Rollingnaira

Key messages Improved competitiveness, in part through the real effective exchange rate, can transform the structure of a country’s domestic production. An overvalued naira is functioning as an export tax and challenging Nigeria’s economic transformation and diversification away from the oil sector. Learning from Indonesia and other countries, devaluations can be an effective currency intervention to allow diversification for economic transformation. Competitiveness as a precursor to transformation Economic transformation often denotes a move away from low-productivity to high-productivity growth. Promoting economic transformation in the aftermath of shocks is one strategy for developing economies to build resilience to further shocks. This is particularly true for resource dependent economies, given that they are more vulnerable to shocks. Many of these countries are still managing the fallout from multiple economic shocks, including the continued effects of