By Adedapo Adesanya
The Minister of Finance, Mr Wale Edun, has said that Nigeria is expected to receive $10 billion in the coming weeks to ease a worrying foreign exchange crisis that has seen the Naira weakened further despite measures to support the market.
Speaking at the Nigerian Economic Summit in Abuja on Monday, Mr Edun said the President Bola Tinubu-led administration has a line of sight on the inflows into the country, which Bloomberg cited will be “in weeks rather than months.”
According to the former banker, the injection of the $10 billion will boost foreign exchange liquidity and aid other measures that have been taken by the Central Bank of Nigeria (CBN) and the federal government in the last few months.
Recall that the CBN earlier this month lifted an eight-year restriction on importers seeking to get foreign exchange from the Nigerian Foreign Exchange Market (NFEM) for the importation of 43 items into the country.
This was among other policy issues that the apex bank says will promote orderliness and professional conduct by all participants to ensure market forces determine exchange rates on a Willing Buyer – Willing Seller principle.
According to the central bank, the FX restrictions instituted by the Godwin Emefiele-led CBN pushed importers into the parallel market, contributing to the surplus demand for FX.
This weakened the parallel-market exchange rate, pushing up prices while contributing to inflation, causing the prices of other goods to increase.
The apex bank said the measure would strengthen its monetary policy tools to become more effective as it would help create a unified, well-functioning market for FX, where pricing is based on a willing-buyer and willing-seller system.
By removing these restrictions, the CBN says it eliminates the need for importers of these products to go to the parallel market, reducing the pressure on the Naira.
If actualised, the $10 billion could help settle a large chunk of the backlogs of the Dollar at the official market placed at $12 billion.
