By Babajide Okeowo
Johnson Chukwu, Chief Executive Officer, CEO at Cowry Asset Management has disclosed that declining Diaspora remittances due to job losses occasioned by the COVID 19 pandemic is one of the major reasons why there is a scarcity of dollars in the country.
Chukwu attributed the low supply compared to demand, to the fall in the proceeds of crude oil sales as a result of lower prices and production, a drop in portfolio investment as investors fled the Nigerian markets and a decline in Diaspora remittances, as Nigerians abroad lost their jobs due to the COVID-19 pandemic.
Analysts have called on Nigeria to diversify its forex supply to the economy by increasing domestic projects and economic activities that generate more foreign exchange or that are import-substituting.
Africa’s most populous country is also faced with the task of creating more investment options for both foreigners and domestic economic agents.
Recall that the Central Bank of Nigeria, CBN had recently ordered that from Monday, November 30, to December 4, 2020, Bureau De Change (BDC) Operators and Service Providers should sell the United States dollars to end-users to N392 to a dollar, lower than the N386 to the dollar it was previously.
This was contained in a circular titled: ‘Weekly Exchange Rate For Disbursement of Proceeds of International Money Transfer Service Operators’ signed by CBN Director, Trade & Exchange Department, Ozoemena Nnaji,
IMTOs sale of dollar to banks was pegged at N388 to a dollar; banks sale of dollar to CBN at N389 to a dollar and CBN sale of dollar to BDCs at N390 to a dollar. The BDCs are now expected to sell to end-users at not more than N392 to a dollar and each BDC is entitled to buy $10,000 weekly.
“Please be advised that the applicable exchange rate for the disbursement of proceeds of International Money Transfer Service Operators (IMTOs) for the period Monday, November 30 to Friday, December 4, 2020, is as follows;
IMTOs sale of dollar to banks is pegged at N388 to a dollar; banks sale of dollar to CBN at N389 to a dollar and CBN sale of dollar to BDCs at N390 to a dollar” the circular stated.
