Thursday, September 22,
2016
The Association of
Bureau De Change Operators of Nigeria says it foresees the naira on the path of
recovery by Monday due to the introduction of Travelex, a licensed Forex
dealer.
The President of ABCON,
Alhaji Aminu Gwadabe, said on Thursday in Lagos that a licensed Forex dealer
would enhance transparency in the distribution network.
Travelex, an
international money transfer organisation, was officially directed by the
Central Bank of Nigeria to distribute Forex to Bureaux De Change operators by
Monday.
Gwadabe saidthat a
licensed Forex dealer would enhance transparency in the distribution network.
Hesaid that Forex
distribution would be efficient and uniformed across ABCON members unlike what
was obtainable in the past.
According to him,
Travelex has the technology to sell Forex to about a 1,000 BDCs within a couple
of hours, which is a major advantage.
He said, “Against this
background, the naira is expected to be on a recovery path from Monday as the
distribution of Forex to BDCs will boost liquidity in the market.
“The boosting of
liquidity in the market will dampen the fears of investors and market
speculators, thereby raising their confidence in the market.
“This is a purely ABCON
and Travelex arrangement, and has the capacity of removing the bottlenecks in
the Forex distribution chain.
“Travelex has the
technology to pay about 1,000 BDCs within two hours.
“The new arrangement
also eliminates relating with bank account officers”
On the CBN's retention
of the Monetary Policy Ratio at 14 per cent, Gwadabe said, “I agree totally
with the decision of the apex bank to retain the rate.”
He said that there was
an inverse relationship between inflation and interest rate, adding that an
increase in liquidity in the economy could put pressure on the exchange rate.
He said, “The more
naira at the disposal of Nigerians, the more they want to convert it to dollars
for speculation purposes.”
The coming of Travelex
into the Forex distribution chain was a response to easing liquidity challenges
in the market.
The Nigerian currency
has had scarcity of Forex challenges leading to a sustained depreciation of the
naira in almost all the segments of the market.
The liquidity challenge
moved the apex bank to reconsider the sale of Forex to BDCs when it was
apparent it could not sustain the ban.
Since the resumption of
Forex to BDCs, ABCON had complained of poor distribution of Forex to its
members which led the association to plead for an independent body to take over
the distribution.
Stakeholders in the
Forex market believed that the latest development would see the naira mounting
the wheel of recovery.
(NAN)
SOURCE: PUNCH