Uche Usim, Abuja and Adewale Sanyaolu
A monetary expert warned against Naira’s devaluation as the country’s banks deal with currency scarcity (forex).
This would possibly not be similar to the federal government’s low oil revenues in the wake of the COVID-19 pandemic.
Some clients who had a domiciled account have difficulties with their funds.
One consumer told the Daily Sun that his attempt to withdraw about $5,000 from his home account at one of the second-generation banks in the Ogba lagos domain had come across brickwall last Friday. He stated that all efforts to make the Cashier at the Forex market counter need an urgent budget had had no effect, as the official claimed to own $400 that was already being processed for the client.
The scenario is the same for most customers who spoke to the Daily Sun about development, saying the scenario was still embarrassing for him.
A senior official at one of the second-generation banks admitted that banks were facing unrest in foreign exchange sources due to the fall in the value of oil, which is recently priced at less than $50 in line with the barrel.
“The data they have is true. Many banks face a currency crisis because the source they get from the Central Bank of Nigeria (CBN) is not enough to meet visitor demand.
What we’re doing now is telling our customers to do something instead of accepting money for the flight. But we still have some who insist on accepting money for flights. For this category of customers, we want to look for tactics to locate the budget for them. But I have to tell you, it hasn’t been easy.
In the wake of the coronavirus pandemic, oil fell to an all-time low of less than $20 consistent with the barrel, forcing many foreign oil corporations (CIOs) to cancel their projects.
Meanwhile, Uche Uwaleke, a capital market professor and former finance commissioner for the state of Imo, reacted to the rise in the exchange rate (devaluation) through the Central Bank of Nigeria (CBN) over the weekend, the measure would damage the economy.
The umbrella bank officially replaced the naira exchange rate opposite the N361 dollar to N379 on its last Saturday.
According to the grant, the recent upward adjustment, which largely responds to retirement situations from the recent facility of the International Monetary Fund’s (IMF) Rapid Financing Instrument (IRN), will hurt the economy in the short term.
Uwaleke said: “In the short term, the implication of this devaluation is that it is likely to damage the economy at most and cause unrest to Nigerians at most, given the nature of the country’s imports and its over-reliance on oil revenues.
“The charge for uploading raw fabrics essential for SMEs will be increased, adding to the import of petroleum products that were previously subsidized at the official counter.
“This will result in increased inflationary pressure in an economy already challenged by COVID-19 and a lack of confidence that has combined to disrupt production, mainly in the agricultural sector.”
Uche Usim, Abuja and Adewale Sanyaolu A monetary expert warned opposed to the devaluation of the Naira because Array..
The Nigerian Diary
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