₦airaland Forum

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SangoCrusader:
Can't believe how ignorant people are... how is this a good policy?!?!?

How many of you imbeciles have ever received dollars at the official rate? Virtually all of us purchase forex first/second hand via these BDCs. Restricting sales to the BDCs WILL INCREASE PRESSURE ON THE NAIRA. Are you all blind to see what Emefieleconomics is doing to this country?

Devaluation is the only option in this instance and the rest of the world is amazed at the silly and ineffective policies CBN seem to conjure. Don't let anyone fool you, WE HAVE TO DEVALUE THE F***KING NAIRA. Russia, Venezuela, Angola, and most other oil producing nations have done the same, we have a reasonable precedent, what are we waiting for?!?!?!?!

This is at least the 20th policy Emefiele is introducing and none of the predecessors have halted the falling value of the naira. I am moving my money out en masse, any one else with two brain cells between his/her ears will do the same!

While I do agree with you that devaluation would have been the most appropriate course of action, I do not think it is necessary for you to use such derogatory terms on others who either do not agree with your views or lack similar insight as yours.
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It is important to not that, even if the CBN had devalued the Naira, most of us would still not be buying at the official rate. We will still patronize the parallel market which will still be a few pips above the official rate.
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The CBN has an inflation target band of 6-9%. Currently, inflation is above 9%. The CBN is probably worried that if they devalue, a major essential item like PMS might go up above N100. This will cause inflation to shoot up above 11%. The other option would be for the government to use its meagre resources to continue subsidy (to keep the product at N87).

grandstar:
I doubt it. Demand for forex on the black market will rise for deposit into dollar denominated card accounts and also to wire abroad by importers unable to access the CBN. The prognosis is not good.May touch 300 soon.

In my opinion, the policy options available to the Apex Bank are:
(1) Continue supporting BDCs until we run out Reserves.
(2) Devalue the official rate of the Naira to cool demand.
(3) Maintain the current official exchange rate to support importation of essential items while pushing all other demand to the parallel market.
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The bank has chosen option 3 since option 2 will lead to instant inflation and option 1 is not even debatable. Mind you, it's not the CBN fault that our FX revenue has declined significantly. They are simply responding to prevent a full blown economic crisis.

seunmsg:
The problem we are facing at the moment is the inadequacy of our forex earnings to meet our importation requirement. So, we have only two possible solutions. We either find a way to increase our forex earnings or find a way to considerably reduce our importation.

Increasing our forex earning in the short term is almost impossible since we are not exporting any major commodity apart from crude oil whose price is currently down. So, we are left with the second option of reducing importation. CBN said they won't provide forex for 43 items but the importers can get the required forex from the parallel market. So, what's the effect of sourcing forex from the parallel market? Increase in the exchange rate.

I am not an economist but I think the decision makers at CBN should work towards finding a way to discourage importation in the short time. That's the only way to help the naira.

@ the bolded. Unfortunately, that is not the direct job of Monetary authorities. That responsibility falls directly on the table of Fiscal authorities.
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The president needs to get his team to come up with a comprehensive & integrated policy covering agriculture, trade & industries, import substitution, etc. Ideally, the CBN should only use its monetary tools to complement government plans.
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But, unfortunately, the CBN Governor seems to be left on his own with very little contribution from Kemi & Co. Nobody know what the economic policies of government are. Their communication management is zero. If the government wants to ban importation of certain items, then they should make it clear and then tell us what they will do in the short term to promote local production as substitutes.

Arian11:
my last hope to pay my f***king fees....why are these people like this .....would start making people travel to ghana just to change currency...mtcheww

If you read the press statement, you will observe that you can now source FX independently and deposit cash into your domicilary account where you can wire out for your fees payment or simply get a dollar MasterCard.

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seunmsg:
Thanks for link, i just finished reading the full press statement by CBN. Truth be told, the DMB's are also guilty of almost all the allegations levelled against the BDC's. With this decision, we are all at the mercy of the DMB's as far as forex is concerned. So, can CBN effectively monitor these banks to ensure that they play strictly by the rules? Considering Emefiele's background as a former Zenith bank MD, I doubt if he can really come down very hard on any erring bank. He's part of them and can't be trusted.

