Naira Takes a Beating as CBN Scrambles to Shore it Up

By Sahabi Abdul

The Nigerian currency maintained its weakening trend this week, peaking at 480 naira per dollar in the parallel market as it shed 1 percent of its value over five days.

Many businesses with urgent foreign exchange commitments are resorting to the parallel market, as official funds remain harder to obtain, according to foreign exchange traders interviewed by 

“I’ve had a pressing need to remit money to my suppliers for months,” said Lanre Adoun, a Lagos-based importer of computers, while transacting with a money changer. “I’m taking a loss doing it here, but I don’t have a choice.”

The Central Bank of Nigeria, after observing the slide for the first four days of the week, responded on Thursday with a circular that relaxed some of its stringent rules for disbursing foreign exchange. 

Importers are now allowed to source imports from third parties other than the original manufacturers of the goods, reversing a rule introduced earlier this year.

“All authorized dealers are to ensure that the list of eligible third parties that meet the requirements are submitted to the Bank for authentication, ” O.S. Nnaji,  the director in charge of trade and exchange, said in the circular.