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CBN Gives Nod to Money Repatriation Amid Shortage of Forex

by James Ikenna………

The Central Bank of Nigeria (CBN) has given a nod to investors to take out their money amid shortage of foreign exchange and dwindling external reserve occasioned by the fall in oil price due to the pandemic.
For instance it is expected that Nigeria’s external reserves, which were about $36.3 billion two months ago is going down to $30 billion by September this year.
Inspite of this the CBN has also gone ahead to give local manufacturer access to foreign exchange for importation of their raw materials for production. According to CBN this is in a bid to reset the economy in the face of the challenges of covid-19.
The CBN Governor, Godwin Emefiele said that foreign investors that intend to repatriate their funds from Nigeria are guaranteed to do so. According him this will restore back their confidence to continue doing business in Nigeria.
“Foreign exchange available would be devoted to strategic importation or service obligations that are the priority” the CBN boss said.
Though the economy had been battling with shortage of foreign exchange as a result of the fall in oil price occasioned by the glut in the international oil market. CBN Governor explained that this move is geared towards not only to galvanize the manufacturing sector but also to reset and instil confidence in the economy.
Prior to this, commercial banks in the country late March reduced international spending limits by their customers abroad amid the fragile currency situation.
The move to curb dollar purchases then was seen as a precautionary, considering banks may be experiencing a shortage of foreign currency available for them to sell to their customers due to the falling forex earnings.

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