FG BARNS THE IMPORTATION OF FOREIGN CURRENCY

The Central Bank of Nigeria has banned the
importation of foreign currencies into the
country.

The Deputy Governor of the CBN in charge
of Economic Policy, Dr Sarah Alade, said in
Abuja that the measure was in line with the
bank’s determination to save the Naira and
the Nigerian economy from external
threats and dominance.
The dollarisation of the Nigerian economy
and a heightened money laundering
challenges were some of the key issues last
week’s Monetary Policy Committee meeting
singled out for immediate actions.
According to Dr. Alade, the movements of
currencies in excess of $5, 000 either out
of or into the country must be declared
and approved by the Central Bank.
Only last week, CBN withdrew the
operating license of 20 Bureaux de Change,
BDCs, found to have purchased and sold
huge sums of United States’ dollars with no
documentation to show details of the
transactions.
Dr. Alade reiterated the position of the
Governor of the CBN, Mallam Sanusi Lamido
Sanusi, after the MPC that “the Management
of the CBN frowned at the existence of
strong foreign exchange demand
pressures from domestic sources, which
are not necessarily linked to increase in the
import of goods and services”.
She said that the management also
observed the surge in United States Dollar
cash importation by Deposit Money Banks,
DMBs, and the huge cash sale of the US
dollars to BDCs by the DMBs.
While noting that Nigeria currently ranks as
the largest importer of United States
dollars, she disclosed that “the purchase
and sale of the cash is not adequately
documented by the BDCs”.
Alade said the Governor, Sanusi and his
team decided to take immediate action to
safeguard the Naira and ensure its stability
in the face of the challenges.
Meanwhile, the Retail Dutch Auction System,
RDAS, will commence today, following the
suspension of the Wholesale Dutch Auction
System, WDAS, at the official foreign
exchange market.
RDAS will allow only customers of deposit
money banks to buy foreign exchange at
the CBN through their banks as against the
WDAS where the deposit money banks
bought foreign exchange at the CBN on
their own accounts and in turn sold to their
customers.
CBN said “the re-introduction of the RDAS is
expected to prevent round tripping of
foreign exchange purchased at the CBN
official window to unauthorized channels”
The Apex bank has also issued a circular
mandating all deposit money banks to
redeem all inward money transfers in naira
to the recipients at the prevailing inter-
bank foreign exchange rate.
While condemning the action of erring
BDCs, the CBN emphasized the continued
relevance of the BDCs in the foreign
exchange market, even as it stressed that it
would continue to support their operations
in line with the existing guidelines..

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