I was scrolling through nairaland and came accross the topic on forex regulations. See the original thread below

https://www.nairaland.com/7888581/fg-outlaws-black-market-forex

There were a number of good points especially this one

13. Expand the official foreign exchange market to incorporate BDCs, forex apps and retail fx dealers, and outlaw transactions in the black market.

I liked this one above because the past administration was doing the opposite. They were attacking BDCs and apps like abokifx as if they were the root cause of the problems were facing . Clearly they didn’t understand that businesses like these help to deepen the economy and all that was needed was proper regulation and enforcement to avoid abuses and ensure consumer protection.

But I noticed some comments like this:

FreeStuffsNG:


Only unpatriotic and greedy people will go buy fx to hoard and they deserve not only to lose their funds but must be prosecuted for economic sabotage as well.

Those being deceived to keep hoarding forex will get burnt severely las las.

It's criminal and unpatriotic mindset that will make an otherwise educated person who spends almost 100% of his day to day expenses in naira to still go and hoard forex and crowd out those who genuinely need it. If they don't get burnt, no defence of the naira will deter such unpatriotic elements.Not even EFCC that Mr Emefiele kept sending after them will make them stop.

I feel a need to point out the appalling ignorance in the thought process that enabled this person post this just because there were a number of likes to the comment.

Yea the FG reserves the right and indeed has a duty to protect the naira. But that is done by fortifying the foundation of the economy and boosting local production. If we cannot consume everything we produce , then we export the rest . The more we export , the higher the demand for the naira as foreign buyers will need either need to buy naira to pay our exporters or they’ll pay in FX which will result in a higher supply of FX and the price will inevitably fall.

But how do you start producing more than we consume ? Go back to your Business Studies is JSS3 and look at the factors of production.. Then add other factors such as power and insecurity and it’s not hard to see why we keep importing.
We have indigenous car manufacturers in this country , but what did our senate do ? They went to spend $160m of borrowed funds to purchase foreign-made cars . That money will end up abroad in the bank accounts of foreign manufacturers . Now tell me , are these senators not enemies of the country ? Why is the executive allowing this

But who is being attacked : An international businessman like me who gets paid in dollars and keeps the Fx in a Nigerian bank account for when I need to use . Or a grandmother in Nigeria who receives dollars from her grandson abroad and keeps it in her account for when she needs it . These are the people that are being targeted.

The people receiving FX from abroad are actually helping the country , Cos they’ll eventually sell it and buy naira . And if they choose to not sell it , then so be it. The FG and CBN will be overstepping its bounds if it tries any act of criminality like going after legitimately acquired income sitting in personal bank accounts. Such actions will result in immediate lawsuits. It’s a sign of a failed state akin to the likes of Venezuela , Cuba, North Korea to embark on such draconian steps while protecting the privileged political class.

If you wanna fix the country , fix and stop with the cosmetic solutions. Fix the refineries , fix the power stations , cut down on government spending and corruption, force the states to look inwards so they can reduce dependence on the Father Christmas federal government . Embark on a massive security drive by pushing for community and state policing. Just provide the right environment and you’ll see private citizens becoming more productive.

I don’t expect these points to make sense to everyone, especially those who are either ignorant of international business or those whose logical reasoning have been compromised by political or ethnic-religious affiliations. But I hope some people will understand .

👀

VeeVeeMyLuv:
Fx in china and Turkey is fully Digitalized no hoarding.


Why must naija case always be different?

They don't have the will power to eliminate round tripping

That’s a very misleading comment.
There’re no laws against keeping of FX in those countries. In Canada , you can keep US dollars or British pounds for as long as you want . In the UK, you can keep Japanese yen for as long as you want .
In the Turkey you mentioned , you can keep dollars as long as your want . Infact there’s over $125bn worth of total FX deposits in Turkish banks . What the government did was to give people access to real-time conversion. Meaning that’s those who had FX deposits can convert to Lira deposits under a scheme but it was optional .

They introduced it in 2021 but by 2023 , most people went back to FX deposits. The government never went after consumers funds or jailed anybody at anytime.

