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Nigerians in Diaspora Remit N23.5tr to Economy in Five Years

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  • Nigerians in Diaspora Remit N23.5tr to Economy in Five Years

In five years, Nigerians in the diaspora remitted to the Nigerian economy S77.06 billion (about N23.5 trillion), according to the National Migration Policy report of 2015.

The remittances were made in bits for the five years of 2005, 2007, 2008, 2012 and 2013.

The report was published for the Nigerian government by the International Organisation for Migration (IOM) with funding provided by the European Union (EU) under the 10th European Development Fund programme on “Promoting Better Management of Migration in Nigeria.”

The document which was made available further stated: “The total volume of remittances transferred globally to developing countries far exceeds Overseas Development Assistance [ODA]. Nigeria is the largest recipient of remittances in Sub-Saharan Africa with receipts of approximately 65 per cent of officially recorded remittances into the region and two per cent of global flows, quoting statistics from the Central Bank of Nigeria (CBN).”

The report noted that while remittances are private funds used by migrants’ families to meet daily needs such as health, education and food, they are also invested in improvement to homes, purchase of landed property and entrepreneurial pursuits.

‘‘Strategies should be developed to encourage Nigerians in the diaspora to invest remittances through efficient formal channels at low transfer cost, as well as to encourage senders and recipients to invest part of their savings.

“Preferential interest rates on savings and opportunities for direct foreign investments for commercial entrepreneurial and other productive activities by the diaspora and the recipients of remittances should be encouraged,’’ the report stated.

According to the document, the development only showed that Nigerians in the diaspora are active and resourceful population, an indication that the country has an active working population out there.

Meanwhile, the Commissioner for Refugees, Migrants and Internally Displaced Persons (IDPs), Sadiya Umar Farouq has expressed gratitude to the Swiss government for supporting the second in a series of the national migration dialogue with $450 million. The event is scheduled to hold in December 2016.

Represented by Amina Ibrahim at a two-day workshop held in Saminaka, Kaduna State, Farouq said that the Swiss government had demonstrated concrete commitment to issues of migration management in Nigeria.

‘‘There are two issues that are immediate priorities and we intend to take them concurrently. One is to design a very practical and durable solution programme that may have a life span of three years to provide the various reintegration options for the IDPs in Nigeria. And the other is to facilitate the domestication of the Kampala Convention through the NCFRMI Enabling Act as well as pursue the approval of the National IDPs Policy which will provide a framework for sharing responsibilities among other various actions,’’ she said.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Forex

More Problem for CBN as Naira Approaches N500/US$ at the Black Market

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Forex Weekly Outlook March 6 - 10

Naira plunged against the United States Dollar to a record low of N495 at the black market on Thursday despite the Central Bank of Nigeria saying it has enough financial means to meet forex demands.

The Naira declined by N12 from N483 it exchanged on Monday amid persistent scarcity and high demands by importers and businesses looking to offset COVID-19 losses with the usual December high demand sales.

Godwin Emefiele, the Governor of the Central Bank of Nigeria (CBN), on Tuesday blamed the wide foreign exchange rate at the black market on speculators and hoarders looking for personal gain at the expense of the nation.

He went on to caution experts using black market rates to analyse the local currency performance to stop and claimed that section of the forex only accounts for 5 percent of the nation’s total foreign exchange transactions.

While that might be true, it is also true that majority of manufacturers and businesses have turned to the black market for their forex needs in recent months, especially after it became obvious that the apex bank does not have enough liquidity to service the economy.

The nation’s foreign reserves has been battered by the weak oil prices and the continuous production cut by OPEC and allies to artificially support low prices. Nigeria’s foreign reserves is presently hovering between $35 billion and $36 billion after plunging from $45 billion attained in June 2019, according to the latest data from the Central Bank of Nigeria.

Against the British Pound, the Nigerian Naira depreciated by N15 to N635 from N620 it exchanged on Monday. Another indication of chronic forex scarcity as the local currency also plunged to N580 against the European common currency, the Euro.

