The Nation Newspaper

Tag: foreign exchange (FOREX)

  • CBN to blacklist exporters withholding forex proceeds

    CBN to blacklist exporters withholding forex proceeds

    The Central Bank of Nigeria (CBN) is threatening to sanction exporters who fail to repatriate foreign exchange (forex)  proceeds from their businesses  into the economy.

    CBN Director (Banking Supervision) Abdullahi Ahmad, who issued the warning yesterday during the Bankers’ Committee meeting in Lagos, spoke of a provision in the CBN Foreign Exchange Manual that mandates all exporters to repatriate their proceeds back to the country to support the local currency and the economy.

    The manual stipulates that proceeds of oil and non-oil exports are to be repatriated into the export proceeds domiciliary accounts of their exporters’ accounts within 90 days for oil exports and 180 days for non-oil exports. Where this policy is violated, the collecting bank will be liable to a fine of 10 per cent of the Free On Board value of the transaction, including other appropriate penalties as provided in the Banks and Other Financial Institutions Act.

    Likewise, where the exporter fails to repatriate the proceeds into the domiciliary account within the stipulated period, the exporter will be barred from participating in all the segments of foreign exchange market in Nigeria.

    Ahmad said many exporters, who benefited from Federal Government’s support scheme, continually failed to comply with this directive, adding that the defaulters would be barred from other banking services.

    He said the CBN had continued to take strategic steps to ensure that Nigeria exporters’ businesses thrived and that not sending earned dollar back to the economy was not proper.

    He said the Gross Domestic Product (GDP) growth of 0.5 per cent, which brought the country out of recession, needed to be improved on, and called for more hard work to achieve better growth for the economy.

    The stability in the foreign exchange market, moderation in inflation and capital market recovery are indications that the economy is getting better, Ahmad said.

    Also speaking, Unity Bank Managing Director/CEO Mrs. Tomi Somefun said the disbursement of  N26 billion special fund for players in the  agricultural sector  would begin at the end of this quarter. The fund, first announced in June, was part of the banks’ plan to finances agro-based small and medium scale enterprises (SMEs).

    The contribution follows the directives of the CBN to all commercial banks to remit five per cent of their annual after-tax profit in support of a scheme as part of the guidelines for the  Operations of the Agricultural/Small and Medium Enterprises Investment Scheme (AGSMEIS). The programme was first approved at the 331st Bank’s Committee meeting, held on February 9th this year.

    Also speaking at the Bankers’ Committee meeting, Managing Director/CEO Emeka Emuwa said the Bankers’ Committee was also worried about the return of ponzi scheme- Mavrodi Mundial Moneybox (MMM).

    He said such schemes always thrived when the end of the year approaches. “The Ponzi schemes are back and more about them as the year comes to an end,” he said.

    According to the Union Bank boss the CBN has instituted the collateral registry to help SMEs access funds, and create more jobs. “The Collateral Registry is going to facilitate lending to the SMEs and also boost employment,” he said.

    The Bankers’ Committee praised the CBN for the stability achieved in the foreign exchange market, adding that the apex bank had been steadfast in executing its policies.

  • CBN injects $195m into foreign exchange market

    CBN injects $195m into foreign exchange market

    Following its 800 million dollars intervention in the inter-bank Foreign Exchange (FOREX) Market last week, the Central Bank of Nigeria (CBN), on Monday, injected 195 million dollars into the market to meet the requests of customers in the various segments of the market.

    The acting Director, Corporate Communications, Mr.  Isaac Okorafor, said in a statement in Abuja that the bank would soon introduce a new FOREX retail option.

    Giving a breakdown of funds injected on Monday, he said the apex bank offered 100 million dollars to authorized dealers through interbank wholesale window, while it allocated 50 million dollars to Small and Medium Enterprises (SMEs) window.

    Okorafor said the Invisibles segment was allocated 45 million dollars to meet the needs of those who applied for FOREX to settle Business/Personal Travel Allowances, school tuition and medicals.

    The CBN spokesperson said the bank would continue to ensure adherence to its forex policy by insisting on transparency by stakeholders to guarantee stability in the market.

    The CBN made two major interventions in the inter-bank Forex market last week, totaling 831.5 million dollars.

    Since February 2017, the bank had boosted transactions at the Investors’ and Exporters’ segment of the market to the tune of 2.2 billion dollars.

    Also last week, the CBN, in a bid to tackle inflation, unveiled plan to mop up N200.32 billion from the Nigerian banking system through special Open Market Operation (OMO) at the rate of 16 per cent per annum.