Going forward, CBN should just ban the operations of the BDC completely, at least, for now. Allowing them to still operate while not selling forex to them will be counterproductive. Those guys will find a way to sabotage the system in connivance with the DMB's to survive. Round tripping will be at the highest level. It's just like CBN's earlier decision to stop providing forex for about 43 items without completely banning their importation. The importers of those items still found a way of getting forex locally to import them and thereby pushing the exchange rate very high. In the long run, I hope this decision will pay off.

@ the bolded. The essence of excluding those items was not to immediately stop importation, it was to conserve FX Reserves by pushing those importers to source FX from the parallel market instead of the official rate.
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Quite frankly, I don't expect most people to buy FX directly from DMBs. Most people are going to buy from BDCs/Abok!s and then deposit same in their domiciliary accounts, so I don't see the DMBs playing a big role on the retail end. They are probably going to be more active at the institutional and interbank levels.
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The key now is for CBN to effectively monitor these banks to ensure that Dasuki yam eaters do not use the opportunity to transfer these yams out to their offshore barns.

seunmsg:
Good decision to lift the restriction on forex deposit, it's long overdue. The decision to stop providing forex to BDC's will only profit the deposit money banks. It's not in the overall interest of the country. Getting and exchanging forex will become more difficult and in the long run, dollars will become more expensive.

The resultant job loss as a result of this decision cannot be imagined. The BDC's decision should be reviewed and reversed. It's not a good decision.

I think the CBN position is appropriate in the prevailing circumstances. They have sacrificed the BDCs for the greater economic good of the whole country. This move will give the Bank some breathing space, as calls for devaluation will now be dampened
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However, if you read the full text of the CBN press statement (link below), you will see the CBN stating that Nigeria is the only country in the world where the Central Bank sells dollars to dealers. The Bank also accused the BDCs for exploiting price arbitrage to round-trip the sold dollars. The CBN also notes that the number of BDCs has risen exponentially as operators try to access "cheap" dollars resulting to over $6bn demand annually.
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As for the job losses in BDCs, the CBN is trying to save many more job losses that would occur from other sectors if they continue the current policy.
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http://www.cbn.gov.ng/Out/2016/CCD/Press%20Release%20-%20CBN%20to%20stop%20Dollar%20Sales%20to%20%20BDCs%20January%202016.pdf

The CBN has made the right call in the prevailing circumstances. I had consistently maintained that the strict controls will have unintended consequences.
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This move will give the CBN some breathing space and dampen calls for devaluation. This will lead to some inflation, but it's a price that has to be paid to prevent a full blown economic crisis.

The CBN has made the right call in the prevailing circumstances. I had consistently maintained that the strict controls will have unintended consequences.
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This move will give the CBN some breathing space and dampen calls for devaluation. This will lead to some inflation, but it's a price that has to be paid to prevent a full blown economic crisis.
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The CBN monitoring & compliance team should watch the banks like Hawks to prevent illicit outflows.

LadyExcellency:
How can he challenge a military dictator?

Give it to him for standing against the redesigning of Naira as a means to punish corrupt Nigerians when it would've also greatly affected businesses across the country considering the time limit attached to the project.

No Minister, Director or Chairperson under Buhari can outshine him without consequences. He wants to be seen, that's why Federal Executive Council was once called-off instead of allowing my Prof to chair the session.

Not completely true. Even though the president was vehemently against removal of subsidies, Ibe Kachikwu prevailed on him with superior argument that has caused him to approve subsidy removal.

It is the job of the CBN Governor (as a professional) to prevail on the president with superior argument why the current FX policy might be counter-productive and end up having a NET negative effect on the economy.

The Financial Derivatives Company Limited, headed by renowned economist, Mr. Bismarck Rewane, in its latest Economic Bulletin, noted that the next meeting of the Monetary Policy Committee of the CBN in two weeks would come up at a time when there were mixed signals on the direction of the monetary policy in the country.

“The CBN is expected to announce a new forex policy, which will give it the flexibility to bring the external and domestic economic variables into equilibrium,

If the CBN does not relax its suffocating FX control policy in this meeting and chart a new policy course, then I'll give up on the economic direction of this country.

