The Central Bank of Nigeria (CBN) on Thursday ordered importers to repatriate their dollar earnings within 180 days or risk suspension from all segments of the foreign exchange market. This was as the naira suffered sharp depreciation against the dollar in the parallel market and the interbank market in reaction to the closure of the official foreign exchange market by the CBN.
At the parallel market, the naira depreciated by N5 as the parallel market exchange rate rose to N218 per dollar on Thursday from N213 on Wednesday.
At the interbank foreign exchange market, the naira depreciated by N2.51 as the interbank exchange rate rose to N199.1 per dollar from N196.59 on Wednesday.
The sharp depreciation of the naira in both markets was attributed to expectation of further depreciation of the naira following the closure of official foreign exchange market.
According to Alhaji Aminu Gwadabe, Chief Executive Officer, Sabil BDC, the expectation is that with everybody going to the interbank market to source for dollars, the naira will continue to depreciate.
But in a move to eliminate loopholes and boost foreign exchange supply, the CBN Thursday ordered exporters to repatriate their dollar earnings within 180 days. This order was contained in a circular to all authorised dealers by the Director of Trade and Exchange Department, Mr. Olalelekan Gbadamosi.
The circular entitled: “Repatriation of Export Proceeds (Oil and Non Oil)” stated: “Pursuant to the provisions of Paragraph (4) Memorandum (11) of the Foreign Exchange Manual, in respect of the repatriation into the export proceeds, all authorised dealers are requested to note that:
“Proceeds of oil and non-oil exports are to be repatriated into the export proceeds domiciliary accounts of their respective exporters’ accounts within 90 days for oil exports and 180 days for non-oil experts, failing which the collecting bank will be liable to a fine of 10 per cent of the FOB value of the transaction, including other appropriate penalties as provided in the BOFIA 1991, as amended.
“Where an exporter fails to repatriate the proceeds into the domiciliary account within the stipulated period, the exporter will be barred from participating in all the segments of the foreign exchange market in Nigeria.”
Copyright Ships & Ports Ltd. Permission to use quotations from this article is granted subject to appropriate credit given to www.shipsandports.com.ng as the source.