The European Union (EU) on Tuesday denied trending media reports that it has called for further devaluation of the Nigerian legal tender, the naira, which has come under unprecedented pressure against major international currencies.
The EU’s public position became necessary after its trade counsellor, Fillippo Amato, was quoted in an interview as advising the federal government to devalue the naira as part of measures to tackle the economic recession.
“To come out of recession, the country has to take brave decisions, regardless of how unpopular they may be such as fully and effectively devaluing the Naira. Devaluing the Naira is a measure, which will finally reassure investors and attract new capitals to the country, and at the same time, it will further reduce imports, thereby removing artificial forex restrictions, and removing any potential waste of scarce resources such as the fuel subsidy,” Amato was quoted as saying.
However, in a swift reaction, the EU denied all such claims, saying that their trade counsellor was rather quoted out of context.
“Our attention has been drawn to various newspaper publications citing the EU calling on the Federal Government of Nigeria to further devalue the Naira. This is an inaccurate representation of the statements made by the Trade Counsellor of the EU Delegation to Nigeria in an interview to the News Agency of Nigeria, as his statements were taken out of context and distorted,” the EU embassy in Abuja said in a statement on Tuesday.
According to the EU, the main thrust of the statement credited to its official by the media was that, to overcome recession, an enabling environment for doing business and a global package of measures aimed at boosting productivity and diversifying the economy should be pursued.
Within this recommended framework, the statement further explained, an effective flexible exchange rate policy and a removal of artificial exchange control would support the agenda of the government to reduce imports and diversify foreign exchange earnings.
It also noted that similar measures would reduce importation of finished goods, which can be produced locally and make non-oil exports from Nigeria more competitive, while allowing only imports of critical inputs which are needed by local firms for domestic production.
