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Tag: Naira

  • Naira value: We won’t kill our people, CBN tells IMF

    Naira value: We won’t kill our people, CBN tells IMF

    The Central Bank of Nigeria (CBN) declared yesterday that it has no intention of ‘killing’ Nigerians through undesirable monetary policies.

    The CBN, in a reaction to a call by the International Monetary Fund (IMF) for Nigeria to float the naira, declared that it made no sense for the country to introduce a policy that will ‘kill’ Nigerians.

    ”Our economy has its own peculiarities, and we cannot kill our people in the name of floating the naira,” CBN Acting Director, Corporate Communications, Isaac Okorafor ,said on the sideline  of the ongoing IMF/ World Bank Spring Meetings in Washington DC.

    Okorafor insisted that Nigeria’s market is extensively liberalized  already and the call to float the naira is unnecessary.

    His words:”Yesterday, when Madame Lagarde (IMF boss) was discussing the economy of Egypt, she lamented the devastating inflation that is in that country.

    “Egypt has half of our population, Egypt receives about $12 billion in foreign aids and several billions in tourism. We are 180 million people, our infrastructure is so  poor and the productive capacity cannot be fast enough to rise to benefit from massive depreciation.

    “If you float the naira today, and given the discoveries by security agencies, you’ll discover that our case will be terrible.

    “ If Egypt today has an inflation rate of almost 31 per cent, remember Angola also has about 36 percent inflation, ours is at 17.26 per cent. If we float the naira and allow speculators and those with corruption money and all the people who create the bubbles to launch into the market, you can yourself imagine the kind of situation we will find ourselves”.

    He said that there is no country that floats its currency, by just leaving it to the dictates of the market.

    Okorafor also said that the CBN would sanction banks denying Small and Medium Enterprises (SMEs) access to foreign exchange (Forex) from the newly instituted SMEs Forex Window.

    The window which  opened about  two weeks ago  is designed  to help SMEs import eligible finished and semi-finished items not exceeding $20,000 for an enterprise per quarter.

    Appropriate sanctions are spelt out by the   CBN Act  and the  Banks and Other Financial Institutions Act (BOFIA).

    He said staff and even  chief executives of banks could be punished where necessary.

    The CBN spokesman said the apex bank has  already received series of complaints from bank customers, especially those that operate in the SMEs segment of the market that banks are frustrating their efforts at getting forex.

    Okorafor said some entrepreneurs still complain that banks are frustrating their efforts at obtaining forex for their eligible imports after the stipulated 48 hours. He said the regulator has reviewed the complaints and discovered they are not evidence-based.

    He appealed to  bank customers and the SMEs to “please give us concrete evidence against these banks so that we can hold them responsible by way of sanctions.”

    He added: “Get a photocopy of your Form Q, Form X, Form A or Form M. Give us the name of the bank, branch and send to us and we will deal with them as example to others.

    “The only way the we can make things better for Nigerians is for them to call the CBN whenever they are in trouble or whenever, or are getting frustrated by banks.

    “We have a number you can call or you send an email to our Consumer Protection Department. We want to urge everyone who is frustrated by banks to call and lay complaints. We assure you that you will get redress,” he said.

  • Naira consolidates gain against Dollar

    The Naira on Thursday strengthened against the dollar in all the major segments of the market, the News Agency of Nigeria (NAN) reports.

    At the parallel market, the Nigerian currency gained five points to exchange at N385 to the Dollar from the N390 recorded on Wednesday.

    The Pound Sterling and the Euro traded at N495 and N410, respectively.

    At the Bureau De Change (BDC) segment, the Naira closed at N362 to the dollar, while the Pound Sterling and the Euro exchanged at N490 and N424, respectively.

    Currency traders urged the Federal Government to plough back the huge sums of money recovered from looters into the economy to further prop up the Naira.

     

  • Naira strengthens against dollar at parallel market for N398

    Naira strengthens against dollar at parallel market for N398

    The naira firmed against the dollar at the parallel market on Tuesday, closing at N398 to the dollar.

    The News Agency of Nigeria (NAN) reports that the naira appreciated from the N410 it posted at the segment on Friday

    It was traded at N497 and N430 to the pound sterling and Euro, respectively, at the segment.

