Bureau De Change operators in Nigeria have cried out that due to the depreciation in the value of the Naira, some Nigerians have resorted to keeping their savings in the United States dollar.
The National President of the Association of Bureau De Change Operators of Nigeria, Aminu Gwadabe, pointed out that there was a need for the forex market to be liquid.
Gwadabe noted that the $2.2bn released by the African Import-Export Bank was not enough to stimulate the market.
“For now, it’s a difficult situation which is also creating panic in the market because the value of the naira is eroding and because of that, a lot of people prefer to keep their savings in dollars,” he disclosed.
Speaking on the $2.2bn facility, Gwadabe said, “The $2.2bn Afrexim bank crude prepayment facility is a welcome development but I don’t think it’s enough to stimulate the market considering the situation because if we put $2.2bn into the market, we have been seeing demand in the I&E window alone ranging from $150m to $250m daily so, in 10 days, the $2.2billion will be exhausted. Speculators will speculate and we will run it out between 10 to 15 days.”
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He, however, called for a paradigm shift in the supply of dollars into the FX market, He said, “we need to have a paradigm shift in terms of supply, it’s very important and should be immediate. We have been talking about diaspora remittances and as of last year, we recorded over $ 20bn US dollars.
“The market is willing buyers and sellers but, we need to separate operation and ownership because if we say an IMSO should be the one to initiate and terminate a transaction then hope for transparency in the transaction will be defeated.
“We, hereby, advise that the CBN review their 2020 circular whereby they have agreed or stated that the BDC should be an agent of the International Money Transfer Transaction so that we can now separate operation and ownership and with that, it won’t be the person that initiates the fund as the owner will be the one terminating the fund to the ultimate beneficiary.”
A financial analysts, said Nigerians were buying and keeping foreign exchange to meet future financial obligations.