Adedapo Adesanya
By Adedapo Adesanya
The Central Bank of Nigeria (CBN) has lifted restrictions placed on the 43 items not permitted to access foreign exchange (FX) at the Investors and Exporters (I&E) window in a move that could allow the rates to stabilise.
In a notice on Thursday, the apex bank said importers can now purchase forex in the official market to import goods like tomato paste and chicken, among other items banned by the bank under the leadership of Mr Godwin Emefiele.
The 43 banned items are a list of goods that cannot be funded from the official window, meaning importers will have to source the funds from the parallel market. These items include cement, margarine, palm oil products/vegetable oils, tomato paste, meat and processed meat products, vegetables and processed vegetable products, and poultry among others.
The apex bank first announced this restriction in June 2015, noting that it would help conserve foreign exchange and encourage local production, but in the last eight years, two items have been added, culminating in 43 items.
However, with the announcement on Thursday, those seeking to bring these goods into the country will be allowed to get FX at the official market, rather than going to other unregulated markets to acquire the currency, which makes the prices of these items higher.
When the CBN announced the unification of the FX market in June 2023, there were expectations that the collapse of the multiple exchange rate would mean a lifting in the forex embargo but this was not the case.
Instead, the lender noted that the 43 non-eligible items remained banned and the market failed to stabilise beyond the first few weeks.
The CBN also announced that it would boost liquidity in the Nigerian Foreign Exchange Market by interventions from time to time adding that as market liquidity improves, these CBN interventions will gradually decrease so as to assure price stability.
The apex bank said it was also committed to accelerating efforts to clear the FX backlog with existing participants and will continue dialogue with stakeholders to address the issue.
“The CBN has set as one of its goals the attainment of a single FX market. Consultation is ongoing with market participants to achieve this goal,” the notice said.
It also promised to promote orderliness and professional conduct by all participants in the FX market to ensure market forces determine exchange rates on a Willing Buyer – Willing Seller principle.
The CBN reiterated that the prevailing FX rates should be referenced from platforms such as the CBN website, FMDQ, and other recognised or appointed trading systems to promote price discovery, transparency, and credibility in the FX rates.
