Experts hail CBN’s decision to stop forex sale to BDC operators

An economist, Prof. Akpan Ekpo, has commended the Central Bank of Nigeria (CBN) for discontinuing sale of forex to Bureau de Change (BDC) operators in Nigeria.

Ekpo, a former Director General of the West African Institute for Financial and Economic Management (WAIFEM), made the commendation in an interview with newsmen on Wednesday in Lagos.

According to him, for BDC operators to obtain forex from CBN at official rate and then sell to those who need forex was unnecessary.

“The decision to discontinue sale of forex to BDC operators is a welcome development, they should never have become major players in the market.

“Nigeria is one of the few countries in Sub-Sahara Africa in which the Central Bank sells forex to BDC operators.

“We argued for years that the practice should cease but we were labeled radicals.

“BDC operators should source for their forex and engage in buying and selling of foreign currencies,” he said.

Ekpo advised them to strive to bring more forex from legal sources to the economy, adding that the impact on the economy would depend on the quantum of forex in the economy.

It would be recalled that  at the end of the 280th Monetary Policy Committee (MPC) meeting on July 27, members unanimously decided to stop forex sales to Bureau de Change operators.

Announcing th decision, the CBN Governor, Mr Godwin Emefiele, said that forex sales would be re-channelled to commercial banks to meet PTA, BTA needs of customers

He said that members also decided to suspend licensing of more BDCs in the country.

He advised commercial banks to dedicate teller points in every branch for sale of forex to customers.

Also, he urged customers to report banks who failed to sell forex to them despite meeting requirements.

Furthermore, CBN promised to come down hard on commercial banks who were found to have connived with foreign embassies, missions and institutions who have conducted their forex businesses illegally and in flagrant abuse of local regulations.

The apex bank would also report such errant institutions to the relevant authorities in their home countries in an effort to redirect forex business to the I&E FX window.

Financial experts on Wednesday, commended the Central Bank of Nigeria (CBN) over its decision to stop the sale of Foreign Exchange to Bureau De Change (BDC) operators.

Some experts also told newsmen in Ota, Ogun, that the ban would curb the incidence of money laundering.

Dr Titus Okunrounmu, a former Director, Budgeting Department of CBN, said the decision of the apex bank to discontinue sale of foreign exchange to BDC operators would also help to curb corruption.

Okunrounmu said it was also a new dawn for those that want to get foreign exchange to travel out of the country.

“It is a measure that will help to stabilize the naira, but the CBN needs to look into other aspects of the economy,” he said.

The former CBN director said the selling of forex through commercial banks would stabilise the nation’s naira, as every transaction in the bank would be well documented.

He said the BDC operators were being managed by one or two persons, which often aided money laundering activities.

Okunrounmu alleged that some Nigerians had been traveling with more than required dollars or foreign exchange, adding that there was a limit to foreign exchange an individual could purchase.

Also, Dr Samuel Nzekwe, former President, Association of National Accountants of Nigeria (ANAN), said it was a good development as genuine exporters would now be able to get required foreign exchange for their business transactions.

Nzekwe alleged that the BDC operators were part of the country’s problem of finding a way to stabilize the naira.

The ex-ANAN boss said getting foreign exchange from commercial banks was usually a difficult task, advising Nigerians and governments at all levels to focus attention on production economy.

“For Naira to stabilize, the economy needs to start producing, because the country is not producing anything presently,” he said.

He called on the Federal Government in particular to further make concerted efforts to create an enabling environment for the production sector to flourish.

According to him, it is when the economy starts producing, that the effect of the new policy by the CBN will be meaningful.