- Currency War: ABCON Seeks Boost for Naira-Yuan Swap Deal
The President, Association of Bureau De Change Operators of Nigeria, Alhaji Aminu Gwadabe, has said that the ongoing economic, trade and currency wars between the United States of America and Russia/ Asian countries present Nigeria with some lifetime opportunities that need to be explored.
He said that Nigeria had to strategise and capitalise on the emerging global trends to strengthen Naira -Yuan swap deal, and boost derivatives market with new product development.
In a statement, the ABCON boss said the fear of the dollar losing its global dominance was real, as Russia and Asian countries unite against the United States.
He said that Russia and Asian countries were already becoming less reliant on dollars and its hegemony, advising Nigeria and other emerging markets not to be caught unawares.
Gwadabe said the insistence by Russia and China that the global economic system must change in such a way as to stop the United States from being able to exert economic pressure on world countries, was an indication of how both countries could pursue the agenda, which had certain implications for Nigeria’s economy, its currency and financial system.
He recalled that at the recently concluded G20 meeting in Tokyo, Britain, France and Germany announced that the special trade mechanism that they had been working on this year was now up and running.
“It is called the Instrument in Support of Trade Exchanges (Instex) and it will permit companies in Europe to do business with countries like Iran, avoiding American sanctions by trading outside the SWIFT system, which is dollar denominated and de facto controlled by the US Treasury,” the statement added.
Gwadabe said the significance of the European move could not be understated as was meant to weaken dollar dominance as the world’s trading and reserve currency.
He noted that talks had been on for years on establishing trade mechanisms that would not be dollar based, but they did not gain any momentum until the Trump administration abruptly withdrew from the Joint Comprehensive Plan of Action with Iran over a year ago.