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 desist from such activities or risk losing their money.
ABCON President, Alhaji Aminu Gwadabe, who disclosed this in a statement, said the Central Bank of Nigeria (CBN)-licenced Bureaux De Change (BDCs) would 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 was upbeat that the local currency would appreciate once the sale of the greenback by BDCs commence.
He said: “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.”
Gwadabe said the return of BDCs to the forex market would 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.