So we have all been wondering how much sliding the Naira was going to do. By mid last week the dollar was trading at somewhere close to N250 and we were all lamenting on the way forward…there was no clear direct path. We all know the CBN’s job is to control inflation but in an unstable economy as ours- it also is to help the currency retain value.
Imagine my confusion when on saturday or so it was I was reading my email as I was climbing the six flights of stairs into my apartment thanks to PHCN’s refusal to give light – so lift “no working” and i was reading emails as a distraction. GTbank specifically sent out an email that they wouldn’t be processing foreign currency deposits into domiciliary accounts, neither will they give out travel allowance or allow foreign withdrawals. I panicked, then i now remembered I have no foreign currency to give them anyway and no money to buy “intahnetional ticket” to go to “the overseas”. When I finally found the key to my apartment i hissed and moved on.
My friend now called me in a panic that she needs to travel and if i can give her USD from my account in America and she will pay Naira- something about not wanting to cary and declare cash. I laughed harder, as in the devil was mocking me – no money to travel talkless of holding dollar then she even called me again on top? Shior. I told her to call mallam – change the money and put it on different parts of her body – i don’t understand why Nigerians are reluctant to declare money- sometimes i believe we just dislike processes. She called me back and said Mallam said N220 for Dollar. I said whàaaaat?😮 it has dropped to as low as N210/206 as of Monday I hear.
Now keep in mind also, there were already limits on how much the banks were getting, Zenith for instance had reduced BTA from $4000 to $2000 and you had to book 3 weeks in advance i think. And something about the bank only getting $20k per week-likely branches sha. I also hear that BDC’s can only get money based on the $4k BTA allowance per BVN per quarter starting August. So BDCs will start making less money because they will need to submit BVNs with their applications and you can’t use the same BVN more than once a quarter.
Sidenote: my BVN is for rent if you have a BDC. Just send me an email “lez discuzz”😇
At this point the entire culmination of madness between the speculators – allegedly mostly political thieves and thugs has led to excess dollar in the system and the CBN has figured out a way to make the money useless in their hands resulting in sort of a fire sale. While this argument is valid somehow- the cost of goods is still high because of import dependence. And Nigeria we know prices never come down.
My next question now is what the long term fix is. From a simpleton’s standpoint – the bank not accepting forex deposits will hinder trade especially imports. Me a lame woman – i paid for my destination wedding using a domiciliary account. Nigerian banks don’t transfer from local currency accounts to foriegn banks…don’t ask me how that makes sense. You have to withdraw the Naira, change on the black market and bring back the dollar to deposit in domiciliary account.
My other question is will the black market rate hit the bank rate of N197? Nobody is willing to stick their neck out and say it will- certainly i for one do not expect the black market rate to drop below bank rate, but there’s a slight possibility in my mind that it may stop around N197 to N200.
Can we get a Minister for finance and coordinating economy? Is that what they are called? Someone who’s job it is to drive sustainable policy while keeping us informed? Is that too much to ask?
From my limited knowledge – the entire thing seems like “putting anbesol on a rotten tooth” anbesol is an oral pain relief- it will dull the pain but the tooth is still rotten and has to be removed. Is the long term fix as simple as pegging the Naira to the dollar or a re-denomination of the Naira?
I don’t have the answer, but I sure do have the questions..please what are your thoughts?