Nigerian
security agents raided the offices of black market currency dealers on
Thursday, detaining several of them while ordering others to sell dollars at a
lower rate in a bid to check the persistent crash of the currency, dealers
said.
The security
agencies’ intervention was coming in the wake of the central bank’s inability
to stop Naira’s slide on the black market where importers often go to buy
dollars due to severe hard currency shortages in the country. The economy has
been pushed into recession partly by a slump in oil prices a key source of
revenue that has the added attraction
of coming in the form of dollars.
The central
bank has kept the official naira rate to the dollar artificially high,
effectively driving hard currency dealing away from commercial lenders and
towards the black market, the real benchmark.
“The police
and state security service officials are raiding black marketers in Lagos and
Abuja to compel an appreciation of the naira,” Mallam Adamu, a Bureau de Change
(BDC) operator, told Reuters.
Another trader
said security agents visiting BDC operators told dealers not to sell dollars
for more than N395.
“We’ve stopped
buying dollars from just anybody that walks into our shop due to the harassment
from security agents and a directive from our association,” said a dealer,
asking not to be named.
The currency
is exchanging at N460 per dollar on the black market, far weaker than the
official rate of N305.5. The naira had regained some ground this week after
dropping earlier from N470, but dealers said hard currency supplies remain
limited.
Aminu Gwadabe,
President of the Bureau de Change Association, said members of his association
had agreed with the CBN and security agencies to enforce a rate of N390 to N400
to the dollar.
“The issue of
naira depreciation has been narrowed to the activities of speculators and we
have decided, with the cooperation of both the central bank and security
agents, to enforce a new rule on pricing,” he said.
The Lagos
police declined to comment while source at the central bank said the bank was
concerned about the spread between the official and parallel market rate.
Meanwhile, BDC operators told the NAN yesterday that
they were forced to fix sales of foreign currencies such as dollar, pounds and
euros for fear of sanctions by anti-graft agencies and the Central Bank of
Nigeria.
For the past three days, naira has been exchanging for N400 to a dollar at the parallel market.
A Licensed BDC
operator in Abuja, Alhaji Yusuf Rabiu, said the recent raid on BDC
establishments by the Economic and Financial Crimes Commission (EFCC) forced
the operators to reach such an agreement.
Also, it was
agreed that pound sterling would exchange for N540 and euros for N500. Usually,
the rate of forex at the BDC segment is based on demand and supply.
When demand is
higher than supply, each operator uses his discretion to hike the price.
To regulate
the segment, CBN recently issued a policy that allowed each BDC to buy dollars
from Travelex at N381 per dollar and sell to end users at a maximum of N400 per
dollar.
On Wednesday,
the Department of State Services (DSS) raided the offices of some BDCs in Lagos
and arrested operators selling above the stipulated exchange rate.
The DSS
operatives posed as end users who came to purchase dollars from the BDCs. After
surveying the market for exchange rate offerings, they arrested some BDC
operators who sold above the CBN agreed rates.
“On Monday,
EFCC called so many licensed BDC operators. The issue is that they feel we are
unnecessarily hiking the rates. But it’s not our fault. Right now, their focus
is on our business; they have been calling us one by one and we don’t want
problem. That is why we have agreed to have a fixed rate for now,” he said.
“After the raid in Lagos, we the Abuja operators met and agreed on a fixed rate so that such will not happen to our members.”
Another
operator, who preferred anonymity, said the market was slow as people who had
dollars were not ready to sell at the existing rate.
He said
personally, he had temporarily closed shop to potential customers until he
studied the market for the next couple of weeks to determine if the new policy
would come to stay.sunnewsonline
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