December 17, 2024
The senate has proposed a bill which is geared towards restoring Nigeria’s monetary sovereignty, including payment of salaries and transactions within Nigeria are done in the nation’s local currency the Naira, it sought to eliminate discriminatory practices and strengthen confidence in the local currency, it included making it mandatory for exports to be paid for in Naira.
The bill sponsored by Chairman of the Senate Committee on Reparations and Repatriation, Senator Ned Munir Nwoko, is titled “A Bill for an Act to Alter the Central Bank of Nigeria Act, 2007, No. 7, to Prohibit the Use of Foreign Currencies for Remuneration and for Other Related Matters.”
Senator Nwoko, maintained that the widespread use of foreign currencies in Nigeria’s financial system undermines the value of the Naira and perpetuating economic challenges.
He described the use of the Dollar, Pound Sterling, and other foreign currencies for domestic transactions as a colonial relic that continues to hinder Nigeria’s economic independence.
The bill amongst others seek to Prohibit salaries, transactions, and payments in foreign currencies, ensuring all workers, including expatriates, are paid in Naira.
Requires crude oil and other exports to be sold exclusively in Naira, compelling international buyers to purchase the currency and driving its demand and value.
Positions the Naira as the central currency for all financial operations, reinforcing its dominance in the economy.
READ MORE; CBN Intervenes With $28.5m To Banks To Shore Up Naira.
Seeks to abolish informal currency markets that undermine the formal economy and encourage unethical practices such as round-tripping by banks.
Directs banks to provide loans at affordable interest rates to stimulate industrialization and economic growth.
Advocates for storing Nigeria’s foreign reserves domestically to safeguard the country’s economic sovereignty and reduce exposure to external vulnerabilities.
Reclaim monetary independence by prioritizing the Naira for both domestic and international transactions.
Increase the currency’s value through higher demand driven by its exclusive use for exports.
Senator Nwoko clarified that transitioning domiciliary account balances to Naira would be a voluntary process for account holders. As the Naira strengthens, the need to hold foreign currencies would diminish, making the transition seamless.
READ MORE; Traders Blame Speculators As Naira Plummets to N1,745/$1,
He also assured Nigerians that access to foreign exchange for travel and other legitimate purposes would be streamlined through banking reforms, alleviating concerns about access to Basic Travel Allowance (BTA) and other forex needs.
Drawing parallels with Morocco, Senator Nwoko noted the stability of the Moroccan Dirham, which has maintained consistent value against major currencies for over 35 years. He attributed this to Morocco’s policy of exclusively using its local currency for domestic transactions.
The bill envisions a future where Nigerian banks expand internationally, offering innovative financial tools like cashless wallets to simplify global transactions. These measures aim to existing challenges, such as the inability of Nigerian debit cards to facilitate international online transactions, while making domiciliary accounts increasingly unnecessary.
If passed, this legislation could mark the beginning of a transformative era.
