…erring members to burn fingers over rising
reserves
The Association of Bureaux De Change Operators of Nigeria
(ABCON) has warned its members and forex speculators putting
pressure on the naira exchange rate to stop such activities or risk
losing their money.
ABCON President, Aminu Gwadabe who disclosed this yesterday in
Lagos said the Central Bank of Nigeria (CBN)-licensed Bureaux de
Change (BDCs) will soon start full operations as the apex bank will
soon reopen dollar sales to operators.
According to Gwadabe, with the CBN’s planned lifting of
moratorium on dollar sales to BDCs, reopening of the airports for
air travels, global ease on restriction of movement are positive
indications that dollar flows to the economy will soon improve.
He said the naira was yesterday evening exchanging at N461 to
dollar at the parallel market but will be upbeat once dollar sales
to BDCs commence.
“The return of over 5,000 BDCs to the forex market will add
great strength to the Naira and lead to major capital losses for
forex speculators. It happened in 2016 and will happen again in
2020. The return of the BDCs will immediately boost Naira recovery
and put the enemies of the economy to shame. We are committed to
the CBN’s exchange rate stability and will take all necessary steps
within set rules and regulations to keep the naira stable,” he
assured.
Gwadabe said the return of BDCs to the forex market will help
chase away speculators, curb rising inflation, boost productivity
and employment, enhance price discovery, enhance market
transparency and competitiveness.
Continuing, the ABCON boss said the uptick in activities in the
Chinese economy has raised the country’s crude oil demand which
will impact positively on Nigeria’s crude oil sales to the Asian
country and boost dollar earnings.
Gwadabe added that the CBN has created enhanced fiscal buffers
with the $3.4 billion International Monetary Fund (IMF) loan under
the Rapid Financing Instrument (RFI) meant for Nigeria to meet its
urgent balance of payment stemming from the outbreak of the
COVID-19 pandemic. He said the loan, which has been disbursed, will
also boost Nigeria’s dollar reserves and financing to the budget
for targeted and temporary spending increases.
The loan, he added, will help in containing and mitigating the
economic impact of the COVID-19 pandemic and of the sharp fall in
international oil prices thereby putting the Naira in a better
standing against other currencies.
The ABCON boss said Nigeria’s foreign reserves have reached over
$35 billion, which represents enough buffers for the CBN to deal
with any act of illegal economic behaviour like hoarding,
speculation, conversion of local assets among other illicit
financial activities.
Gwadabe also added that the OPEC measures on sustainable price
stability are commendable as many governments across the world have
agreed to oil production adjustment targets and continued
collaboration with all their partners, a move that will benefit
Nigeria.
He said the CBN has also officially reviewed the naira exchange
rate to N380 to a dollar. Aside devaluing the naira, the apex bank
also adopted a unified exchange rate, and pushed the official rate
of the naira to N376 to dollar for International Money Transfer
Operators rate to banks; N377 to dollar for banks’ dollar sale to
CBN and pegged CBN’s dollar sales to banks at N378, all aimed at
attracting Foreign Portfolio Investment and strengthening the local
currency. The BDC operators are expected to buy dollar from the CBN
at N378 per dollar.
Gwadabe said the naira rate review and assurances by the CBN
Governor, Godwin Emefiele to foreign investors that want to
repatriate their funds from the country are positive for the naira
continued recovery.
“The apex bank has put in place policies to ensure an orderly
exit for foreign investors that might be interested in doing so and
has also urged investors to be patient as such repatriations are
processed, owing to the bank’s policy of orderly exit of
investments. The CBN has continually kept its promises to foreign
investors and that confidence will play in Nigeria’s favor,”
Gwadabe said.
He said the Federal Government’s plan to revise the 2020 budget
oil benchmark to $20 per barrel will make more foreign capital
available for economic development and strengthening of the
Naira.
Gwadabe commended efforts by the Federal Government in curbing
COVID-19 pandemic including several initiatives by the CBN meant to
boost the real sector growth and attract more foreign capital to
the economy.
He assured the CBN that ABCON and its members, remained
committed to supporting the regulator in realizing its exchange
rate stability mandate and ensuring transparent market operations
built on regulatory compliance and zero tolerance for market
abuse.
