The Managing Director and Chief Executive Officer (CEO) of Coleman Wires and Cables, Mr. George Onafowokan, has disclosed that the current uncertainties surrounding the country’s foreign exchange (forex) market is posing a great challenge to the relevant administrative authorities and the industry as a whole. Onafowokan disclosed this in an interview in Lagos recently.
He stressed that the scarcity of forex was forcing businesses to consider painful alternatives such as the black market. Onafowokan said: “The inconsistencies, poor management and lack of inflows prompt bidders to place higher bids than they actually need because at the end they may not get up to 20 per cent of the forex amount.
“This gives rise to blotted figures that does not reflect the actual demand in the market, leading to further devaluation of the local currency.” Onafowokan, whose company is a key member of Manufacturers Association of Nigeria (MAN), argued that if the apex bank increases the supply of forex to meet the demand at a market equilibrium price, there would come a time when investors and other stakeholders will be seeking to buy naira in exchange for foreign currencies, thereby strengthening the local currency. He advised government to settle all outstanding forex liabilities as the first step towards easing the current crisis in the market, as well as allow naira to find its true exchange rate. “I wouldn’t say the current exchange rate of about N430 or thereabouts is a true reflection of the market price, but somewhere between that and N500,” he added. Onafowokan said government could borrow a leaf from Coleman Wires and Cables that has devised ingenious ideas to solving difficult problems. According to him, the company has, within six years, exited a negative position to grow its net worth into billions of naira and is now working with the Transmission Company of Nigeria (TCN) to ensure steady power supply in the country with the supply of one of the latest technology-driven power conductor, Gap Cable, that has the capacity to carry more load than existing cables. “Our company has acquired the technology and capabilities to manufacture various cables that were previously imported with huge foreign currencies.