In a significant move aimed at stabilising the nation's economy, the Office of the National Security Adviser (ONSA) has announced a partnership with the Central Bank of Nigeria (CBN) to curb foreign exchange speculation in the country.
The announcement was made in a statement released by Zakari Mijinyawa, the Head of Strategic Communication at the ONSA.
The partnership is part of a concerted effort to safeguard Nigeria’s foreign exchange market and combat speculative activities that have been impacting the nation’s economic stability.
The CBN's proactive measures to stabilise the foreign exchange market and stimulate economic activities have been lauded. However, these initiatives' effectiveness is being undermined by the activities of speculators, both domestic and international, operating through various channels, thereby exacerbating the depreciation of the Nigerian Naira and contributing to inflation and economic instability.
To address the exchange rate volatility, the CBN initiated a comprehensive strategy to enhance liquidity in the forex market. This included unifying Forex market segments, clearing outstanding Forex obligations, introducing new operational mechanisms for Bureau De Change operators, enforcing the Net Open Position limit for commercial banks, and adjusting the remunerable Standing Deposit Facility cap.
In an effort to reduce the pressure on the naira, the Economic and Financial Crimes Commission (EFCC) has raised a 7,000-man special task force across its 14 zonal commands to clamp down on dollar racketeers. Despite these measures, recent intelligence reports have highlighted continued illicit activities within the Nigerian foreign exchange market.
In response, the ONSA and CBN are embarking on a collaborative approach to tackle these infractions. This partnership will involve a coordinated effort with key law enforcement agencies, including the Nigeria Police Force (NPF), the Economic and Financial Crimes Commission (EFCC), the Nigeria Customs Service, and the Nigeria Financial Intelligence Unit (NFIU).
The primary objective of this alliance is to systematically identify, thoroughly investigate, and appropriately penalise individuals and organisations involved in wrongful activities within the Forex market. By leveraging the expertise of these agencies, the aim is to deter malicious practices, protect investor interests, and promote sustainable economic growth.
This joint effort underscores the commitment of the Nigerian government to improving its Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT) framework and exiting the grey list of the Financial Action Task Force. In addition, the efforts will make progress in ensuring a stable and transparent foreign exchange market, fostering investor confidence, and advancing the nation’s economic well-being.