As controversies over Nigeria’s the foreign exchange (forex) market continue to rage in the public domain, the Centre for the Study of the Economies of Africa (CSEA), a leading research firm on Africa’s economic development trends, has advocated the need for the Nigerian government to boost productivity across sectors of the economy in order to permanently tackle the lingering forex crises.
The research think-tank, in its latest Nigeria Economic Update Issue 36 sourced by our correspondent on Tuesday, had noted some recent measures by the Central Bank of Nigeria (CBN) to stabilize the Naira exchange rate for other foreign currencies, stressing that the measures should be completed by other measures to achieve the desired results.
For instance, the CSEA recalled that the CBN had directed banks, through a recent letter, to publish on their websites the names and Bank Verification Number (BVN) of customers who defaulted against existing forex sale policies by presenting fake travel documents or cancelling their tickets but failed to return the purchased Personal Travel Allowance/Business Travel Allowance.
The research firm pointed out that the apex bank directive was sequel to reports of practices by bank customers to circumvent the new CBN policy on the sale of foreign exchange was detailed.
The CSEA researchers observed the the circular cameon the back of the CBN’s July directive to all banks to establish teller points that will be in charge of selling forex to retail customers, and the indefinite ban placed on forex trading by Bureau De Change outlets.
While noting that these moves by the CBN shows the apex bank’s resolve in ensuring an efficient forex market, the experts, however, cautioned that this policy would further tighten the supply of forex and lead to further depreciation of the Naira which will ultimately transmit to the general price levels in the domestic market as Nigeria is heavily reliant on imports.
On the way out of the lingering forex crises, the CSEA recommended that “the long-term solution to the forex crises is to improve the production capacity of the economy to boost exports.”
