Dollar scarcity to ease as CBN resumes FX sales for SMEs, school fees

The Central Bank of Nigeria (CBN) on Wednesday resumed dollar sales for school fees and Small and Medium Enterprises (SMEs), which should go a long way to ease dollar scarcity and reduce the gap between the parallel and investors and exporters (I & E) window exchange rates.

“The Central Bank of Nigeria (CBN) has resumed provision of foreign exchange to all commercial banks for onward sales to parents wishing to pay schools fees and SMEs wishing to make essential imports needed to revamp economic activities across the country. In particular, the CBN is resuming the provision of over $100 million per week for both categories,” a statement signed by Isaac Okorafor, director, corporate communications department of the CBN, said.

“With these actions, the CBN wishes to reiterate that it is adequately meeting the needs of all legitimate users, and our continued capacity to do so should not be in doubt. There is therefore no need for panic by any end-user that could necessitate recourse to illegitimate sources and spike in foreign exchange rates.”

The naira had weakened to as low as $1/N450 in the parallel market on Monday, while it exchanged at $/N389.35 at the I & E window yesterday.

Even as CBN dollar reserves have fallen to about $33 billion, it will be buoyed by the expected inflows of $3.4 billion from the International Monetary Fund (IMF), giving it some extra firepower in its fight to maintain monetary stability.

The CBN has also made arrangements to resume foreign exchange sales to the bureau du change (BDC) segment of the market for business travels, personal travels, and other designated retail uses, as soon as international flights resume.

This is in view of the gradual easing of the COVID-19 lockdown both globally and in Nigeria.

Given this, the Bank said it has ramped up its surveillance of the foreign exchange markets for speculators, smugglers and other illegal users, and will take decisive actions against anyone/institutions involved in such nefarious activities.

Hope Moses-Ashike