The Central Bank of Nigeria (CBN) is set to go tough on exporters who are guilty of forex non-repatriation. This is part of the CBN’s ongoing efforts to resolve the prevalent forex crisis in the country by increasing forex liquidity.
To this end, the CBN has directed banks to submit the names, addresses, and Bank Verification Numbers (BVNs) of all the exporters who have failed to repatriate their export proceeds. Necessary ‘action’ would be taken against such defaulters, the CBN said in a statement that was seen by Nairametrics.
The statement further noted that the Central Bank Governor, Godwin Emefiele, gave the directive on August 25, 2020, while virtually attending a Bankers’ Committee meeting.
“As part of its effort to increase foreign exchange liquidity in the country, the Central Bank of Nigeria (CBN) has directed all banks in the country to submit the names, addresses and Bank Verification Numbers (BVN) of exporters that have defaulted in repatriating their exports proceeds, for further action.
“The directive issued by the CBN Governor, Mr. Godwin Emefiele, on Tuesday, August 25, 2020, during the Bi-monthly virtual meeting of the Bankers’ Committee, comes barely 24 hours after the Bank announced the abolition of third-party “Form M” payment,” part of the statement said.
Just yesterday, Nairametrics reported that the CBN had informed stakeholders about its decision to permanently stop agents/companies or any third parties from accessing its SMIS forex window through FORM M forex purchases. A circular issued to this effect by the CBN noted that “authorized dealers are herby directed to desist from opening of Form M whose payment are routed through a buying company/agent or any other third parties.”
Nigeria’s currency woes got exacerbated by the COVID-19 pandemic and the drastic decline in oil revenues, caused by declining oil prices and oil war between some of the world’s major oil producers. There has, since, been concerted efforts by Governor Emefiele and his team to manage the forex situation. Some of these efforts range from tackling forex speculators, to restricting Forex for the importation of maize, and now targeting exporters who refuse to repatriate the proceeds of their trades to Nigeria.
Please, note that export repatriation basically entails moving back the proceeds (be it dollars, pound, euro, etc) of one’s exports back to Nigeria. Such hard currencies would typically contribute towards ameliorating the forex challenges. However, some exporters now prefer to keep such earnings outside of the country. As far as they are concerned, this is a safer way to preserve the value of their earnings.