Exchange Rate Unification Policy in Nigeria: The Implications for the Economy

This study examined the implication of exchange rate unification policy on the Nigerian economy. The basic objective of the paper is to benefits and implications of exchange rate unification on macro and socio economic variables. Data for the study was collected via library science method. The findings showed that, the benefits of exchange rate unification include but not limited to efficient price discovery, access to foreign exchange supply, increased capital importation, and brings about investor confidence in the economy. But the implication of the unified exchange rate regime is that, it brings about naira depreciated which was accompanied by high increase general price level of goods and services especially food inflation. Also, socioeconomic variable like poverty rises in the short run, and this in turn will increase consumption cost vis-à-vis high energy prices and many more. Based on the findings, the paper suggested the temporary suspension of the unified exchange rate regime since the policy cannot work effectively in a consumption economies of which Nigeria is one. Also, government should encourage farmers to produce finished goods for exports in order to improve the value of the naira.