Cbns new forex policy dailytrust

You're referring to the recent changes in the Central Bank of Nigeria's (CBN) foreign exchange policy, as reported by Daily Trust.

Here's a summary of the key points:

New Forex Policy:

  1. Unification of Exchange Rates: The CBN has unified the exchange rates for all foreign exchange transactions, effective from March 20, 2023. This means that the official exchange rate of N415 to the US dollar will be used for all transactions, including imports, exports, and other foreign exchange transactions.
  2. Removal of Multiple Exchange Rates: The CBN has abolished the multiple exchange rates system, which had led to confusion and inefficiencies in the foreign exchange market. The unified exchange rate will apply to all transactions, eliminating the need for multiple rates.
  3. Increased Allocation to Bureaux De Change (BDCs): The CBN has increased the allocation of foreign exchange to BDCs from 10% to 20% of the total foreign exchange available for sale. This is aimed at increasing access to foreign exchange for individuals and small businesses.
  4. Increased Transparency: The CBN has committed to increasing transparency in its foreign exchange operations, including the publication of daily foreign exchange sales and the provision of regular updates on foreign exchange market developments.
  5. Improved Monitoring and Regulation: The CBN has strengthened its monitoring and regulation of foreign exchange transactions, including the implementation of stricter guidelines for foreign exchange transactions and the establishment of a new foreign exchange monitoring committee.

Impact on the Economy:

The new forex policy is expected to have several positive impacts on the economy, including:

  1. Increased Foreign Exchange Availability: The unified exchange rate and increased allocation to BDCs are expected to increase the availability of foreign exchange for individuals and small businesses.
  2. Improved Efficiency: The removal of multiple exchange rates and increased transparency are expected to improve the efficiency of foreign exchange transactions and reduce the risk of corruption.
  3. Increased Investment: The new forex policy is expected to attract more foreign investment to Nigeria, as investors will have greater confidence in the country's foreign exchange market.
  4. Reduced Inflation: The increased availability of foreign exchange is expected to reduce inflation, as it will help to increase the supply of goods and services and reduce the pressure on prices.

Overall, the new forex policy is expected to improve the efficiency and transparency of Nigeria's foreign exchange market, increase foreign exchange availability, and attract more foreign investment to the country.