The Governor of the Central Bank of Nigeria, Godwin Emefiele, has blamed the CBN’s funding of Bureaus de Change (BDC) operations with $66 billion over an 11-year period for the current depletion of the country’s reserves, saying this also contributed to the economic crisis.
He complained that the funds if spent on economy-stimulating activities such as infrastructure and industry for wealth creation, would have prevented the current crisis in the country.
“In September 2008, Nigeria’s foreign reserves stood at $62 billion. But what did we do with $62 billion at a time crude price was in excess of $120 per barrel? What we could have done was to save the money, if we couldn’t save the money, invest it in infrastructure and industry that will create productivity and wealth for our people.
Instead, the central bank at that time went about licensing Class A, Class B and Class C bureau de change operators. For Class A BDCs, the central bank was allocating $1 million per week, for Class B, the CBN was allocating $750,000 per week and for class C BDCs, the central bank was allocating $500,000 per week. The CBN was among one of the few central banks in the world allocating dollar cash for BDC operations.”
“What that meant was that in 11 years, we spent $66 billion funding the operations of BDCs which came to an average of $6 billion a year. If we had thought of other ways to utilise our reserve, especially in 2008 when our reserves were as high as $62 billion, certainly we will not be where we are today,”
ThisDay quotes Emefiele as saying.
He said that the period between 2008 and 2011 when oil prices peaked also coincided with the increased investment from the United States and argued that the administration then should have built the reserves and that is responsible for our current plight.
Parts of this article originally appeared in ThisDay Newspapers
Now I am beginning to like the governor of central bank.talk is easy in Nigeria.if i am the governor,i will order an audit of those bureau of change,and their owners,you do not going to be a genius, on why Nigeria economy is bleeding and leaking from any part of Nigeria,for one those bureau of change pays no any taxes,if they do not pay this retro/back taxes,they should be handed to the army, and shoot them on sight,or the effc should take control of their mansion.
In the western world,they have two school ot thinking freud and jung,jung said the causes of madness is when an individual fails to undergoes a legitimate suffering,but the main issues now,when will our suffering in Nigeria ends,the minister of information said the growth was driven by consumption,and it create this temporary happiness,now the chicken have come to roost in Nigeria,that is why this recession is painful,there is no ex-governor of cbn have the right to criticizes this present governor.
President Buhari and governor godwin my man are soul brothers