Don’t just type anyhow my guy.

👀

VeeVeeMyLuv:
Fx in china and Turkey is fully Digitalized no hoarding.


Why must naija case always be different?

They don't have the will power to eliminate round tripping

@ BitterTruth01

Boss diaspora people earn dollars then send to their folks here

Their folks then goes to where? BDC
and BDC is what? Black market.

Solution: go to bank 🏦 (DIGITAL PLATFORM) to change it

The individuals based in Nigeria wants dollars, instead of bank (DIGITAL PLATFORM) to give them, they go to BDC

How did BDC get this dollars $? From banks themselves and from diaspora relatives based here in Nigeria.

Digitalize let it only b gotten at the bank digital platform.

The BDCs and the apps can also be incorporated into the digitized platform . That’s why I like the number 13 :

13. Expand the official foreign exchange market to incorporate BDCs, forex apps and retail fx dealers, and outlaw transactions in the black market.

VeeVeeMyLuv:
But is their fx roudtripping in Turk?

No but it’s not the fault of the innocent businessmen and consumers that the government has not incorporated our BDCs and forex apps into the platform . This can be done.
Those talking about arresting people or seizing funds in accounts are just ignorant

BitterTruth01:


No but it’s not the fault of the innocent businessmen and consumers that the government has not incorporated our BDCs and forex apps into the platform . This can be done.
Those talking about arresting people or seizing funds in accounts are just ignorant

I don't think anybody is asking the government to arrest people or seizing funds in accounts, such a policy will be disastrous and make things more worst like what happened in Lebanon few months ago.

Ikaeniyan0:
I don't think anybody is asking the government to arrest people or seizing funds in accounts, such a policy will be disastrous and make things more worst like what happened in Lebanon few months ago.

Read my first post in full. And then click the link to read the original thread by that notorious individual

BitterTruth01:
I was scrolling through nairaland and came accross the topic on forex regulations. See the original thread below

https://www.nairaland.com/7888581/fg-outlaws-black-market-forex

There were a number of good points especially this one

13. Expand the official foreign exchange market to incorporate BDCs, forex apps and retail fx dealers, and outlaw transactions in the black market.

I liked this one above because the past administration was doing the opposite. They were attacking BDCs and apps like abokifx as if they were the root cause of the problems were facing . Clearly they didn’t understand that businesses like these help to deepen the economy and all that was needed was proper regulation and enforcement to avoid abuses and ensure consumer protection.

But I noticed some comments like this:



I feel a need to point out the appalling ignorance in the thought process that enabled this person post this just because there were a number of likes to the comment.

Yea the FG reserves the right and indeed has a duty to protect the naira. But that is done by fortifying the foundation of the economy and boosting local production. If we cannot consume everything we produce , then we export the rest . The more we export , the higher the demand for the naira as foreign buyers will need either need to buy naira to pay our exporters or they’ll pay in FX which will result in a higher supply of FX and the price will inevitably fall.

But how do you start producing more than we consume ? Go back to your Business Studies is JSS3 and look at the factors of production.. Then add other factors such as power and insecurity and it’s not hard to see why we keep importing.
We have indigenous car manufacturers in this country , but what did our senate do ? They went to spend $160m of borrowed funds to purchase foreign-made cars . That money will end up abroad in the bank accounts of foreign manufacturers . Now tell me , are these senators not enemies of the country ? Why is the executive allowing this

But who is being attacked : An international businessman like me who gets paid in dollars and keeps the Fx in a Nigerian bank account for when I need to use . Or a grandmother in Nigeria who receives dollars from her grandson abroad and keeps it in her account for when she needs it . These are the people that are being targeted.

The people receiving FX from abroad are actually helping the country , Cos they’ll eventually sell it and buy naira . And if they choose to not sell it , then so be it. The FG and CBN will be overstepping its bounds if it tries any act of criminality like going after legitimately acquired income sitting in personal bank accounts. Such actions will result in immediate lawsuits. It’s a sign of a failed state akin to the likes of Venezuela , Cuba, North Korea to embark on such draconian steps while protecting the privileged political class.

