By Camillus Eboh
The naira can sell for almost 500 to the dollar on the illegal parallel market, while the government has pegged its value to around 305 to the dollar since June.
The Central Bank of Nigeria’s (CBN’s) policies are aimed at conserving foreign exchange, stimulating agriculture and manufacturing and promoting exports, the central bank said in a statement.
“Intelligence reports at the disposal of the Bank reveal the involvement of some unpatriotic elements funding the push to have the CBN and the Federal Government reverse its forex policy,” the bank said, without providing further details of those intelligence reports.
The bank said it would ensure inflation remains within manageable limits, intervene in critical sectors of the economy by injecting capital and provide credit to farmers and small businesses at low rates.
“We will continue to ensure monetary and price stability as well as maintain external reserves to safeguard the international value of the Naira,” said the CBN.
The CBN has been widely criticised by economic experts and the public alike for not allowing the naira to float freely, which those critics have blamed for a slew of problems, from foreign investment drying up to an inability to import goods.
Instead, the central bank in part blamed the “past practice of frittering away huge earnings made from oil sales” for the country’s economic woes.
“Our decisions on forex management are prompted by the challenge posed by the level of depletion of the country’s reserves, arising from issues such as a drastic reduction in oil earnings, (and) speculative attacks,” it said.
Indeed, Nigeria has been hit by low global crude prices and attacks on facilities in the restive and oil-rich southeast Delta region by militants.
The government relies upon crude exports for roughly 70 percent of its revenues, which heavily contribute to foreign exchange reserves.
Foreign currency earnings fell from over $3.2 billion a month in 2013 to below $500 million a month in 2016, when the demand for dollars continued to rise, the CBN said. (Reporting by Camillus Eboh; Writing by Paul Carsten; Editing by Toby Chopra)
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