datola:
You said CBN should pump dollar into the economy. Where is the money? Our place reserves is dwindling by the day.

Can't we do without these foreign tastes for now?

Truth234:


We can't do without it, this is because Nigeria is a petrol-dollar economy. In fact there is no economy without the two, until we diversify. The restrictions we create unnecessary scarcity that will plunge naira the more and most likely forced customers to engage in all kinds of questionable transactions to get dollar to finance their business or fund oversea tuition.

fulanimafia:
It is a serious challenge, over here in England we are resorting to Nigerian business owners that need Naira paid into their accounts at home in exchange for pounds, and the rates are quite competitive. The issue is the sustainability of such a measure over time.

Truth234:


because now people we have to buy dollar and deposit in their domiciliary account for oversea transactions.

Activa:


You didn't answer his question.

Where will cbn get the dollars to PUMP into the market?

Activa:


Are you sure this is allowed?

Truth234:


Where will the people get dollars to finance their forex transactions if a whole CBN can't?

Mind your CBN still hoard dollars for special transactions, abi have you seen politicians complain? Nigeria is still selling oil just low volume at a lower rate. I don't think it would be hard for CBN to sell another $20 million like they did last week based on our recent oil sales.

Truth234:


100%

datola:
You said CBN should pump dollar into the economy. Where is the money? Our foreign reserves is dwindling by the day.

Can't we do without these foreign tastes for now?

Activa:

What cbn holds is public knowledge. Our external reserve is less than $30b
If you continue to spend it without additions to it, it will finish and you won't be able to import anything again.
There's nothing like 'a whole cbn'. Cbn doesn't manufacture dollars.
There's nothing like 'hoarding' for special transactions. If you know how much they're hoarding say it.
Nigeria sells oil but the oil dollars is no longer as much as it used to be. That's the problem.

Activa:


What cbn holds is public knowledge. Our external reserve is less than $30b

If you continue to spend it without additions to it, it will finish and you won't be able to import anything again.

There's nothing like 'a whole cbn'. Cbn doesn't manufacture dollars.

Truth234:


How do you mean without addition? They are selling it to Bureau de change for naira, is the reserve not their for the economy or are we not selling oil at all?

Activa:


Be careful not to misinform people.

If it's 100% allowed, then explain this:

https://www.thecable.ng/just-cbn-bans-deposits-dom-accounts

AbuMaryam1:
They should come back home and study here, most them not all of them are been sponsored by corrupt and I'll getting money. Buhari always punishing the rich isn't the good idea.

EternalTruths:
You are right and very correct

But

Is oil the only thing Nigeria can exchange for dollars.? No.

Tell Buhari to encourage True Federalism by sending a bill to the National Assembly to create a law that will empower the States to control 25% of any mineral and non mineral wealth gotten within their territories.

This will spur massive exploitation of full economic potential fetching us extra dollars

EternalTruths:


Nigeria is having difficult in selling their oil

This approach is a short term solution that is good but will backfire on the long run if Buhari fails to enthrone True Federalism.

So comrade

They are right on the short term

Truth234:
How do you mean without addition? They are selling it to Bureau de change for naira, is the reserve not their for the economy or are we not selling oil at all?

Truth234:


Be careful to always stay informed, change is the most constant thing. What you posted was in August, there are new policies and rules now.

http://venturesafrica.com/the-cbn-now-restricting-the-use-of-naira-cards-abroad/

Bevista:
The CBN is concerned about the NET inflow through the Foreign Reserves Account. If the demand exceeds inflow and they continue to meet all demand, then the Foreign Reserve will continue to decline.
---
Foreign Investors and International Merchants watch these Foreign Reserves like hawks. Once they feel that it has gotten uncomfortably low, they will refuse to do business with Nigeria because they will be worried about our capacity to meet up payment obligations. It is for this reason that the CBN tries to control the outflow from this Reserves to ensure that we still have enough to meet the most essential items like Fuel imports for a few months.

Truth234:


That is not the reason, it is basically because of our rigid economic policy. With our reserve at current level, foreign investors are still pulling out and has pulled-out over 69.33 billion from our economy so far, according to NSE.

Activa:


You said it's 100% allowed for people to pay cash dollar into their dom accts.

I gave you an evidence that deposit of dollar cash into dom accts is not allowed.

You posted a totally unrelated link of the ban on debit cards.

I can now see that you don't have a good understanding of the topic you started.

Bevista:
Your obsession and hatred for Buhari is taking a toll on you. If you so knew that True Federalism and Resource Control was such a good thing, why wait till now to rush the new president? Why don't you take a chill pill and watch this government evolve its policies before you go all haywire.
---
Currently, oil accounts for over 95% of Nigeria's Foreign Exchange earnings. We need to find ways to export more items, so we can earn more FX. But these export measures will take time, so the focus should first be on Import Substitution. The administration is trying to achieve this by ensuring local refining and self-sufficiency in agriculture. These efforts alone can save Nigeria over $2bn monthly on FX payments.

Activa:


How can you describe holders of hot money in the capital market as foreign investors?

See the way you even linked reserve to the pull-out. Na wa o

Guy, you're going too deep into what you don't know.

Truth234:
That is not the reason, it is basically because of our rigid economic policy. With our reserve at current level, foreign investors are still pulling out and has pulled-out over 69.33 billion from our economy so far, according to NSE.

Truth234:
What do you call foreigners that invest in an Economy? You know nothing, the guy mentioned foreign investors and I explained why they are pulling out, it has nothing to do with reserve. They are wary of our rigid economic policy and government reluctant to allow market to dictate Naira value. Trust me I live the market, I am sure the market is not paying you.

Bevista:
There are a combination of factors responsible for the pull out:
---
(1) As an investor who has money in a country that is largely dependent on oil, you are aware that the economy and the currency will be largely influence by the price of oil in the international market. With lower oil prices, the CBN might be constrained to devalue the naira to protect Foregin Reserves. This move will devalue their investment so it's best to pull out now before the inevitable finally happens. It's not only Nigeria, even the Canadian Dollar is being hammered right now. Most oil dependent countries are having their currencies devalued.
(2) Also, with lower oil prices, the country will have less wealth and so very little disposable income to invest in the stock market to push prices up. Infact, most investors might start selling their shares to meet basic needs which will might cause a selling frenzy. So as an International investor, it's best to leave now.
(3) There is also the tight FX Controls that the CBN is currently implementing which is making the foreign investors very weary. They are not sure if they need to repatriate their tomorrow, whether will be able to access dollars, so they better leave now while they still can.
(4) You have to also look at what is happening in the US. The FED has increased its interest rate for the first time in 10 years with opportunities for further increase in the coming quarters. This makes the US a relatively better investment destination, so International Funds are flowing out of emerging markets like Nigeria to the US.

Bevista:
@Activa. They are still Foreign Investors as long as the funds are coming from a foreign country to invest in the local country. They just belong to sub category called Portfolio Investors since they focus on investing in the financial assets of the local country.

Truth234:
I agreed with all you said but (4) The FED rate hike does not make US better investment destination, interest rate hike means increase in cost of servicing loans, which is not something investors want as they are struggling to cut cost with current global economic rout.