Bevista:
That explanation is plain ridiculous. How can the CBN blame the banks, when they (CBN) are the ones that stopped banks from receiving dollar cash lodgements into domicilary accounts. Where did they expect banks to get FX to meet their international payment obligations, especially with the meagre Dollar sells to BDCs.
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For the records, I fully understand the constraint the CBN is facing from low FX inflow into the Foreign Reserves due to low oil prices, however, the restrictions imposed by the Central Bank are extreme. With a daily limit ranging from $100 to $1000, How do I make a payment of $1500 for my professional exams? Or am I not supposed to write such exams again because the government is on a fvcking mission?
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I believe the current CBN Governor is a weak link in this administration, as he may not providing the president with the right monetary policy options/advice. While there are obvious benefits from the CBN policy, I strongly believe that the NET result of the policy on the economy will be negative.

Keneking:




Seriously, foreign exchange should be made available for legitimate purposes. I mean it should be available on short notice. This current plight is unacceptable. Parties (CBN, banks and other financial institutions) must work to bring relief to genuine users of foreign exchange.

In an idea situation, this is what applys but our current pathetic situation simply can't accommodate this. Our reserves are depleted and prospects for huge foreign exchange in the neatest future simply isn't there. We misuse our days of plenty, we all need to be patient. Even the government of the day knows it's not a normal situation. It's for the time being.


You would agree that the success of any government is its ability to show concern when there is outcry from its populace.

Actually, the cry on this issue isn't from the populace but for from the minute few. What is the percentage of Nigerians that needs foreign exchange?



Meanwhile is Osinbajo sef Someone needs to talk....I don't rely on this CBN governor

He is on holiday. Should be back by next week.

In addition, can we have a schedule of banks that have placed this embargo?

Biko, leave that. It's also in the interest of CBN that the banks takes these steps.

blackpanda:
You sort of answered your own question. How do you pay something for some you have no money for. If you pay with your atm, where will your bank get the foreign exchange to do the transaction

I agree it is a painfull situation we find ourselves. But this is the reality we have to deal with till we become a real exporting country. And no cbn wasnt blaming anybody, rather just stating the facts

TonyeBarcanista:
This will be tough for diasporans

PassingShot:

@ the emboldened, I hope you don't really mean it; especially the first part that says it an't be dipped into.

Chai, there is God oooo.

Abatsam111:


Source: https://www.today.ng/business/57950/cbn-insists-it-wont-reverse-restriction-on-naira-atm-card-abroad?utm_source=&utm_medium=twitter

dustydee:

Tough? I am kindof happy because I get more in naira when I send money home.
It will be tough for students though.

Bevista:
The CBN should allow demand and supply to determine a fair price for the dollar. A price where supply can clear all demand; they do not need to deplete the Foreign Reserves to defend the naira. That is Economics 101.

The problem is that if they allow the exchange rate to adjust downwards, there will be serious backlash on the new administration. So they are allowing political considerations to influence their monetary policy actions.

Keneking:


So what does the legitimate "minute few" do? Terminate their business, academics, relationship

Follow due process. It's far more stringent now I agree but it's not impossible. Why should this be difficult for the minute few which includes me to do?

I think we need to tackle the root source of huge demand of forex.

The natural way is to have exports of our own. Savings from the days of plenty would have been used to acheive alternative source of foreign exchange but our leaders squandered such. This is the reasoning of current govt which intends spending heavily next year to stimulate other sectors of the Nigerian economy.

IMO petroleum marketers should look elsewhere for forex and forget local banks.

As we proceed, these marketers will be off from business starting from next year. A lot is ongoing. Current restrictions are temporary and Nigerians should endure.

Bevista:
That explanation is plain ridiculous. How can the CBN blame the banks, when they (CBN) are the ones that stopped banks from receiving dollar cash lodgements into domicilary accounts. Where did they expect banks to get FX to meet their international payment obligations, especially with the meagre Dollar sells to BDCs.
---
For the records, I fully understand the constraint the CBN is facing from low FX inflow into the Foreign Reserves due to low oil prices, however, the restrictions imposed by the Central Bank are extreme. With a daily limit ranging from $100 to $1000, How do I make a payment of $1500 for my professional exams? Or am I not supposed to write such exams again because the government is on a fvcking mission?
---
I believe the current CBN Governor is a weak link in this administration, as he may not providing the president with the right monetary policy options/advice. While there are obvious benefits from the CBN policy, I strongly believe that the NET result of the policy on the economy will be negative.

sholatech:


Yes, junior student in international trade finance even knows this. IT CANNOT be 'dipped into'. It's not physical cash, it's not money kept in an account. It's not a cheque. Foreign Reserves are not vaults

Bevista:
The CBN should allow demand and supply to determine a fair price for the dollar. A price where supply can clear all demand; they do not need to deplete the Foreign Reserves to defend the naira. That is Economics 101.

