Trade liberalization

This study examines the impact of government policies on the depreciation of the Nigerian Naira during the regime of General Ibrahim Babangida. The research focuses on the economic reforms introduced under the Structural Adjustment Programme (SAP), which aimed to restructure the Nigerian economy through deregulation, currency devaluation, and trade liberalization. Using a historical and analytical approach, the study evaluates how these policies influenced exchange rate dynamics, inflation, and overall economic stability. Data were obtained from secondary sources, including government publications, Central Bank reports, and scholarly literature. The findings reveal that while the policies were designed to promote economic growth and reduce external imbalances, they significantly contributed to the depreciation of the Naira due to increased market-driven exchange rate mechanisms, reduced government intervention, and rising demand for foreign exchange. Additionally, the study highlights the socio-economic consequences of currency depreciation, such as increased cost of living and reduced purchasing power among citizens. The research concludes that although the reforms had long-term economic intentions, their short-term effects exacerbated currency instability. It recommends the adoption of balanced policy frameworks that combine market efficiency with strategic government intervention to ensure currency stability and sustainable economic development in Nigeria.