BY EDMOND ODOK – Eight years after restricting Forex sales to importers of certain items that Nigeria has comparable advantage in their importation, the Central Bank of Nigeria (CBN) has finally called it a day with the policy action.
Announcing the restoration of the 43 items banned years ago from accessing foreign exchange (FX), the apex Bank’s Director of Corporate Communications, Isa AbdulMumin, said on Thursday that; “Importers of all the 43 items previously restricted by the 2015 Circular referenced TED/FEM/FPC/GEN/01/010 and its addendums are now allowed to purchase foreign exchange in the Nigerian Foreign Exchange Market”.
The statement further said; “The CBN reiterates that the prevailing Foreign Exchange (FX) rates should be referenced from platforms such as the CBN website, FMDQ, and other recognized or appointed trading systems to promote price discovery, transparency, and credibility in the FX rates.”
In restating its commitment to boost liquidity in the FOREX market, the apex bank assured that its policies will “continue to promote orderliness and professional conduct by all participants in the Nigerian Foreign Exchange Market to ensure market forces determine exchange rates on a Willing Buyer – Willing Seller principle.”
It further added that; “As part of its responsibility to ensure price stability, the CBN will boost liquidity in the Nigerian Foreign Exchange Market by interventions from time to time. As market liquidity improves, these CBN interventions will gradually decrease.”
Also explaining that the “CBN has set as one of its goals the attainment of a single FX market”, the statement said; “Consultation is ongoing with market participants to achieve this goal”, adding that; “The CBN is committed to accelerating efforts to clear the FX backlog with existing participants and will continue dialogue with stakeholders to address the issue.”
With this development, many financial sector operators acknowledged that it is clearly a major policy shift by the Dr Yemi Cardoso-led new management from the Godwin Emefiele era that introduced the policy and doggedly protected it over the years.
The CBN had in 2015 placed at least 43 Items on the Forex restrictions list with the argument that the policy was meant to promote local manufacturing capability and backward integration.
Among the banned items were Rice, Cement, Poultry – chicken, eggs, turkey, Indian incense, Margarine, Palm kernel/palm oil products/vegetable oils, Meat and processed meat products, Vegetables and processed vegetable products, Tinned fish in sauce (geisha)/sardines, Cold-rolled, steel sheets, Head pans, Metal boxes and containers and Enamelware. Tiles – vitrified and ceramic, Textiles, Galvanised steel sheets, Roofing sheets, Wheelbarrows, and Private airplanes/jets.
Also affected were Plywood boards and panels, Wooden doors, Furniture, Toothpicks, Glass and Glassware, wood particle boards and panels. Kitchen utensils, Tableware, Woven fabrics, Clothes, Plastic and rubber products, polypropylene granules, cellophane wrappers, Eurobond/foreign currency bond/share purchases, Wood fibre boards and panels, Dairy/milk and Maize, Soap and cosmetics, as well as Tomatoes/tomato paste.
The list also included: Iron rods and reinforcing bars, Wire mesh, Steel nails. Security and razor wire, Steel drums, Steel pipes, and Wire rods (deformed and not deformed).