    At the Bureau De Change (BDC), the dollar was sold at N362 to the dollar, while the pound and the Euro closed at N495 and N428, respectively.

    Trading at the interbank saw the naira closing at N306 to the dollar.

    Traders still expressed optimism that the naira might sustain its appreciation against the dollar as the CBN maintained its liquidity boost to all the segments of the market.

    Meanwhile, Alhaji Aminu Gwadabe, the President, Association of Bureau De Change Operators of Nigeria (ABCON), said that BDCs were working hard to close the gap between the official and the parallel market rates.

    He commended the CBN for increasing the volume of foreign exchange offered to BDCs weekly and promised that its members were ready to drive down the rates if the apex bank continued to inject more liquidity to the sector. (NAN)

  • IMF urges Nigeria to adopt flexible exchange rate

    IMF urges Nigeria to adopt flexible exchange rate

    The International Monetary Fund (IMF) on Tuesday released its World Economic Outlook (WEO) and advised Nigeria to adopt flexible foreign exchange regime to restore values of revenues and the naira.

    Speaking at a media briefing to unveil the WEO, at the ongoing IMF/World Bank Spring Meetings in Washington D.C, IMF’s Chief of the World Economic Studies Division, Oya Celasun, said the nation’s economy will benefit from flexible exchange rate.

    She also challenged Nigeria and other African countries to adjust their fiscal policies, in line with the continued drop in crude oil prices.

    “Fiscal policy has to adjust to new realities of oil price fall, even though it is a difficult adjustment. It requires coherent of policies. In many cases, that should be achieved by focusing more on domestic revenue mobilization and to some extent, by rationalizing expenditures,” she said.

    Celasun said there was also broader need to diversify the economy away from basic commodities of growth, such as crude oil to achieve sustainable growth.

    Also speaking at the press conference, IMF’s Economic Counsellor/ Director of Research, Maurice Obstfield, said the Fund will continue to engage governments from emerging markets, but added that it was hard to be optimistic because of the challenges faced by such economies.

    He said that each African country remains different in terms of economic challenges they face, stressing that such problems will require diverse solutions.

    He projected that world economy will grow at a pace of 3.5 per cent this year, up from 3.1 per cent last year, and 3.8 per cent in 2018.

     

  • Liquidity boost to BDCs narrows exchange rate gap, says Gwadabe

    Liquidity boost to BDCs narrows exchange rate gap, says Gwadabe

    Alhaji Aminu Gwadabe,  the President of Association of Bureau De Change Operators of Nigeria (ABCON), says  lower exchange rate gap is due to liquidity boost to the BDCs sector.
    Gwadabe told the News Agency of Nigeria (NAN) on Tuesday in Lagos that the increase in the weekly volume of foreign exchange offered to BDCs  had seen the reduction in the exchange rate gap from N418 to N403 to the dollar.
    “The review of volumes upward of the proceeds of International Money Transfer Services Operators (IMTSOs) and the removal of disparity in applicable exchange rates is impacting the rates positively,’’ Gwadabe said.
    The ABCON chief said that the naira rebounded to an all time low of N360 from N520 to the dollar at the onset of the CBN’s injection of liquidity to the inter-bank market.
    He, however, said that it was surprising that the gains of the injection of over 1.5 billion dollars by the CBN could not last for more than two weeks in spite of liquidity boost to the banking sector.
    “The naira witnessed another somersault to a new high of N420 to the dollar in spite of the liquidity boost to the banking sector,’’ he said.
    Gwadabe said that all these were happening at a time when the banks were returning most of their purchases for invisible from the CBN on the premises of poor customer patronage and resistance.
    The president of the association said that the CBN was left with the only option of using the BDCs to ensure the renewal of confidence in the foreign exchange market.
    He said that the apex bank’s move was also to check the renewed onslaught by speculators, parallel market operators and currency hoarders.

    Gwadabe said the BDCs were collaborating with the CBN and the security agencies to ensure the stability of the naira, adding that the naira might strengthen further during the week.

  • Nigeria’s inflation declines by 0.52 % in March

    Nigeria’s inflation declines by 0.52 % in March

    The National Bureau of Statistics (NBS) on Thursday said that inflation dropped by 0.52 per cent in March, the second decline recorded on the year- on- year basis.

