The frenzy of excitement among key government figures about the momentary gains of the naira against the United States dollar is a cause for concern because such ecstasy can blur the line on what needs to be done on a sustainable basis.

Money is a medium of exchange or a mere receipt for values and also a means for the exchange of values. Measuring the value of the naira against the dollar or any other major international currency for that matter is wrong economics. Rather there are consequences for inaction on crucial structural issues that have real possibilities to reset the economy and put it on a path of sustainable growth for the well-being of the population.

Money must first be seen in the national context as a reflection of the values created for which it’s a mere receipt and must potentially incline to value additions, stagnation or even decline. Money has prospects as a tool to assess further value addition and multiplication and can also help to understand the trajectories of the stagnation and inertia of value creation, with all this depending on the elaborate policy options available from the realistic examination of the actual situation.

The dollar, despite its international standing, is usually being tinkered with at times for economic management and the US authorities do not need any consultation outside their shores to do this. A key indicator in the trajectories of the currency is the interest rate, which is mostly applied to manage inflationary trends. In 2022, the US Federal Reserve hiked interest rate by a cumulative three per cent to tame inflationary pressures. While these measures are designed to recalibrate the US economy, the implication for other currencies tied to the dollar like the naira would be a sharp rise in the value of the US national currency and a negative impact on the local currency.

Two ways to ameliorate the situation are obvious. As regards the case at hand, the Nigerian government has chosen the easy way with the least exertion and without any prospects for sustainability in the long run but has brought only short-term relief. The avalanche of political chest-thumping that has greeted the naira gain will most likely dissipate when reality sets in. There is no serious original policy intervention that has currently featured in the momentary arrest of the naira slump except for travelling the familiar and old path. A $3bn loan facility guaranteed by oil sale as collateral was sourced and is been massively deployed to stem the haemorrhage of the naira.

An external factor like the potential adjustment of US interest rates which is widely speculated to be imminent and certainly outside the influence or control of Nigeria’s monetary authorities could tip the naira for another round of downward spiral. The combination of measures which the government has embarked on, including sanitising the manipulative parallel market and placing a lid on the government’s excessive demand for foreign exchange such as a moratorium on foreign trips, especially the frivolous ones, may have played a role in the naira recovery but just for the short term.

These measures (good as they are) could ameliorate the fate of the naira in the short term but will do nothing to strengthen its value and stabilise the naira in the long term. To stabilise the naira, that can only be attained exclusively on original policy ideas and initiatives focused on value creation, multiplication and expansion. And this simply means a deliberate return to the path of value creation with a focus on optimising agricultural and industrial productivity. This is the road that is hard to travel but it is certainly the only way.

Despite the naira recovery, prices remain high, providing no respite to the long-suffering citizens and the reasons are not far-fetched. The massive expansion of productivity and revenues from both the domestic market and export earnings, especially from the non-oil sector, will stand the naira in better stead of genuine recovery with the consequences of moderate price stability.

To start, we proceed from the fact that money of any type, including the naira, is not value or wealth in itself but rather a receipt of the wealth or value that is created or to be created. Therefore, anyone seeking to understand the value of the currency without focusing on the values of material products created and how these values are added, multiplied and expanded, will be acting as the foolish dog that chases its own shadow to the sea where it drowns.

Across the country, in the various regions, Nigeria has huge material endowments that beckon for optimal exploration, but the curse of myopic leadership, mainly focused on the next election and policy inertia, compounded by a deficit of originality, have added to the woes of the country naturally wired to play in the big league of at least the middle-income countries. Rural revitalisation through a coherent and sustained national policy of boosting rural connectivity will raise local production, and spur the primary market that will establish the unbreakable framework for a national value chain.

Reviving the national economy and delivering the value that will stabilise the naira in the long term requires more than the current measures that seemed more tailored for political ventilation. The root of the matter is the structural disarticulation of the Nigerian economy in which non-economic variables play leading roles both in the distortion and deformation of the economy. In the current economic impasse, the industrial sector has been considerably asphyxiated. In cahoots with politicians, these few state-minted billionaires have disproportionately cornered the existing wealth without actually creating any new wealth, thereby depriving the real sector of the economy the financial oxygen not only to breathe but to breathe life into the Nigerian economy.

Increasingly, the relationship of these cliques with politicians in government expands and dangerously forecloses the prospect of rational allocation of resources to the sectors more conducive to value creation, addition and expansion. There are differences between undue appropriation of the existing value to grow fat among the few, and genuine entrepreneurial endeavours, where the expansion in the wealth of the leading captains triggers rising incomes among the rest of the population, with opportunities spreading across the board in a win-win situation for all stakeholders though affecting all, differently according to outputs and contributions.

Nigeria’s years of economic gloom and its dire socio-political consequences can be overcome but there must be a genuine appetite to see the big picture, instead of the short-term goals of political goal-scoring. The Tinubu government has set itself in a mood of ecstasy for no obvious reason except to validate its political line. The key economic drivers that will return Nigeria to her manifest destiny of a growing, middle-income country are there but have either been condemned to obscurity or unsearched because of the “politics of the belly” as one French iconic political scientist puts it. However, while the existing order is not sustainable as the majority of citizens wallow in the brutality of misery with the additional toxin of insecurity, sensible leaders will act fast to prevent a festering and widening social chaos from mutating into a political rupture.