The problem is that if they allow the exchange rate to adjust downwards, there will be serious backlash on the new administration. So they are allowing political considerations to influence their monetary policy actions.

erico2k2:


Great stuff this was where I was driving to on the other news.They are playing politics with the lives of Nigerians.

Dee60:

You want to put Naira in your account in Nigeria and withdraw dollars freely abroad! Where would Nigeria have all the dollars to fund that. with the oil price fallen to by more than 60?

Does it occur to anyone that allowining free withdrawal (dollar against naira) will result in huge dollar debt for Nigeria over time?

Is there not an avenue for students to have their fees transferred officially instead of via ATMs?

The protesters need to push their argument clearly. Otherwise, it is simple commonsense that you cannot dollarise your economy, unless you want to pile up debt for future generations. Common sense.

If we had saved forex when oil was USD100 plus, it would have helped a bit. But with dwindling reserve CBN has to look for ways to curb DOLLAR consumption. We just cannot continue to CONSUME what we dont produce and expect FG or CBN to do magic.

Please think before you talk. Read before you comment. Common sense says so..

Keneking:


Are you in town? Make we hang out somewhere...
Amazing responses

pendusky:
From ur comment above, its quite obvious that ur a banker

PassingShot:

Your problem is the understanding of "dipping hands into". You must think that FR cannot be corruptly be depleted by "dipping hands into" since it's not physical cash.

Demdem2:


I appreciate u too but am sorry, my anonymous state on nairaland is very important.

Bevista:
The CBN should allow demand and supply to determine a fair price for the dollar. A price where supply can clear all demand; they do not need to deplete the Foreign Reserves to defend the naira. That is Economics 101.

The problem is that if they allow the exchange rate to adjust downwards, there will be serious backlash on the new administration. So they are allowing political considerations to influence their monetary policy actions.

TeOwl:
Email your exam people and tell them to split the payment into two, you pay $750 one month and the other $750 the other month.... i forsee that this policy would last for at least six months, dont let the govt mess up your career!

Demdem2:


Good advise. Not all is strictly black and white we are trying to portray.

Keneking:
What animal is demand and supply? In Nigeria, this eco 101/201 principle does not apply. Imagine, one needs to conduct a forex transaction urgently and the other is ready to sell at N300/$1. In this instance, one has no choice but to buy at that rate. So consider multiple demands and its broad implications....

Demdem2:


I appreciate u too but am sorry, my anonymous state on nairaland is very important.

1freshdude:
You are a Voodoo Economist! No too vex. No person in their right senses who has even a basic knowledge of economics would advise for the Naira to be allowed to float. What are you guys talking about sef? Everybody on Nairaland claiming egghead.

IVORY2009:


anonymous indeed only me know u

Demdem2:
Am sure u are not ignorant of the rippling effect this will have on the General populace especially the vulnerable who happened to be in the majority. How this will affect their current purchasing power without adequate increase to their income. This " political consideration " is in the best interest of the people and not those in power itself.

Bevista:
So, In your opinion, the better option is to create scarcity and pretend that there is no demand?
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As painful as it may seem, if my business depends on FX transactions, I'd rather buy at that high rate than not get it at all. When importers exhaust their existing stock and cannot access dollars to import, there will be complete price dislocation in the system due to scarcity.
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The CBN can protect our Reserves (which I believe they should). But why not allow those that can buy dollars in the parallel market to make legitimate transfers and payments. That way, it's not Reserves that are used to settle those int'l payments.

Demdem2:

Yiimmuuu

Bevista:
You lack decorum, but I'll respond to you for the sake of others reading.
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I did not talk about allowing the Naira to float freely, but finding a Fair exchange value. CBN has been adjusting the value of the Naira for ages depending on prevailing economic realities,so why the grandstanding now? When oil price started falling last year, did they not allow the Naira to depreciate from N155 - N197 in Nov 2014?
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Abacha tried to artificially hold the value of the Naira in the 90s, students of economic history know how that all turned out.