The CBN hand will be forced. No matter how they grandstand on the current exchange rate, sooner or later, they will do the needful by adjusting the rate to a more realistic and appropriate price.
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If they don't, then the divergence between the official rate and the parallel rate might hit N100 this quarter.

The arrested person is not a politician, but it won't surprise me if PDP sympathizers still find some depraved reasons to throw tantrums at the president. Lemme guess - "...he is being witch-hunted for allowing vile campaigns to be aired against the president during the last elections".
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On a more serious note, the sheer scale of corruption & sleeze that goes on in Nigerian public offices is suffocating. How some disgruntled Nigerians (just because of hatred for the president) want us to all turn a blind eye is beyond me.

I have consistently maintained that the CBN's current FX Policy is beyond ridiculous.
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It is obvious that the president is sentimentally attached to the value of the Naira, but I blame the CBN Governor more for the current situation. He doesn't look confident enough to man up to the president. If every oil exporting country (including Canada & Norway) has seen its currency value depreciate against the dollar due to decline in oil prices, then it is foolhardy for the CBN & the FG to grandstand.
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It is complete nonsense to allow private citizens & businesses (by extension the whole economy) to suffer simply because of attachment to strong Naira value.
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We will only know how bad things are when the NBS releases its economic numbers for Q4-2015.

managermahmud:
If the refinery will fetch Nigeria $6bn, then how much will be Dangote's profit?
CBN sef, nawa 4 una o

$6bn is likely the turnover (total sales) figure. The Net Profit itself could be well under $1bn.

“The party therefore has nothing to do with anyone who has collected money from the former NSA. Anyone, who has collected money from him, should return it. They are on their own.

“They will face trial without the party’s coming to their rescue. PDP is a clean party that has not taken money meant for the procurement of arms and ammunition or from the Federal Government.”

PDP seems to have begun the process of internal cleansing and renewal. While I do not have the least regards for the party, I consider this a positive development for our democracy. Any person (or party) who confesses his sins and promises not to go back to his evil ways deserves a second chance.
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Recovery of looted funds is probably more important to this administration than prosecution of looters. One of the revenue lines in the 2016 budget is loot recoveries (N300b+), so it is absolutely imperative that the yam eaters cough out every yam.
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The government might forgive secondary beneficiaries through plea bargain if they return the yams without rancor. This will enable the administration focus its meagre resources in prosecuting primary looters like Dasuki, Dikko (Customs), Dieziani, Akpobolokemi (NIMASA), etc.

It is true Kanu was granted bail on October 17. On the day he claimed to have perfected his bail conditions, he was already too late as the Attorney General of the Federation (AGF) had already filed a fresh six-count charge against him. Thus, in law, Kanu was released on bail for the earlier charges and then re-arrested on the new charges, which charge sheet was served on him the day he perfected those conditions.

@OP, pardon my ignorance on legal matters. I would like clarification based on the quoted text above:
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Does filing of charges in a law court gives the government the right to arrest citizens? Don't they need to obtain a warrant of arrest?

patrickmuf:
Trust me you don't know a thing about Ayade...Ask Cross Riverians to tell you sup

Maybe you can provide me some enlightenment. I'd like to know.

I'd like to hear a statement from the EFCC to know exactly what transpired before drawing any conclusions. Unfortunately, everything in Nigeria is always screened through the prism of politics.
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Governor Akpabio and Governor Dakingari were invited by EFCC and released same day, so what is the fuss about?
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http://theeagleonline.com.ng/akpabio-released-by-efcc-after-grilling-over-corruption-allegation/

http://www.thisdaylive.com/articles/after-eight-hours-of-interrogation-efcc-releases-dakingari-on-bail/223275/

All I can tell you is that the PDP is an assemblage of greedy elements, militants and touts who have no interest of the State at heart.

It doesn't matter which political party. When a society elects the likes of Fayose, Wike, Aregbesola, Theodore Orji, etc to govern its affairs, then you know that society is doomed.
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It is only the likes of Fashola, Ayade (CRS), El Rufai, Peter Obi, Donald Duke, etc that should have the honor of governing the people. Governance is not for touts!

erico2k2:
Guy can't we all be wise.you are believing those bul shyte from those oleh.tell me the name of the country where it was landed from @N80/ltr. Then go and check how much the pump price is minus VAT of that country. The internet is there.

