Experts in Nigerian economy say that the five-year-old agreement between Nigeria and China on currency swaps has not helped to ease the pressure on the Nigerian currency. According to an expert, the large trade deficit between Nigeria and China is holding back the implementation of the currency swap agreement.
Reduce the pressure on the Naira
Experts on Nigerian economics say that the five-year-old currency exchange agreement between Nigeria and China has not been able to reduce the pressure on naira. The agreement, signed between the Central Bank of Nigeria and the People's Bank of China, was intended to ease pressure on Nigeria's reserves and ensure stability of foreign exchange.
Since the signing of the swap agreement in 2018, however, the Nigerian currency depreciated against the dollar. It went from N305 to $1 in 2018 to N460 per $1 in the first week in April 2023. The exchange rate for the Nigerian currency against the yuan fell from N48:CNY1 in 2018 to N66.70 CNY1 on 6 April 2023. The naira/dollar rate was reported to be over N730 per $1 on the parallel foreign exchange market. This is a major source of greenbacks for Nigerian individuals and businesses.
The failure of the currency exchange arrangement came as several countries were attempting to or have established similar arrangements with China.
Taiwo Oyedele of PWC Nigeria's tax and corporate advisory service pointed out that the trade imbalance between China and Nigeria is the reason why the currency exchange arrangement seems to be failing to stop the naira from declining.
"The implementation of the agreement has been difficult so far due to the imbalance in trade between Nigeria and China. "We import a lot from China but export a fraction of that amount, and this has actually been declining, in addition to relative instability in the naira's value," Oyedele said.
Oyedele believes that Nigeria can remedy the situation by substituting locally produced products for imports or by promoting them.
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Frequently Asked Questions
How can I withdraw from a Precious metal IRA?
First, determine if you would like to withdraw money directly from an IRA. Make sure you have enough cash in your account to cover any fees, penalties, or charges that may be associated with withdrawing money from an IRA.
Consider opening a taxable brokerage instead of an IRA if it is possible to pay a penalty if your withdrawal is made before the deadline. If you decide to go with this option, you will need to take into account the taxes due on the amount you withdraw.
Next, you'll need to figure out how much money you will take out of your IRA. This calculation depends on several factors, including the age when you withdraw the money, how long you've owned the account, and whether you intend to continue contributing to your retirement plan.
Once you have an idea of the amount of your total savings you wish to convert into cash you will need to decide what type of IRA you want. Traditional IRAs allow you to withdraw funds tax-free when you turn 59 1/2 while Roth IRAs charge income taxes upfront but let you access those earnings later without paying additional taxes.
Once these calculations have been completed you will need to open an account with a brokerage. Brokers often offer promotional offers and signup bonuses to encourage people into opening accounts. You can save money by opening an account with a debit card instead of a credit card to avoid paying unnecessary fees.
When you do finally decide to withdraw from your precious metallic IRA, you will need a safe space where you can safely store your coins. Some storage facilities will take bullion bars while others require you only to purchase individual coins. Either way, you'll need to weigh the pros and cons of each before choosing one.
Bullion bars require less space, as they don't contain individual coins. However, you'll need to count every coin individually. On the flip side, storing individual coins allows you to easily track their value.
Some people prefer to keep their coins in a vault. Others prefer to place them in safe deposit boxes. Whatever method you choose to store your bullion, you should ensure it is safe and secure so you can enjoy its many benefits for many years.
How much gold should your portfolio contain?
The amount of capital that you require will determine how much money you can make. A small investment of $5k-10k would be a great option if you are looking to start small. As your business grows, you might consider renting out office space or desks. This will allow you to pay rent monthly, and not worry about it all at once. It's only one monthly payment.
It's also important to determine what type business you'll run. In my case, we charge clients between $1000-2000/month, depending on what they order. So if you do this kind of thing, you need to consider how much income you expect from each client.
You won't get a monthly paycheck if you work freelance. This is because freelancers are paid. Therefore, you might only get paid one time every six months.
You must first decide what kind and amount of income you are looking to generate before you can calculate how much gold will be needed.
I recommend starting with $1k-$2k in gold and working my way up.
Is buying gold a good way to save money for retirement?
While buying gold as an investment may seem unattractive at first glance it becomes worth the effort when you consider how much gold is consumed worldwide each year.
Physical bullion is the most popular method of investing in gold. There are other ways to invest gold. You should research all options thoroughly before making a decision on which option you prefer.
If you don’t have the funds to invest in safe places, such as a safe deposit box or mining equipment companies, buying shares of these companies might be a better investment. If you need cash flow to finance your investment, then gold stocks could be a good option.
ETFs allow you to invest in exchange-traded funds. These funds give you exposure, but not actual gold, by investing in gold-related securities. These ETFs typically include stocks from gold miners, precious metallics refiners, commodity trading companies, and other commodities.
How to Open a Precious Metal IRA?
