The Central Bank of Nigeria, CBN has just released a new circular instructing that banks must sell 40% of their forex holdings to manufacturers, while the rest 40% can be allowed for other traansactions.
The CBN said the directive is a follow up to its ‘review of returns on the disbursement of foreign exchange to end users, it has been observed that negligible proportion of foreign exchange sales are being channeled towards the importation of raw materials for the manufacturing sector.
TheCBN said it is ‘to address the observed imbalance, Authorised Dealers are hereby directed to henceforth dedicate at least 60% of their total foreign exchange purchases from all sources (interbank inclusive) to end users strictly for the purposes of importation of raw materials, plant and machinery. The balance of 40% should be used to meet other trade obligations, visible and invisible transactions.
‘For the avoidance of doubt, Authorised Dealers are to continue to publish weekly sales of foreign exchange to end users in the National Newspapers and to render statutory returns on same to the CBN promptly’ the statement said.
Last week, the CBN made swift changes to the rule or engagement with Bureau de Change by increasing their quota to USD50,000 per week.
Nigeria has not only been battlling a recession but Forex shortages that has negatively impacted importation of goods and needed raw materials for local production.
