A message to Nigerian banks by the high priest of Nigerian banking: “The era is coming to an end when because your customers need $100 million in foreign exchange or $200 million, you now want to go to the CBN and pack all the dollars. It is coming to an end before or by the end of this year. We will tell them don’t come to the Central Bank for foreign exchange again, go and generate from export proceeds,” Central Bank of Nigeria governor Godwin Emefiele.
The Nigerian forex crisis is spiraling out of control in defeat to the stringent policies initiated by the Central Bank of Nigeria (CBN) to tackle it.
The backdrop is not only evident in rising inflation rate, now 20.52%; it is also visible in its bearing on international transactions. The CBN has continued to limit the amount of dollars that Nigerians can spend on international POS. But that, like every other initiative it has taken, has failed to ameliorate the forex crisis.
Now banks are completely running out of dollars even though the CBN had earlier in the year, halted supply to Bureau de Change operators, opting to supply dollars to banks that will in turn sell directly to customers.
If the CBN does it, what that means is simple: you cannot run a manufacturing business in Nigeria which uses imported raw materials without having a clear strategy to deepen exports. In other words, every business in Nigeria which uses foreign inputs should have a foreign desk that can receive foreign currencies.
This is not a radical playbook. In Tekedia Capital, we encourage our startups to do everything necessary to earn US dollars, Euro, Pounds, etc even as they pack Nairas. Our thesis has been clear: Nigeria’s economic growth is slower than population growth, and within years, most of the big brother policies in Nigeria will stop working. Only companies that take charge of their futures will remain and thrive.
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Nigeria’s Forex Crisis: First Bank to Suspend Int’l Transactions on Naira Cards
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It’s actually radical here, because it means having a banking industry that understands banking, which presently is not the case.
It is not collection of deposits, approving withdrawals and disbursement of loans that make a banking institution; even women groups in the villages do such tasks more efficiently.
We need a banking industry that knows a thing about banking, that is not currently the case…
You obviously don’t know a lot about banking and banking activities in Nigeria.
This CBN governor is the most confused I have seen in years
NIGERIA unlike other nations are filled with hatred and usher negative policies that are rigid and are not profitable to the Ferderal government economy initiatives to readicate poorverty from existing among the u citizens.because of ingorance on other part of amateur employees employed to mismanage CBN.the only trying set of workers that are trying to build the economy of the national Nigeria are the cpd .con.the consumer protection beneficiary department.all other departments working contrary to the cpd initiatives should,such officials should be sumariryly dismissed from holding CBN office thence forth from sanctioning bad loan condition to spoil the commercial Bank from granting Free loan condition to company that government has granted power to borrow with power to forfeit any amount borrowed.eg EDWARD OBUKOWHO OKOTIE LIMITED RC 452559. For details call +2348086366539.contact the [email protected] lack of credit.
A good step
Until drastic steps are taken in the right direction, the forex issues in Nigeria would continue to be in deplorable state.
Let there be a more liberal condition for export of product and services to boost forex income.
Please share the drastic steps that comes to mind
The easiest way to solve the problem of foreign exchange crises in Nigeria is to encourage exports. We have a lot of products to export but the means to export them is not there. What I think the government should do right now is to assist local farmers and smes to export their products easily . if this is done things would automatically get balanced because there won’t be need for rushing of dollars any more
Good
The CBN governor is something else
Supply of dollars is low and the demand is high
Which will lead to the fall of the naira
Bring back crypto
Nigerians will leave Dollars and go for it
Production of consumables and ease of export is needed internally. Local alternatives in production will be a result of research and development – A path that the Nigerian system is yet to imbibe.
We need to go local and develop local from the presidency to the ordinary man.
The reasonable thing for CBN to do is to float the naira to be traded in international forex market. That way naira will be bought and sold as a stock thereby relieving the pressure on CBN to provide dollars for international transactions.
Until we encourage local farmers and we export our farm produce outside dollar will continue to drag us back, with my little knowledge about this so called forex or whatever we don’t need to be deceived, if you don’t produce and you over dependant on foreign things definitely you will be control by the currency, is not a most we produce cars or planes before we can enter the world market, with our farm produce naira will be respected and the value will be stable. There is a country that make billions in dollars every year export tomatoes..let’s create our own pattern and go back to farm….imagine our red oil in the USA market very very expensive over there but shipping it from here is hard so government need to work on many things over our export policies.look at what happened in Tanzania this year cashew nut season the usa bought all their cashew nuts not allowing others buyers to operate the others buyers have to rush to Nigeria to get cashews nut the reason why the price wasn’t stable here and it affected lots of local buyers to operate effectively..We have so many farms produces that we can use to save our naira,so many people use other Africa port to export Nigeria farm produce to other country but why?
Since this delta state man CBN governor enter office, he has destroyed naira to the point that any ideas the CBN governor brings to the table leads to further depreciation of Naira, Banks give loans with highest interest rate without considering the interest of the masses, I think the CBN governor should be arrested and the police should be allowed to investigate all the activities of the CBN governor, no body is worried about what this CBN governor is doing that is making the Naira to fall day by day, by the time the CBN governor leave office it will be too late. The CBN governor should be arrested and investigated.
The worst central bank governor, he has ruined Nigeria economy, he needs to be killed
Killed Noooo.His govt frustrated him
The cbn governor is most useless governor we ever have, very confusing and bad policies. He should get of that office.
The main
The main people that drive the economy are the small and medium scale enterprise. How can you short down SME and MSE from getting access to dollars to run their business and expect growth. Money is liquid was and need to flow in circular economy for effectiveness. For example chika is a small scale tailor that supply sowed fabric to international market. He has ability to buy machines and employ two other people to increase his output from 20 per month to 300/month but can’t because his bank card can only do 25dollars per month transaction. The majority of the people having access to dollars now don’t do business at home. It is those people that can not import little machine to increase export that drives the economy.