Nigerian currency traders ask central bank for official market access

- Advertisement -


ABUJA, Nov 11 (Businesshala) – Nigeria’s bureau de change operators have asked the central bank to consider a framework that would allow foreign exchange rates to exceed official market rates in an effort to eliminate black market premiums that put additional pressure on the naira. Will enable access to currencies.

- Advertisement -

Aminu Gwadabe, head of the Association of Licensed Currency Exchange Operators, said on Thursday that the body had sent a request to the central bank for an alternative foreign exchange window where they can handle expatriate remittances, capital imports and export proceeds.

- Advertisement -

In July, the central bank banned the sale of dollars to such operators in a string of restrictions on the foreign exchange market, forcing them to use black market rates and sending the naira tumbling to record levels.

“We are redefining our business model. Instead of central banks distributing dollars, let us focus on being the distributor of liquidity,” Guadabe said.

- Advertisement -

Nigeria is grappling with a dollar crunch as a result of low oil prices, its main exports and coronavirus-induced disruptions. This established a multiple exchange rate system as the government sought to avoid a large naira devaluation as a matter of national pride.

In the black market, the naira on Thursday firmed up to 540 per dollar, while at the official spot market it traded at 410 per dollar, which is broadly in the range held since June.

Guadabe said there was low demand for the dollar from importers and tourism, as well as insecurity across the country.

Nigeria is battling criminal gangs in the northwest that perform mass kidnappings for ransom, a decades-old Islamic insurgency in the northeast, piracy off the south coast and tensions from separatist movements in the southeast.

Nigerian Vice President Yemi Osinbajo has urged the central bank to ensure that the naira’s valuation reflects market rates, prompting the regulator to reconsider its policy, which it has used in an effort to manage pressure on the currency. To restrict imports. (Reporting by Chijioke Ohuocha, Editing by Andrei Khalip)

,

- Advertisement -

Stay on top - Get the daily news in your inbox

DMCA / Correction Notice

Recent Articles

Related Stories

Stay on top - Get the daily news in your inbox