The Nigerian Naira depreciated against global counterparts at the parallel market popularly known as the black on Monday despite efforts by the Central Bank of Nigeria to curb foreign exchange scarcity through the “Naira 4 Dollar” initiative implemented to lure diaspora remittances into the Nigerian economy.

The Naira depreciated by N2 against the United States Dollar to N482 on Monday, down from N480. Similarly, against British Pound it remained pressured at N675, down from N672 it exchanged on Thursday.

The local currency was traded at N583 to a single Euro on Monday, representing a decline of N1 from N583.

This was after the Central Bank of Nigeria announced it will start paying N5 for every $1 received by diaspora remittance recipients. The apex bank called the new initiative “Naira 4 Dollar”.

According to the circular released by the central bank and seen by Investors King, the N5 is to encourage diaspora inflow and curb escalating forex scarcity that is on the verge of returning the nation back into recession.

The logic is to flood the Nigerian economy with an estimated $21 billion per year diaspora remittance. However, weak global economy due to COVID-19 lockdown continues to drag on remittance inflow needed by the apex bank to complement falling foreign reserves and plug forex scarcity.