    The first decline was recorded in February when inflation dropped by 0.94 per cent.

    In its latest Consumer Price Index (CPI) for March released in Abuja, the bureau stated that the index, which measured inflation increased by 17.26 per cent year-on-year.

    It, however, stated that the increase was a slower pace in March when compared to February consumer activities, which was 17.78 per cent.

    “This is the second consecutive month of a decline in the headline CPI on a year-on-year basis.

    “It represents the effects of stabilising prices in already high food and non-food prices as well as favourable base effects over 2016 prices.

    “It is also indicative of early effects of a strengthened Naira in the foreign exchange market.’’

    According to the report, price increases have been recorded in all Classification of Individual Consumption by Purpose (COICOP) divisions that yield the Headline Index.

    It, however, stated that the major divisions responsible for accelerating the pace of the increase in the headline index were Housing, Water, Electricity and Gas.

    Others it said were Education, Food and Alcoholic Beverages, Clothing and Footware and Transportation Services.

    On a month-on-month basis, the report stated that the Headline index increased by 1.72 per cent in March, 0.23 per cent points higher from the rate recorded in February.

    The Food Index increased by 18.44 per cent (year-on-year) in March, slightly down 0.09 per cent points from the rate recorded in February, which was 18.53 per cent.

    It stated that the index was driven by increases in the prices of bread, cereals, meat, fish, potatoes, yams and other tubers and wine.

    It also stated that the slowest increase in food prices year-on-year was recorded by Soft Drinks, Fruits, Coffee, Tea and Cocoa.

    In addition, the report stated price movements recorded by All Items less farm produce or Core sub-index rose by 15.40 per cent (year-on-year) in March.

    It stated that it was down by 0.60 per cent points from the rate recorded in February (16.00) per cent.

    “During the month, the highest increases were seen in miscellaneous services relating to dwelling, electricity, solid fuels, clothing materials.

    “Increases were also seen in other articles of clothing, Liquid fuel, Spirits as well as Fuels and lubricants for personal transport equipment.

    “The Urban index rose by 18.27 per cent (year-on-year) in March from 18.57 per cent recorded in February, and the Rural index increased by 16.47 per cent in March from 16.98 per cent in February.’’

    On month-on-month basis, the report stated the urban index rose by 1.76 per cent in March from 1.52 per cent recorded in February.

    It further stated that the rural index rose by 1.69 per cent in March from 1.47 per cent in February.

    The News Agency of Nigeria (NAN) reports that CPI measures the average changeover time in prices of goods and services consumed by people for day to-day living.

    The construction of the CPI combines economic theory, sampling and other statistical techniques using data from other surveys to produce a weighted measure of average price changes in the Nigerian economy.

  • EFCC recovers another huge cash in Lagos apartment

    EFCC recovers another huge cash in Lagos apartment

    The Economic and Financial Crimes Commission (EFCC) on Wednesday recovered yet another huge sum of dollars, pounds and naira in a Lagos apartment.

    According to the EFCC, about $38m, N23m and £27,000 cash was found during a sting operation by its operatives from the Lagos Zone.

    N250m had earlier been recovered from the Balogun market in Lagos on Monday.

    See Video below of the counting of the money.

    Details later

     

  • ABCON seeks more strength for Naira

    ABCON seeks more strength for Naira

    The Association of Bureau De Change Operators of Nigeria (ABCON) on Monday directed its members to ensure that the Naira appreciated against the Dollar and other major foreign currencies.

    Its President, Alhaji Aminu Gwadabe, who spoke at the directors’ meeting in Lagos, said that it was important that the members complied with CBN regulation to force down the exchange rate in the parallel market.

    The ABCON chief said that the CBN was ready to increase weekly volume of foreign exchange to BDCs if they worked hard to drive down the increase in the exchange rate.

    “We will cooperate with the CBN to narrow the gap between the parallel market and the official market.

    “We are looking at an acceptable exchange rate for the dollar,’’ Gwadabe said.

    He noted that there were pressures, even from the International Monetary Fund (IMF) that the naira was overvalued.

    “There are pressures from speculators and from black market operators.

    “All these are happening in the market and it is really driving up the rate.

    “We are looking at a very acceptable margin between the official and parallel market rates, say a maximum of five per cent, which translates to about N10,” Gwadabe said.

