Some financial experts, yesterday, said that the new directive to stop direct sale of foreign currencies by Central Bank of Nigeria (CBN) to bureaus de change operators would check illegal activities in the market.
In separate chats with NAN in Lagos, they explained that the decision would stabilize the foreign exchange market and wrest it from the controls of those with untoward intentions.
The country’s external reserves had dropped to $28.19 billion on January 8, from $29.07 billion at the end of last year, a reduction of $88 million in the first week of 2016.
Head, Research and Investment Advisory at Sterling Capital, Sewa Wusu, said the CBN decision was part of the measures to reduce the pressure on the nation’s foreign reserves.
Wusu noted that although the new decision was a big task, the overall health of the economy was important.
According to him, the country could not afford to remain in the current situation, stressing that the directive on deposit of dollar into domiciliary accounts would increase the level of dollar deposits in banks.
He said that the directive would also put an end to round-tripping and rent seeking as dollar demand from the system would reduce, adding that the liberalisation of the interbank market was necessary to stabilise the foreign exchange market.
“The CBN however has to rationalise the foreign exchange to ensure that the reserves do not continue to deplete further due to decline in revenue earnings from crude oil.
“Although, there might be slight pressure on the parallel market, but this will reduce later as the market stabilises.
“We are moving towards a regime of flexibility where the demand and supply would determine the value of the naira,” he said.
A former President of Association of National Accountants of Nigeria (ANAN), Samuel Nzekwe said the decision was long overdue.
Nzekwe pointed out that that BDCs all over the world were not sourcing their foreign exchange from their respective central banks.
He said that BDCs in many countries were only allowed to attend to foreign exchange demands of light travelers, which they got from visitors into the country.
Nzekwe recalled that some Nigerians were jailed in the past for patronising BDCs before their activities were legalised.
A currency analyst at EcoBank Nigeria, Kunle Ezun said the actions of the CBN were aimed at reducing the pressure on the naira at the foreign exchange market.