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Naira plunges low at foreign exchange market despite security measures

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Naira plunges low at foreign exchange market despite security measures

The Nigerian Naira has further decreased at the parallel market despite clampdowns by the federal government on foreign exchange market speculators.

Earlier this month, Bureau De Change (BDC) hubs were raided in Abuja, Lagos and Kano and some operators were arrested.

Despite the raids, the naira plunged further with a dollar exchanging for 1,900 in Abuja and Kano, and N1,800 in Lagos; while the British Pound was exchanged for N2,250.

However, at the official market, the naira recorded a marginal gain closing at N1,551.24 as against the earlier N1,574.62, according to the Nigerian Autonomous Foreign Exchange Market (NAFEM).

The National Security Adviser, Nuhu Ribadu, has directed operatives of the Nigeria Police Force, the Economic and Financial Crimes Commission (EFCC), the Nigeria Customs Service (NCS) and the Nigeria Financial Intelligence Unit (NFIU) to clamp down on forex market speculators.

READ ALSO: EFCC in Abuja arrests 50 Bureau de Change operators (Video)

He said it was a concerted effort to safeguard Nigeria’s foreign exchange market and combat the activities of speculators, both domestic and international, operating through various channels.

Ribadu, in a statement by Zakari Mijinyawa, Head, Strategic Communications in the Office of the NSA, said the office had to wade in at this time because some individuals and organisations had continued to undermine proactive measures of the Central Bank of Nigeria to stabilise the foreign exchange market and stimulate economic activities.

But some experts who spoke to Daily Trust described the move as faulty, saying there are better ways to address the volatility.

The statement from Ribadu said, “The CBN’s proactive measures to stabilise the foreign exchange market and stimulate economic activities have been commendable.

“However, the effectiveness of these initiatives is being undermined by the activities of speculators, both domestic and international, operating through various channels, thereby exacerbating the depreciation of the Nigerian Naira and contributing to inflation and economic instability.

“To reduce the pressure on the naira, the EFCC raised a 7,000-man special task force across its 14 zonal commands to clamp down on dollar racketeers.

“Yet, recent intelligence reports have highlighted continued illicit activities within the Nigerian foreign exchange market. The ONSA and CBN are therefore embarking on this collaborative approach to tackle these infractions.

“This partnership will involve a coordinated effort with key law enforcement agencies, including the Nigeria Police Force, the EFCC, the Nigeria Customs Service and the Nigeria Financial Intelligence Unit (NFIU).

“The primary objective of this alliance is to systematically identify, thoroughly investigate and appropriately penalise individuals and organisations involved in wrongful activities within the FX market,” the official said.

The NSA said by leveraging the expertise of those four security agencies, the government aimed at deterring what he described as “malicious practices”, in order to protect investors’ interests and promote sustainable economic growth.

Acting on the NSA’s directive, the security operatives swooped on the streets of Lagos, Abuja and Kano to raid unlicensed BDC operators.

At the popular Allen Avenue in Lagos, about five BDC operators were reportedly arrested when the EFCC operatives stormed the area around 10am.

Many of the unlicensed operators transacting by the road fled on sighting the security operatives.

An operator said: “They came to our place today; they said we are the ones responsible for the hike in foreign exchange. All of us had to take to our heels for fear of arrest.”

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