    The financial expert said that speculators were influenced by sentiments which made the market volatile and prone to manipulations.

    Gwadabe said that the BDCs were ready to see that the market remained liquid to drive down the increase in the exchange rate.

    “Definitely our message will reach the market and we are sure with the support of our members, we are going to do it by the close of trading today.

    “On margin, we have told the regulators that it was small compared to other  climes, adding that there were margins that were up to 10 per cent,” Gwadabe said.

    Gwadabe said that the association already had a relationship with the Nigerian Inter-Bank Settlement System (NIBSS) to ensure that members used electronic platform for documentation of foreign exchange sales.

    He added that the usage of the electronic platform would commence in two weeks’ time, adding that some ABCON members were being disqualified on weekly basis.

    “Sometimes it is difficult to know that users have used their international  passports to buy foreign exchange.

    “They so perfect it that even if you put stamp, they can go and clean it and re-present it to you to buy dollars.

    “What we are doing with NIBSS is that there is a platform that they have developed whereby all the international passports that buy dollars will be stored on that platform.

    “So, BDCs will just go into that platform and input the passport number and this shows if the passport has been used by a particular bank or BDC, since one is allowed to buy one in a quarter, ‘’ Gwadabe said.

    Talking about the 450 million dollars found in an abandoned shop on April 7 in Lagos, he said that investigation was ongoing and still under the security purview.

    Gwadabe assured that as soon as investigation was concluded, the press would be briefed accordingly.

    “We have identified the characters involved and we are going to write them to invite them.

    “The reason we call this meeting is to say that we condemn it in entirety,’’ he said.

    Gwadabe urged members to desist from such act since it was an abuse of Know-Your-Customer (KYC) policy. (NAN)

  • Adeboye to those behind naira devaluation: you won’t live to enjoy your illicit gains

    Adeboye to those behind naira devaluation: you won’t live to enjoy your illicit gains

    From the board rooms and seminar halls, the battle to strengthen the naira went spiritual yesterday. The Redeemed Christian Church of God Worldwide General Overseer Pastor Enoch Adejare Adeboye has declared that those responsible for the drastic loss in the Naira’s value will not live to enjoy their illicit gains.

    The cleric was delivering a sermon at the special Sunday service organised by RCCG Region 11 (aka Ikoyi/Victoria Island family) at the Tafawa Balewa Square, Onikan, Lagos.

    Pastor Adeboye said the message was a revelation he received from God early this year, but which he was sharing for the first time.

    “Those who are deliberately destroying the Naira will make the money but will not spend it,” he said.

    The Naira has drastically and dramatically nose-dived in value in recent months, exchanging at over N500 to the United States (U.S.) dollar before it began to appreciate lately.

    Yesterday’s service was the first of its kind by Region 11, whose appellation was changed from “Ikoyi/Victoria Island Family” by Pastor Adeboye.

    “On my way here this morning, while I was on the long bridge, God told me to change your name to Blessed Family,” he said.

    Dwelling on the theme of the programme, which is “Enlarge”, Pastor Adeboye said it connotes the presence of the enlarger as well as the one to be enlarged.

    “God is not interested in addition but in multiplication” he said, adding that God has pleasure in the prosperity of His people.

    He enjoined the organisers to  take next year’s edition to the National Stadium because “God would have so much enlarged you that this venue would be too small for you”.

    Pastor Adeboye  admonished the congregation to always do the will of God and be ready to pay the price for greatness.

    Using his personal life as an example, Pastor Adeboye said his greatest desire was to become the youngest vice-chancellor in Africa but that God blessed him beyond his wildest imagination.

    “I might not have become the youngest Vice-Chancellor, but today I have many vice-chancellors who call me ‘daddy’ and I have my own university,” he said.

    “If you would be committed to the vision and mission of RCCG, you cannot die without commanding influence.

    “There is a special influence and special anointing upon RCCG,” he added.

    The Mother-in-Israel, Pastor  Folu Adeboye, described the programme as “the beginning of a new day” while appreciating those who grew the region from humble beginnings at Our Saviour’s School in the 1980s.

    The service started with the Regional Pastor, Charles Kpandei, leading the congregation to sing the Blessed Family’s special song.

