The Nigerian Senate has introduced a bill to prohibit the use of foreign currencies, such as the US dollar, for payments and transactions within the country. Sponsored by Senator Ned Nwoko of Delta North, the bill, titled “A Bill for an Act to Amend the Central Bank of Nigeria Act, 2007, to Prohibit the Use of Foreign Currencies for Remuneration and Transactions,” has successfully passed its first reading.
Strengthening the Naira
The bill aims to ensure that all financial activities, including salaries and commercial transactions, are conducted in the naira. This move is designed to restore the naira’s value, boost confidence in the currency, and enhance Nigeria’s monetary sovereignty.
Nwoko highlighted that the widespread reliance on foreign currencies like the US dollar and British pound has weakened the naira and compounded Nigeria’s economic struggles. He described this practice as a colonial remnant that limits Nigeria’s economic independence.
Key Provisions of the Bill
- Mandatory Use of Naira for Exports: The legislation would require crude oil and other export transactions to be carried out exclusively in naira. International buyers would need to obtain naira, thereby increasing its demand and strengthening its value.
- Reducing Informal Currency Markets: By positioning the naira as the primary currency for financial operations, the bill seeks to eliminate informal markets that undermine the economy and curb unethical practices like currency round-tripping by banks.
- Encouraging Local Production: The bill proposes that banks offer loans with lower interest rates to stimulate industrial growth and promote local manufacturing.
Economic Security Measures
Nwoko proposed storing Nigeria’s foreign reserves domestically to minimize exposure to external economic shocks and bolster economic security. He reassured Nigerians that the transition of domiciliary account balances to naira would remain voluntary, allowing for a gradual adaptation to the new system.
Access to Foreign Exchange
While prioritizing the naira, the proposed law ensures continued access to foreign exchange for legitimate purposes, such as travel. Reforms are planned to streamline access to Basic Travel Allowance (BTA) and other foreign exchange needs.
Long-Term Vision
Nwoko emphasized that prioritizing the naira in domestic and international financial transactions is critical for achieving economic self-reliance and long-term stability.
READ ALSO:
Follow the LMSINT MEDIA channel on WhatsApp:
Join Our WhatsApp Group Hear:
Kindly Share:
Discover more from LMSINT MEDIA
Subscribe to get the latest posts sent to your email.