Maybe you can use the Internet to educate me. The PPPRA has been updating it template for years now, which normally reflects the price of crude oil, why are we doubting them now?

bidemi12:
You are missing the point on why subsidy removal is important. Once it is removed, market forces come into play and once that happens, there is no way to know how much prices at the pumps would be. Absolutely no way.

Subsidy removal does not automatically translate to price deregulation.
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The government will still regulate prices and adjust it based on the landing and ex-depot price of the product. Prices will not be left completely to market forces.

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bidemi12:
Pray tell, how did you arrive at that bold statement?

Do you have any contrary information to the one advanced?
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According to PPPRA, the current landing cost of PMS is lower than N80/ltr, so the recommended OMP (open market price) of N86 has no subsidy input. In fact, I understand there is a negative subsidy of around N1.50, since the ex-depot price is about N84.50.

obayaya:
So that is enough reason for soldiers sworn to obey their commanding officer to commit mutiny?

So all these is the justification for reinstating soldiers charged with mutiny?

Now they are defying the Army authorities.

You guys are playing with fire in the name of politics.

Other soldiers are watching and learning..

Don't get me wrong man. There is no justification for insubordination or indiscipline in the military. My point is that Nigeria is a Savage country where the high & mighty get away with their evil deeds but lesser mortals face the full weight of the law.
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You talk about playing with fire in the name of politics. Is that not what we have been doing since time immemorial? Can't you see that the #Dasuki-Gate already has loads of political arguments?

obayaya:
Nigeria is the only country in the world where soldiers that attempted mutiny are reintegrated into the Army..

Goodluck trying to enforce discipline..

Nigeria is the only country in the world that will send her soldiers to the war front without the proper firearms and without adequate welfare.
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The only country in the world where the president, NSA and Service Chiefs will collude to divert State budget meant for arms purchases.

modath:
Stop chasing shadows & peddling bad belle opinions.. Nigerians were not against the removal in principle but cos they didn't trust (rightly so) the government to do right by them, we know they are not sincere & will never be judicious with any savings....

By the way "Mr unretarded Solomon of our time" who loves Nigeria more than the next person---- , what happened to the proceeds of the partial removal of subsidy? Lawan & Otedola drama, how far?

Kindly highlight just 2 ways it benefited the average Joes & janes .....

You have till May 29th 2019 to give an answer!!!! Uhhhhhmm!

There is another fundamental difference between removing subsidy right now and doing so back in 2012, which most people are not thinking about.
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Back in 2012, subsidy removal would have resulted in an instant increase in pump price of PMS from N67 to N141, whereas any subsidy removal right now will have no immediate effect on pump price of PMS.
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So, from a psychological standpoint, Nigerians are less likely to resist subsidy removal right now the way they did back in January 2012.

Accountability was thrown to the dogs during the 16yrs of PDP's infamous reign.
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Quite reassuring to see some semblance of sanity being gradually restored back to the system. How some youths find something wrong with the President’s commitment to probity is beyond me.

...clutching a file with EFCC insignia, he headed straight for the office of President Muhammadu Buhari, where he barely spent 10 minutes

Baba just minuted on the file "Approved" - meaning - "Arrest Them All".

free2ryhme:
90% of ibo people are traders. If these people move to the east who will buy these products in the east? In a place where everyone is a seller who will be the buyer?

The landmass in the east is not able to support your huge numbers hence you have more population outside your geopolitical zone than within it. Erosion is eating you lands away and when you add overpopulation that is a disaster waiting to happen.

The insecurity, kidnapping,money rituals, human rituals, baby factories, cultism, and the lack of infrastructure is endemic to the east

Most intelligent comment on thread. Others are mere emotional rants.
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Business decisions by traders are not taken on the basis of patriotism, but on the basis of where the largest market exist. A man who has a family to feed and bills to pay is going to situate his business where the highest profit opportunity is.
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Those calling for Igbos to relocate are obviously throwing juvenile tantrums. I bet most of them schooled outside the SE. Some of them, probably, still live outside the SE. One wonders why they themselves have not relocated back home.

Even though I am 100% positive that they do not mean what they are saying, this is, however, a much better narrative than the trash they have been spewing since.