    He paid tributes to his predecessor, Pastor  Oretayo Adetola, whom he described as the “matriarch” of the Blessed Family.

    Dignitaries at  the special Sunday service include the RCCG National Overseer, the National Secretary (represented), National Treasurer, Elders Fola Aboaba, Felix Ohiwerei, Okey Mofunaya, the Chief of Defence Staff, General Gabriel Olonisakin and provincial pastors, among others.

  • IMF’s Naira revival pill rejected

    IMF’s Naira revival pill rejected

    •Fund: currency overvalued by 20%

    If the Federal Government heeds the International Monetary Fund’s (IMF’s)  advice, it will collapse the exchange rates—official N306/$ and Bureau De Change  N360/$.

    To the IMF, the Naira is overvalued by 10 to 20 per cent.

    The IMF mission chief for Nigeria, Gene Leon, said that the Naira overvaluation “is somewhere to the tune of 10 to 20 per cent and that  the country’s 2017 projections for non-oil revenues are more optimistic than the Fund’s.

    He urged the authorities to increase tax levels to diversify income.

    Leon disclosed that the Nigerian authorities were concerned about the IMF’s last week Article IV Report.

    The Fund warned that the economy required urgent reforms and spoke of the dangers of a volatile foreign exchange market.

    It outlined a raft of failings in the Federal Government’s handling of Africa’s largest economy which could affect talks over at least $1.4 billion in international loans.

    But the President of the Association of Bureaux De Change Operators of Nigeria (ABCON), Aminu Gwadabe, said the IMF should explain the yardstick for its advice.

    According to him, the IMF has technically said that the official rate of N306/$ should move to N360/$.

    Gwadabe said: “The IMF and others look at the bureau de change rate. That is why we are saying there should be a special window for both entry and exit to encourage more capital inflows to supplement the foreign reserves and diversify dollar sources.”

    The Naira closed yesterday at N390/$ due to the Central Bank of Nigeria’s (CBN) intervention.

    The Managing Director, E.M Consolidated Investment Limited, a BDC operator, Emeka Moses, said the IMF has not explained the basis of its judgment on further naira devaluation.

    “Their judgment is not correct. The IMF and their group have since 1980s have been insisting that the naira be-devalued further. But we have continued to devalue to where it is today. The value of the currency cannot be taken singularly. There are many things that determine how the country runs its exchange”, he said.

    Moses said that Nigeria has inflationary economy, and cannot devalue more because it is not going to help us and we are trying to encourage local production.

    He added: “They are not in a position to give us a comprehensive economy plan, but they are not the ones running our economy.”

    The new report, according to Reuters, strikes a more critical tone than the Fund’s board adopted in a statement last week, though that also said the country should lift its remaining foreign exchange restrictions and scrap its system of multiple exchange rates.

    The IMF quoted the government saying further measures were under way which included the implementation of a more flexible foreign exchange market and “maintaining tight monetary policy to underpin price stability.

    “Nigeria has not asked the Fund for fiscal support but its recommendations may influence institutional lenders ahead of the annual spring meetings with the World Bank.

    “The World Bank has been in talks with Nigeria for more than a year over an application for a loan of at least $1 billion and the African Development Bank (AfDB) has $400 million on offer. But talks have stalled over economic reforms.

    “Nigeria fell into recession last year, its first in 25 years, largely due to the impact of low oil prices and militant attacks on energy facilities in the Niger Delta oil hub. Crude sales account for more than 90 percent of foreign exchange earnings and two-thirds of government revenue.

    “The country, whose economy contracted 1.5 per cent last year, has also been plagued by a conflict with Boko Haram militants since 2009, creating a humanitarian crisis in the northeast which authorities are struggling to handle.”

    The Washington-based Fund’s analysis coincided with yesterday’s launch of an economic recovery plan by President Muhammadu Buhari.

    But the IMF said the plan (Economic Recovery and Growth Plan), criticised by economists for including few concrete measures, “is not enough to drag the economy out of recession.”

    “If Nigeria’s economy is to recover, much more needs to be done, the IMF said in the staff report.

    It also urged the Federal Government to introduce immediate changes to its exchange rate policy – characterised by CBN curbs, multiple exchange rates and an artificially high naira valuation – or risk “a disorderly exchange rate depreciation”.