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NSIA says Nigeria committed to U.S dollar, as Russia, China challenge greenback

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Capital importation into Nigeria drops by $790m, largest decline in over 2 years

The Managing Director and Chief Executive of Nigeria Sovereign Investment Authority (NSIA), Uche Orji, has refute possibility of Nigeria replacing the United States dollar for another global currency, amid Russia and China’s quest challenging the greenback.

The dominance of the dollar had been called into question following the role of the U.S in the ongoing war between Russia and Ukraine, as the U.S used its currency dominance to unstable Vladimir Putin’s financial system, in favour of the latter.

Some western nations, including U.S, restricted Russia’s Central Bank from tapping into its foreign reserves, which is majorly dollar, in order to financially weaken its capital base in the fight against Ukraine, and in response, Putin began renegotiating the currency in which his country traded with.

He directed countries in need of Russian oil and gas supply to pay in Ruble, his country’s currency.

The restriction had shown the danger of relying on dollar and the impact of the greenback’s dominance in global trade, and with Russia’s currency gaining 30% this year despite the sanctions, amid the war against Ukraine, there are reports that other countries might toil the path of Russia.

Read also :Forex pressure weakens Naira against US dollar

But Orji said Nigeria will not be doing so.

He stated that the U.S dollar would continue to be dominant in global trade due to its preference as haven for assets during a global financial meltdown. Orji elaborated that no currency would replace the dollar anytime soon, Arise TV reported on Monday.

“So for the NSIA, I think we are still going to remain fairly heavy on the dollar for some time. In terms of moving our investments away from the dollar, I think we are still a long way from any other world reserve currency. It is still complicated for the world to unwind into something else.

“When there is an economic crisis, there are probably three currencies people tend to hide their assets in: one is the US dollar, second is the Japanese Yen, and third is the Swiss Franc.” Orji stated.

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