An All Progressives Congress (APC) presidential campaign official has rejected a claim by political economist Pat Utomi that Peter Obi could strengthen the naira to 500 per dollar if elected president, describing the assertion as a fundamental economic fallacy.
Segun Showunmi, a member of the APC presidential campaign council, issued a statement on Friday faulting Utomi’s argument as “an elementary misunderstanding of exchange-rate economics and the mechanism of price formation.”
Utomi, a chieftain of the Nigeria Democratic Congress (NDC), had said the proposed exchange rate formed part of Obi’s economic agenda. He argued that moving the naira from about 1,350 to 500 per dollar would help curb inflation, reduce poverty and boost purchasing power, alongside investments in security, electricity and infrastructure.
Showunmi dismissed the position as “a textbook example of confusing political aspiration with economic feasibility.”
“The fundamental fallacy is the assumption that an administrative or politically declared appreciation of the naira from ₦1,350 to ₦500 per dollar will automatically translate into a 50% reduction in the prices of virtually every essential commodity,” he said.
He stressed that an exchange rate is a market price shaped by foreign-exchange supply and demand, productivity, export earnings, capital flows, monetary conditions and economic confidence, not a figure government can arbitrarily set.
“Where is the additional foreign exchange coming from? What will finance the proposed intervention? How will the authorities sustain the new rate if market demand for dollars exceeds available supply?” Showunmi asked.
He also challenged the assumption that prices of commodities such as yam, garri, plantain, eggs, chicken, bread, rice and cement would all fall by half, noting that each has distinct cost structures involving domestic productivity, imported inputs, energy, labour and transport.
Using cement as an example, Showunmi said a product priced at $10 would cost ₦5,000 at ₦500 per dollar, not the ₦2,000 suggested in the proposal, which he said required an unexplained further 60 percent drop in the dollar price.
While acknowledging that Obi’s goal of lowering the cost of living is legitimate, Showunmi insisted it could only be achieved through sustained productivity growth, agricultural transformation, industrial competitiveness, reliable electricity, infrastructure, security and sound macroeconomic management.
“The naira should become stronger because the Nigerian economy has become stronger, not because somebody has decided that ₦500 to the dollar would make an attractive manifesto headline,” he added.
— “A winning strategy” —
In a post on X, the political economist described the proposed appreciation from the current level of about N1,350 as a central plank of Obi’s economic agenda.
“We are convinced that targeting a strategic appreciation of the exchange rate by reasonably strengthening it from ₦1,350/$ to ₦500/$ as part of our manifesto is a winning strategy,” Utomi said. “It offers a direct, multi-faceted approach to curbing inflation, reducing poverty, and lowering the cost of living.”
He said the measure would be backed by investment in security, electricity and road infrastructure, along with structural reforms to make markets more competitive.
Prices to fall by half
Utomi projected steep price cuts under the plan. A loaf of sliced bread, he estimated, could drop from N1,750 to N800, a 50kg bag of imported rice from N55,000 to N27,500, and a medium-sized tuber of yam from N2,400 to N1,200.
He also forecast that a 50kg bag of maize could fall from N75,000 to N37,500, a bunch of plantain from N2,500 to N1,250, a whole chicken from N7,000 to N3,500, a dozen eggs from N2,300 to N1,150, and a paint of garri from N1,300 to N650. Petrol and cement were also listed among commodities expected to become cheaper.
“It clearly demonstrates our concrete plan to uplift the 140 million Nigerians currently experiencing multi-dimensional poverty,” Utomi said.
No timeline given
Utomi did not give a timeline for reaching the target or spell out the monetary and fiscal policies needed to achieve it. On Friday, the naira traded at about N1,346.86 per dollar on the official market.