If you wanna fix the country , fix and stop with the cosmetic solutions. Fix the refineries , fix the power stations , cut down on government spending and corruption, force the states to look inwards so they can reduce dependence on the Father Christmas federal government . Embark on a massive security drive by pushing for community and state policing. Just provide the right environment and you’ll see private citizens becoming more productive.

I don’t expect these points to make sense to everyone, especially those who are either ignorant of international business or those whose logical reasoning have been compromised by political or ethnic-religious affiliations. But I hope some people will understand .

Front page material. I'm very glad that there are Nigerians that still have connection to their brain. I was beginning to lose hope seeing Tinubu supporters.

All you have said is apt to fix this broken economy. I have kept saying it. Only a positive trade balance will redeem the value of our currency. Reno ignorantly opined that an increase in the patronage of local goods and services will save the economy. While that is not a lie, it is not the practical solution to a free falling naira.

Local patronage will continue to decline as long as inflation is hyper. It is only in APC administrations that Nigeria experienced hyper-inflation. The cosmetic Central Bank should raise interest rates first and arrest inflation to pave the way for local consumption of goods. The soaring prices of goods will come crashing to their true value - the equilibrium price.

The dollar to the naira rate will see significant improvement when our exports exceed our imports. That can never happen until we have fully functioning refineries. Export production should be greatly encouraged at this time. Businesses that engage in services where they are paid in dollars should not be stifled with forex restrictions but allowed to expand their base. The previous administration did the exact opposite of this. Their failure on the financial and economic front of the nation is catastrophic as it is monumental.

I don't want to repeat the things you have outlined verbatim. This is a very good article that X-rays the ailing economy and proffers cogent solutions to salvage it from its current shipwreck.

BitterTruth01:


No but it’s not the fault of the innocent businessmen and consumers that the government has not incorporated our BDCs and forex apps into the platform . This can be done.
Those talking about arresting people or seizing funds in accounts are just ignorant

Tinubu supporters will throw their weight behind the bolded disregarding the grievous harm it will do to the economy and democracy as long as the president okays it. Do you now see why I said that I had lost hope seeing that a very good number of Nigerians supporting Tinubu have not being in touch with their freely deposited intelligence for years?

THE BETTER.

THE BETTER.

OUTLAW BLACK MARKETS AND LET US HAVE PEACE IN OUR BANKING SYSTEM.

The write-up by the op is apt, and touches at the base of the fx issues the country is facing.

Looking beyond that, the elephant in the room is the illicit fx flow occasioned by the mad rush by politicians using stolen funds to crowd out legitimate fx users, only for these dollars to end up in private vaults outside the financial system, then reappear during electioneering periods.

Isn't anyone asking how the dollars shared during the APC presidential primaries in 2022 was sourced? These issues are germane to the discussion, not the gibberish some hateful APC online tout spew around, looking for who to arrest and/or jail.

BitterTruth01:


No but it’s not the fault of the innocent businessmen and consumers that the government has not incorporated our BDCs and forex apps into the platform . This can be done.
Those talking about arresting people or seizing funds in accounts are just ignorant

Thanks for this submission.

BitterTruth01:


No but it’s not the fault of the innocent businessmen and consumers that the government has not incorporated our BDCs and forex apps into the platform . This can be done.
Those talking about arresting people or seizing funds in accounts are just ignorant

well, I strongly believe it will still get to that, that is confiscating FX funds in Dom accounts.

It will be touted as one of the reforms. They will say you can't have access to the physical cash. So you either use a dollar card to use the funds electronically OR you get the naira equivalent of your FX funds at official rate. Bookmark this post.

You have a brain op.

I couldn't believe my eyes when I saw how much was spent on SUVs for our legislators.
In this same country where dollar is scarce.

