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CBN Considers Ending Dollar Cash Sales To BDCs - Business (4) - Nairaland

Nairaland Forum / Nairaland / General / Business / CBN Considers Ending Dollar Cash Sales To BDCs (23153 Views)

CBN Resumes Dollar Sales To BDCs / CBN To Banks: Sell Forex To BDCs - Nairametrics / Cbn Lifts Forex Deposit Restrictions & Also Cancels Forex Sales To BDCs (2) (3) (4)

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Re: CBN Considers Ending Dollar Cash Sales To BDCs by 40manlappy: 9:48pm On Dec 12, 2015
teemy:


Now the purpose of regulating dollar sales by regulating the BDCs would be diminished if that happens. It is no big deal if it is between friends or associates but when done on a commercial level it must be done by registered persons who have to provide track records of every sale.

Note that the regulation is a means of limiting money laundering where money could be sold here and resurfaces in another place as another currency. The end result would be such foreign transactions would be illegal once they stage conversion over here.

Thanks for your response...you too @Chukzyfcb

@teemy: Just a little more clarity; what do you have in mind by "registered persons"?

Is there currently a regulatory certification that allows an entity to do FX business on a commercial scale/level in Nigeria? Or as a money transfer operator (FX)? Thanks for your kind response.

Looping: Activa, ifyan, echelons, ceaser, xandy84, Kashif, Boss13
Re: CBN Considers Ending Dollar Cash Sales To BDCs by austinonyii(m): 12:09pm On Dec 13, 2015
princeonx:

STFU fo.ol. Don't make silly noises and threat of what you can't do in this your miserable life and the next!! Simply tell us how dollars is satanic period.
fat fool!! Get lost
Re: CBN Considers Ending Dollar Cash Sales To BDCs by igbonla(m): 1:05am On Dec 26, 2015
MAURI:
@igbonla



Nigeria is a “net” import country, even with our abundant crude, we are not in the position to meet local need due to the fact that we hardly have any operational refinery. Meaning that we incur huge costs associated with export / import crude and refined products that are paid in USD. Which in turn means that to acquire the USD (forex) needed to fund this process, Nigeria has to sell Naira to the market, and by so doing flooding the exchange market with more Naira in exchange for USD.
Simple law of demand and supply. Putting more pressure on the Naira. (Just to mention one simple example)

I as much as I agree with your point on the prosecution of offenders, there are also major flaws in the system and policies. And just catching and sentencing a few people to jail terms is rather simplistic and symbolic.

Further, for the Nigerian government to continue to subsidize imported finished oil products and at the same time subsidize the Naira are draconian tasks that cannot be sustained considering the huge drop in the price of crude which accounts for 70-75% of the government’ revenue.

Jailing offenders cannot be simplistic! Cleaning up the house is a major issue, even when we had "abundance" of forex. Yes, there are major flaws in the system but I am not here to discuss our "sad" situation in its entirety but only focusing on the topic here - ending dollar cash sales to BDCs. There are other reasons why CBN is going that way and we can expand the discussion into that.

As of this week, I could not even get PTA before leaving Nigeria, then the exchange rate at the ATM abroad can at best be described as murder!
While government is fixing the flaws, we must get forex for the basics such as PTA, mortgage, medical bills and school fees except if CBN wants to come out and out rightly ban the use of forex for all that so we all stop any form of international relationship!

I am a firm believer in capitalism, Naira needs to find its level, petroleum products management must be deregulated, etc but citizens must hold the government accountable on how the resources are managed. I do not see how a cosmetic approach such as ending dollar sales to BDC would solve the problem of forex management.

By the way, the reason given by CBN for the action is partly because of the conduct of the BDC, and this can be easily fixed via necessary sanctions.

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