CBN won’t review forex policy for importers –Emefiele

In from Ali Smart … .
For those still nursing the idea that the Central Bank of Nigeria (CBN) may soon rescind its decision banning importers from accessing foreign exchange, the forex policy will remain in force.
The CBN governor, Godwin Emefiele reiterated this on Monday in Lima, Peru, while briefing journalists at the International Monetary Fund (IMF)/the World Bank Group meetings.
“The CBN will continue to deny access to forex to import goods that can be produced locally,” he insisted.
It would be recalled that the apex bank has categorised about 41 items as not eligible for foreign exchange funding from its interbank window.
“We have not banned any items. What we just did was to exclude from accessing foreign exchange, items that can be produced in the country. We think that because of the problems we’ve had, the drop in commodity prices and revenue accruing to the nation, and because we know that these items have been produced in large quantities in this country in the past, that provision still stands. The CBN is not reconsidering the ban, the exclusion still stands,” he stressed.
The apex bank’s chief said in the course of the period that this policy has been in force, he has been prompted from various quarters to even elongate the ‘excluding items’ list, but he however said the CBN would confine itself to the items as presently indicated.
The CBN, Emefiele stressed, “has at different fora received the list of additional items which some section think should be included from receiving foreign exchange, but the CBN has for now limited the options to the existing ones.”
In defending the apex bank’s stance, Emefiele argued that if there’s global economic slowdown which has affected the growth and resilience of emerging and frontier markets, including Nigeria, and there is a drop in revenue receipts which has impacted negatively on everyone, “there’s abounding need for the regulator to intervene to restore stability in the exchange rate regime, look for ingenuous ways of increasing the sources of foreign exchange, such as encouraging exporters to repatriate their proceeds and make more foreign exchange available to the real sector, so as to grow the economy.”
He said the reforms that commenced about two years ago, with respect to economic diversification and taxation, will be vigorously pursued with a view to increasing the government’s revenue base.

Read also: IMF wants CBN to dump forex policy

He said since about two years ago, and even before, government has been on the path of reforms, focusing on how to increase the countries revenue base. He said the collaboration with Mckinze (a foreign Accounting Tax Consultant), resulted in the increase of revenue by about N75billion in 2014, pointing out that a N150billion revenue target is being expected from this engagement, this year.
Emefiele, who spoke on a wide range of issues, said investors are exiting from frontier and emerging markets on account of the uncertainty and insecurity that pervade the markets, saying that in the last quarter of this year alone, about $48billion capital outflows has been recorded in these markets. He said people are pulling funds out and are looking to more stable and safe zones to invest.
“This is why, he argued, “we are saying that we should be nationalistic in our approach, that we have to carry our cross by ourselves,” pointing out that there is need to prioritise, by making sure that “foreign exchange is made available to only those who are importing essential raw materials and goods we know cannot be produced within the country. That is the only way we can conserve our foreign exchange.”
He said the CBN will continue to intervene in the foreign exchange market and to ensure that forex is made available to meet the import needs of our people,” pointing out that it is in this respect that the apex bank is appealing to exporters to make available their export proceeds to further boost available foreign exchange.
Emefiele said the slow down as a result of the drop in commodity prices, the anticipated rate hike by the US by the Federal Reserve Bank and the tension in the global arena, have affected some of the economies, to the extent that some have gone into recession.

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