The first step in opening an Individual Retirement Account, (IRA), is to decide if it's something you want. You must complete Form 8606 to open an account. To determine which type of IRA you qualify for, you will need to fill out Form 5204. This form must be submitted within 60 days of the account opening. Once this is done, you can start investing. You can also contribute directly to your paycheck via payroll deduction.
Complete Form 8903 if your Roth IRA option is chosen. Otherwise, the process is identical to an ordinary IRA.
To be eligible for a precious metals IRA, you will need to meet certain requirements. You must be at least 18 years of age and have earned income to qualify for a precious metals IRA. You cannot earn more than $110,000 annually ($220,000 if married filing jointly) in any one tax year. You must also contribute regularly. These rules apply regardless of whether you are contributing directly to your paychecks or through your employer.
You can invest in precious metals IRAs to buy gold, palladium and platinum. However, physical bullion will not be available for purchase. You won't have the ability to trade stocks or bonds.
Your precious metals IRA may also be used to invest in precious-metal companies. This option is offered by some IRA providers.
An IRA is a great way to invest in precious metals. However, there are two important drawbacks. First, they're not as liquid as stocks or bonds. It is therefore harder to sell them when required. Second, they don't generate dividends like stocks and bonds. Also, they don't generate dividends like stocks and bonds. You will eventually lose money rather than make it.
What Precious Metals Can You Invest in for Retirement?
The best precious metal investments are gold and silver. They are both simple to purchase and sell, and they have been around for a long time. If you want to diversify your portfolio, you should consider adding them to your list.
Gold: Gold is one the oldest forms currency known to man. It is also extremely safe and stable. Because of this, it's considered a good way to preserve wealth during times of uncertainty.
Silver: Silver is a popular investment choice. This is a great choice for people who want to avoid volatility. Silver tends instead to go up than down, which is unlike gold.
Platinium: Another form of precious metal is platinum, which is becoming more popular. Like gold and silver, it's very durable and resistant to corrosion. It is however more expensive than its counterparts.
Rhodium: Rhodium can be used in catalytic convertors. It's also used in jewelry making. It is relatively affordable when compared to other types.
Palladium: Palladium, which is a form of platinum, is less common than platinum. It is also cheaper. Investors looking to add precious and rare metals to their portfolios love it for these reasons.
What are the advantages of a gold IRA
You can save money on retirement by putting your money into an Individual Retirement Account. It's tax-deferred until you withdraw it. You are in complete control of how much you take out each fiscal year. And there are many different types of IRAs. Some are better suited for people who want to save for college expenses. Others are designed for investors looking for higher returns. Roth IRAs are a way for individuals to make contributions after the age of 59 1/2, and then pay taxes on any earnings upon retirement. These earnings don't get taxed if they withdraw funds. This account is a good option if you plan to retire early.
The gold IRA allows you to invest in different asset classes, which is similar to other IRAs. Unlike a regular IRA where you pay taxes on gains, a gold IRA doesn't require you to worry about taxation while you wait to get them. People who want to invest their money rather than spend it make gold IRA accounts a great option.
Another advantage to owning gold via an IRA is the ease of automatic withdraws. You won't have the hassle of making deposits each month. You could also set up direct debits to never miss a payment.
Finally, gold is one the most secure investment options available. Because it isn't tied to any particular country its value tends be steady. Even in times of economic turmoil, gold prices tend not to fluctuate. It is therefore a great choice for protecting your savings against inflation.
Statistics
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
- (Basically, if your GDP grows by 2%, you need miners to dig 2% more gold out of the ground every year to keep prices steady.) (smartasset.com)
- Instead, the economy improved, stocks rebounded, and gold plunged, losing 28 percent of its value in 2013. (aarp.org)
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
External Links
wsj.com
- Saddam Hussein's Invasion Helped Uncage a Bear In 1990 – WSJ
- Want to Keep Gold in Your IRA at Home? It's Not Exactly Lawful – WSJ
finance.yahoo.com
bbb.org
investopedia.com
How To
Gold IRAs are a growing trend
As investors look for ways to diversify their portfolios and protect themselves against inflation, the gold IRA trend is on the rise.
Owners of the gold IRA can use it to invest in physical bars and bullion gold. It can be used as a tax-free way to grow and it is an alternative investment option for people who are not comfortable with stocks or bonds.
Investors can have confidence in their investments and avoid market volatility with a gold IRA. Investors can protect themselves from inflation and other possible problems by using the gold IRA.
Investors also get the unique benefits of owning physical Gold, including its durability, portability, flexibility, and divisibility.
Additionally, the gold IRA has many benefits. It allows you to quickly transfer your gold ownership to your heirs. The IRS doesn't consider gold a commodity or currency.
This is why the gold IRA has become increasingly popular with investors looking to provide financial security during times of financial uncertainty.
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By: Terence Zimwara
Title: Report: Nigeria-China Currency Swap Agreement Fails to Ease Pressure on the Naira
Sourced From: news.bitcoin.com/report-nigeria-china-currency-swap-agreement-fails-to-ease-pressure-on-the-naira/
Published Date: Sun, 16 Apr 2023 09:30:49 +0000
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