    Meanwhile, the Naira had continued to maintain its stability in the FOREX market, exchanging at an average of N364 to a dollar at the parallel segment of the market on Monday.

  • Discos to FG save us from forex black marketers 

    …Blames power outage on transmission constraints

     

    The association of Nigerian electricity distributors (ANED) Director of Research and Advocacy, Bar. Sunday Oduntan Wednesday called on the Federal Government to save the DisCos from the hands of black marketers of foreign exchange (forex).

    He urged the government to direct the Central Bank of Nigeria (CBN) to give priority to the power sector operators in order to save them from purchasing dollars from the black market.

    His words: “we have been calling on the Federal Government to get the CBN to give us priority, so that we don’t have to go to the black market to buy dollar. So the one that is going on now, is beneficial to us. If dollar improves against the dollar it will benefit the DISCO’s”

    Citing an example with metering, Oduntan said that “we have about 2.9m customers yet to be metered ,and if you look at the amount of money required to do that even at the minimum of N53,000 per meter , it can be more than that now because of forex issue. If forex goes down it can still go below that 53,000 that means we need billions of naira to take care of that”.

    According to him, the government needs to do more to fix the power sector as that is the only way to fix the economic situation of the country.

    Oduntan blamed the constant power outage on transmission bottleneck, noting that areas like Apo, Central Area, Katampe and Gwagwalada are experiencing power outage, owing to defective facilities of the Transmission Company of Nigeria (TCN).

    Oduntan, however said that instead of simply blaming the situation on the TCN, he would rather urge the Federal Government to strengthen it for efficiency through sufficient investment.

    According to him, the Federal Government needs to urgently and critically support the entire value chain, in order to make the Nigeria Electricity Supply Industry (NESI) profitable or commercially viable.

    He said “N701 billion intervention fund is a good start but without a holistic resolution and details of how the intervention will work, we will not make progress, that is our reaction to that intervention. There must be a holistic resolution for the whole value chain from the upstream to downstream.so that for me in the downstream side of the sector, if I am buying a product at the rate of N68 and I am only allowed to sell it for N31.50,there is no way it can be commercially viable”. He added that the support needs to go down not just the GENCOs.

    He appealed to the general public to pay their bills, adding that electricity theft has remained one of the factors weighing down the efforts of the DISCos adding that the association appeals to the National Assembly to consider passing an anti-electricity theft bill, and create mobile courts to formally prosecute energy thieves.

    He called on the key players in the energy sector, to adopt “SCADA” a technology which according to him, can help monitor the activities of power facilities nationwide.

     

  • Naira to appreciate further as CBN boosts forex sale

    Naira to appreciate further as CBN boosts forex sale

    The Naira is set to appreciate further in the week as the Central Bank of Nigeria (CBN) plans to inject more Foreign Exchange (Forex) into the market to meet the requests of genuine customers.

    The spokesman of CBN, Mr Isaac Okorafor, gave the assurance in a statement on Sunday in Lagos.

    The News Agency of Nigeria (NAN) reports that the apex bank had so far kept to its promise of continuing to supply enough forex to guarantee liquidity in the market.

    The statement said the bank was committed to ensuring that authorised dealers got sufficient supply to meet the demands of authentic customers of banks.

    It disclosed that the bank had since February offered over one billion dollars to the interbank market.

    The bank expressed optimism that stability had been restored to the forex market.

    According to the statement, individuals can easily access forex to address personal and business allowances.

    NAN reports that a summary of the CBN intervention in the interbank market over the past two months, shows the highest bid rate was N360 per dollars, while the lowest was N315 per dollar. (NAN)

  • Reps summon oil company’s chief over diversion of $9.1 forex

    The Managing Director of Total Nigeria Plc has been invited by the House of Representatives to explain the position of the company over alleged  diversion of $9.1m Foreign Exchange (forex).

    Total was alleged to have collected as part of the Federal government special intervention fund through the Central Bank of Nigeria (CBN) for the importation of Premium Motor Spirit (PMS) for avoidance of scarcity of the product in the country.

    This emerged Thursday at the continuation of a public hearing by the Nnana Igbokwe – led ad hoc committee on the review of petrol pump price.

    The committee expressed concern over the discrepancies in the presentation and documents of the oil company that were at variance with those presented by the Department of Petroleum Resources (DPR), Nigeria Ports Authority (NPA) among others.

