IMF says Naira overvalued up to 20%

The International Monetary Fund (IMF) on Wednesday said that the naira is overvalued by 10 to 20 per cent.
This was according to the IMF mission chief for Nigeria, Gene Leon, who said the overvaluation of the naira is “somewhere to the tune of 10 to 20 per cent” and the country’s 2017 projections for non-oil revenues are more optimistic than the Fund’s.
He also urged Nigerian authorities to increase tax levels to diversify its income, adding that Nigerian authorities were concerned about the IMF’s earlier staff report’s view.
The Fund warned that Nigeria economy needs urgent reform and the dangers of a volatile foreign exchange market.
IMF outlined several failings in the government’s handling of the economy and could affect talks over at least $1.4 billion in international loans.
But President, Association of Bureaux De Change Operators of Nigeria (ABCON), Aminu Gwadabe, said the IMF officials should explain the yardstick for their advice.
He said what the IMF is technically saying was that the official rate of N306 to dollar should move to N360 to dollar.
“The IMF and other agencies look at the bureau de change rate. That is why we are saying there should be special window for both entry and exit to encourage more capital inflows to supplement the foreign reserves and diversify dollar sources,” he said.