be talking about another money issue. The VAT, 7.5% that has been added on diesel or that will be charged on diesel henceforth. Stay with us.