Truth234:


And is their economy better than ours at the moment, see Nigeria have one of the best economy currently. All the countries you mentioned are struggling without options, that was why they devalued. South Africa currency, Rand declined 9% today even though its not fixed like Naira, the economy is the most affected among emerging economies. IMF should go and do something about those first, at least their currency is not fixed, how come they are suffering the most?.

Russia didn't devalue, after Angola devalued, Kwanza has slide 40%. Since China yield to pressure August last year and devalued Yuan, it has devalue 5 times after, causing global equity to lose around $4 trillion. The same people that pressured China are the one complaining China policy is responsible for global economic rout. You know what they are doing now? Withdrawing and leaving China to her fate.

Chinese government have stopped trading twice this new year to stop people from withdrawing because of the damage it is causing to the entire economy. It is simply wrong to measure the strength of an economy against the most appreciated currency in the world for the past 12 months. Naira is not the best but trust me we are far from the worst.

Truth234:


And is their economy better than ours at the moment, see Nigeria have one of the best economy currently. All the countries you mentioned are struggling without options, that was why they devalued. South Africa currency, Rand declined 9% today even though its not fixed like Naira, the economy is the most affected among emerging economies. IMF should go and do something about those first, at least their currency is not fixed, how come they are suffering the most?.

Russia didn't devalue, after Angola devalued, Kwanza has slide 40%. Since China yield to pressure August last year and devalued Yuan, it has devalue 5 times after, causing global equity to lose around $4 trillion. The same people that pressured China are the one complaining China policy is responsible for global economic rout. You know what they are doing now? Withdrawing and leaving China to her fate.

Chinese government have stopped trading twice this new year to stop people from withdrawing because of the damage it is causing to the entire economy. It is simply wrong to measure the strength of an economy against the most appreciated currency in the world for the past 12 months. Naira is not the best but trust me we are far from the worst.

iboboyswag:


I have been looking forward to a sane comment and I have found it..... In yours. The hoard of people screaming for devaluation do not know that inspite of our present economic situation, we are far better off than a whole lot of this great economies..... America increased interest rate the Rand caught severe cold as well as currencies of countries in the BRICK. The present economic challenge is global but we must handle it locally, appreciating the uniqueness of our own challenge and proffering tailor made solutions to it..... And to the best of my understanding, that is what the CBN and the Ministry of Finance is trying to do.

We will only appreciate the effort if we look at all the policies from its inception as a whole and not piece them individually.

onatisi:

Like 1naira to 1 us dollars ,abi?

fulanimafia:
You seem to be quite familiar with fools going by your frequent reference to them.

The fact remains that this move will reduce forex activity in the parallel market, and minimize the frequent round tripping where BDC's get forex from the CBN at official rates only to dispose of them at exorbitant rates. You failed to factor the fact that the current official exchange rate is fixed and not floating.

The grand question is, why is the official fixed and the black market rate floating?

bigtt76:
Yea but in this case they would need to revalue the naira to the dollar and use the lowest value to match the dollar. That would mean for example pegging the new Naira value at N2.00 to the dollar (old Naira value would be N200.00 to the dollar). Naira and dollar can never be equivalent again. We missed that opportunity back when Soludo wanted to redenominate.

onatisi:


I don't think many ppl fully understand the negative implications of what cbnjust did. There is already a massive reduction and restriction on the amount of people transaction one can do with the atm cards,the question now is how do ppl get dollar for deposit. This move will reduce the pressure on the naira in the short term but skyrocket the cost if dollars in the parallel market

Bevista:
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
---
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.
---
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.
---
http://www.cbn.gov.ng/Out/2016/CCD/Press%20Release%20-%20CBN%20to%20stop%20Dollar%20Sales%20to%20%20BDCs%20January%202016.pdf

duby91:
the banks are accusing the BDC for exploiting price arbitrage...and the banks in turn are using the BDCs exchange rate to make more money cos there's really no difference in the exchange rates if you use your card for online transactions considering that they all get the dollars at N197. I still wonder how this policy would go a long way to help because banks will still charge you at the same rate the BDCs are charging whether they have access to more dollars or not.

Nuahall2k14:
if i open a foreign account and dey wire money to me wil it b more expensive for dem wen wiring d money?

saints2:
Just heard this from Channels TV...

If you are still been charged dollar by the black market rate, pls get in touch with the CBN.. That is if GTBank, Stanbic, FirstBank UBA etc still charge you at black market rate.. Report them now to CBN..


