The Association of Bureau De Change Operators of Nigeria (ABCON) says reopening the bureau de change window for foreign exchange will crash the prevailing spike in the exchange rate.
Aminu Gwadabe (pictured), ABCON president, told NAN on Sunday that BDCs have always been the bridge for the availability of liquidity in the retail end sector.
“The immediate thing to be done to crash the rate is the reopening of the BDC window for school fees payments pending when the international air travels resume,” Gwadabe said.
“The germane role of BDCs is bridging the gap between the official rates and the parallel market rates, which was achieved from early 2017 to early 2020.”
While appreciating efforts by the CBN in ensuring stability in the exchange rate, ABCON said that the factoring of BDCs into the FMDQ floor and diaspora remittances agencies would ensure long term exchange rate stability in the economy.
NAN reports that since the COVID-19 pandemic, the price of crude, Nigeria’s major source of foreign exchange, has suffered some setback.
The regular interventions at the foreign exchange market are also affected by low proceeds accruing from the sale of crude.
Diaspora remittances before the COVID-19 pandemic had also helped in boosting liquidity at the FX market.
However, a World Bank report has projected that remittances to Nigeria, Egypt, Senegal and other low and middle-income countries (LMICs) would drop sharply by 19.7 percent to $445 billion in 2020 due to the economic crisis induced by the COVID-19 pandemic.
The report noted that the decline would be the sharpest in recent history and was largely due to a fall in the wages and employment of migrant workers that were more vulnerable to loss of employment and wages during an economic crisis in a host country.
Meanwhile, the naira traded at N472.5 to a dollar at the parallel market at the close of trading on Friday.
The CBN had earlier adjusted its official rate from N360 to a dollar to N381 to a dollar.
– The Nation.