    Total’s N2.1b indebtedness to Pipeline and Product Marketing Company  (PPMC) also became a subject of controversy as the 14 days credit sales agreement that does not give them room to default in payment appear to have been jettisoned.

    “Forex collected by you was on the 22nd June, 2016, but I want to draw your attention to products consummed by you before collecting forex to pay”.

    “How come you are owing this huge sum when you are to pay for any product received from PPMC on or before 14 days.

    “It is even more worrisome that the document before us shows that the N2.1b reflects that the indebtedness I arising only from Dual Purpose Kerosene (DPK).

    “So we stand by the decision that the transaction you are doing with PPMC is opaque, your through-put documents are not included here; neither is your credit sales.

    “The entire process of your acclaimed reconciliation with PPMC is fraught with irregularities”, Igbokwe said.

    Total’s representative, Funmi Ogunmade, in his response said dispute with the DPR over certain transactions with PPMC had made reconciliation of records difficult.

    “I will crave your indulgence to step down the decision as taken by your committee due to the irreconcilable differences between us and PPMC”, Ogunmade said.

  • FG to prosecute illegal importers of frozen fish

    FG to prosecute illegal importers of frozen fish

    …seal offenders cold room

    The Federal Government says it will henceforth arrest, prosecute and fine illegal importers of frozen foods into the country through the land borders and seal cold rooms where it is sold.

    Sen. Heineken Lokpobiri, the Minister of state for Agriculture and Rural Development, announced this while speaking with newsmen in Abuja on Thursday.

    Lokpobiri said the government would also set up a taskforce to seal and prosecute operators of cold room, who deal on those illegally imported produce.

    The minister said the ministry was working in collaboration with the Nigeria Customs Service, Nigerian Navy and the Nigerian Marine Police to actualise the plan.

    He said the offenders would pay a fine of $250,000 or attract five years imprisonment or both in addition to the forfeiture and destruction of the produce as stipulated by the law.

    He listed some of the fishes usually being imported to include tilapia, red pacus, river bream, pangassius, horse mackerel, sardine and croaker, among others.

    Lokpobiri said the illegal venture had resulted to huge loss of revenue, decrease in local production and loss of jobs, as well as discouragement by farmers.

    The minister, who said that the move was to encourage local production and exports, disclosed that the country’s annual demand on fish was currently at 3.2 million tonnes and deficit at 1.9 million tonnes.

    According to him, the Department of Fisheries and Aquaculture in the ministry is the only competent authority empowered by the Nigeria Sea Fisheries Act to issue distant water fishing licence for the importation of frozen fish into Nigeria.

    “The department does not issue licence for the importation of frozen farmed fish into Nigeria through the land borders.

    “The smuggling of unhealthy frozen fish into the country is detrimental to the progress being made toward guaranteeing the good health and nutrition of Nigerians.

    “We will continue to partner with the Nigeria Customs Service, the Navy, marine policy to see how we can clamp down on the offenders.

    “Even those that have brought the produce into the country, we are setting up a taskforce that will go round different cold rooms, like what Customs is doing to rice.

    “Any cold room that we find these fishes, we will seal them up, ensure you pay the $250,000 fine because laws are meant to be obeyed,’’ he said.

    The minister said that consumption of those imported frozen foods were major cause of some health challenges being experienced in the country.

    Lokpobiri, who frowned at the rising cases of kidney disease among children between the ages of five and seven, assured that the government would fight the menace to a halt.

    In an interview, Mr. Lamina Rasheed, the National Chairman, Association of Indigenous Seafood Stakeholders, appealed to the Federal Government to release foreign exchange (FOREX) for the importation of fish.

    He said that getting FOREX at a cheaper rate would ensure reduction in the price of the produce and make it affordable.

    The chairman said the illegal importation of fishes was detrimental to their business.

    Rasheed said that members of the association paid import duty of 14 per cent, which amounted to millions of naira to the Federal Government while the illegal importers pay next to nothing through the land borders.

    According to him, it is difficult to compete with them in the market because they slash their prices.

    He attributed the high cost of fish to the current exchange rate, adding that the frozen fish did not enjoy FOREX from the Central Bank of Nigeria (CBN).

    “Before, we were getting FOREX from the government but now, we are buying from the open market.

    “When you pay 14 per cent and somebody is paying zero per cent, how do you sell your commodity?

    “Therefore, all the fishes we brought legally into the country are currently stocked in the cold room because we cannot afford to lose our money or bank’s money.

    “We have a lot of stocks in the cold room, which are unsold,’’ Rasheed said.