Bureau De Change operators (BDCs) in Abuja got a rude shock yesterday as security operatives swooped on them in a sting operation designed to arrest the free fall of the naira, believed to be fuelled by the antics of currency speculators.
The security agencies, working in cahoots with the Central Bank of Nigeria (CBN), quizzed the BDCs’ top shots, reports Daily Sun.
When our correspondent got to the zone 4 area of Abuja, the hub of black market foreign exchange, the place was somewhat deserted as most of the dealers stayed away claiming to have run out of forex to trade with.
Some of them said they were in solidarity with their leaders who are protesting a spike in dollar price and the rapid tumbling of the naira.
Major areas for forex trade like the Zone 4 Plaza, Musawa Plaza, Bulama House, Fabdal Plaza and Baura House were shut yesterday.
Some of the BDC operators opposite the Abuja Continental Hotel said with the sting operation by security operatives, they have been forced to stop selling forex at the parallel market until the price crashes considerably.
Isah Adamu, the Chief Executive Officer of An-Nasara Nig Ltd Bureau De Change lamented: “As you can see, nobody is selling. It is because of the instruction. We have to obey. They came in the morning with the police, EFCC and others and said we should stop selling and buying dollars today. That we should join the strike. Even Lagos has shut down, Kano and PHC too because the price is too high. Now it is N1,350. Tomorrow it may not be up to that again. They said they want it to return to N750 instead of above N1,000. The dollars I have, since morning I have been unable to sell them. Nobody to buy. Everywhere including the plazas are locked”.
Another dealer who craved anonymity, said the EFCC and police today swooped on them to force them to comply with the directive to stop selling dollars for now.
“We are being blamed for the rapid fall of the naira. They are hoping that by Monday, there would be a determined price between N700 to N1,000 and we can continue our business freely”, he said.
Abdullahi Yahaha, another currency trader said: “We are not selling today. We are on strike. The government, the CBN and banks are blaming us for the fall in the value of the naira and the rise in price of dollars. So, we are not selling. We plan to resume sales tomorrow but for today, we are not trading.”
“If you want to buy or sell dollars, I have to join you in a car to a quiet place because I don’t want to be arrested by EFCC or the police”.
The shutdown, we learnt, will last 24 hours as normal activities are expected to resume today if the market responds positively to the action.
Customers who were eager to buy or sell dollars were sent back by the union’s taskforce.
The move by the association and security operatives feeds into an effort to boost the value of the naira.
Naira rose to N1,520 at the BDC segment on Wednesday.
At the Nigerian Autonomous Foreign Exchange Market, the naira fell around N1,480, from the N900 which it was in December, 2023.
Some frustrated dealers are blaming online banking transactions and cryptocurrency as causative factors mopping up forex and leaving them with the shorter end of the stick.
BDC operators in Port Harcourt, Lagos and Kano also shutdown over the foreign exchange crisis.
Some finance analysts suspect that the weakness of the naira at the official market price was deliberate, mainly to close the gap between official and black market rates and ultimately tame arbitrage.
However, there are concerns that the strategy is not sustainable because there is too much money in the system and held by a few, including the banks.
“That’s what they are using to speculate on the naira. There should be a meeting of the MPC and let the CBN Governor give a direction on rates and possibly a hike will help mop up excess money, shore up supply and tame demand which no one is really talking about”, an analyst who craved anonymity stated.
Last week, the CBN Governor, Dr Yemi Cardoso, at the 2024 macroeconomic outlook launch hosted by the Nigerian Economic Summit Group (NESG), said that the naira is currently undervalued and would be made to be at its real level soon.
The CBN Governor said the monetary and fiscal wings of the country were deepening collaboration to administer policies and interventions that will accelerate genuine price discovery in the near term and also boost the economy.
He said CBN has reverted to the conventional monetary policy approach with a focus on achieving price stability, which fosters sustainable economic growth.
This comes as experts diagnose the ailing Nigerian economy and proffer solutions, including plugging leakages, tackling insecurity and injecting sufficient foreign exchange to lubricate the economy.