BitterTruth01:

The people receiving FX from abroad are actually helping the country , Cos they’ll eventually sell it and buy naira . And if they choose to not sell it , then so be it. The FG and CBN will be overstepping its bounds if it tries any act of criminality like going after legitimately acquired income sitting in personal bank accounts. Such actions will result in immediate lawsuits. It’s a sign of a failed state akin to the likes of Venezuela , Cuba, North Korea to embark on such draconian steps while protecting the privileged political class.

This part is more of an emotive argument than a factual argument. The Naira is the only Legal tender in Nigeria. The CBN will simply issue a regulation asking banks to close all Dorm accounts and convert balances to Naira at the prevailing exchange rate. It has happened before outside Nigeria.

When he is done with his four years the next idiot will revert everything back to the nonsense it use to be in the interest of his tribe of religious affiliates or what it may be

That’s the sh!t that frighten me about this country. Policies and laws changes like London weather. Such economy will continue to suffer set back

3ice9ce:


This part is more of an emotive argument than a factual argument. The Naira is the only Legal tender in Nigeria. The CBN will simply issue a regulation asking banks to close all Dorm accounts and convert balances to Naira at the prevailing exchange rate. It has happened before outside Nigeria.

Like I said , it’s a sign of a failed state . Its a massive red flag and sends distress signals to the international community including potential foreign investors. Some steps are counter productive.

Yes they can regulate transactions in Nigeria and mandate that only naira be used a legal tender. They already did that in back in 2013/14.
But to go after foreign inflows domiciled on accounts which are not sourced from within Nigeria ? No. They have will have a lot of explanation to do in court especially considering that the political class continues to expend our national reserves for personal on gain.

Well there are 2 types of Black Markets; The official Black Market and the unofficial Black Market.
The govt can only be able to attempt to regulate the official Black Market.

Secondly note the documents talks of outlawing official Black Market transactions without specify if that mean all Black Market transactions or if not, which Black Market transactions.

Yeah, so basically nothing is likely to change so no need to panic, seems it is just one of those policy statement that is meaningless and only made to look like FG is doing something new.

So, no need for concern , no need for any knee-jerk reactions and no need to panic.

Eseka12 please how can I reach you

@Eseka12

@Eseka12 how can I reach you please

BitterTruth01:
I was scrolling through nairaland and came accross the topic on forex regulations. See the original thread below

https://www.nairaland.com/7888581/fg-outlaws-black-market-forex

There were a number of good points especially this one

13. Expand the official foreign exchange market to incorporate BDCs, forex apps and retail fx dealers, and outlaw transactions in the black market.

I liked this one above because the past administration was doing the opposite. They were attacking BDCs and apps like abokifx as if they were the root cause of the problems were facing . Clearly they didn’t understand that businesses like these help to deepen the economy and all that was needed was proper regulation and enforcement to avoid abuses and ensure consumer protection.

But I noticed some comments like this:



I feel a need to point out the appalling ignorance in the thought process that enabled this person post this just because there were a number of likes to the comment.

Yea the FG reserves the right and indeed has a duty to protect the naira. But that is done by fortifying the foundation of the economy and boosting local production. If we cannot consume everything we produce , then we export the rest . The more we export , the higher the demand for the naira as foreign buyers will need either need to buy naira to pay our exporters or they’ll pay in FX which will result in a higher supply of FX and the price will inevitably fall.

But how do you start producing more than we consume ? Go back to your Business Studies is JSS3 and look at the factors of production.. Then add other factors such as power and insecurity and it’s not hard to see why we keep importing.
We have indigenous car manufacturers in this country , but what did our senate do ? They went to spend $160m of borrowed funds to purchase foreign-made cars . That money will end up abroad in the bank accounts of foreign manufacturers . Now tell me , are these senators not enemies of the country ? Why is the executive allowing this

But who is being attacked : An international businessman like me who gets paid in dollars and keeps the Fx in a Nigerian bank account for when I need to use . Or a grandmother in Nigeria who receives dollars from her grandson abroad and keeps it in her account for when she needs it . These are the people that are being targeted.

