The Nigerian Central Bank has once again silently maintained a dual forex exchange rate, further aggravating Nigeria’s economic recession while festering corruption.
In June of this year, after being implicated in the triggering of the economic collapse, the Central Bank announced the floating (devaluation) of the Naira to allow the interbank rate match up with the parallel market, BDC rate. However since then, while the BDC rate has further dropped to N465/$1 (currently), the interbank rate has been artificially held at around N312/$1. This has thus created and maintained a 50% disparity between the two rates.
Periodically injected CBN announcements and sudden new regulations have targeted the BDC dollar supply thereby deliberately expanding the gap.
The negative impacts of the duality in rates have been recognized and thoroughly criticized by local and foreign experts and entities. This rate-dichotomy does not only drive away investment but also directly promotes corruption while siphoning away billions in government dollars given to cabal at the subsidized rate. With all features implicated in contributing to and exacerbating the recession.
Those with access to CBN-subsidized dollars have been accused of engaging in the sale and supply of this to BDC customers and retailers thereby raking 50% profit on each dollar at the current rates. Large companies with connections to the powers that be and CBN management are enabled to create phony dollar requests used to purchase items for needy BDC customers, thus circumventing the law and immediately making 50% on the dollar; $500,000 on every million dollars round tripped. [See: Sanusi: FG Creates Billionaires through Forex Round Tripping; August 25, 2016]
Nigeria’s government corruption-made billionaire Aliko Dangote was gifted a whopping $100 million via this CBN cabal-funding scheme, according to a report by Reuters this June, which examined just a 3-month span of CBN-released figures. This translates to a staggering gift of as much as half a billion dollars by the Apex Bank to a single cabal in one year and billions of dollars to the handful of cabal for the period. The CBN was found to sell as much as 10% of all government dollars to just Dangote for his personal needs at the official subsidized rate. We are talking about catastrophic loses of Nigeria’s revenue. Millions of Nigerians suffer and die for one man to be pleased.
At the current rate, on every billion subsidized dollars the CBN sells to Dangote, he will immediately make a massive half a billion dollars. This loss of revenue of the masses has been accused of being directly responsible for the deepening economic recession. Small businesses are not given access to dollars and have been folding up leading to job losses in the millions while the cabal are fed fat on Nigeria’s oil earnings, making economic recovery impossible. Femi Kuti asked why Buhari does not simply rename Nigeria “Federal Republic of Dangote?”
The FGN is seeking to borrow $1 billion in eurobond while giving the same and more out in gift to the cabal by maintaining the amphibious forex rates.
The same cabal who in partnership with the Central Bank and successive governments including the present, keep the nation in reverse and got it into a recession, have now coerced the government to sell them its assets as a fallacious “means out of the recession.”
And it’s happening all in the masses’ faces. Someone must have taught the cabal-controlled
God will deliver Nigeria.
Peregrino Brimah; @EveryNigerian