Skip to main content

Nigeria tightens controls on foreign exchange

(FRANKS..)
Oil platform off the Nigerian coast

The Nigerian central bank has imposed new foreign exchange controls to try to stem the flow of dollars out of the country.
It means importers will not be able to get hard currency to buy a list of 40 items ranging from rice to cement.
The list includes Indian incense, plastic and rubber products, soap and even private jets.
It has also restricted access to the interbank currency market for the purchase of foreign currency bonds.
In April, the central bank limited the amount that Nigerians could spend on credit cards abroad.
The Nigerian currency, the naira, has plunged because of the fall in the oil price.
The central bank has spent $3.4bn propping it up since it fixed the exchange rate in February and tightened trading rules to curb speculation.

Black market

"We see this policy move as confirmation that foreign exchange supply remains extremely tight. But more worryingly, it suggests that the central bank remains reluctant to devalue the naira," said Yvonne Mhango, sub-Saharan Africa economist at Renaissance Capital.
The central bank has said in the past that devaluing the naira by allowing it to float freely on the currency markets is not an option.
The naira, which was trading at 198.50 to the dollar on the interbank market, was reported to be trading close to 220 on the black market in the commercial capital, Lagos, on Wednesday.
Analysts said the latest measures meant importers would increasingly turn to the black market to buy dollars.
Cobus de Hart of South Africa's NKC Africa Economics said: "The decision to, in effect, introduce additional capital controls does not bode well in relation to investor perception and may also adversely affect domestic business operations and costs."

Popular posts from this blog

G8 Northern Ireland summit: Syria set to top agenda

Cannot play media. You do not have the correct version of the flash player. Download the correct version David Cameron and Vladimir Putin disagree on Syria but aim to build on "common ground" Continue reading the main story Syria conflict Behind the battle lines The city that died Who is arming whom? Guide to conflict The leaders of the G8 nations are to begin a summit in Northern Ireland, with Syria's conflict set to dominate. UK PM David Cameron met Russian leader Vladimir Putin - Syria's key ally - on Sunday. They will each hold separate talks with President Barack Obama, who has indicated he will arm the rebels. Mr Cameron, the host, is also keen to focus on global economic issues. He hopes to oversee the launch of talks for an EU-US free trade deal and achieve ...

Who are the Niger Delta Avengers?

(Franks.) With a name that sounds like it has come from the pages of a superhero comic book, the Niger Delta Avengers (NDA) is the latest militant group to emerge in Nigeria – attacking oil installations in a campaign which threatens the economy of Africa’s most populous state. “We are a group of educated and well-travelled individuals that are poised to take the Niger Delta struggle to new heights that has never been seen in this nation before,” the NDA proclaimed in one of their first statement’s on their website in April. “We have well-equipped human resources to meet this goal.” It was not an idle threat. The NDA has carried out a barrage of attacks on oil installations in the Niger Delta region, causing a huge decline in oil production, which is the mainstay of the West African state’s economy. “The renewed activities of the militants in the Niger Delta are seriously affecting our oil production,” Minister of Finance Kemi Adeosun admitted on state-owned NTA tele...

Nigeria won’t succumb to Boko Haram –Dogara 0

(FRANKS..)   From IHEANACHO NWOSU, Abuja Speaker of the House of Representatives, Yakubu Dogara, yesterday expressed wor­ry over mass killing and bombing of churches and mosques by Boko Haram insurgents in the North East. He, however, pledged that the nation would not bow to the insurgents. Dogara, in a statement by his Special Adviser on Me­dia and Public Affairs, Tura­ki Adamu Hassan, said the motive of the terrorist was to instill fear in the minds of Nigerians. He condemned yester­day’s bomb attack on wor­shippers in a church in Potis­kum, Yobe State, describing it as “barbaric, inhuman and wicked.” The Speaker said he was deeply worried over the “new dimension” of mass murder by Boko Haram in­surgents in recent days. He urged Nigerians not to lose hope in the capacity of the state and its security ap­paratus to subdue the insur­gents and bring the violence to an end. Dogara insisted that by embarking on mass killing and destruction of communi­ties, the...