The people receiving FX from abroad are actually helping the country , Cos they’ll eventually sell it and buy naira . And if they choose to not sell it , then so be it. The FG and CBN will be overstepping its bounds if it tries any act of criminality like going after legitimately acquired income sitting in personal bank accounts. Such actions will result in immediate lawsuits. It’s a sign of a failed state akin to the likes of Venezuela , Cuba, North Korea to embark on such draconian steps while protecting the privileged political class.

If you wanna fix the country , fix and stop with the cosmetic solutions. Fix the refineries , fix the power stations , cut down on government spending and corruption, force the states to look inwards so they can reduce dependence on the Father Christmas federal government . Embark on a massive security drive by pushing for community and state policing. Just provide the right environment and you’ll see private citizens becoming more productive.

I don’t expect these points to make sense to everyone, especially those who are either ignorant of international business or those whose logical reasoning have been compromised by political or ethnic-religious affiliations. But I hope some people will understand .

Freestuff is paid to post gibberish here so don't waste your time stelling him or her.

The problem we are dealing with predates this present administration, my only problem with them is the fire brigade/cosmetic surgery approach and i feel most of the appointees are round pegs in a square hole.

1. They should find a way to harness the money that people living in the diaspora are remitting. That's a whole lot of money to cushion this liquidity brunch.

2. Encourage local production by giving out grands,subsidizing and giving single Digit loans.

3. Politicians should be discouraged from whatever they are during with dollar,those guys literally transact in dollar currently.
4. Crypto should be legalized, believe me we move bricks in the crypto world. We can use that to out advantage. A case where binance can peg naira to some coins.
5. They should expediate effort in revamping the power sector either by subsidizing or encouraging captive power generation because without this there will be no local production so we wont be discussing the issue of exporting.
6. Our security infrastructure is a mess. The current defence guy seems to be clueless.

Artscollection:
The problem we are dealing with predates this present administration, my only problem with them is the fire brigade/cosmetic surgery approach and i feel most of the appointees are round pegs in a square hole.

1. They should find a way to harness the money that people living in the diaspora are remitting. That's a whole lot of money to cushion this liquidity brunch.

2. Encourage local production by giving out grands,subsidizing and giving single Digit loans.

3. Politicians should be discouraged from whatever they are during with dollar,those guys literally transact in dollar currently.
4. Crypto should be legalized, believe me we move bricks in the crypto world. We can use that to out advantage. A case where binance can peg naira to some coins.
5. They should expediate effort in revamping the power sector either by subsidizing or encouraging captive power generation because without this there will be no local production so we wont be discussing the issue of exporting.
6. Our security infrastructure is a mess. The current defence guy seems to be clueless.

Those speculating idiots with dollars in domicile account shouldn't exceed a month. After a month, it should be changed into naira! It's Nigeria, not USA. If they want dollars, they should go live in USA. The politicians spending in dollars should really be checkmated and dealt with! Anyone who wants to spend or transact in dollars should go live in USA!

Domiciliary account balance rises to $29bn amid weaker naira

The foreign currency deposits, a chunk of which are in dollars, stood at N17.65 trillion in June, up from N10.72 trillion in May, according to the CBN data. When converted to the greenback, it rose by 21 percent to $28.92 billion (using the average exchange rate of N610.17/$ in June) from $23.20 billion; the naira averaged 462.01/$ before the devaluation in mid-June.

A further breakdown of the data also showed that the increase was driven by more deposits and devaluation, which boosted the naira value of the foreign currencies in the domiciliary accounts.

The naira has plunged to record lows across markets since the central bank allowed it to weaken by as much as 40 percent against the dollar in June.

Adeola Adenikinju, a professor of economics and president of the Nigerian Economic Society, said the boost in the naira value of deposits in domiciliary accounts was the major factor driving banks’ deposit growth.

Domiciliary accounts constitute more than a third of deposits in the banking sector and a large portion is sitting idle, according to him.

The country’s external reserves stood at $33.41 billion as of November 7, down from $37.08 billion at the end of last year, according to the CBN.

Adenikinju disagreed with the suggestion in some quarters that the government should convert the money in domiciliary accounts to naira. “I think that will do a lot more damage to the economy because it will just hamper the free flow of dollars.”