Instituting a single market-driven foreign exchange (forex) rate has been identified as a major step to stabilising the value of the Naira against other currencies, while also stemming volatility on account of speculations in the system.
The Association of Bureaux de Change Operators of Nigeria (ABCON), who canvassed this yesterday in Lagos, also put the appropriate or what it described as the “realistic exchange rate” under the prevailing economic circumstances at N400 to $1. The CBN official market rate is N305 to $1, while banks sell to the BDC at N381. The BDCs have a band of N399, where the parallel market is about N480.
However, the high volatility and multiple exchange rates have become a disincentive to new foreign direct investments, while the uncertainty and rate fluctuations have reduced the capacity of firms to invest in export.
ABCON Ag. President, Mohammed Gwadabe, at a maiden interaction with journalists, said the single market exchange rate is one of the solutions the Association came up with to help stem market volatility.