By Merit Ibe
Manufacturers have lamented that their fate is now hanging in the balance accessing foreign exchange (forex) from commercial banks following the Central Bank of Nigeria’s (CBN) decision to stop supply to Bureau De Change (BDCs) operators.
The manufacturers predicted more woes for the real sector of the economy, as the move would further accelerate hoarding and more end users, exporters and importers would also experience stifling forex allocation from commercial banks, leading to more forex squeeze in the country.
The manufacturers under the Manufacturers Association of Nigeria (MAN) emphasised the need for the apex bank to properly monitor and supervise the commercial banks for prompt release of forex to operators and the business community in a bid to curb hoarding.
An official of MAN, who did not want his name in print, said it is an abnormal situation for manufacturers to depend on BDCs using the BDC models instead of commercial banks. “It is an abnormal situation. it doesn’t happen in any economy “that is why we see many disruptions in the market and that does not help the economy .”
On possible round tripping, he said: “That is why I said that there must be supervision and proper monitoring of the commercial banks in this situation, knowing the commercial banks and what they are.
“So what will happen is that they may use pseudo companies to get that forex and round trip it to BDC operators. And that is why I emphasised a proper monitoring and supervision of the commercial banks, and if that is not done it is just a wasted effort.”
He disclosed that the stopping of BDC operators from sales of dollars would make them go underground, saying they would still be in operation but will only depend on insiders in the commercial banks for patronage in releasing dollars to them to sell in the black market.
“If the commercial banks are not properly monitored this will happen, because BDCs ought to get their forex from households remittance from Diaspora, from individuals and not from the CBN,” the MAN source said.
On forex squeeze, he said: “I don’t think that the intention of the CBN for bringing back forex to commercial banks is to ease out forex from the market.
“The intention is to make the forex flow, especially for the small scale operators that will need $10,000, $20,000 it will be easier to get it from the banks and they will process your papers and officially send it abroad for whatever you want to buy.”
Meanwhile, a former Director General, Lagos Chamber of Commerce and Industry( LCCI), Dr Muda Yusuf, said what is happening in the foreign exchange market is a consequence of the CBN policy choice of a fixed exchange rate regime and administrative allocation of forex.