ABUJA (CU)_In late July, the Central Bank of Nigeria (CBN) announced its decision to completely cease forex sales to Bureau De Change (BDCs) operators and to channel the funds through commercial banks in the country. According to the apex bank, the move was in response to discovered that BDCs they have been flouting regulations and selling millions of dollars each day, contrary to the current cap of $5,000.
Nevertheless, the recent policy reform does not appear to have been successful in achieving its objective, as the growing illiquidity in the black market continues to pose a threat to financial stability in Nigeria. Currently, a US Dollar is traded at about N411, while in the black market, this value stands at N535.
Accordingly, CBN has now decided to increase the volume of dollars supplied to authorise banks by a significant proportion, with the aim of boosting foreign exchange supply in the system. The central bank has launched a host of other measures, including instructions to ministries, departments and agencies to stop collecting payment in foreign currencies and announcing that those who collect rent in dollars will also be prosecuted.
If you need dollars for foreign transactions, simply go to one of the authorised commercial banks in the country, the apex bank noted.
Officials of the CBN continue to express confidence in these reforms, noting that the central bank already has the capacity to meet the demands of those who wish to conduct legitimate transactions through the banks. They further noted that the country’s dollar exchange rate cannot be determined based on the rates in the black market, which represents less than 1 per cent of foreign exchange transactions.
“There is no reason for anyone, who needs dollars to go to the black market as long as the person needs dollars for legitimate purposes,” the officials told THISDAY during an interview. “Anyone patronising the black market to buy dollars at such rates must be engaged in illegal business, because he can get the same dollars from the banks, the CBN, investors and exporters’ window at much lesser rates.”