Channels

coolsix:


No. The person wiring the money would only pay FX Transfer fees to a maximum of $100. Your bank may charge you for receiving

Nuahall2k14:
i stil dnt see any reason to rejoice wit all dis cbn measures...hw does dis benefit me as i ma a student abroad..

SangoCrusader:


"Russia didn't devalue"... Read this article please. My fiance is Russian, I was in Moscow three times last year so I know what I am saying. Not just trying to score cheap points. Russia DID devalue! They devalued three times in fact.

http://www.telegraph.co.uk/finance/currency/11820755/Russian-rouble-hits-new-low-as-oil-prices-plunge-further.html

The best economy currently?!??! @Truth234... are you OBanikoro by any chance? We have one of the worst performing economies on the planet. Here is ANOTHER article to prove it:

http://www.bloomberg.com/news/articles/2015-11-26/buhari-bounce-becomes-bust-as-nigeria-policies-annoy-investors

I didn't mean to insult people in my original post, but 75% of what you are saying here is incorrect, and a simple google search will show that. How your post has got 5 likes is beyond me...

SangoCrusader:


Everybody I know right now is pulling their naira away from Nigerian banks, converting it to GBP or USD. This includes some companies who have removed up to N75 million in the past two weeks...

Investors lost confidence last year and everyone is losing confidence now. We are not doing better than anybody at all. I live and work in other economies and cannot qualify your statement at all. The present economic challenge IS NOT GLOBAL and our situation is not UNIQUE, we are just reacting to it with greater ineptitude.

iboboyswag:


My friend like you said, everybody you know and not all investors in Nigeria.

As to if the economic challenge is global, you are actually contradicting yourself here because in your previous posts you have referred to the devaluation embarked upon by Russia, the closing of trade by China not to talk of the South African challenge etc.

I will still reinstate that the Nigerian Challenge is Unique because of our mono economy(which is the actually reason we are faced with this dilemma) and thus must be tackled as such... We must not conform to popular dictates as we seek out means to sorting the challenge.

SangoCrusader:


And Angola do not also have a "Mono" economy? Oil makes up 80% of their budget so they are facing the same situation but chose to devalue. what is the contradiction?!

There are global economic challenges but we faring much worse than other countries due to inept policies from Emefiele, that is all I am saying. What is the contradiction?!

Here is another article showing that "not just the people I know" are also pulling out billions from the economy:

http://www.bloomberg.com/news/articles/2015-11-30/nigeria-s-stocks-fall-to-three-year-low-as-foreigners-exit

I do not mean to be rude, but everything I am saying is backed up by articles... you are just making baseless suppositions. Do you have a single article or precedent to prove that the current course CBN is taking will work?

SangoCrusader:
Guys, no vex. I realize I am being rude and we should just be exchanging ideas here.

@iboboyswag and @Truth234, I apologise. This is just a frustrating issue to be honest, but always good to hear different opinions on how best to resolve the situation.

SangoCrusader:


And Angola do not also have a "Mono" economy? Oil makes up 80% of their budget so they are facing the same situation but chose to devalue. what is the contradiction?!

There are global economic challenges but we faring much worse than other countries due to inept policies from Emefiele, that is all I am saying. What is the contradiction?!

Here is another article showing that "not just the people I know" are also pulling out billions from the economy:

http://www.bloomberg.com/news/articles/2015-11-30/nigeria-s-stocks-fall-to-three-year-low-as-foreigners-exit

I do not mean to be rude, but everything I am saying is backed up by articles... you are just making baseless suppositions. Do you have a single article or precedent to prove that the current course CBN is taking will work?

ZUBY77:
I think CBN should allow people receive their Western Union in Dollars.

modath:


Wish he could have the mind to ignore trolls..

Wish you could see my mentions but trust me, I don't entertain foolishness!

Bevista:
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.
---
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.

tolulakin:
I think people should look at it this way. The CBN has now approved dollar deposits so the scramble for dollars will increase as people now have the hope of getting deposits done.

This means, the forces of demand for the dollar will increase. Unfortunately, because the BDCs are not allowed to sell, there will be short supply of the greenback even in the face of increased demands.

By simple principles of demand and supply, when demand outweighs supply, price goes up!

I will not be surprised if the little amount of greenbacks in the parallel market before this ban begins to trade at 320 in the next few weeks.