The Association of Bureaux De Change Operators of Nigeria (ABCON) has called on the Central Bank of Nigeria (CBN) to restructure the BDC sub-sector so as to be able to address issues concerning the continued depreciation of the naira in the parallel market.
It also asked the CBN to resume dollar sales to the public through BDCs especially in view of the failure of the intervention through Deposit Money Banks to bridge the gap between the official market exchange rate.
In the ABCON Quarterly Economic Review for the 3rd quarter of the year (Q3’21), the Association stated: “Industrialists have reported increased scarcity of foreign exchange in the system since the stoppage of intervention to BDCs which is an indication that irrespective of the anomaly observed in the operations of BDCs, part of the allocation to the sub-sector flows into the real sector.
Thus, it is logical to consider restructuring BDC operations to weed out the dysfunctional units and operators bringing out the real outfits for operational efficiency. These can be achieved through the design of dynamic operational modalities of standard practices.”
“The refined outfits can effectively operate on independent transparent platforms dealing in autonomous funds in the economy. They should be permitted to operate as fully independent foreign exchange professionals under the best practices in international foreign exchange operations.
Medium-scale dealers in foreign exchange should be permitted to operate a lower platform to the Investors and Exporters (I&E) market under transparent clearinghouse modalities.
“The market or platform will compete for funds in the global foreign exchange market thereby deriving a merger and stability in the exchange rate in the economy. This is a basic solution to the divergent and multiple exchange rates regimes plaguing the Nigerian foreign exchange market for ages.”
ABCON also called on the CBN to investigate the actual causes of the depreciation since July 2nd when it suspended dollar sales to BDCs and why the Deposit Money Banks were unable to bridge the gap of supplying foreign exchange to satisfy the demand earlier fulfilled by BDCs