By Adewale Sanyaolu
Reprieve may have come the way of fuel marketers, airlines and agricultural businesses as the Central Bank of Nigeria (CBN) has announced a special market intervention to clear a backlog of foreign exchange obligations now due.
The CBN says it plans to settle the bids through a combination of spot and short-term forward deals. However, the bank did not specify the amount of dollars to be sold.
“Authorised dealers’ accounts with the central bank will be debited in full for the naira equivalent of the dollar bid amount on a spot basis,” the bank said in a notice to lenders.
CBN has been selling dollars since February in an effort to improve liquidity and narrow the spread between the official and black market exchange rates for the naira. Close to $5 billion has been sold, according to analysts.
Recall that the International Air Travel Association (IATA) had last year confirmed that $575 million in revenue generated by foreign airlines in the country was trapped in CBN as at March 2016.
IATA’s Area Manager, South West Africa, Dr. Samson Fatokun, said foreign airlines have found it increasingly difficult to repatriate their earnings due to the dollar shortage in the country brought on by the low earnings from crude oil sales.
Fatokun, however, explained that IATA had been engaging government through the Ministry of Transportation, CBN and the Vice President’s office.
“We are engaging government through the ministry, CBN and Vice President and government is giving the Aviation Ministry the best possible attention the sector deserves. We are addressing the issues and government is giving us support,” Fatokun had said.
Meanwhile, the naira was quoted at N377.83 to the dollar at the investor window, according to market regulator (FMDQ OTC) Securities Exchange. It sold for N305.60 to the dollar at the interbank window and N362 on the black market as against N356 on Monday.