NSIA says Nigeria committed to US dollar, as Russia and China challenge greenback

The Managing Director and CEO of the Nigeria Sovereign Investment Authority (NSIA), Uche Orji, has refuted the possibility of Nigeria replacing the US dollar with another global currency, amid the quest for Russia and China to challenge the greenback.

The dominance of the dollar had been called into question following the role of the United States in the ongoing war between Russia and Ukraine, as the United States used its monetary dominance to destabilize Vladimir Putin’s financial system, in favor of the last.

Some Western countries, including the United States, prevented the Central Bank of Russia from drawing on its foreign exchange reserves, mainly in dollars, in order to financially weaken its capital in the fight against Ukraine, and in response Putin began to renegotiate the currency in which his country traded with.

He ordered countries that needed Russian oil and gas to pay in rubles, his country’s currency.

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

Also Read:Forex Pressure Weakens Naira Against US Dollar

But Orji said Nigeria would not.

He said the US dollar would continue to dominate in global trade due to its preference as a safe haven for assets during a global financial meltdown. Orji clarified that no currency will replace the dollar anytime soon, Arise TV reported on Monday.

“So for the NSIA, I think we’re still going to be pretty heavy on the dollar for a while yet. In terms of moving our investments away from the dollar, I think we’re still a long way from any other global reserve currency. It is still complicated for the world to let off steam on something else.

“When there is an economic crisis, there are probably three currencies that people tend to hide their assets in: the first is the US dollar, the second is the Japanese yen and the third is the Swiss franc.” Orji said.

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