The wide forex is expected to further weigh on the nation’s inflation rate and consumer spending this December.

On Tuesday, the apex bank left the interest rate unchanged at 11.5 percent and attributed the rising inflation rate to structural policies, the recent #EndSARS protest and a surging fuel price.

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Forex

Naira Gains N1 to N483 Against US Dollar as CBN Warned Speculators of Impending Doom

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Naira Remains under pressure

The Central Bank of Nigeria on Tuesday warned speculators and hoarders of the United States Dollar against creating artificial forex scarcity for personal gain.

Godwin Emefiele, the Governor of the Central Bank of Nigeria, said black market forex rates does not reflect the economic reality of the Nigerian Naira as that section of the forex is tainted with bribes and individuals looking to profit at the expense of the nation.

We do not agree that the determining factor for our currency should be based on a market that is tainted, where people go to offer bribes,” he stated during a virtual monetary policy committee briefing in Abuja.

The Nigerian Naira gained N1 against the United States dollar to trade at N483 at the parallel market also known as the black market, up from N484 it traded on Monday.

Emefiele said “The black market is illegal where people do not provide documentation to support transactions. It is unfortunate and unfair for analysts to say Nigeria’s exchange rate is at 480 per dollar.”

The Association of Bureau De Change Operators of Nigeria (ABCON) agreed with the central bank, saying speculators and currency hoarders are responsible for the wide forex rates. The association warned that speculators are going to lose money given that the apex bank has foreign reserves of $36 billion to support the local currency and meet forex demands.

The apex bank left the interest rate unchanged at 11.5 percent to further stimulate growth in the real sector and speed up the recovery process with cheaper loans. Other ratios were left unchanged as well.

Speaking on the rising inflation rate, Godwin Emefiele attributed the 14.23 percent increase in consumer prices to the rising pump price, the recent #EndSARS protest and structural policies.

Therefore, it looks like the apex bank will damn rising inflation for the first time to focus on economic productivity, new job creation and general growth.

The Naira CBN official rate remains $379 to a United States Dollar while it exchanged at N385 on the Investors and Exporters Forex Window on Tuesday.

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Forex

Bureaux De Change Association Warns Against Hoarding of US Dollar, Says Speculators will Lose

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Naira Dollar Exchange Rate

The Association of Bureaux De Change Operators of Nigeria (ABCON) on Sunday warned currency speculators and hoarders of impending losses if they do not desist from creating bogus foreign exchange rates for personal gain.

In a statement titled, “ABCON warns speculators will lose money as CBN has enough reserves to fund market, defend naira”, the association said speculators and hoarders are taking a huge risk as the Central Bank of Nigeria has enough liquidity to defend the Naira and maintain stability against global foreign counterparts.

This is coming few days after the local currency plunged to N484 to a United States dollar and N620 against the British Pound at the black market due to the rising demand and persistent scarcity that most hoarders interpreted as lack of financial muscle on the part of the central bank, especially if the nation’s falling foreign reserves is factored in.

However, ABCON said with about $36 billion foreign reserves, the Central Bank of Nigeria has the necessary means to punish speculators and hoarders they described as enemies of the nation.

President of ABCON, Alhaji Aminu Gwadabe, explained that the central bank is working to unify the nation’s foreign exchange rates and eliminate past challenges that have made market determined forex rates almost impossible.

He said “I think that the CBN by pushing the official foreign exchange rate from N306 to N379 to the dollar is in line with market demand.

“It has also helped to narrow the official-parallel market rates gap that formed the basis of ridiculous speculations among unpatriotic forex dealers and spectators.

Gwadabe, however, advised the Federal Government to improve security surveillance at the nation’s land borders to checkmate illegal foreign currency cash deals.

He also asked the central bank to raise liquidity ratio of bureau de change operators to discourage dollar holdings.

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