Ogona Anita
Africa’s richest man and the Chairman of Dangote group, Aliko Dangote, has seen his wealth decline by $4.12bn since the Central Bank of Nigeria (CBN) liberalized the naira and harmonized the rates at the Investors’ and Exporters’ (I&E) foreign exchange window.
Naira was on 13th June, 2023 floated leading to the official price declining to daily high of N791 at the I&E window on Thursday The decline went above the parallel market rate trading around N757 per dollar. As Nigeria struggles to regain the trust of investors with more transparent FX regime, banks can now sell and buy forex at market rate not dictated by the apex bank. Data gathered from Bloomberg Billionaire Index on Friday showed that Dangote’s fortune which he makes from Dangote Cement, Dangote Sugar and Nascon Allied Industries among others crashed to $16.8bn from $20.92bn held a day before the CBN announced the new FX regime. Dangote’s ranking has also fallen from 74th to 99th richest person in the world since the naira began to crash. The majority of Dangote’s wealth is from his 86 per cent share in Dangote Cement, traded on the Nigerian Exchange Limited.
If the naira continues to decline, the billionaires wealth is most likely to plunge as his companies are quoted in naira on the country’s stock market, financial experts believe. The naira lost its value from N464 per dollar before the policy to N702 as of the end of trade on Thursday.
Although the policy has been described as beneficial to the country in the long-run, it is expected that the regime will fuel inflationary pressures, according to the Manufacturers Association of Nigeria.
“In the short term, we expect a depreciation of the currency in the official window because of the huge demand backlog. “But as the market conditions normalizes and moves towards equilibrium, the rate would moderate,” the Chief Executive Officer of the Centre for the Promotion of Private Enterprises, Muda Yusuf said in a emailed comment to THE WHISTLER.
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