End users of forex in Nigeria who engage in speculation will definitely get their fingers burnt in the present dispensation.
The Association of Bureau De Change Operators of Nigeria, ABCON, President, Alhaji Aminu Gwadabe gave the warning in a chat with newshounds in Lagos recently.
Alhaji Gwadabe while insisting that the naira was gradually firming-up against the dollar and other major currencies said the mere announcement of the resumption of sales of foreign exchange to Bureau De Change operators in the country led to about N47 appreciation in the value of naira to the dollar.
According to the ABCON, President whosoever attempts to undermine the market by mopping up the available dollars will only have himself or herself to blame as the rates are bound to crash in no disant time.
He argued that with Nigeria’s external reserve at $32 billion, capable of supporting the nation’s imports for a period of six months, the rising demand for crude oil as well as the associated increase in the price of the commodity, in addition to the resumption of businesses in some of the developed countries where Nigerian citizens work and remit money back home by way of diaspora remittances ‘ as measures that will further assist the apex bank defend the naira and ensure stability.
Gwadabe said ” our reserve is at $32 billon which can cover about six months of imports. I’m not saying we should wipe out our reserve because it is also a measure of strength; a measure of capability that the CBN is having to at least defend the value of the naira. We are also witnessing the crude oil demand is rising, the prices are going up, which will give the Central Bank more muscle to defend the value of the local currency.
In addition to the above “the tactics of this governor, you know he is somebody that is very unpredictable. You cannot predict a leader. Continue to give him issues, one day he will come with a surprise. Even we, he has warned us, if your members think they have an opportunity, I will make them incur losses. Anybody that wants to undermine the policy of the Central Bank, the management of the Central Bank is ready to give him a fight. They are ready to give him a fight and they have the muscle.
The ABCON President therefore cautioned the end users of forex on the need to avoid speculation. While advising government on the need to intensify its backward integration programme to enhance productive capacity ” if you want to mop up the dollars in the system, you are doing it at your peril because you will loose money. See, the gap is closing, so that is a pointer for those that will want to speculate. It is not profit, it is losses.
For government, let them continue with their backward integration so that we can enhance our productive capacity, very important and the porous borders should be checkmated so that illegal cross-border payments will be tracked. Give the BDCs more mandate, more businesses, more scope of transactions to make the dollar readily available and at a competitive price” he added.