Bureau De Change Operators Expect Dollar Rate To Rise Above N730 Due To CBN’s Policy

The policies of the Central Bank of Nigeria (CBN) under Godwin Emefiele have been blamed by the Association of Bureau De Change Operators of Nigeria (ABCON) for the hike in dollar rate.

According to the President of ABCON, Aminu Gwadabe, the exchange rate between the dollar and the naira is now N300 due to the decision of Emefiele to halt forex sales to the BDC operators. 

Gwadabe explained that, “The foreign exchange policy of the Central Bank of Nigeria (CBN) has adversely impacted the naira stability across all markets and created a huge premium between official and parallel market rates.” 

This reflects in the exchange rate, considering the dollar exchanged for naira at N501/$1 in the parallel market before Emefiele halted sales to the Bureau De Change operators. 

The rate has since soared to N730/$1 in the black market, with the naira depreciating by over N230 since the ban in July 2021. However, in the official market, the rate of both currencies stands at N430/$1. 

Gwadabe said the gap between the black market and the official exchange market could encourage “rent-seeking, currency substitution that continues to hurt real sector operators and the overall economy.” 

He said the dollar rate might continue to rise if fundamental goodwill and courage are demonstrated, “I am not a prophet of doom and student of continuing naira depreciation but except fundamental goodwill and courage are demonstrated, the naira will continue to suffer loss in exchange for the greenbacks. 

“The question on the lips of everyone is, are the banks not having the allocation for invisible transactions?” The president of ABCON said. 

Meanwhile, he asked for review of transactions that Bureau De Change operators are allowed to engage in. “A licensed BDC in Nigeria cannot access oil proceeds, non-oil proceeds, and Diaspora remittances. We need expansionary regulatory approvals on the scope of transactions and margin reviews.”