BUSINESS DAY NG
The pressure on foreign exchange (FX) is expected to ease soon and a stronger naira is anticipated as the Economic and Financial Crimes Commission (EFCC) and the Association of Bureaux De Change Operators of Nigeria (ABCON) have agreed to crash the dollar rate at the black market.
This followed a meeting held on Monday at the EFCC headquarters in Abuja attended by EFCC Chairman, Ola Olukayide and ABCON National Executive Council (NEC) led by its President, Aminu Gwadabe.
When contacted by BusinessDay on Tuesday, Gwadabe said he would share the communique as soon as possible.
Part of the discussion was a directive for an approval for ABCON to establish a common website for BDCs rate and trading platforms.
The platform is to also serve as a challenger to other platforms in the economy and ensure uniform rate reporting.
ABCON reiterated CBN-licenced BDCs readiness for regulatory reforms that would reposition the operators for enhanced efficiency, transparency and compliance with set regulations in the interest of the financial system and economy.
Gwadabe said that despite the challenges facing the BDC segment of the financial markets, its role of providing across-the-counter, retail foreign exchange services to end-users is sacrosanct.
He said ABCON and CBN-licenced BDCs will continue to discourage forex end-users from patronising the unofficial or black market segment of the forex market to achieve exchange rate stability and convergence.
Nigeria’s financial crimes watchdog has granted approval to the Association of Bureaux de Change Operators of Nigeria, allowing them to publicly disclose the buying and selling rates of the naira against the dollar on the internet.
Aiming to boost competitiveness and foster better price discovery in the market, the association’s president, Aminu Gwadabe, emphasized the move’s objective to challenge the parallel market.
This decision marks a departure from the previous central bank leadership’s measures, which sought to control bureaux de change and restrict the visibility of the unofficial market in an attempt to stabilize the official naira. However, those measures inadvertently pushed trading activity to the streets and into the shadows.
With the new directive, naira exchange rates are set to be prominently displayed online, aligning with the broader initiative of Africa’s most populous nation to transition away from a managed exchange rate and bring about greater unity between the official and unofficial markets.
The naira has weakened by about 50 percent against the dollar since the reforms were announced in June and the spread between the two markets — which briefly merged — has widened due to the local scarcity of dollars, Bloomberg reports.
The Economic and Financial Crimes Commission has taken aim at currency traders, many who operate on the streets, accusing them of money laundering and manipulation.