…erring members to burn fingers over rising
reserves
The Association of Bureaux De Change Operators of Nigeria
(ABCON) has warned its members and forex speculators putting
pressure on the naira exchange rate to stop such activities or risk
losing their money.
ABCON President, Aminu Gwadabe who disclosed this yesterday in
Lagos said the Central Bank of Nigeria (CBN)-licensed Bureaux de
Change (BDCs) will soon start full operations as the apex bank will
soon reopen dollar sales to operators.
According to Gwadabe, with the CBN’s planned lifting of
moratorium on dollar sales to BDCs, reopening of the airports for
air travels, global ease on restriction of movement are positive
indications that dollar flows to the economy will soon improve.
He said the naira was yesterday evening exchanging at N461 to
dollar at the parallel market but will be upbeat once dollar sales
to BDCs commence.
“The return of over 5,000 BDCs to the forex market will add
great strength to the Naira and lead to major capital losses for
forex speculators. It happened in 2016 and will happen again in
2020. The return of the BDCs will immediately boost Naira recovery
and put the enemies of the economy to shame. We are committed to
the CBN’s exchange rate stability and will take all necessary steps
within set rules and regulations to keep the naira stable,” he
assured.
Gwadabe said the return of BDCs to the forex market will help
chase away speculators, curb rising inflation, boost productivity
and employment, enhance price discovery, enhance market
transparency and competitiveness.
Continuing, the ABCON boss said the uptick in activities in the
Chinese economy has raised the country’s crude oil demand which
will impact positively on Nigeria’s crude oil sales to the Asian
country and boost dollar earnings.
Gwadabe added that the CBN has created enhanced fiscal buffers
with the $3.4 billion International Monetary Fund (IMF) loan under
the Rapid Financing Instrument (RFI) meant for Nigeria to meet its
urgent balance of payment stemming from the outbreak of the
COVID-19 pandemic. He said the loan, which has been disbursed, will
also boost Nigeria’s dollar reserves and financing to the budget
for targeted and temporary spending increases.
The loan, he added, will help in containing and mitigating the
economic impact of the COVID-19 pandemic and of the sharp fall in
international oil prices thereby putting the Naira in a better
standing against other currencies.
The ABCON boss said Nigeria’s foreign reserves have reached over
$35 billion, which represents enough buffers for the CBN to deal
with any act of illegal economic behaviour like hoarding,
speculation, conversion of local assets among other illicit
financial activities.
Gwadabe also added that the OPEC measures on sustainable price
stability are commendable as many governments across the world have
agreed to oil production adjustment targets and continued
collaboration with all their partners, a move that will benefit
Nigeria.
He said the CBN has also officially reviewed the naira exchange
rate to N380 to a dollar. Aside devaluing the naira, the apex bank
also adopted a unified exchange rate, and pushed the official rate
of the naira to N376 to dollar for International Money Transfer
Operators rate to banks; N377 to dollar for banks’ dollar sale to
CBN and pegged CBN’s dollar sales to banks at N378, all aimed at
attracting Foreign Portfolio Investment and strengthening the local
currency. The BDC operators are expected to buy dollar from the CBN
at N378 per dollar.
Gwadabe said the naira rate review and assurances by the CBN
Governor, Godwin Emefiele to foreign investors that want to
repatriate their funds from the country are positive for the naira
continued recovery.
“The apex bank has put in place policies to ensure an orderly
exit for foreign investors that might be interested in doing so and
has also urged investors to be patient as such repatriations are
processed, owing to the bank’s policy of orderly exit of
investments. The CBN has continually kept its promises to foreign
investors and that confidence will play in Nigeria’s favor,”
Gwadabe said.
He said the Federal Government’s plan to revise the 2020 budget
oil benchmark to $20 per barrel will make more foreign capital
available for economic development and strengthening of the
Naira.
Gwadabe commended efforts by the Federal Government in curbing
COVID-19 pandemic including several initiatives by the CBN meant to
boost the real sector growth and attract more foreign capital to
the economy.
He assured the CBN that ABCON and its members, remained
committed to supporting the regulator in realizing its exchange
rate stability mandate and ensuring transparent market operations
built on regulatory compliance and zero tolerance for market
abuse.