As the gap grew wider between the official naira exchange rate and the parallel market, some Nigerians living abroad are avoiding to send monies home through the regular money transfer agencies in the country. According to ThisDay’s report, many of them are taking advantage of the official N197 to a dollar disparity against N370 to a dollar on the parallel market by patronizing the latter.
On the advice of their contacts at home, these diaspora Nigerians now prefer to send dollar or other foreign currencies to the country in cash. That way, the beneficiary would be able to convert it at the black market rate at higher value.
They achieve this by giving the cash to anyone coming into the country to help them deliver to the beneficiaries.
One of the respondents, Mr. Chike Anosike based in the United States has sent $10,000 cash to the country through five different persons that came to Nigeria to facilitate his building project in Imo State in the past one month.
According to Anosike:
“It doesn’t make sense for me to send in dollars through MoneyGram or Western Union, for it to be converted at official rate of N197, when it can be exchanged for about N400 on the streets.”
However, Mr. Johnson Chukwu of Cowry Asset Management Limited, said this is a clear example of what was going on in the country as investors feel short-changed to send inflows into the country as inflows for investments and other legitimate transactions would be converted at official price as against the prevailing rate on the black market.
“Maybe there several of such dollars that would have come into the country, but they are all staying away. So, we must look at the factors that are making Nigeria’s diaspora remittances not to flow as it used to,” he added.
